Information Vs Physical Products



2016 is well underway now and lots of people, myself included will thinking about how they are going to meet their goals for this year. Making money online is a goal that a lot of people aspire to and it is my primary goal for this year.

Selling things is one of the biggest areas in which you can make money online and can  generally be divided into 2 categories; selling information (digital) products or selling actual (physical) products. The type of product that is the most successful and the most profitable will depend on who you speak to, who you follow on social media and which blogs you read.

Having had experience in selling both types of products online, the purpose of this post is to look at the pros and cons of them so that you can make an informed decision if you are thinking about getting into selling online.

Physical products

Selling physical products is really the traditional way of making money and has been for a long time, way before the internet even existed. People like to buy things and hold and inspect their new item and to be able to see where their money has gone. Entering the digital age has not changed this at all. People will always need physical products such as clothes, medicine, utensils etc. They are a vital part of life and I can’t see that ever changing, not in my lifetime anyway! The success of business’s like Amazon and Ebay are testament to just how thriving the physical product arena actually is. Because of the history and tradition that come with selling physical products, there is a greater element of trust between sellers and customers. There can still be a lot of stigma attached to selling digital products with some people viewing them as scams.  So with all these plus points you would think this was definitely the way to go right?

shpWell as with most things there are pros and cons. We’ve looked at the pros so lets look at the cons. It can actually be quite expensive to sell physical products. Sound crazy? Well not if you think about it. In order to sell physical products, you have to own physical products, which means you have to buy them, or get them manufactured. This is an expense. Before you invest your money into buying however many of your chosen product, you’ll want to be certain of the quality of it so you will need samples, another expense. You will then need to get your product shipped to wherever it is going to be stored. Another expense. If you are doing this internationally you then have customs to deal with. This can be quite complicated if you do not understand international tax law plus potential  language barriers.

The physical products that I sell on Amazon, I had manufactured in China, and the shipped to the USA (I am based in the UK). Although interesting, this process was long and expensive, and at times very frustrating! I have my products stored in Amazon warehouses in the states, and they  deal with the shipping to the customers upon purchase. Whilst this is very helpful and useful to me, it’s not free. With Amazon becoming an increasingly competitive arena, there is the additional cost of advertising to bring customers to your product. So you can see how all these expenses add up, plus some of them are ongoing.

You don’t have to pay Amazon (or any other online retail site) to store and ship your products. Depending on where you are selling them you can do this yourself. It will save a lot of money. But you need to think about where you’re going to store them, keeping track of who has ordered what, whether they have paid and getting them shipped out in good time. You will also need to think about people wanting to return items and refunds.

So to sum up, selling physical products online can be very lucrative if you find the right product, however the expense associated with it will eat into your profit margin and it can be quite labour intensive.

Digital Products

So how does selling digital products online compare? The beauty of digital products it that you can effectively the sell the same thing over and over again. When someone buys a digital product, they will download it. So the product only needs to be created once, and can be downloaded as many times as needed. This makes your profit margin limitless really. The cost of creating a digital product can vary, but it does not have to be expensive.

My first digital product was an eBook. It cost me about a week, in time, to write and about $5 in money to buy the photo to put on the cover. I am no good at soldgraphics, but fortunately my brother is, so he did my cover for me for free. There are plenty of places online where you can get this kind of service for pretty cheap. I self published via Amazon, which was free and did all my marketing and advertising on Facebook and Twitter which was free. Amazon took 30% of my sales leaving me with a huge 70%. Plus there is no storage to worry about or shipping. Another big advantage of selling digital products is that you can set it all up into an automated system so your input is minimal, leaving you with time to dedicate to other things.

Good stuff, but lets look at the cons of digital products, because they do exist. As mentioned before, there is still a stigma about people selling digital products being con artist and scammers. Whilst there are some dodgy characters out there selling poor quality products (and you can still experience this with physical products), there are a lot of genuine sellers out there, who sell good quality and informative digital products. A little research and due diligence can usually help differentiate between the two. The other disadvantage of digital products is that you are more limited in what you can sell, as only certain things can be created in digital format. Even then some  people will just prefer the original physical product. Just look at how passionate people get about vinyl vs. iTunes! I for one much prefer getting stuck into an actual book compared to an eBook.

So there you have it, if 2016 is going to be about selling things online, I hope this helps you decide which path will be best for you. Having tried both, digital products is the clear winner for me. I have made more money in less time and with less effort at less expense. So that is where I will be focusing my energy in 2016. Keep tuned in to follow my progress.

Bye for now 🙂

P.S. Affiliate marketing is also something I am going to be focusing on in 2016.  Keep your eyes peeled for some posts on how to do well in this.


Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.