The increased reliance on e-commerce fuels the need for digital items. As a result, there are several chances to sell online and generate passive income streams—without the bother that usually comes with selling real things.
Whether you want a low-cost side hustle or a strategy to grow your full-time business, digital and downloadable products can help.
A rising number of people are seeking strategies to generate several streams of income. Recent research indicated that 67% of Americans have a small business or side hustle, with 80% establishing one to supplement their income.
Passive income is defined as money generated with little to no ongoing effort. It is sometimes contrasted with active or earned income, which demands ongoing labor. Passive income, sometimes known as making money while you sleep, can be an excellent strategy to augment current income or achieve financial goals.
As the name implies, digital passive income is passive income generated from digital products or services, such as eBooks, software, online courses, etc. Once created and listed on your online store, these products can generate revenue continuously, requiring minimal ongoing effort for maintenance or delivery.
Compared to physical goods, digital and downloadable products offer unique advantages.
- Low overhead costs: There are no physical products to store or ship, so you don’t have to worry about inventory, manufacturing, or shipping costs. This helps ensure higher profit margins. Other than any upfront costs needed to create your products, there aren’t many expenses to worry about.
- Global reach: With the power of the internet, your digital products can reach a worldwide audience, breaking geographical barriers.
- Scalability: Scaling your digital product sales doesn’t require a proportional increase in resources or effort. Once you create your product, sell it over and over again with minimal effort and replicate it infinitely without incurring more production costs.
- Flexibility: Another major benefit of selling digital products online is that there are so many options to choose from. For instance, many bloggers and professionals can make digital marketing passive income via downloadable content, such as a Canva template or PDF guide. On the other hand, web developers can sell software and other digital products and tools.
The cost-efficiency and flexibility of digital selling make it a worthwhile endeavor, even for beginners. The key is figuring out what to offer.
Now that you know what digital products are and what their benefits are, let’s look at some of the most popular digital products you can create and sell this year.
- Ebooks
Many creators are making banks from selling ebooks. Take Carol Tice, for example. She has made over $45,000 selling ebooks with minimal effort. 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” Aliche is a financial educator with the goal of empowering women worldwide. She runs a popular online school, the Live Richer Academy. On top of that, Aliche has published a number of successful ebooks for students and non-students alike.
Before you create an ebook, make sure there’s a market for it first. You’ll need to do two things here:
- Ask your audience what challenges they are facing and pick one you can solve with your knowledge
- Ask your audience if they like to read ebooks or prefer some other content format
Once you’ve established demand for it, you can create your ebook. On a high level, you’ll need to come up with a topic and outline, develop the outline, proofread the content, and create a simple book cover using a tool like Canva or AI art generators.
You can sell your ebook on a self-hosted platform created with Thinkific. You can also sell it on ecommerce marketplaces like Amazon and Smashwords.
- Courses
Teaching online lets you turn something you already have—your expertise—into a new source of revenue. If you have the 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 creating online courses isn’t just limited to traditional classroom environments like high school and university, or corporate trainers adapting with remote onboarding… And you don’t need to be formally trained as an educator, either.
You can create an online course to teach people just about anything — from tai chi and drone piloting online to yoga and guitar.
Read Also: Passive Income for Consultants: Leveraging Your Expertise
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:
- Sewing
- Yoga classes
- Laughter yoga
- Guitar lessons
- Meditation
- Dance classes
- Juggling
- Resumes and job search
- Professional development
- Arts and Crafts
- Photography
- Copywriting
- Graphic Design
If you don’t want to deal with the pressure of self-hosting and marketing your online course, you can sell it on a global marketplace like Udemy and Coursera. Once your course meets their standards, these platforms will add it to their library and market it to platform users on your behalf.
Alternatively, you can create and sell online courses on your own website using Thinkific. This gives you total control over your course material and students.
- Memberships and paid communities
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 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.
If you already have a strong social media following, you can sell your membership program on your social account. Your audience already knows and trusts you and is likely to sign up for paid membership.
- Graphic design
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 are several platforms where you can sell your art and design work online. Some popular options include Etsy, Society6, Redbubble, Fine Art America, and Artfinder.
Additionally, you can always sell your work directly through your own website or social media channels.
- Templates
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
Look for niche marketplaces where you can sell your template. Say you’re selling WordPress themes, Theme Forest is a great choice. Meanwhile, Notion Utopia is the top marketplace for — you guessed it — Notion templates.
You can also sell templates on the social platform where your target audience hangs out. For example, if you’re selling a social media calendar template, you can market it on LinkedIn, X, and Instagram.
- 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 digital files.
Etsy is obviously the first choice. But, if for some reason you don’t want to sell on Etsy, you can explore platforms like Shopify and Makerist.
You can also set up a store on your preferred social platform — like a Facebook or Instagram store — to sell your prints.
- 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. You can independently publish and distribute your music on digital music stores like CD Baby and Tunecore. These platforms will help you publish your music on streaming platforms and online stores for a fee.
If you want to sell stock or royalty-free music, you can use platforms like Audio Jungle and Pond5.
- Stock photography
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.
Stock photography marketplaces like Alamy and Shutterstock pay percentage commissions for photo sales.
SmugMug, on the other hand, is a paid membership platform for stock photos. Once you sign up, the platform takes care of sourcing buyers for your photos. On top of that, it will let you keep up to 85% of the profit on the sales.
- Software and games
It’s no secret there is a large market for both software and digital games. While both of these digital products require coding knowledge to create, for those who do have a development background, they can be immensely lucrative. If you’re interested in getting into the software or gaming market and don’t have the technical skills to build a product yourself, consider working with someone who does.
Software can be any solution or software that is powered by code. This includes mobile apps, web apps, desktop software, and many other options. The difference in effort between a basic mobile game, for example, vs. complex accounting software, is something to take into account when scoping out what kind of software you would like to sell. Smaller niche software offerings may be a faster route to making money.
The indie gaming market has also exploded in the last few years, with platforms like Steam allowing developers to sell directly to gamers without large studio interference. Games like Hollow Knight and Among Us both have indie roots and have exploded in popularity. While creating a digital game is undoubtedly a large time commitment, the payoffs can be major.
Shopify is one of the most popular platforms for selling software. It lets you upload digital copies of your software. Customers can download these after making verified payments.
On the other hand, many creators like to sell games on Ecwid. You can create a free online game store or set up an Ecwid store on your website to make sales directly.
- Webinars
If you don’t have the time to write an ebook, consider hosting a paid webinar to share your knowledge. It’s an easy way to build authority in your industry, plus the resale value is great too. You can record and sell it to people who couldn’t attend the event live.
Freelance writing business coach, Paulette Perhach, hosts a paid webinar at the beginning of the year to help writers set their goals for the year. She’s built up credibility in her niche, so it’s easy to convince people to sign up to learn from her.
If you’re just starting out, a webinar might not be the ideal digital product for you. Build credibility by sharing your knowledge for free first. When you’ve gained a loyal audience, you can ask them to pay to learn from you in real-time.
The first place to promote your webinar is your social platform. After all, people who are already familiar with your knowledge and expertise are more likely to pay to learn from you than those who aren’t.
You can create a landing page webinar using Thinkific for registrations. You can also host the webinar recording on Thinkific for post-event sales.
- Coaching and consulting sessions
Another way to monetize your knowledge is to provide paid coaching and consulting services. On average, consultants make more than $8,000 a month, so it’s a juicy financial reward for your expertise.
We’ll recommend this digital product for busy 9-5ers who want to make some extra cash on the side. On top of that, it helps you build credibility within your industry and become an authority in your niche.
You can organize one-on-one coaching sessions, or group calls with a small community. These sessions can be offered as one-time purchases or as part of a package that includes multiple sessions. You can even offer tiered coaching packages where people pay more for a one-on-one session or pair your consulting offering with paid membership communities — it’s up to you!
Use Thinkific to create a landing page or website for your coaching and consulting services. It’s free and saves the time you would have otherwise spent on building a website from scratch. It also gives you full control over your branding, messaging, pricing, and overall website aesthetics.
Alternatively, list your coaching services for free on coaching directories like Noomii and Life Coach Hub to connect with potential clients. These directories are often free to join but may charge a fee for premium features.
- Social media paid subscriptions
Social platforms like X and Instagram have rolled out subscription services, providing another path for digital creators to earn from their audience. Creators like Bianca Araduta and Dan Pulzello diversify their Instagram earnings via paid subscriptions.
On Instagram, for example, verified creators can ask their audience to pay a monthly fee to access exclusive content. The same goes for X — if you’re a verified creator with 500 followers, you can receive payments from your followers via paid subscriptions.
Subscriptions are a low-hanging fruit for creators who already have an active audience on social media. If you’ve built a loyal following, then a handful or more of them are definitely willing to pay for exclusive access to your content.
You’ll sell subscriptions on the social platform you want people to subscribe to. Say you want people to subscribe to your Instagram account; you can record a reel telling them that you now offer subscriptions plus the type of content they’ll get if they sign up.
There are a number of different ways to promote your digital products, and what works the best will depend greatly on the platform you are selling on and what you’re actually selling. However, there are some principles to keep in mind across the board.
Don’t rely on your chosen platform to market your products. For example, if you decide to sell on Etsy or Amazon, you can’t expect to gain large amounts of traffic just for existing on these marketplaces. Build audiences for your products through social media platforms like Instagram or TikTok. If you’re stuck for ideas, pay attention to the most popular content and emulate those posts.
Once you start to see some growth try networking with other digital product creators in your space. This will help you build connections, get tips, and open up opportunities to cross-promote. If budget allows, try out a few paid advertisements on social media or on your selling platform if the platform supports ads. Test some different ideas and pay attention to what converts the most people to buy your product.
