Digital products are a powerful way to share your expertise and generate passive income. Downloadable patterns, PDF guides, and gated video tutorials can make great additions to your existing product offerings and create additional touch points between you and your customers. (If you are wondering about what kind of digital product to create, head over to the Artcademy blog to learn more about developing your ideas.)
While digital products can be an excellent additions to your business, they generally don’t follow the same pricing rules as the physical products you might carry in your online shop. Pricing a digital product is not like pricing a physical product; you can’t use a formula such as total cost of supplies + wage per hour = price. Instead you need to take a slightly different approach.
What is the first price that comes to mind that you believe you could safely sell your product for? Write it down and now you are going to raise it 20%. This instinct-based approach to pricing is a helpful starting point because it helps you develop some confidence as you go along. If you are still not sure how to determine the price of your product, here are a few questions to guide you:
What makes this product unique?
What are your competitors selling similar products for?
Who will buy it and what is their ability to pay for it?
Once you answer these, you’ll have even more information on the best price for your digital product.
Additional Tips on Pricing
1. Different prices attract different customers, think about the price point when you put something up for sale.
2. If you save people time, they will pay you. Yes, it is really that simple.
3. There are many ways to price a product and not every pricing strategy is right for all products.
Make sure you do your research and sometimes it’s okay to go with your gut. If you want to learn more about developing your ideas check out the Artcademy blog or get comprehensive training from April Bowles Olin in Create Digital Products that Sell While You Sleep.
Are you ready to start selling your handmade craft projects?
Download our free PDF: Etsy 101: A Guide to Getting Started! This comprehensive collection of notes, worksheets, and slides from Marlo Miyashiro’s class, Etsy 101: Launch Your Handmade Shop gives you the tips and insights you need to launch a successful Etsy shop!