Do you have this desire to turn your creativity into a thriving online business, and you’re eyeing the vibrant world of Etsy? Have you spent hours doing research on how to sell digital products on Etsy? In this guide, we’ll walk hand in hand through the process of getting started in the world of digital products. From picking the perfect niche to setting up and promoting your shop, making sure you follow all the steps from the beginning will increase your chances of success as a new Etsy seller.
Back when I started my Etsy journey, I spent hours researching how to sell digital products on Etsy. I read dozens of articles and watched hours of YouTube videos.There is actually a lot of very useful and free information out there and there are also many courses and ebooks available. I never bought an ebook because I am more of an empirical learner.
In this guide, I’m summarizing what I have learned from my own research and from my actual experience selling digital products on Etsy. If you are looking for enough guidance to get started with a good solid base but without committing to buying a course or eBook, this is a great place to start.
So, gather your ideas, fuel your passion, and let’s dive into the world of selling digital downloads on Etsy. Let’s make it happen!
Table of Contents
What Are Digital Downloads?
Before we delve into the process of selling digital products on Etsy, let’s ensure we’re on the same page about what, exactly, digital downloads are.
Simply put, these are files or content that can be electronically transferred from the seller to the buyer, eliminating the need for a physical product and shipping. It could be anything from stunning art prints and beautifully designed planners to insightful eBooks and customizable templates.
Think of it this way: if you can create it on your computer, chances are it can be transformed into a digital download. This opens up a world of opportunities for creators across various fields, whether you’re an artist, writer, designer, or someone with a unique skill to share.
The beauty of digital downloads lies in their accessibility. Buyers can instantly acquire and enjoy your creations with just a few clicks, and you, as a seller, can reach a global audience without the logistical challenges associated with physical products.
Why You Should Consider Selling Digital Downloads on Etsy
But why Etsy, you ask? And why digital downloads?
1. It’s a passive income source: Once your digital products are listed and your shop is set up, your Etsy shop becomes a powerful source of passive income. Your creations can be continuously accessed and purchased by customers, providing you with a steady stream of revenue without the need for active involvement.
2. You don’t need an audience to get started: Etsy’s established platform comes with a built-in audience actively seeking one-of-a-kind items. If you were to start your digital shop on your own website, you will need to build a following to bring traffic to it or invest heavily in ads. With Etsy, as long as you did the market research to validate demand, people will find you even as a new shop.
3. Global Reach: With a massive and diverse user base, your digital products have the potential to reach customers globally, which can increase your sales potential.
4. Minimum investment: You don’t need a big initial investment to get started. I’d recommend you invest in a few design and market research tools, but the investment is still under $20.
5. Small selling fees: Etsy charges $0.2 for every listing you create and a 6.5% fee of the total order amount. This investment is a small price to pay for the exposure and potential sales you gain. The fee structure is transparent, allowing you to calculate and incorporate it into your pricing strategy, ensuring a fair balance between profit and investment.
6. Etsy takes care of processing payments and sales tax: The above fee gives you convenience. You don’t have to worry about processing payments or changing the right percentage of sales tax depending on where your customer is shopping from.
7. User-Friendly Interface: Setting up shop on Etsy is a breeze, even if you’re new to the world of online selling. The platform offers intuitive tools and a user-friendly interface that simplifies the process of showcasing your digital downloads. You can focus on what you do best – creating – while Etsy takes care of the technicalities.
Types of Digital Products you can Sell
There are many different types of digital products to choose from, some more popular than others. Here, I have tried to put together a very comprehensive list of the most popular product types. These are just product categories, we will talk about niches later.
1. Digital Art: High-quality digital art prints, illustrations, and designs that customers can instantly download, print and adorn their spaces with.
2. Planners and Organizers: Digital planners, calendars, and organizers tailored for various purposes – be it daily productivity, fitness tracking, or meal planning. These are usually PDF files meant to be used with a note taking app such as GoodNotes, OneNote or Notability.
3. Printables: This is a very broad product category. A printable could be any PDF or JPG file that people can download and print. Think products like printable party invitations, flash cards, daily planner or even bingo games.
4. eBooks and Guides: You can share your knowledge and expertise through digital books and guides. It could be a comprehensive how-to guide, a captivating novel, or informative e-books on niche topics.
5. Notion Templates: Notion is a productivity and note-taking web app. Notion users are looking for templates tailored for diverse needs, whether it’s project management, goal tracking, or personal planning.
6. Spreadsheets: Offer spreadsheet templates for budgeting, financial planning, and other organizational needs, catering to a wide range of users. Spreadsheets can be designed in either Excel or Google Sheets, although the latter is generally more popular on Etsy.
7. Photography Presets: Appeal to photographers and social media enthusiasts with downloadable presets. Craft filters and presets that elevate photography, offering a quick and effective way for users to enhance their images with your signature style.
8. Fonts: Design unique fonts that add character and flair to a variety of creative endeavors. Graphic designers and web designers could be some of the potential customers.
9. SVG Cut Files: Intricate patterns and shapes that crafters can use with cutting machines for projects like vinyl decals, paper crafts, and more.
10. Mockups: Print on Demand businesses are looking for mockups to showcase their designs. A mockup is basically a picture of a product in a solid color (without a design). Print on Demand businesses can then add their designs on this blank canvas to showcase their designs.
11. Web themes: Offer customizable website themes and templates for individuals and businesses looking to establish a unique online presence.
12. Canva templates: Canva is a very user friendly graphic design web app (we are going to be using it as part of this guide). Canva templates are ideal for products that customers would usually want to customize like party invitations, banners, or even restaurant menus.
Understanding the Potential Niches
Now that we have a better idea of the different types of digital products, let’s explore some potential niches for each product category. And if you are wondering what a niche is, it is simply the segment of the broader market that your business is trying to target.
For example, you could decide to sell digital art, but that is too broad of a target market. While you can certainly make digital art for different niches, I believe that at least in the beginning it is helpful to focus on a niche to both gain more credibility as a niche expert and to simplify the creative process.
Let’s go through the above 12 product types and explore some niche ideas for each one.
1. Digital Art: This can be a very broad market, so I would definitely suggest niching down if you are thinking about selling digital art. This is a product category where it will be especially important to do some good market and keyword research to make sure you have a chance to rank in the Etsy results (more on this later).
Niche Ideas: Abstract art, Y2K aesthetic, minimalist designs, art for wine lovers, vibrant colors.
2. Planners and Organizers: Do you really need to choose a niche? Can your niche just be digital planners? Well, yes, but the way I see it, even if you offer digital planners for different purposes like daily life, work, fitness, mental health, there is still a specific design aesthetic you are going for which would mean you do have a niche (people who would be searching for that kind of design)
Niche Ideas: Digital planners for business owners, dark academia digital planners, digital planners for men, digital planners for students.
3. Printables: Again, a very broad category where you would certainly want to focus on a niche.
Niche Ideas: Home organization printables, printables for parents, flashcards, personal development printables, coloring pages
4. eBooks and Guides: Your choice of niche here might be more obvious for this product type and it is probably going to depend on your life and professional experiences.
Niche Ideas: Travel guides for different destinations, cooking ebooks, DIY Home Improvement guides
5. Notion Templates: Similar to digital planners, you can think about niches for this product in terms of different purposes for the templates or different design aesthetics.
Niche Ideas: Personal finance template, project management, personal organization and productivity
6. Spreadsheets: You could certainly just offer any possible kind of spreadsheet in your store, but it is still helpful to think about different niches that could be interested in buying spreadsheet templates.
Niche Ideas: Personal finance, business management, productivity, organization spreadsheets for teachers
7. Photography Presets: Another specialized product that could by itself be your niche. But here are some ideas of niches or sub-niches.
Niche Ideas: Vintage film aesthetic, travel adventure vibes, minimalist and clean edits, seasonal and holiday presets
8. Fonts: You could start focusing on a particular style of font and later expand to offer multiple styles.
Niche Ideas: Gothic and medieval fonts, art deco typography, cursive calligraphy fonts, brushstroke fonts
9. SVG Cut Files: This is a very interesting product category to explore. You could design SVG files for any kind of interest or theme.
Niche Ideas: Party planning SVG files, SVG files for home decor, SVG files for accessory design, floral designs
10. Mockups: When trying to find a niche for a mockup store, you could think about different product types that you want to photograph or different vibes/themes you want to portray in your pictures.
Niche Ideas: Mockups for apparel, mockups for stationery products, fitness themed mockups, seasonal mockups
11. Web themes: One way to think about niches here is to try to target a specific type of customer, what kind of website are they trying to design?
Niche Ideas: e-commerce stores, corporate and business websites, personal blogs
12. Canva templates: There is a plethora of potential niches in this space. Keyword research is going to be very important to identify low competition niches but for now here are some ideas.
Niche Ideas: Branding and logo kits, event promotion and invitations, newsletter and email campaigns, menu designs for restaurants
How to Sell Digital Products on Etsy in 6 Steps
Now that we know more about the different types of digital products and have explored some potential niches, let’s get into how to actually start your digital downloads store on Etsy. Follow these six steps to navigate the process and establish a successful presence in the digital marketplace.
1. Market research: Know Your Audience and Competition
Before diving into creating your digital products, you should conduct thorough market research. Identify your target audience, understand their preferences, and explore the competition within your niche.
Make a list of at least 20 niches or product types
Begin your market research by brainstorming and listing at least 20 potential niches or product types. Consider your interests, skills, and areas where you see a demand. What kind of professional or personal experiences do you have that could be turned into a digital product? This initial step sets the stage for a thorough analysis of potential markets.
Conduct Keyword Research for Each Niche Idea:
Once you have your initial list of niche ideas, we will do keyword research for each idea. For this, we will need a keyword research tool. My favorite tools are Sale Samurai and Erank, but you can also consider Marmalead or Everbee. Most of them offer a free trial period but even after that you can get a monthly membership for less than $10, so it’s totally worth the investment.
Start by writing down the niche name or a keyword related to the niche. These keyword tools will show the metrics for many related keywords and you can start creating a list of good keywords. What is a good keyword? We are looking for keywords that have high search volume and low competition. Although, depending on the niche this may be hard to find, I like to save even low search volume keywords if they are low competition.
Let’s look at an example using Sale Samurai:
Let’s say we want to sell Invitation Templates for Canva. We’ll search for “invitation template canva”. We can see that the canva template invitation keyword is not very attractive because search volume (29k) is a lot lower than competition (133k)
However, once we get to page 3 we start to see some interesting keywords such as princess invitation canva and graduation invitation canva. I’d stay away from Encanto and Barbie invitations as they will be infringing trademarks.
Perform Competitor Research for Each Niche Idea:
Investigate the competitive landscape for each niche on Etsy. Identify top-performing shops and listings within the selected niches. Analyze their product offerings, pricing strategies, and customer engagement. This is also an opportunity to identify interesting keywords competitors may be using, but most importantly, in this step we are looking to validate growth potential in the niche. If all the top sellers are older and established stores, then this is telling you that it may be harder to break into this niche. If, on the contrary, you can find a few newer stores (less than 1 year old) that are ranking in the Etsy search results and doing quite well, then this is a sign that this may be a better niche for a new store.
Compare Metrics and Narrow Down Your List:
Based on the research you have done so far, it is time to narrow down your niche list. Perform a comparative analysis that includes key metrics for each niche such as search volume, competition level, number of good keywords found, number of new stores with sales above $x.
Choose the top 5 niches (or less) before moving onto the next step.
2. Pick your niche
Now it’s time to pick the final niche. For your list of remaining 5 niches, ask yourself these questions.
- Can you create a superior product to what is currently in the market? Do you have a unique selling proposition?
- Do you see yourself creating dozens of products for this niche? How interested are you in the niche?
- Do you understand the needs and preferences of your potential customers?
- Do you have some cool marketing ideas to promote products in this niche?
- Is the niche likely to have long-term relevance and demand?
Reflect about the above question and choose your final niche. If you are still debating between 2 or 3 niches, just choose the one you are most interested in.
3. Create your products
Once you’ve identified your niche and conducted thorough market research, the next step is creating digital products that not only meet the demands of your target audience but also reflect the quality and uniqueness that will set your Etsy shop apart. Here are three options to consider for creating your digital products:
Get Pre-made Digital Products:
If you’re looking to kickstart your Etsy shop quickly or want to explore niches that may be outside your primary skill set, consider sourcing pre-made digital products. Platforms like Creative Market, Pretty Grafix, Etsy itself, or other digital marketplaces offer a plethora of pre-designed assets, templates, and resources. However, ensure that these products come with commercial use licenses to avoid copyright issues. While this option allows for a speedy start, customization and personalization will be limited.
Design Digital Downloads Yourself:
If you possess design skills or are willing to learn, designing digital downloads yourself offers the advantage of complete creative control. Software like Adobe Creative Cloud , Canva, or even Excel can be employed to bring your vision to life depending on the type of product you want to sell. Designing yourself allows for a personalized touch and the ability to tailor products to your unique style and brand.
Hire a Professional:
If you have a specific vision but lack the design skills or prefer to focus on other aspects of your Etsy business, hiring a professional designer can be a strategic investment. Platforms like Fiverr, Upwork, or even local freelancers can assist in bringing your ideas to live. Clearly communicate your expectations, provide detailed briefs, and collaborate with the designer to ensure the final product aligns with your brand and resonates with your target audience.
4. Set Up Your Etsy Shop
Now you are ready to create your Etsy shop! Establishing an appealing and well-crafted Etsy shop is vital for attracting potential customers and building trust within the digital marketplace. Follow these steps to create an inviting storefront that reflects your brand identity:
Create an Account
Obviously, you first need to sign up for an account. Provide the necessary details, including your email address and a secure password. You will need to choose a name for your shop in this step. If you already have one in mind, go ahead. If not, we will talk about naming your shop in step 2. You can always change your Etsy shop name later.
Name Your Shop
Your shop’s name is the first impression you make on potential customers. Choose a name that is not only distinctive but also reflective of your niche and the products you offer. Consider the visual and auditory appeal of the name, as it will become an integral part of your brand recognition. I recommend using Namelix to get some inspiration on shop name ideas.
Shop Description
Craft a compelling and informative shop description that introduces visitors to your brand and the essence of your digital products. Use this space to convey your passion, expertise, and what makes your shop unique. Highlight your commitment to quality, customization options, or any special features that set your digital downloads apart.
Logo and Banner
A logo adds a professional touch to your Etsy shop and contributes to brand recognition. Use Canva (or any other design tool) to create a visually appealing logo and banner that encapsulate the aesthetic of your brand. Use consistent colors, fonts, and imagery across your logo and banner to create a cohesive visual identity..
Set Shop Policies
Finally, define clear and transparent shop policies to establish trust with your customers. Outline details such as payment methods accepted, processing times, and any specific terms related to digital downloads. Well-defined policies contribute to a positive customer experience and minimize misunderstandings.
Key Shop Policy Points:
- Payment and refund policies.
- Licensing terms for digital downloads.
- Communication expectations with customers.
5. List your products
It’s time to list your first product! The way you present your offerings plays a pivotal role in attracting and converting potential customers. Follow these steps to optimize your product listings effectively:
Pictures and Video for Your Listing
Visuals are key to grabbing the attention of potential buyers. Include high-quality images that showcase your digital products from various perspectives. The type of pictures you should include will depend on the product type. For example, if you are selling digital art, you could showcase how the piece of art looks once it is printed and framed using different settings or backgrounds. If you are selling a digital planner, provide a sneak peak of some of the pages. If applicable, consider creating a short video that provides a closer look at your product in action. This can be particularly important for products that customers will edit or interact with through a PC such as editable Canva templates or spreadsheets. In any case, the best way to know what kind of pictures or videos to include is to look at what the competing products with the highest conversion rates are doing. For this, Erank can be very helpful to estimate conversion rates of other products.
SEO Optimization: Title, Description, and Tags
Improve the discoverability of your listings through effective SEO optimization. Craft a compelling title that includes relevant and low competition keywords associated with your digital product. Make sure to also include keywords in the description, but remember to provide detailed information about the product’s features, potential uses, and customization options. Finally, Etsy lets you use up to 13 tags. Make sure to use them all! Incorporate a mix of broad and specific keywords to enhance search visibility.
SEO Optimization Tips:
- Research and include keywords that your target audience is likely to use.
- Use clear and concise language in your product title and description.
- Utilize all available tag slots and experiment with variations.
- Regularly update your SEO strategy based on changes in trends or customer preferences.
Product Pricing
Set a competitive yet profitable price for your digital products. Consider factors such as the effort invested, market demand, and the value your product provides. Be transparent about what is included in the purchase, whether it’s additional files, future updates, or customer support.
Pricing Strategies:
- Research the pricing of similar products in your niche.
- Consider offering introductory pricing or bundling options.
- Factor in the cost of your time, skills, and any resources used in creation.
- Regularly review and adjust your pricing based on performance and market trends.
6. Promote Your Etsy Store
A good SEO optimization strategy can bring you traffic from Etsy search, but if you want to take your business one step further, you should be promoting your store to bring even more traffic. Explore diverse marketing strategies, including Etsy ads and social media platforms, to boost visibility and engagement:
Etsy Ads
Utilize Etsy’s advertising platform to increase the visibility of your digital products within the Etsy marketplace. Etsy Ads allows you to create targeted campaigns by setting a daily budget and bid for placement in Etsy search results and on other Etsy pages starting at $1 per day. Optimize your ad strategy by monitoring performance metrics, adjusting bids, and refining your targeting options.
Social Media: Pinterest, TikTok, Instagram
Leverage the power of social media platforms to showcase your digital products, engage with your audience, and drive traffic to your Etsy shop. Each platform offers unique opportunities for visual storytelling and audience interaction. I have personally tried both TikTok and Pinterest and had different types of results. TikTok is great at bringing you a few customers every time you post a video but you need to keep posting all the time. With Pinterest, you can keep adding pins and sometimes nothing happens but all of a sudden one pin takes off and you can start getting traffic to one specific listing.
FAQ
1. Is it worth it to sell digital downloads on Etsy?
Selling digital downloads on Etsy can be highly rewarding for many creators. If you have a passion for creating digital content and can identify a niche or target audience, Etsy offers an excellent opportunity to showcase and sell your creations.
2. Can you make a lot of money selling digital downloads on Etsy?
Yes, it is possible to generate a substantial income selling digital downloads on Etsy. Many sellers have found success by creating high-quality, in-demand products and implementing effective marketing strategies. However, success often requires dedication, continuous improvement, and honestly a little bit of luck. Consistency in creating new products, optimizing listings, and engaging with your audience can contribute to increased sales and revenue over time.
3. How do I handle customer support for digital downloads on Etsy?
Avoid customer support requests by providing clear instructions in your product listings and shop policies. If you get customer questions, Etsy’s messaging system makes it easy to handle.
4. Are there any legal considerations when selling digital products on Etsy?
Yes, be aware of copyright laws, licensing agreements, and intellectual property rights. Clearly define the terms of use for your digital products, and ensure compliance with Etsy’s policies and guidelines.
5. How do I handle taxes as a digital product seller on Etsy?
Understand your local tax regulations and comply with Etsy’s requirements. Etsy may collect and remit certain taxes on your behalf, but sellers are responsible for reporting income and paying applicable taxes.
Final Thoughts
Wow! This article ended up being longer than I thought it would be. I hope you found it educational and easy to follow. I almost wrote a whole ebook in the process, which I may consider doing in the future. If you have any questions, please comment below and I’ll be happy to answer.