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Digital downloads are incredibly powerful tools that deliver an excellent ROI. Part of the reason that they’re able to do this is that they consistently deliver payoffs with a low bar to entry at a low cost. In other words, they’re efficient. 

In this post, we’re going to take you through the 7 reasons that you should add digital downloads to your small business plan. 

Read more: Selling Digital Products: Your Ultimate Guide

7 Reasons Why Digital Downloads are Key to Small Business ROI

1. They help with almost every metric
2. They’re easily trackable
3. They require less effort than other products
4. They don’t require physical inventory
5. You’ll keep a lot more profit and develop your brand
6. Access to a larger audience
7. Lower overhead and cost-to-entry

A businesswoman analyzes her business plan, adding digital downloads to improve small business ROI

1. They help with almost every metric

Digital downloads help with nearly every metric that you can think of when calculating ROI. Digital products are cheap, require minimal overhead and management, and can serve as an evergreen source of profit for your business. Adding digital downloads like eBooks or courses to your product offering provides excellent returns for metrics like:

Unique Monthly Visitors 

Offering digital downloads adds another source of value to your products and small business, and with more products come more potential customers. 

Cost Per Conversion

Depending on what you consider a conversion, digital downloads can show very promising results in this metric. For example, if you consider every email signup a conversion for your coaching business, adding a digital download that requires an email address provides a low-cost way to drive conversions.

Selz analytics include in-platform analysis of sales, conversions, traffic and more with direct integrations

Return-on-Ad-Spend (ROAS) 

When you’re calculating ROAS, you normally have to factor in the costs of producing the product as well. The equation for physical products has to include the cost of producing a physical item. In the case of digital products, this cost will be extraordinarily low or nonexistent. 

The way to remember this one is your ROAS = (Revenue/Total Ad Spend)*100. That will give you the percentage of return. 

2. They’re easily trackable

One of the best things about digital downloads is that the sale and distribution of them are easily trackable. You don’t have a set inventory or shipping, so you don’t have to worry about keeping inventory synced up or shipping processes in place. 

That’s if you’re selling digital downloads, if you’re using them as a marketing tool or as part of your customer journey, they have additional utility. 

A happy customer checking out a digital download on her tablet. Digital downloads are an effective addition for every stage of the buyer journey.

Digital downloads can serve more than just as another product. You can also use them to supercharge your marketing efforts. Creating forms to gather information about potential leads with the reward of a digital download is an effective method to build an email list of interested customers, and creates massive ROI for your sales team because they don’t have to hunt down the leads themselves. 

3. They require less effort than other products

If you’re running a small business, you likely don’t have an overabundance of time. The process of developing, testing, and bringing to market is both resource and time heavy. 

Digital downloads are much less time-intensive to create and they can also offer unique educational opportunities for your customers about your products and your field of expertise as a whole. 

Read more: 40 Small Business Ideas for Digital Products to Diversify Your Business Income

However, there are some important things to consider when you’re creating digital downloads for your customers:

Free competition

Often, you will be competing with free content across the web. If you’re selling a PDF or an eBook, many of your competitors might be offering something comparable for free. In that case, remember to differentiate what you’ve created from your competitors, so your products offer premium value. 

Selz license keys are easy to add and easy to use, which is why you should use Selz e-commerce for digital downloads

Piracy and theft

If you’re selling digital documents, make sure that they’re locked and protected to prevent people from copying your work. As far as products go, using a license key generator is an excellent idea.

Read more: Three Secrets to Secure Digital Product Delivery

Get creative with social media

Because you’re selling products that don’t require a physical inventory, you can create an entire sales pipeline around social media. While Facebook and Instagram do not allow digital sales on their platforms, you can use them for marketing and outreach that directly links customers to your products. 

And when you need to actually make a digital sale, not just raise awareness, you can use a platform like Selz to list, manage, and sell your digital products. 

Read more: Social Media Marketing for eBooks: How to Sell Your eBook through Facebook, Twitter or Pinterest

Sell digital video

While it might seem like a lot of work, creating digital videos as an additional product offering enables you to sell tutorials, courses, entertainment, as well as opening up a wide variety of marketing options too. 

Depending on what you’re already selling, adding in videos can be a great way to expand your business and they provide tons of ROI. 

Read more: How to Sell Videos Online for Profit

Start with free content, and from there you can start upselling. If you create one free course video, start charging for the rest. Creating tiers for your products will help you engage casual customers, eventually turning them into brand loyalists and ambassadors. Video courses also allow you to bundle in other digital products and tools, creating an even wider revenue stream. 

4. They don’t require physical inventory

Tracking inventory is time consuming and digital downloads are much easier to track

Digital downloads have a huge advantage over other types of products: they don’t require any physical inventory. That means that they never run out of stock, you never have delivery problems, and they simplify the purchase process. 

On top of that, if you’re selling digital products like software or apps, you can push updates and other important information to your customers easily. 

Read more: How to Start Selling Software Online: The Essential Guide

Exciting ways to deliver

In addition to not requiring physical space, digital products offer exciting opportunities for delivery that can provide additional ROI.

For instance, you can email customers directly with links that will enable them to download their purchases. You can also create delivery pages where customers can access their products whenever they need them. 

On top of that, within these delivery environments, you get opportunities to sell other products. If you send someone an email with their video course, you can use that email to advertise the next one too, maybe with a coupon code!

Streaming inventory

Another item to add to your digital inventory is streaming. Selling a pass for a time period where users can stream video can be a powerful way to keep folks coming back as you create more content. Streaming works well for video workout plans, podcasts, and other rewatchable content. 

Update the digital inventory

If you’re selling software or apps, being able to push updates without interruption will help maximize ROI by saving labor on pushing updates. With Selz, our management system will make it easy for you to push updates to your customers, automating a crucial part of your growing business. 

5. You’ll keep a lot more profit and develop your brand

When you produce and sell a traditional physical product, you’re often having to eat a whole bunch of costs, and if you’re really lucky, you’re keeping around 40-60% of your profits. You’re paying for shipping, packaging, and other necessities to get a physical product into the hands of your customers. 

Selling digital downloads directly from your website allows you to bypass many of these costs, where you’ll be taking nearly all of the profits from each download. 

When you’re picking a method to sell digital products, you want to make sure that you pick a platform that makes creating, listing, and selling easy, without taking a huge chunk of your profits. Selz has that covered. 

Selz is an incredible ecommerce platform for partners to use as they add ecommerce to small business websites

When you start selling digital downloads, you open up a wide range of options for business growth. Collaborations and partnerships can extend across borders and boundaries, giving you exciting opportunities for creative growth and business development. 

You can develop your brand by cross-promoting content with other creators like you, or products or services that complement your own. When you partner with another business that isn’t a direct competitor, you often end up getting the combined power of customers from both!

6. Access to a larger audience

A crew of fast moving business people shows how you can increase the scope of your business with digital downloads

One of the unique benefits of creating digital products is that it expands your audience. You might be producing workout equipment that’s at a fairly high price point, which automatically might eliminate many types of customers. 

Now, if say you created a PDF full of workout plans or nutrition tips for a low price, you’ve added a space for more customer interest and purchasing. 

The added benefit beyond the initial sale is that you’ve established yourself with a new type of customer, which might later convert into a potential buyer for some of your other products, be they physical or digital. 

Nurturing existing customers is an exciting sales opportunity for your business!

7. Lower overhead and cost-to-entry

If you’re looking to start a business, but are low on funding, digital downloads can be a fantastic place to start. Because of their low overhead costs, you can focus on slowly building your business over time, eventually getting to the point where you can start creating and delivering physical products. 

Especially if you’re first getting started out, you can explore opportunities like sponsorship and affiliate programs. 

Sponsorship and affiliate marketing

Most people hate advertising that interrupts the content they’re engaging with. But, audiences are often far more receptive to advertising that is integrated into your content itself. 

If you start making videos that promote other products or establish you as a credible influencer or social media presence, that can be a way of attracting a source of income from companies that want you to help sell their products. 

Seeking sponsorship from a larger company can be lucrative, but you walk a fine line between selling products and annoying your audience. 

The same goes for affiliate marketing. Often, you can organize or structure your small business around being an affiliate for another company. This means that you are essentially becoming a freelance part of their marketing team, where you are rewarded by the company for bringing new customers in. 

Selz affiliates work hard and earn rewards for sharinng what Selz does with small businesses

Creating digital downloads that boost your affiliate sales can be a powerful tool, but to work well, you need a large audience. If that’s you, the Selz Affiliate program can be a great place to start growing your affiliate business. 

Where to start?

All you need is an ecommerce platform to list your products, some elbow grease, and some digital products that add value to your customers’ lives. Once you’re there, you’re on the way to growing your small business ROI.

About the author

Thomas Wells

Thomas Wells is a Content Marketing Lead at Selz, an ecommerce platform for businesses of all sizes. You can learn more about ecommerce, as well as how to get started with your own ecommerce business at selz.com.