One of the easiest types of products to sell online is an informational product.
Just about anything you have expert knowledge on can be developed into a guide and sold online. Unfortunately, the vast majority of people selling informational products online do so in the wrong way.
Let's take a look at 3 ways of selling an informational product. The basic way, the better way, and what we call the brilliant way. This last way of selling your product allows you to build a multi-million dollar business out of your product.
The Basic Way
As an active user of online dating sites, Sheryl notices that many men struggle to write a decent introduction and profile to post on a dating site. As a consequence, they get hardly any responses from prospective dates. Sensing a market opportunity, Sheryl writes a 50 page ebook targeted to men on how to market themselves better in the dating market.
She prices the book at $6 and sells it on Amazon.com. She makes $3 per sale as the distributing site, Amazon.com, takes 50%. Selling 100 copies a month, she makes only $300 a month. Later Sheryl also decides to advertise the book herself on Google and Yahoo!. To afford pay per click advertising rates in the busy online dating market she has to increase the price of her book to $15.
At the higher price, Sheryl now sells only 50 copies a month but by selling them on her own and not on Amazon.com she now makes $750 a month. After paying her advertising bills on Google and Yahoo!, she earns an income of around $500 a month. This is good....but far from great. Sheryl could have been a lot more innovative.
The Better Way
Marge writes a book on dating, just like Sheryl, but she knows that selling it online will not bring her much more than $500 a month so she tries something different.
She gives away the contents of her book for free online. She sets up a website dedicated to dating tips. The 50 page book is broken into sections and she designs the site according to search engine optimization rules so she gets a steady stream of traffic from Google, Yahoo!, bloggers and fellow site owners who link to her site.
How does she make money? By giving away her book for free she now has traffic coming to her site. Better yet, this traffic is highly targeted and consists of people looking for dating tips and advice. Marge makes money by reviewing and recommending various dating sites to her audience.
Since the online dating industry is ultra-competitive, many websites will pay Marge affiliate fees between $10 and $50 for every customer she sends to them.
By offering free advice, her audience comes to trust her and to appreciate her honest reviews. She in turn makes money every time a visitor signs up for a site she reviews.
The Brilliant Way
Quincy's idea was to help people learn to play their favorite songs on an acoustic guitar in a fun, simple, and intuitive way.
Quincy told us that he had never seen any product online that made learning to play guitar fun and easy. He said, "Every guitar instruction book and DVD on the market is not teaching people how to start playing their favorite songs, they all focus on music theories and practice lessons!"
That's when he decided to launch iPlayMusic.
He decided to completely change his approach. He realized that if his beginner book and DVD was so successful, why not give some of it away for free? As a small business, it is very hard to get people to trust us and buy from us.
However, it is far easier to give them something for free, earn their trust and then convert them into paying customers later. Plus, giving away some lessons would cost us next to nothing since ebooks and videos could be formatted into easy downloads.
He added free demos and created a free online course that customers received over two week span. He also made our instructional videos available through iTunes, which got him a lot of publicity.
He then went back to creating more content and started working on the next volume of lessons to help beginning guitar players take it to the next level!
In addition to expanding his instructional "Learn to Play Guitar" lessons he also created detailed how-to videos teaching people how to play some popular guitar songs.
Lastly, he came up with the idea to create a "Beginner Guitar Bundle" that combined his lessons with an acoustic guitar.
Since he doesn't make guitars, he contacted a leading guitar manufacturer and struck a deal where he was able to source guitars at over 65% less than retail price.
He now had a $129 product with a profit margin of over $65 per order. This time, all the changes he made worked and iPlayMusic soon reached sales of over $1,000 per day. He hasn't looked back since.
So as you can see, there are 3 very different ways to market an informational product online. The last thing you want to do is follow the crowd and sell your product on Amazon.com. Although Amazon.com is the easy way out, it's not very effective and you won't make the money you're hoping for.
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