6 Reasons Why You Need to Sell Information Products

January 26, 2009 - Written by Gyutae Park  

A common question many Internet marketers have is, “what do I sell online?” In fact, it could be a question you’re asking yourself right now – especially if you don’t already have an established business. What’s the best way to make money online? Is it through selling advertisements on your blog? Selling collectibles, jewelry, or sporting goods? Providing consulting services? With unlimited opportunities and countless ideas being pushed every day, it’s no wonder why Internet entrepreneurs and marketers are always so confused.

So what’s the best product to sell online? Without a doubt, it’s information.

knowledgeIn this digital age, knowledge is power. Having the right information means better higher-paying jobs, more profitable entrepreneurial business ventures, and possibly even a better golf swing (or whatever your hobby of choice is). People want the benefits of knowledge and spend trillions of dollars each year on education (e.g. college degrees, books, and training programs). Don’t you think it’s time you grab a piece of that action?

I know what you’re thinking. “What kind of knowledge do I possibly have to offer that people would pay for? Can’t they just get everything they need for free online?” While it’s true that there is an abundance of free information on the Internet, it doesn’t mean people aren’t willing to invest in gaining knowledge. In fact, when it comes to valuable information, people expect to pay. There’s a much higher perception of value for information products that are easy to read, well organized, and come from industry experts.

Still not sold on the idea? In this first post of a 3-part series, I’ll describe the many benefits of selling information products. In the following installments I’ll cover different ideas about what you can create using various platforms and how you can market your info products for maximum gain. Are you ready?

1. High perception of value

How much is the new Apple MacBook worth? $1,500? What about a new BMW car? $40,000? While physical products are priced according to their intrinsic worth, knowledge is a little bit different because its value is a lot more subjective. For example, how much would you pay for a business tip that doubles your revenue? How about a ballroom dancing training course that will help you get the woman of your dreams? An exercise program that will make you look great and add years to your life? People want solutions to their problems and tools to achieve their hopes and dreams. Provide this sort of knowledge and people will throw obscene amounts of money at you. The right information has an extraordinarily high perception of value – something that you should strive for and take advantage of in your business.

2. Extremely low startup costs

Unlike most other businesses that require a lot of capital to start up, all you need to start up an information business is a unique idea, a brain, and a computer. Information products have very little expenses which is great if you’re just getting started. The downside to this is that there will be a lot more competition, but it’s nothing you can’t overcome as long as you stay focused and work hard to provide value to your customers. Don’t be held back by worrying about the cost of things like inventory, shipping, etc. You don’t need more than $20 to create your own information business today.

3. Huge profit margins

Ok, put points 1 and 2 together – high value and low cost. What do you get? Absolutely huge profit margins. Info products are so effective because the majority of revenue is pure profit. This means you can pump more money into marketing and advertising to make even more sales. At the end of the day you have a solid stream of revenue and a stable business model that doesn’t fluctuate depending on inventory costs, gas prices, advertising rates, etc.

4. Do work once, make money long term

Another big benefit of information products is that you only need to do the work once. Unlike consulting where you’re only paid after performing customized service, information products can be packaged and sold over and over again long after they’re first created. Of course you should still aim to grow your business in new ways, but what’s better than doing work once and being paid for it forever?

5. Easy distribution with rich media formats

Information products are perfect for the Internet. With the emergence of rich media formats (video, audio, pdfs) and distribution channels like email and RSS, creating and sending out products has never been easier. You can even automate the process so that customers easily attain the digital products that they buy without any cost or work on your part. How awesome is that?

6. Zero competition

A lot of e-commerce sites compete on price and customer service because they sell the same exact products as everyone else. However, with an information business, you literally have zero competition because you sell your own unique product that doesn’t exist anywhere else. Although there may be similar products out there in your niche, people buy from you because of your reputation, your experiences, and your unique value proposition. You never have to compete on price because only you can sell your product (along with your affiliates).

It doesn’t matter whether you’re a new aspiring Internet marketer or someone who already has an established Internet business. You can benefit from incorporating information products into your business model. Are you selling the benefits of knowledge to your audience yet? What other benefits of selling information did I miss?

Look out for part 2 of this information product series. I’ll describe to you in greater detail how you can come up with your own information products using the various tools out there.  Stay tuned.

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Comments

30 Responses to “6 Reasons Why You Need to Sell Information Products”

Eyal Sela on January 26th, 2009 Subscribed to comments via email

I agree.
It is a very smart idea to leverage your knowledge that way. One of the thing that most effected me (and related to that post) is the notion that the process of creating a product is a product by itself. That mean that the knowledge you gain is in itself valuable for others, and that you should use it just as you would use a product you created.

I also think that not all knowledge and information you gain should be sold. Sharing can benefit both you environment and you in numerous ways beside money.

Great post.

Gyutae Park on January 26th, 2009

Hey Eyal, thanks for the feedback. As for your comment, “the process of creating a product is a product by itself”, I’d have the agree. The beauty of information products is that everyone has unique experiences that they could potentially share. Sure time and attention are limited for potential customers, but you’ll always have people interested in what you have to offer.

 
Kevin Njoroge on January 27th, 2009 Subscribed to comments via email

I like the idea of leveraging your knowledge.In most cases what you know no matter how little might be what someone is desperate to find out there You just might not know until you do keyword research.
There is joy in sharing the little you know with the world while it at the same time put food on your table.
If you have read “rich Dad poor dad” you might have seen this:

“Land was wealth 300 years ago. So the person who owned the land owned the wealth. Then it was factories and production, and America rose to dominance. The industrialist owned the wealth. Today it is information. And the person who has the most timely information owns the wealth”
Chapter 5 “Rich Dad Poor Dad”

 
 
Daehee on January 26th, 2009

Hi Gyutae, great post. I just released an ebook yesterday, revealing our strategies for winning the Google Online Marketing Challenge. Great feedback from buyers so far. Check out the website at http://www.gomchabook.com.

Gyutae Park on January 26th, 2009

Hey Daehee,
Congrats on the new launch! And big props to you for winning the Google Online Marketing Challenge. That’s definitely an accomplishment to be celebrated. As for your book, I think it’s severely underpriced at $15. Anything under $47 and people will think of it as a commodity. You can raise the perceived value by raising the price. That’s valuable information – so sell it like it is!

Daehee on January 26th, 2009

I have to consider that my target audience is students. I lowered pricing after fielding questions to several students not just in the US but in Europe and Australia.

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Gyutae Park on January 26th, 2009

Hm, I still think that the price is too low. Lowering the price means more people will buy it – which then lowers the value of the book since it loses its competitive advantage (it is a competition after all). I think it’s better that you double the price and have half the customers than to make it readily available for all. Just my thoughts but I could be wrong. Let me know how it goes.

 
 
 
 
Will Lowrey on January 26th, 2009

I agree with the idea – but I think it can be misleading for people. Yes – making and selling information products is great. Making your own has the highest profit margins.

However, I think the message you give is that it is easy to create and sell your own product. The creating isn’t too hard, but does require good, hard work. The selling though – that requires even more work. I would be interested in hearing how many products people sold of their first info product. How successful was the first launch?

Gyutae Park on January 26th, 2009

Hey Will,
Sorry if I was misleading in the post. It’s really a given that this stuff takes a lot of time and hard work. Anything worthwhile usually is.

In my next posts in the series, I’ll give some advice on how to create information products and how to market them. Hopefully, that’ll clear things up for you.

 
 
Cheap Mobile Calls on January 26th, 2009

Like the sound of that idea. you have to have your wits about you when selling information. Also, to get a good product, your English has to be close to perfect, and will often have to get someone to proof-read your work.

If you’ve got the tools and knowledge to do this, then go for it. Think of those huge profit margins!

Gyutae Park on January 26th, 2009

The biggest thing holding people back usually is the idea. They don’t know what kind of info product to create and sell. Once you have that killer idea though, it’s really just a matter of execution – which is another beast in itself. Information is profitable, but only the strong-willed can succeed.

 
 
kevin on January 26th, 2009 Subscribed to comments via email

It is absolutele true that information is wealth in 21st century.I cant agree more

Gyutae Park on January 26th, 2009

Thanks Kevin. So what are you doing to create that wealth?

Kevin Njoroge on January 27th, 2009 Subscribed to comments via email

Thanks Gyutae Park for your feedback.I appreciate your question.Well, concerning what I am doing right now ,I am doing the finishing touches to my website which I am launching later this week

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Gyutae Park on February 3rd, 2009

What kind of website? Are you selling information products?

 
 
 
 
Chris on January 26th, 2009 Subscribed to comments via email

There’s a hopeful note in this post for the community. Like many industries that are poised to reap the benefits of the online world. Being a newcomer to corporate blogging/SEO, my only concern is that the “right” people find me.

 
Jared O'Toole on January 26th, 2009

I totally agree.

People can copy a product, there will always be rip-offs. However no one can really copy your passion for a subject. Your teaching style is something that you can really make remarkable.

People can copy what your teaching but can they really distribute it the way you do. That’s where people will pay big money and will spread the word about your stuff.

Kevin Njoroge on January 27th, 2009 Subscribed to comments via email

It is true Jared;very true.People will always rip-offs of your product but never your passion.If you like what you are doing you will never lack ways to better your delivery.That way you will set yourself apart.
In my opinion also if you remain focused and continually brand yourself as an expert in your area of expertise you are bound to overcome any competition.

 
 
Donny Gamble on January 26th, 2009

The only thing that I really don’t like about information products is that there is a pretty high rate of refunds. People like to take too much advantage of the 30 day guarantee even if they like the product. They will read the product, like it, and then ask for a refund

Gyutae Park on February 3rd, 2009

Unfortunately, this is probably true.. but only a small percentage of people do it. It’s like click fraud – it sucks but you know a percentage is going to do it no matter what. Might as well take the hit and focus on the customers that stick with you.

 
 
Blogguebo on January 27th, 2009

Absolutely agree. Great post Gyutae. Waiting for the next two other posts. 🙂

Gyutae Park on February 3rd, 2009

The other two posts are up now. Check them out as well and let me know what you think. Hope you like them!

 
 
Sai Seemac on January 27th, 2009 Subscribed to comments via email

Really It a clever plan to influence your information that way.

I also think that not all knowledge and information you gain should be sold. Distributing can benefit both you environment and you in several ways beside money.

 
Proven Online Business on January 27th, 2009

Selling information products is a great way of making money online. Let me give you a personal example:
I came across a fellow Internet Marketer at an event last summer and found out that he sells career guides information products through his ‘How 2 Become…’ brand. I contacted him the following week and proposed to write a product for him to put on his website. He agreed and I wrote an 80 page ebook on ‘How 2 Become an Investment Banker’ (a previous occupation of mine). He put the product on his high traffic website and we split the sales 50:50 (although I own the FULl copyright).
See it doesn’t take much to get your product online – just a bit of ingenuity.

Gyutae Park on February 6th, 2009

Very cool, thanks for sharing that story. How has that deal worked out for you? Was it just a one-time thing or do you plan on partnering up with the guy for more work ?

 
 
blogger hacks on January 27th, 2009 Subscribed to comments via email

Although i agree about every point discussed in the article i would still think a lot before selling out such products.Possibly because isnt there too many of them already there providing such services ?

Gyutae Park on February 6th, 2009

There are already a lot of info products out there, but that doesn’t mean you can’t sell your own. The beauty of information is that you make it unique. Your personality and your knowledge are both assets that no one can replicate.

 
 
Classifieds on January 29th, 2009 Subscribed to comments via email

I agree with this completely. Info products are great ways to make money and many people will be interested in learning something new. You just have to have a great idea and write unique content.

 
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