How to Make Passive Income Selling Digital Downloads

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When it comes to building an online business, there are so many different options out there for making money. There are the big ones like AdSense and Amazon, and then there are more specific niches like selling ebooks or dropshipping.

In this article, We will show you everything you need to know about how to make passive income selling digital downloads.

One of the easiest ways to make some extra money online is by selling digital downloads, but there are a few things you need to know before you get started.

What Products Should You Sell?

There are many products that you can sell online to make money, but here are some of the most popular: ebooks, MP3s, software, photos, other digital artworks (illustrations, vectors), and videos.

I like to split these up into two different categories…niche products, and non-niche products.

Niche Products

The first category is niche-specific digital downloads. If you have an online business in a very specific niche then it might be easier to create your own digital product that is only relevant to people in that niche. For example, if you have an online fitness store, creating your own digital workout plans would be a perfect fit. (They’re not too expensive to create either.)

Non-niche products

The second category is non-niche-specific digital downloads. Think outside the box a little bit and look at what other kinds of things people might buy online. People buy lots of different kinds of things online that might not be directly related to their niche. For example, a cooking website could sell digital recipe ebooks.

Build an Email List Before Selling Digital Downloads

If you’re going to sell a product – especially a non-niche-specific digital download – then having a pre-existing list of customers is extremely helpful. Once they trust you, they are much more likely to buy something when you recommend it to them.

Since this is the internet and people hate being sold to, I never recommend trying to create a “hard sell” email list. You’ll just come off as pushy or annoying! Instead, I like to stick with creating an email newsletter where I send out valuable information to my readers on a regular basis.

Once you have a good amount of content up, include a link at the bottom of every post that leads them to an opt-in box where they can signup for your email list. Be sure to offer something valuable in return, such as a free ebook or some other useful resource!

If you’re just starting out and don’t have a ton of readers yet, that’s okay! You can still build your list by offering an ebook for free in exchange for your email address.

Make sure to follow up by sending them valuable information to keep them coming back and get them excited about the next time they get an email from you.

How to Make Passive Income Selling Digital Downloads

How to Start Selling Digital Downloads

Here are 5 Easy Steps to start selling digital downloads:

Step 1: Choose Your Niche

The first step to selling digital downloads is to choose your niche. What are you good at? What are you passionate about? What do people need? Answering these questions will help you determine what types of digital products you can create and sell. For example, if you’re a graphic designer, you might create digital art prints or social media templates. If you’re a writer, you might create e-books or printable planners.

It’s important to choose a niche that you’re passionate about, as this will help you create products that people will love. Additionally, you want to make sure that your niche is profitable. Do some research to see what types of digital products are selling well in your niche. You can use tools like Google Trends or Amazon Best Sellers to get an idea of what’s popular.

Step 2: Create Your Digital Products

Once you’ve chosen your niche, it’s time to create your digital products. This is where your skills and expertise come into play. Depending on your niche, you might create e-books, printable planners, digital art prints, social media templates, or something else entirely.

When creating your products, make sure they’re high-quality and valuable to your audience. People won’t pay for products that aren’t useful to them. Additionally, make sure your products are visually appealing. If you’re creating digital art prints, for example, make sure they’re beautiful and eye-catching.

Step 3: Set Up Your Sales Platform

Now that you’ve created your digital products, it’s time to set up your sales platform. There are many different platforms you can use to sell digital downloads, including Etsy, Gumroad, and Shopify.

When choosing a platform, consider the fees, ease of use, and features. For example, Etsy is a popular platform for selling digital downloads, but it does charge fees. Gumroad is a platform that’s specifically designed for selling digital products, but it doesn’t have as many features as Shopify.

Once you’ve chosen your platform, you’ll need to set up your shop and upload your products. Make sure to optimize your product listings for search engines by including relevant keywords in your titles, descriptions, and tags.

Step 4: Market Your Products

Now that you’ve set up your shop, it’s time to start marketing your products. This is an important step, as you want to make sure people know about your products and are interested in buying them.

There are many different ways to market your digital products, including social media, email marketing, and paid advertising. Choose the marketing channels that make the most sense for your niche and audience.

Additionally, make sure your product listings are optimized for conversion. This means including high-quality images, detailed descriptions, and clear pricing information.

Step 5: Scale Your Business

Once you’ve set up your shop and started marketing your products, it’s time to scale your business. This means finding ways to increase your revenue and reach a larger audience.

One way to scale your business is by creating new products. This could mean expanding your offerings within your niche or branching out into a related niche.

Another way to scale your business is by optimizing your sales funnel. This means finding ways to improve your conversion rates and increase the lifetime value of your customers.

Finally, consider outsourcing tasks to free up your time and focus

How Much Will You Sell Digital Downloads For?

Now that you have come up with a product you want to sell online, the next step is figuring out how much it will cost. The most important factor in determining your price is your profit margin.

What is your profit margin? Your profit margin is the amount of money you will keep after subtracting all of your product costs. For example, if you have a product that costs $30 to create, ship, and sell then you need to be selling it for at least $40 just to break even!

However, if you want to make some money, you need to increase the price. Let’s say that your profit margin is 50%. This means that for every $100 in sales, you will keep $50. You can adjust this percentage up or down depending on how much money you would like to make per sale.

What are my product costs?

When you create a digital product, you are basically creating something that is completely unique. Because it isn’t tangible, the only thing you need to pay for is the time it takes to actually make your product.

For example, if I sell ebooks then my product costs would be things like buying Adobe InDesign or Photoshop so that I can format the book or pay a designer to create a cover.

If I sell mp3’s then my product costs would be things like buying audio recording equipment, paying musicians, and paying for studio time.

In general, you should try to keep your product costs as low as possible because this will give you a higher profit margin. However, there is one other thing you need to be aware of…

How much money can you make selling digital downloads?

When you sell digital downloads, there are no limits to how much money you can make! I know this is obvious but it’s important not to think of the amount of money you make as a single number. Instead, it’s more helpful to look at your earnings over time. For example, if you had made $20k last year but only $10k so far this year then you’re actually not earning more money!

It’s always good to track your progress and set goals but don’t get discouraged when you don’t reach them right away. It takes time to build an audience that is willing to buy what you have to offer. So, be patient with yourself and keep building your business step by step!

In the world of digital downloads, it’s much easier to scale your income from product to product than from job to job. You don’t have to worry about a boss giving you a low salary because “that’s just how the industry is.” Instead, you can sell as many products as possible and watch your earnings grow! Another thing to note is that you’ll get a much higher percentage back from the money customers spend on your product compared to the money they spend on your services. If you make $100 selling a product, then 50% of that money goes to you (taxes are another matter though).

On the other hand, if you make $100 from a job then generally your employer keeps around 60-75% of it! That means if you’ve got a job making $100/hour then you’re only earning around $25-$37.5 per hour!

Do you have the time to maintain a website?

Some people don’t realize how much work goes into running an online business. It’s not just about creating content, adding products, and driving traffic, it’s also about staying on top of all these different aspects of your website.

You need to be on top of everything that goes into running your website. Create content, manage the site, promote it on social media, answer emails, deal with refunds or customer service…the list goes on and on. It’s a full-time job!

Do you want to control your own income?

I know I touched on this a little bit before, but it’s worth going over again.

When you sell digital downloads, you are responsible for marketing them, customer service, refunds, and everything in between. You have complete control of how much money you make from your website!

However, if you don’t want to deal with these aspects of your business then you should not sell digital downloads.


Selling digital downloads is a great way to make money online! You can scale your income by selling multiple products and automating the process so you don’t have to do all the work yourself.

The best part is that it takes a lot less time and money compared to starting a business from scratch. All you have to do is choose a product, set up an email list, and offer dollars to customers interested in your product!

It’s important to remember that this is a long-term strategy and it often takes months or even YEARS to start making significant money. If you’re impatient, this probably isn’t the best option for you.

However, it’s much easier to scale your income when you’ve already got an audience that knows, likes, and trusts you. This is why it’s so important to start small, gain followers on Social Media platforms, have an email list, and provide valuable content to your readers.

🙂 Good Luck!

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