Everything You Ought to Know About How to Sell Digital Products in 2023

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This is a guest post by David Pagotto. David is the Founder and Managing Director of SIXGUN, a digital marketing agency based in Melbourne. He has been involved in digital marketing for over 10 years, helping organizations get more customers, more reach, and achieving more impact.

Selling products online might sound simple at first. Billions of people log on to the World Wide Web every day. They visit sites, browse e-commerce stores, watch videos, and more. Yet, the competition to turn those consumers into your customers is a difficult one.

This guide will discuss how to help you connect with your audience and sell digital products online. Before we dive into the tactics, I want to quickly cover the basics. Let’s get started!

Table of Contents

What Are Digital Products & What Can You Sell

A digital product is an intangible asset. It could be a photo, a WordPress theme, a plugin, an online course, an eBook, MP3, video, a downloadable product, or something else entirely. The great thing about digital products is that you create them once and sell them multiple times.

There are lots of benefits to selling digital products online. They include:

  • You don’t have to hold any inventory, and shipping is free.
  • They have high-profit margins once you’ve recouped the initial costs of production.
  • You can automate the delivery process.
  • You can sell digital products at almost any price point.

You can sell digital products in almost any niche. Moreover, digital products are a huge industry. For example, the e-learning industry is expected to be worth $374 billion by 2026.

Selling Digital Products: eCommerce Vs. Blogging

One of the first things you’ll need to decide if you want to start selling digital products is your route to market. You have two very different approaches. At one end of the spectrum, you have the digital product marketplaces. These are websites that sell digital products produced by individuals and companies.

Some examples of digital marketplaces include sites like:

  • Themeforest: they sell WordPress themes, premium plugins, and more
  • Shutterstock: they sell copyright photos, videos, and other digital assets for creatives
  • Udemy: they sell online courses created by individuals that cover just about any topic

Within their respective sectors, these sites are the market leaders.

At the other end of the spectrum, you have people who create and sell their content. There are plenty of famous people I could highlight. For example, Pat Flynn from Smart Passive Income has built out a series of courses covering different aspects of digital marketing.

Smart Passive Income
Selling content

There are plenty of other bloggers and business people I could point to who have taken this same approach. For example, Mark Brunson, the founder of Clickfunnels, has a range of courses that cost $1,000 or more to access.

The approach you take to selling digital products will impact your route to market. For example, if you’re running a marketplace, you can’t actively promote all of the digital products you list simultaneously. It just doesn’t make sense. On the other hand, if you’ve just got one digital product, or even two or three, you can create marketing campaigns to promote these offers.

You can see why it’s important that you choose your approach before considering how to promote your products. You can change your approach over time. You might start with a blog and end up running a marketplace. That’s fine.

How to Promote Your Digital Products

We’ve now covered what a digital product is and discussed your route to market. In this section of the guide, I want to share some actionable strategies you can use to increase your digital products’ sales. I’ll try to provide some nice illustrative examples that you can use as inspiration for your campaigns.

Create a Marketing Funnel

If you want to sell your digital products, you need to put in place a strategy to funnel your audience towards the places where you list your product offerings. If you can get warm leads to your sales pages, you will generate revenue.

A marketing funnel goes through four stages; awareness, interest, decision, and action. Some marketing funnels add a fifth stage, which is retention or advocacy.

Marketing Funnel
Create a marketing funnel

You need to turn people who know a little bit about your business into customers by revealing how your product offering will help them solve a problem. I recommend you set some time aside to decide how you plan to achieve this goal.

Your marketing strategy should play to your strengths.

If you’re great at Pay Per Click Advertising (PPC), that might be your primary customer acquisition channel. On the other hand, if you’re great at Search Engine Optimization (SEO), then getting your content to rank in the search results will be the easiest way to get people to enter the top of your funnel.

Once you’ve got people to enter your sales funnel, you need to try to generate a sale. You can do this slowly over time by sharing information about your company, or you can do this rapidly by pushing the hard sell. I’ll look at each of these approaches briefly below.

Email Marketing & Retargeting

Many businesses that sell digital products online focus on building a relationship with their customer base. Developing a relationship is key to not only making that first sale but securing those return customers.

One of the best ways to develop a relationship with your audience is to get them onto your email list. Once they are on your email list, you can send regular updates.

Growing an email list is a straightforward process:

  • Create an optin form and place it on your website.
  • Incentivize people to convert with a clear USP for your email list. Content upgrades are a great way to get people to join your list.
  • Use an email verification platform like Voila Norbert or Zerobounce to validate details.
  • Start sending emails to your list.

While the fundamentals of growing an email list are straightforward, the difficult part is the execution. There are plenty of email marketing mistakes you need to avoid.

The thing about effective email marketing is that there needs to be a clear purpose behind sending an email. You need to send content to your subscribers that they’d find interesting and enjoy reading.

A nice example of a site that, in a way, sells digital products that has a good USP is Flippa. If you’ve never come across Flippa, it’s a marketplace for buying and selling websites.

Flippa send regular updates to their subscribers with their best listings

I find these emails quite interesting. As someone interested in SEO and digital marketing, it’s nice to see the most profitable niches. I often look at the site listings and review their backlink profiles and along with other research.

For me, Flippa has a strong USP. You need to find a nice angle for your business that allows you to send regular updates to your subscribers without leaving them annoyed.

Run a Product Launch

There’s a good chance that you’re reading this article and are looking for actionable tips you can implement to sell your digital products and start earning an income. If that’s the case, I recommend you consider running a product launch or a variation of a product launch.

Jeff Walker developed the product launch formula. He put together an effective sequence you can follow to promote your digital product to your audience.

The sequence looks a bit like the image below.

Email sales funnel
Autogrow - Email sales funnel

The idea of a product launch is to generate a lot of sales in a short period of time by getting your audience excited about the stuff you’re selling. You do this by sending a sequence of emails where you share information about the product you’ll be releasing. Your goal is twofold:

  • Build anticipation about the digital product
  • Reveal the value of that product / show how it can help your audience

The Product Launch Formula is incredibly effective. Matthew Woodward has a good case study where he talks about how he followed the Product Launch Formula to generate $134,171 in seven days. You can read more about it here.

Secondary Factors to Consider

In the previous section, I discussed some strategies and approaches you can use to sell digital products. Before we wrap up this guide, I want to cover some other things you’ll need to consider when selling digital products.

How to Manage Online Payments & Delivery

If you want to sell digital products online, you’ll need to set up a system to handle payments. There is a range of payment platforms you can use.

The most widely used system is Stripe, which is an online payment processing platform that lets you take payments via credit and debit card. I recommend this approach if you’re planning to set up an online store. Keep in mind, Mageplaza has a payment gateway suite, which can help you manage payments.

Paypal is a simpler option if you’re a blogger, though they have a lot of fees.

You’ll also need to set up an invoicing and delivery system. There are online platforms that help you manage the process from receiving payment through to delivery.

You might also want to explore affiliate marketing marketplaces. For example, a site like JVZoo will handle payment and delivery of your digital products. You can also list your digital products and get affiliates who will promote your products through the platform.

You need to set out the ‘terms of service’ if you plan to sell digital products online. It’s a legal requirement. Make sure the ‘terms of service’ is clear and protect both you and your customers.

Include the following information:

  • The name and registered address of the business or individual selling the product.
  • Link to your policies - for example, your privacy policy
  • A clause covering intellectual property
  • An outline of illegal behavior

There are online tools you can use that will auto generate ‘terms of service.’ You can probably use one of these tools to create a ‘terms of service’ for your business / digital products.

CRM Software & Customer tracking

A Customer Retention Management (CRM) platform will help you manage the customer. You can use your CRM software to track people’s actions on your email list, their spending habits, and more. It’s especially useful when you are handling a direct-to-consumer (DTC) business.

There are many great CRM software options you can use to track your audience’s behavior and actions. A good solution will provide you with a clear overview of the sales process.

In addition to a CRM platform, I recommend using tools like Google Analytics to analyze customers’ behavior. A tool like Google Analytics will reveal what people are doing on your website, user flow around your website, and can even provide conversion data once set up.

Wrapping Up

Regardless of your business model, you need to consider how to turn cold leads into piping hot prospects. The best way to do this is develop a relationship with your audience. I discussed how you should conceptualize this by creating a suitable marketing funnel for your business. That funnel starts with drawing in fresh leads to the top of the funnel.

There are numerous ways to create that initial connection and bring leads into your funnel. Once you’ve created that connection, you need to further develop that relationship. You can do this over time through email marketing, or run a product launch or other sequences to generate sales.

Hopefully, the tips I shared provide you with a starting point for further research. Selling digital products online might be tough, but with the right approach it can be very profitable.

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