10 Benefits of Creating + Selling Digital Products (Aside from Passive Income)

Have you ever thought about creating and selling digital products…

… and then hesitated because – well, you’re not quite sure why you hesitated.

Maybe it didn’t feel right. Maybe the potential for passive income wasn’t worth the investment of time and energy it takes to create a product. Maybe it wasn’t the right time… or was it?

Digital products are wonderful for so many reasons, the first (and typically, most attractive) one being that they can generate passive income.

But running a digital product shop has the potential to contribute so much more than just dollars to your business.

So before you press pause on your digital product dreams and decide that opening up a shop isn’t for you, take a quick read through this list and decide for yourself if benefits like these – the kind that don’t necessarily involve making money in your sleep – are worth giving digital products a second (or first, or third) chance.

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1. Target teeny tiny sub-niches within your niche.

If you’re running a successful online business, odds are, you’ve selected a niche. As they say, the riches are in the niches – and this is true for digital product sales, too.

The cool thing about selling digital products is that you can target and sell (passively) to even more specific “sub-niches.”

For example, someone who does brand and website design for bloggers could create pre-made logo packs and website themes for food bloggers, fashion bloggers, beauty bloggers, business bloggers, finance bloggers… You get the idea.

It’s like you’re creating unique content to attract every one of your ideal clients, but the content also has the potential to make you money.

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2. Diversify your income in case of an emergency/change of pace.

Mind if I get vulnerable for a quick second?

I struggle with anxiety and seasonal affective disorder, and one of the reasons why my digital product shop is so important to me is because it has become my financial security blanket.

Unlike client work, my digital product shop can operate independently and continue to generate income on my behalf – which means whenever I feel mentally unwell and am unable to “show up” 100% in my business (or in my freakin’ LIFE, for that matter), my shop enables me to take some time away without adding financial stress into the equation.

Whether you have an invisible illness like I do, or you’re a solopreneur who is looking to establish some sense of security without cloning yourself or hiring some version of an on-call business stunt double, digital products are an excellent way to do just that.

3. Avoid giving your time away to other people.

Service-based business owners often maintain a consistent monthly income by doing one of two things:

  1. Taking on retainer clients, which are clients who “lock in” for a certain deliverable or amount of time per month in exchange for a monthly fee

  2. Booking one-off services so far in advance that their next 3, 6 or even 12 months are guaranteed to clients who have signed a contract and paid a deposit

While I have taken on retainer clients (and continue to work with a select few), I personally never felt comfortable booking client work farther than a week or two in advance. What if I got sick? What if I wanted to take a last-minute vacation? What if I felt creatively blocked? What if I just didn’t feel like working on that particular project anymore?

Part of this discomfort stems from the fact that I struggle with anxiety and depression (see point #2), which means I can’t always count on how I’ll feel a month from now, let alone six months from now.

But if I’m really being honest with myself, I don’t think I’ve ever been cut out for the “freelance life.”

Aaaand cue my next point:

4. Work as independently as you want.

In my experience, it’s expected for creatives to either work at an agency, or run an agency.

A lot of the service-based business owners that I follow on social media have gradually outsourced parts of their business, which naturally led to running an agency-style business, where they become responsible for a team of people.

This is because no matter how much money you charge, the only way to scale a service-based business is to dedicate more hours to more clients, whether the hours belong to you or to someone you hire.

And, um… I can’t relate.

When I picture the next few years of my life and business, I simply cannot imagine working and communicating with more than a handful of people, because it’s just not in my nature to do so. This is partly because I’m very introverted, which means that I get my energy from alone time. If I spend even an hour or two of my day on a call, or in communication with other people, most of my energy is spent and I’m useless for the rest of the day.

At the end of the day, the only person I want to be responsible for is myself. And if I never had to show up to another meeting – in person or virtual – for the rest of my life, I would be forever grateful.

But hey, that’s just me.

5. Say no to inquiries that aren’t the right fit.

Speaking of taking on more clients, how about doing the opposite?

When I started my business, even though I was very strict about the type of projects I took on – absolutely NO branding and website design, please and thank you! – I did take on a few clients that weren’t the right fit.

These were the clients that referred me to their websites home page for “brand inspiration,” or used phrases like creative magic, or stood me up for a Skype call and then didn’t reply to my e-mail for four days.

As soon as my digital product shop started generating enough monthly income, I was able to turn down any and all client inquiries that gave me an intuitive icky feeling, and I immediately felt lighter.

The funny thing was, as my shop continued to grow and become more visible, I got even more client inquiries to replace the ones I’d turned away.

6. Position yourself as the expert in your niche.

One thing that I didn’t anticipate happening when I started my digital product shop was appearing more professional/in demand/as an “expert” to my clients and customers.

Now that I think about it… this totally makes sense.

The idea of choosing and sticking with a niche is to become well-known as THE go-to person for [insert thing you do here].

When you begin selling digital products, this reinforces the fact that you are the go-to person, not just for your clients, but for anyone at any stage of business who is searching for resources in your niche.

Not only that but, going back to point #1, selling digital products demonstrates the range of work you’re capable of doing. Which leads me to…

7. Build a buy-able portfolio.

One of the things I was most concerned about when I started my shop and reduced my client workload was that I wouldn’t be able to build my portfolio of client work as quickly.

Then, when I realized that my entire digital product shop WAS my portfolio, I smacked myself on the forehead.

Now, I’m not saying that a digital product shop can replace a portfolio – clients who are looking for custom work will still want to see examples of your custom work.

But, I have also received dozens of client inquiries from people who found my products on Creative Market, made a purchase, and inquired about custom work based only on what they’d seen in my shop.

That’s what I call a win/win.

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8. Serve clients who are outside of your price range.

Price increases are a natural part of scaling a service-based business.

The problem?

As you increase your prices, you become inaccessible to the clients who could once afford to work with you. Digital products are a great way to offer an alternative to those clients without having to turn them away or refer them out to someone else.

Not to mention, offering digital products at a lower price point opens up new opportunities that you wouldn’t have otherwise had, such as expanding your target market by serving an entry-level audience.

9. Get complete and utter flexibility in your schedule.

One of my favourite parts about my digital product shop is that I can spend one day on a digital product, or several weeks on a digital product, and the result will be the exact same.

I can wake up and work on a product, or decide that I’m not feelin’ it.

There are no deadlines, no deliverables, and no revisions.

*Immediately schedules naptime*

10. Help more people and have a bigger impact

When I first started my online business, what I really wanted to do was help other people start and grow their online businesses.

See, I had just been laid off from my full-time job, and before that, I quit another full-time job for… well, a variety of reasons.

Long story short, starting my own online business made me feel like, for the first time ever, I was in control of my destiny. Nobody could ever lay me off, turn down my request for a raise, ask me to stay late in the office, or have any amount of control over when, how, or how much money I made ever again.

The thing about running a service-based business is that, although I was helping other people grow their online businesses, I could only help one person at a time.

And typically, that one person had already achieved a certain level of success, which is what allowed them to hire me.

Selling digital products enables me to do a similar amount of work, while offering the benefit of my design services to hundreds, or even thousands of people at a much more accessible price point. Instead of working one-on-one, I’m able to work one-to-many, and make the impact that I’ve been wanting to make since Day 1.

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