Are digital course more scalable than other passive income products?

Hello! And welcome to another episode of the Simplify Your Sales podcast. This is part 1 of a 5-part series of bite-sized solo podcast episodes where I’m going to get real with you about what goes into creating a digital course-- the practical elements like time commitment, revenue scalability, that sort of things vs. other digital products…

…. and hopefully have you walk away with a better understanding of if a course IS a good fit for your goals or if you would be better going with something else like a printables shop or templates or something that aligns better with your personal business goals. There’s truly no right or wrong answer here-- I just want to give you a practical approach to making this decision. 

I’ll be honest and say this started out as 1 episode, but 7 pages in a Google doc later I knew we had to break it down so I wasn’t overwhelming you with everything all at once. And so you weren’t having to listen to a 3 hour podcast episode. 

So again, this is PART 1 and we’re kicking things off by talking about scalability-- and more specifically REVENUE scalability. How easy is it to take the digital product (or products) you create and hit your revenue goals with it? 

I bring this up first because this is one of those things that sort of gets “lost in the shuffle” when people are trying to decide on what to do with passive income. There are so many options out there-- templates, spreadsheets, graphics, editing presets, swipe copy-- that it’s easy to get overwhelmed and just make a decision based on “what sounds like the most fun.” 

And yes, you should definitely have some degree of interest in what you create, but there also needs to be some practicality here. You need to look at your revenue goals and pick a digital product that supports those goals.  This isn’t a drama-based decision-- this is a DATA BASED ONE.  

Get clear on YOUR goals

Okay, so what are your goals with passive income? Is it to replace your current 9-5? Supplement an Etsy shop so you can work less on it? Bring in an extra $2K/month while you stay home with the kiddos? 

There’s no wrong answer here-- it’s going to be unique to you + your situation. But you need to get clear on what your goal actually is-- and write down an actual monthly revenue number for it if at all possible. 

We need to get clear on this BEFORE you ever get started on product development because we need to make sure you choose a passive income product that can realistically meet those goals.

Let me explain what I mean here. 

The average printable art piece on Etsy is $5. And with a 2-3% conversion rate (which is simply the number of people that visit your website or store that actually purchase)-- a 2-3% conversion rate is pretty standard for digital e-commerce products-- that means for every 100 people that visit your shop, 2-3 of them will purchase. 

So you can use that information to take a look at your current monthly visitors and see what kind of revenue you can expect from that. For example, if you currently have 2,000 people/month visiting your shop, times that by a 2% conversion rate and you’re looking at 40 or so sales/month-- or about $200 in revenue from a $5 printable product. 

Now on the flip side, if you’re selling a $97 digital course-- which is the minimum you’ll want to charge for a product like that--you can plan on a 1-3% conversion rate. So very similar numbers here. But with 2,000 people/month visiting your store, even if only 1% convert into actual customers, that’s 20 sales. And 20 sales of a $97 course is almost $2,000. Same amount of traffic, even LOWER conversion rate + number of sales, but you’re earning 10x the amount of revenue.

So if your goal is to earn an extra $1,000/month in passive income sales from a digital product, you can plan on selling 200 $5 printable-- which means you’re looking at about 10,000 visitors/month to your shop …. Or 10-  $97 courses-- which is only about 1,000 visitors/month to your shop. 

I don’t know about you, but driving MORE traffic is the bane of my existence some days, so I’m going to choose whatever option requires LESS of me driving traffic to get to my goals! Which is why I recommend digital courses for beginners. It may seem like they should “ease their way in” with something smaller, but from a practical, data-based standpoint that is terrible advice because they don’t have the numbers to make any real money from a smaller priced product! 

Now in full transparency-- you can absolutely create a shop full of items that are priced higher than $5 printables. You can create photo editing presets or something that you can sell a bundle of for $27 - $47. There is a lot of wiggle room between a super cheap printable vs. a digital course. 

But the key takeaway here is that you need to be realistic about your current traffic situation and how that is going to impact the scalability of your revenue based on the product you decide to sell. 

Meaning you need to understand that if you’re going to sell cheaper digital products because they seem “easier” to sell-- which is something I firmly believe is a big fat myth and we’ll explore in a later part in this 5-part series of episodes-- but if you’re going to go with the cheaper digital products, you need to look at this from a data-based perspective and realize you’re going to either need a heckuva lot more traffic to reach your passive income revenue goals and come up with a game-plan for making that happen…

…or you need to go the direction of creating a higher priced passive income product-- like a digital course-- put in a bit more time initially to create it, but realize that you’re going to be able to scale your revenue infinitely faster with something priced between $97 - $497 as opposed to a $5 printable-- simply because you need less traffic and less sales to do a lot of damage. 

So again-- no right or wrong answer here-- just some practical food for thought that you can use to get started making your decision on the direction you want to go with things. And if you’re thinking “yeah, it would be great to earn MORE money with LESS people,” and realizing the true scalability of digital courses, then stay tuned for next week’s episode because we’re going to break down the time investment of things-- how much time it REALLY takes to create a course vs. exploring other digital product options. 

And  that’s a wrap! See you next time on the Simplify your Sales podcast!