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Making Money from Digital Products

Entrepreneurs always have two things to sell: they have the product they create; and they have the knowledge that went into creating that product.

Both of those things are valuable.

If you had built a successful website that matched local tour guides to tourists-in-the-making, for example, then you might have a valuable product. (Don’t get excited. It’s been done.)

But the lessons that building that site would have taught you about website optimization, marketing, fund-raising, copywriting, outsourcing and a whole host of other techniques could all help someone else do the same thing… and can all make you money.

It’s likely too that creating that product would be a lot easier than building your business in the first place. Information products don’t even have to be physical. In fact, digital products often sell for far higher amounts than hard copy books.

Why that might be is an interesting quirk for economists to puzzle over. Physical books go through rigorous selection processes. They’re edited, printed, professionally designed and expensively marketed. And yet they still rarely sell for more than $25, giving an author who might have sweated over the manuscript for months little more than a dollar a copy — assuming, that is, he sees past the advance. Most don’t.

Digital products, on the other hand, can sell for hundreds and even thousands of dollars, most of which ends up in the creator’s pocket. They can be written and placed on the market by anyone, few are edited and many are poor. A buyer has to depend on nothing more than a giant sales letter he hasn’t read and testimonials from people he’s never heard of to trust that the money he’s paying will buy him the foundation of his new business, rather than slightly less space on his hard drive.

And yet they sell, generating large amounts of income for entrepreneurs and analysts who understand that what they know is sometimes more valuable than what they do.

There are a number of ways to do it.

Clickbank — Your Friendly Downloadable Shopping Mall

The easiest is to post your product on Clickbank, an online mall for downloadable products. For publishers, the site offers a couple of advantages.

First, it’s open to everyone. You won’t have to write a persuasive query letter or talk your way past a commissioning editor to get your book on the shelves. That makes it a good place to start.

And the second is that it’s marketed to marketers as much as to buyers. Clickbank makes its money by encouraging website publishers to promote the products it “stocks” as affiliates.

That makes the sales relatively easy too.

The downside is the pricing. Clickbank caps the amount publishers can charge at $50, although it might be willing to stretch this to $200.

That sounds like a lot in comparison to traditional publishing but if buyers are willing to pay more, Clickbank’s easy uploading and marketing could turn out to be fairly expensive.

Become a Guru

An alternative to Clickbank is to market the product yourself — and market yourself at the same time. The Web is filled with business experts who speak at conferences and use those appearances to promote products that can also be downloaded online. Freed from the restrictions of Clickbank, they can charge whatever they think the market will bear.

AdSense expert Joel Comm, for example, first made his name selling an e-book containing his strategies for $97 — almost four times the price of his hard copy version.

The real money for gurus though lies in the orders for the sort of physical products audience members can pick up at conferences. David Garfinkel’s copywriting course, for example, is described as a steal when you can pay for it in three “easy installments of just $347 each.”

But in addition to a physical book, you also get a stack of CDs, DVDs and transcripts for that price. That’s a lot harder to produce than a digital product, even if a low-cost digital product is often used to promote it.

Become a Sherpa

If you want to get in on the really high-paying downloadable materials though, you need to leave the world of self-promotion and head for analysis. This is where the big bucks really are… not least because this is where the valuable information is.

Some of the e-books available on Marketing Sherpa, for example, make exactly the same promises as those sold by the likes of uber-marketers Armand Morin and Jeff Walker. “Landing Page Optimization for Ecommerce” could easily have been titled “Boost Conversions By 816% With Unbeatable Landing Pages!” but it sells for just under $1,000, the sort of price that would have a guru outsourcing hours of box-stuffing.

The difference is Marketing Sherpa’s apparent reliability. The company tells publishers to drop the hype, raise the proof and use the sort of language more often found in business schools.

It makes their products look researched rather than cobbled together by a guru and a ghostwriter, which means that people are more confident that they’ll get the results — and more willing to spend more money on them.

All of that though pales into insignificance when you look at the amount polling firms charge for their digital products. While these aren’t the sort of books that you can produce on the strength of the experience you picked up marketing your website, they are worth a lot of money. Gallup’s World Poll, for example, is available online to anyone prepared to spend $28,500.

At that price we’ll have two… and a $200 subscription to esurveyspro.com.

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