Selling digital products is a low-cost, low-hassle way to open a new revenue stream. Whether that stream is a trickle or a torrent will depend on how much time you invest, the quality of your products, and how well you promote them.
You may have hopes of making it big, or maybe you just want a passive income stream that can grow to eventually replace your job.
Whatever your reasons are, diversifying your revenue—and finding new ways to earn from home—is a smart move. Best of all, you get a chance to put your knowledge and talent to work helping others.
This article should give you an idea of the best digital products that you can sell online in 2020, and where you can sell them.
But, before we review the best digital items and where to sell them, a quick overview.
What is a digital product?
Digital Products are any virtual item you can pay for, and download instantly.. They are intangible, in the sense that you can’t touch them. But they have value—to the tune of a $199 billion industry in 2020.
Streaming movies and TV, video games, software, and apps—those are the big hitters, and they’re the first things you might think of when you hear “digital products.”
But there are lots of other ways you can create digital products from your own knowledge, creativity, skills and expertise – and you don’t need a film crew or a team of software developers to do it.
Why sell digital products?
Creating, marketing, and selling digital products may seem overwhelming, especially if you’re not the most tech-literate person on the planet. But thanks to online tools like Etsy, Shopify, and Thinkific, the learning curve can be surprisingly short.
Plus, there are a lot of good reasons to sell digital products online:
Low investment, (potentially) high returns
There are plenty of digital items you can put together using only time, energy, and a little focus. Online marketplaces and e-commerce tools are relatively inexpensive, compared to renting a brick and mortar location or building a physical inventory. This means the potential for higher profit margins.
More profitable than physical goods
Digital products sell at higher margins than physical products. And that margin improves over time because you don’t need to spend any money producing more units.
No inventory, shipping or rent hassle
Besides the fact that you don’t have to cover the cost of producing, storing, or shipping physical items, you can also avoid the logistics. Selling digital products through an online platform has the potential to be radically simple—which is why it’s an ideal side hustle.
Automated delivery for passive income
If you’ve already got a day job keeping you busy, the digital products you sell online can keep money coming in even if most of your week is spent at your full-time gig.
Serve a niche at scale
Sometimes, it helps to be good at something obscure. Honing in on a specific audience, with specific needs is easier than competing broadly.
Lots of people want shredded abs in 30 days. A much smaller minority wants the perfect physique for water polo. That’s called serving a niche.
The challenge with selling niches locally is there often isn’t a big enough market to sell to. But even the smallest niches are big enough to serve globally with no geographic boundaries limiting who you can sell to.
Leverage the shift towards online education
With more businesses shifting online, the demand for digital products continues to grow, with the demand for online courses was estimated to reach $319+ bn by 2025.
And adoption is accelerating—our report on the impact COVID-19 had on the online course industry found a 217% increase in student enrollment in online courses in the second half of March 2020, as COVID social distancing measures came into play.
8 digital product ideas to sell online
There are hundreds of different digital products you can sell online. Rather than list each one, here are eight digital product categories to cover them all—and some inspiration to get you started.
You don’t need to be the world’s greatest novelist to write a book thousands will buy. Think about what you do best, and how you can teach it to others, in writing.
For instance, Tiffany “The Budgetnista” Alliche is a financial educator with the goal of empowering women worldwide. She runs a popular online school, the Live Richer Academy. But on top of that, Alliche has published a number of successful ebooks for students and non-students alike.
Teaching online lets you turn something you already have—your expertise—into a new source of revenue. If you have expertise, and a passion for sharing it with the world, then an online course is the perfect digital product for you to sell.
People are eager to learn from home, whether they want to learn a new hobby, or advance themselves professionally—you can serve them by launching a digital course.
The appeal of online courses isn’t just limited to traditional classroom environments like highschool and university, or corporate trainers adapting with remote onboarding… And you don’t need to be formally trained as an educator either.
Since the quarantine measures came into place and more people found themselves at home, sourdough bread went viral. People were staying home, had time off, and wanted to learn a tangible skill. For weeks, social media was flooded with photos of beautiful and not-so-beautiful home-baked loaves.
Puff School of Pastry responded to the sourdough trend by offering a free six-part video guide to making sourdough in lockdown as a way to create value while also getting in front of new prospective students (and hopefully, sell more courses).
Here are some other areas of expertise that we’ve seen translate into profitable online course businesses, to give some ideas of what you can teach:
- Yoga classes
- Laughter yoga
- Guitar lessons
- Dance classes
- Resumes and Job search
- Professional development
- Arts and Crafts
- Graphic Design
If your goal is to build recurring revenue by building and serving a community on an ongoing basis, then a membership is the perfect digital product for you to sell.
Whether you plan on selling a series of online courses, or simply charge members for the ability to pick your brain, a membership site can help you build up a monthly revenue stream.
Membership sites aren’t just geared towards one specific type of business. As you can see from these membership site examples, anyone with niche expertise and a passion for sharing it with the world can create one.
With a paid community membership, students get the chance to participate in exclusive discussion groups, workshops, and Q&A sessions. And when they subscribe, they add to a steady, predictable stream of income for you, their teacher.
In addition to offering standalone yoga classes geared towards a range of skill levels, Lasater Yoga has bridged the gap between online courses and membership sites by offering personalized mentorship through their monthly office hours calls. You can purchase any of their classes, but for $19 per month, you get the full experience and the opportunity to engage the experts.
Graphic design work
If you’re a graphic designer, you already have the tools you need to create digital items that sell.
That’s because other designers, some of them on tight deadlines, are looking for the elements they need to make their work shine.
Vector icons, textures, objects, typefaces—there’s a whole range of digital products you can create and sell on the side while you work day-to-day with clients. If you have a passion for design, it can be a chance to let your creativity shine outside of a client’s project.
For instance, Iuliia Mazur is a professional graphic designer based in Ukraine who sells popular clip art packs on the side. By selling her designs on Creativemarket.com, she can generate passive income and leads for her freelance consulting business.
There’s a world of people who want a head start on whatever it is that they’re working on—from WordPress bloggers to newlyweds.
Why reinvent the wheel? A template can save someone the effort of designing a website from scratch. It can also help them get their wedding invitations sent out on time, create personalized business cards, plan their marketing strategy, crunch some numbers on excel, or polish their resume in a pinch.
For instance, designer Janna Hagan made over $5,000 just selling resume templates during a period between jobs. Obviously, not everyone is going to have the same level of success—but reading Jana’s story may inspire you to start your own venture.
Other templates you can sell include:
- Business planning templates
- Marketing strategy templates
- Excel templates
- Google Data Studio Analytics templates
- Business contracts
- Canva Templates
- WordPress themes
- DIY home project blueprints
- Powerpoint presentations
Craft patterns and downloadable prints
If you decide to sell on Etsy, you’ll be marketing your digital products to a captive audience of 46 million, many of whom joined the site because they love crafting and DIY projects. There’s a huge market for patterns—for sewing, knitting, macrame, papercraft, and just about any project you can imagine.
On top of that, there’s the printable market: whether you offer coloring pages, kids’ workbooks, posters, or birthday cards, someone out there is looking for them. For instance, Lena Miramar’s summery printable posters are a huge hit, and she’s built a business out of selling the digital files.
Music and audio
The hills are alive with the sound of music. Or the internet is, at least. Podcasters, YouTubers, bedroom pop stars, film producers, marketing teams—they all use audio in one form or another, and they’re all in the market for that special element to make their work stand out.
Examples of audio products include:
- Beats and instrument samples
- Plugins for music software
- Stock music
- Sound effects
For instance, Mattia Cellotto is a digital sound producer who sells recordings of everything from trained animals to vintage lab equipment.
Stock photos get a bad rep. We’re all familiar with the cliché: a model, awkwardly posed, performing some indecipherable activity against a stark white background. Or better yet—viral sensation, Hide the Pain Harold.
However, beautiful stock photography does exist—just check Unsplash for inspiration. If you have an eye for light, color, and framing, selling your photos online can supply you with a steady side income.
Another option is to give away stock photos for free in order to promote other products. For instance, self-described “hobbyist photographer” Annie Spratt shares free photos on Unsplash. But she also sells photo rights online. Customers can buy full commercial licenses on a per-photo basis, which allows them to legally create and sell prints of the work.
Where to sell digital products online
You should be ready to choose a digital selling platform based on what you plan to sell, as well as your budget.
Other factors to take into account include ease of use, and how much control you have over the appearance of your store.
It’s important to recognize the difference between a marketplace and your digital storefront.
Selling through your own site
Ecommerce platforms like Shopify and Thinkific charge you for the ability to create your own digital storefront customized with your own branding — without taking half of your profits, or displaying a competitor’s product on your listings.
You choose exactly how much you want to charge, and exactly what your site looks like.
|Platform||Best for…||Cost||Useful Features|
|Shopify||Ecommerce||Starting at $29 per month|
Payment Processing 2.9% + 30¢ USD
|Free plan includes all core features. After that, monthly prices start at $39 per month. No transaction fees.|
Selling through marketplaces
Marketplaces like Amazon, Skillshare, and Udemy will take a big cut of your profits in exchange for the consumers they bring you. You don’t have any control over the branding, and it’s their logo on the site, not yours. And when someone views your listings, they’ll also see your competitor’s products.
Marketplaces should be viewed as a marketing channel to complement your storefront, because they are a great way to generate leads that you can drive to your own online store for larger purchases and subscriptions.
|Platform||Best for…||Cost||Useful Features|
|$0.20 for a 4-month listing, plus 5% of each sale||Large community of crafters and vintage sellers you can target |
Small percentage taken from each sale
Option for an unbranded online store using Pattern
|Amazon||ebooks||$39.99 per month for Professional Plan, plus $0.15 per digital item, plus a $1.80 closing fee for each book, music, or video item||Kindle Direct Publishing (KDP) is a massive platform for ebooks sales|
Super easy word doc to ebook conversion
Pricey per-ebook sales cost
|Skillshare||Online Course Marketplace||Opportunity cost: you are paid a relatively small royalty for the number of minutes student watch your courses (about $200/ month for first time producers)||Lead generation / promotion|
Shorter class formats
|Udemy||Online Course Marketplace||Revenue share (50% of revenue goes to Udemy for being listed in their marketplace)||Lead generation / promotion|
Longer class formats
New platforms for selling digital products seem to pop up every day. Below, you’ll find six tried-and-true industry standards, and how they’re used.
Selling digital products on Amazon
As one of the Big Five tech companies, Amazon seems like a natural first choice for getting your product out into the world. But how well does it work with digital products?
While Amazon lets you sell music and videos, the service was originally designed for physical products. For digital items, you can find more robust, easier to use solutions tailored to what you’re selling for a lower price.
Where Amazon shines, though, is ebook sales. In 2019, 83% of independently published ebooks (books without ISBNs) were sold through Amazon, and they claimed 47% of ebook sales overall.
More than market share, Amazon boasts an easy-to-use publishing platform, Kindle Direct Publishing (KDP). If you’re just testing the waters, KDP could be a great intro to online publishing. As writer Biron Clark explains, formatting your Kindle ebook is as simple as uploading a Word document.
If you’re selling other products besides books—such as classes or workshops—Amazon isn’t a one-stop solution. But Amazon’s suggestion algorithms make this marketplace a great source of awareness for other products you may be selling
Selling digital products on Etsy
With more than 46 million active users, and 15 years dominating the market, Etsy is the go-to online service for craftspeople, artists, and vintage sellers.
It can also be an excellent place to sell digital products. For example, a search of “sewing pattern pdf” brings up over 400,000 results. Not only does Etsy make it easy to upload and sell craft guides, it exposes you to a huge market of crafters and DIYers—some of whom are bound to fit your niche. Instead of selling someone a poster, you can sell them a downloadable print.
Etsy is more suited to digital publications whose value lies in their visuals. Amazon’s Kindle has graphics support, but you won’t find many coloring books or clipart collections in that format. For visually rich items, and the people who want to buy them, Etsy is your best choice.
On the other hand, Etsy’s features for selling audio or video items aren’t robust. If those are going to be the bread and butter of your business, you’re better off going a different route.
Etsy is sort of like a marketplace, that gives you the option to open your own e-commerce storefront. If you’d like to have your own site ontop of Etsy’s marketplace, Pattern lets you design and launch a separate, non-Etsy-branded website. Your Etsy shop will still exist, and automatically sync with your Pattern site. But you’ll have the chance to do your own branding, with your own domain.
Selling digital products on Shopify
Shopify has rapidly become one of the most popular e-commerce sites in the world, but people aren’t just selling physical products on Shopify.
Their Digital Downloads plugin allows you to offer digital products in your store. When someone purchases a digital product from you on Shopify, they can download the product immediately, and receive a link to download in their email.
You can even add online courses built on Thinkific to your Shopify store, which means that you can sell other products alongside your course, like a physical copy of your book, an ebook, templates, merchandise, bonus study guides, and whatever else you want.
Selling through an online course marketplace – Udemy & Skillshare
Because Udemy and Skillshare are marketplaces for students looking for online courses, these platforms are a great way to generate awareness.
But there’s a catch…
You’d have to sell a lot of courses on these platforms to make a profit because of their profit sharing and royalty schemes, as well as limits on the price you can charge.
There’s no fee to host a course on Udemy, and you can publish as many courses as you like. The catch is, Udemy will keep up between 50% – 75% of your revenue in exchange for driving visitors to your courses.
Skillshare operates under a subscription model, which means students pay a recurring fee for unlimited access to the entire catalog of premium classes. Teachers are paid out from a royalty pool based on the number of minutes their courses were watched by premium members.
As you can see, it’s best to view these marketplaces as a lead generation source that drives people back to your own online course platform for larger purchases and recurring revenue.
Selling with an online course and membership platform – Thinkific
If you’re ready to create and sell online courses, and you want to keep all of the revenue for yourself, Thinkific should be the first place you look. Thinkific is designed for independent instructors who want to teach what they know, rather than spend time learning a new software platform.
Since Thinkific provides the tools to create your digital storefront, you have complete control over how much you charge, and the design of your site.
It’s a great way to take one step beyond ebooks. If you’ve already had some success selling your book online, Thinkific lets you take that information and turn it into a rich, feature-filled online learning experience. Get started with our guide on how to transform your book into an online course.
You can take a full tour of Thinkific’s core features by signing up for free. Since the trial has no expiry, you can create and sell up to 3 courses with unlimited students on Thinkific for free.
Just by researching digital products, you’ve taken the first step. You know what you’re good at, so hopefully, you’ve got a few digital product ideas to sell.
The next best thing you can do is to get started!