How To Sell Digital Downloads On Etsy 2022: The Ultimate Guide

how to sell digital downloads on etsy

Whether you are a stay-at-home mom, student, or entrepreneur who seeks financial independence you should definitely consider selling on Etsy.

Etsy has revolutionized the entire shopping industry, by creating a huge market for digital products with opportunities for sellers to make a significant income.

If you are looking for the best strategies and tips to effectively sell digital downloads on Etsy, look no further, because in this article we will cover EVERYTHING.

We will talk about why should you sell digital products on Etsy, how much can you make, and how to sell your products effectively.

So without further ado, let’s dive into it:

How Much Can You Make Selling Digital Downloads On Etsy?

As you may already understand, selling digital downloads on Etsy can be profitable. Like in every business, your income on Etsy will depend on the amount of work you are willing to put in.

The more high-quality products you will list, the more likely customers will discover and buy from you. But that’s not it. You also have to be strategic about what products you create, and how you market them.

So how profitable selling digital downloads on Etsy can be?

There are many success stories, of how people made huge amounts of money selling digital products on Etsy.

You can take a look at this video, where the lady called Passive Income Girl in her video demonstrates how she has made over $140,000 selling planners alone.

For another example, take a look at this Etsy seller’s profile:

how much can you make selling digital downloads on etsy

She has listed over 180 digital products, mostly consisting of planners, stickers, and templates, and she has made over 74,000 sales so far! The prices for her products range from around $3 to $14 per item, so you can get an idea of how much money she has made…

Another great example proving how profitable selling on Etsy could be is this single listing:

is selling digital products profitable on etsy

Although by default, Etsy won’t tell us how many sales the individual listing has made, we can use a method to easily calculate the rough figures.

You can later use the same method to estimate how much money each listing has made when analyzing the competition and profitability of a product.

Normally, about only 10% of customers on Etsy will leave a review, so if we do the calculations, this product has been purchased at least 10,000 times for a price of $24.20, and that brings $242,000 in sales just from a single product! Crazy, isn’t it?

There are endless amounts of successful sellers who made significant amounts of money while selling digital downloads.

The platform displays how many sales each seller has made so far, so you can head over to the marketplace and see the figures of the top sellers to get a massive motivation pump!

Why Should You Sell Digital Downloads On Etsy? (Top Benefits)

Selling digital products, especially on Etsy, has amazing benefits that many people don’t even realize. One of the fundamental benefits of a digital product is that it costs nothing to duplicate it.

You don’t have to spare additional resources or materials to recreate the same digital product, and even better – you don’t have to run to the post office every time you generate a sale.

With a digital product, you only have to create it once, for it to potentially be sold hundreds, if not thousands of times.

This attribute of a digital download ultimately creates the chances of passive income, which many entrepreneurs these days live off.

Besides that, there are more benefits and reasons why you should start selling digital downloads on Etsy today:

Huge marketplace: Etsy is a massive marketplace with a big demand for digital downloads. The store had 96.3 million buyers in 2021 alone, and the number is significantly growing every year. Unlike other marketplaces like eBay, or Amazon, Etsy is super a popular source for buying digital items. Since Etsy is already getting massive amounts of visitors every day, you don’t necessarily need to market your products outside the platform.

High-profit margins: The only fees you pay for selling digital products are small Etsy fees. Unlike with a physical product, there’s no manufacturing, inventory, storage, packaging, shipping, and other costs involved when selling digital downloads. This sets the profit margins significantly higher.

Instant download: Compared to physical items, digital downloads are accessible instantly once the customer makes a purchase. There’s no possibility that the item will be delayed, damaged, or lost while in the delivery process. That makes the shopping experience better for customers, and they will be more likely to leave positive reviews, which will bring you even more sales.

Easy to produce: Imagine how many resources and skills you need to create a wedding dress or a wooden TV stand. It’s nothing like that with digital products as you can create them quickly without any special skills or expensive materials. Most of the time, you can do it all with free design software, or by hiring a freelancer for a low cost.

Lasts forever: Digital products do not expire, they don’t break, or get destroyed by thunderstorms or hurricanes. It’s easy to manage them, and you are never out of stock, which is another factor for a positive shopping experience.

Low risk: Etsy only charges $0.20 per listing and 5% of the sale price per transaction. 20 cents per product is the only upfront cost you are committed to paying, and that brings selling on Etsy to the low financial risk business.

What Digital Downloads You Can Sell On Etsy?

There can be plenty of digital product ideas to sell on Etsy.

You can either sell printables or digital-use products, but most of the time people sell items that customers can print at home and use for various purposes.

Here’s an endless list of digital products that are popular among the buyers:

  • Art prints
  • Birthday cards
  • Birthday invitations
  • Bullet journals
  • Business cards
  • Business logos
  • Business planners
  • Cash envelopes
  • Checklists
  • Cosmetic labels
  • Clip art
  • Coloring pages
  • Craft patterns
  • Digital papers
  • Ebooks
  • Embroidery patterns
  • Envelope templates
  • Etsy banners
  • Excel templates
  • Facebook templates
  • Flashcards
  • Fonts
  • Funny cards
  • Gift cards
  • Greeting cards
  • Holiday cards
  • Instagram templates
  • Invitation templates
  • Knitting patterns
  • Lightroom presets
  • Meal plans
  • Notebooks
  • Party banners
  • Party decor
  • Party invitations
  • Party signs
  • Phone wallpapers
  • Pinterest templates
  • Printable games
  • Printable stationery
  • Printable stickers
  • Resume templates
  • Selfie frames
  • Sewing patterns
  • Shower invitations
  • Snapchat filters
  • Spreadsheet Templates
  • Social media templates
  • Stock photos
  • SVG files
  • Sympathy cards
  • Thank you cards
  • Trackers
  • Website themes
  • Wedding signs
  • Wedding invitations
  • Workbooks

The list is endless and there are definitely more product niches apart from what we mentioned. Take time to go through all of these products in order to find what you would like to be creating most.

How To Sell Digital Downloads on Etsy:

sell and create digital downloads on etsy

Selling digital products on Etsy is definitely more than creating a few products and waiting for the sales to pop in.

The successful selling process involves different stages, such as market research, product creation, and most importantly – marketing.

Each of these stages must be considered carefully in order to reap the most benefits of this platform, but the most important step is finding the products:

Finding A Niche:

Finding the right niche for your digital products plays a critical role in your success.

You may have the most fantastic product to sell, but if there’s not going to be enough demand for it, or the niche will be too competitive, you will have a hard time making sales.

That’s why you have to do niche research, which is essentially keyword research.

Your primary goal is to find specific types of products, which are on-demand and are not too competitive.

But the most important thing is to come up with a product that you would be passionate about and love creating. In this way, you would beat the competition, and even create demand for it if you really want to.

All digital product ideas that we have listed are popular enough among customers, and there’s definitely enough money to be made while selling them. However, you will have to narrow them down.

Also, remember that you won’t be married with a particular niche, and you can successfully sell several types of digital products on your Etsy store.

Once you have some niches that interest you, it’s time to do keyword research to find what kind of products you should create within those niches.

Keyword Research:

Keyword research is a process where you analyze different phrases that people search on Etsy, and find the ones with little competition.

The first rule of thumb when doing keyword research – focus on specific keywords.

It’s because selling printable stickers, invitation templates, or workbooks is simply going to be too competitive.

Etsy returns over 200,000 results for the term “printable stickers”, so how do you expect your new printable sticker bundle will be discovered?

As a newbie, instead of focusing on general keywords, you will have to aim for long-tail keywords, that are more specific and consist of 3-5 words.

So instead of creating printable stickers, you may want to create printable stickers for phone cases or printable anime stickers.

When it comes to the actual keyword research process, there are two ways to do it – you can do it for free or with a help of a premium keyword research tool.

The free method obviously costs nothing, but the results will be limited and not that accurate. Whereas with a paid tool, you invest a little bit of money, but you take away some profitable keywords.

Let’s discuss these two options in more detail:

Free Method:

You can start typing your product niche on Etsy’s search, and see what suggestions on the drop-down populate. This will include the most popular terms the customers are looking for on the platform.

For example, if you are planning to create Instagram templates, here are the types of templates people are looking on Etsy:

keyword research etsy

All of these suggestions can be the ideas for your product.

Unfortunately, Etsy will only show 11 related suggestions, and that’s the downside of a free method.

Once you find the search term that hooks your attention, click on it and see how many results it returns. If there are under 3,000 results, this could indicate that the niche is not over-saturated, and you can squeeze in.

Another method to get some product ideas is to head over to Amazon, Pinterest, or Google, and see what people are searching for there. If you find searchable phrases on these platforms, there are big chances that they will be searchable on Etsy too.

Paid Method (Recommended):

The free keyword research method can give you a good insight into what people are looking for, but you won’t be able to accurately tell whether the keyphrase is too competitive or not.

To get more accurate insight, you can use the best Etsy keyword research tool – Sale Samurai.

For only $9.99 a month this amazing platform provides a big number of relevant keywords you can target, showing monthly Etsy search volume, competition score, as well as many other important data.

Keep in mind, that many of your Etsy listings will likely show up on the world’s biggest search engine Google, and Sale Samurai provides Google keyword insights too.

This tool can save you significant amounts of time and headache as it can guide you in the right direction by providing the most profitable keywords and product ideas.

Here’s a video tutorial on how to find keywords using Sale Samurai. Although this tutorial is based on finding physical product ideas, you can apply the same principles for digital product research.

Try Sales Samurai For 3 Days For Free

Creating Digital Downloads:

Once you finish with the keyword research and have some profitable product ideas, it’s time to create those products.

The majority of digital products will require some level of graphic design skills to make. While logo creation demands some advanced graphic design skills, products like checklists, workbooks, and others can be created with minimal expertise.

Either way, you don’t have to worry, as today we have a fantastic tool, called Canva, which can simplify the entire design process.

And if you are not very passionate about designing stuff, and have some spare money to invest, you can hire an experienced freelancer to do everything for you.

So that brings us to two ways of creating products – creating them with Canva, or outsourcing to a freelancer.

Related: The Best Low Content Book Creator Tools

Create Digital Products With Canva:

Canva is a very easy-to-use intuitive graphic design tool, which empowers the majority of digital products sold on Etsy.

With hundreds of predesigned templates and thousands of available design elements, this platform turns the overwhelming design process into a flawless experience.

But the best thing about it – you can use it for free.

Etsy digital product design
Designing notebook’s cover with Canva

The reason why we are not recommending traditional graphic design software like Photoshop, Illustrator, or Indesign, is because they have a steep learning curve, and everything in there needs to be created from scratch.

Whereas with Canva, you get plenty of premade templates for various styles and occasions, so you can easily manipulate them and design to your liking.

You can also access the outstanding amounts of fonts and stock images as well as export the artworks in various formats, including the ones for printing.

The only catch of Canva’s free version is that you won’t be able to access some premium elements, but you can definitely start at no cost, and upgrade later if you feel that you need to.

In case you would like to use some additional resources for your designs, you can head over to royalty-free image sites, like Pixabay, Unsplash, or Pexels, and download whatever you need for free.

And if you would like to add some premium quality graphics, fonts, or other elements, you can purchase them from Creative Fabrica for a very good deal.

Hire A Freelancer:

If you don’t have time for creating digital products by yourself, you can always outsource this to someone else. The good news is that you can find some great graphic design services for a very cheap price, especially if you go to Fiverr.

Fiverr is a huge freelancing marketplace, with thousands of skilled and experienced freelancers ready to bring your ideas to life.

This platform is so big, that you can outsource the creation of any type of digital product, including business cards, templates, logos, illustrations, banners, and many many more.

There you have so many options when it comes to deciding what services you would like to get, and whom you would like to work with.

fiverr etsy

Another great thing is that most of the freelancers on Fiverr are very humble, and they will do their best to satisfy your needs.

Here are a few tips when hiring a freelancer on Fiverr:

Look for freelancers in countries where the living cost is cheaper. Just because they advertise the gigs for a lower price, it does not mean they will provide low-quality work. Since the majority of digital products do not require perfect written English skills to be created, you can outsource them to a freelancer from any country in the world.

Don’t go too low with the prices. At the end of the day, you need a high-quality product to sell on Etsy, and high-quality products cost more to produce. So, often it’s worth investing a little more into the product in order to get higher returns on investment.

Check the reviews: Every seller you hire on Fiverr should have a considerable amount of positive reviews on his profile. In this way, you will make sure he is a reliable, skilled, and experienced person to work with.

Get in touch before you buy: Always message a freelancer before you order anything from him. By that, you can make sure he will deliver work according to your standards, and his communication is on point. Also, it’s always a good idea to ask for some samples of his previous work.

Only order GIGs with revisions: Although most sellers on Fiverr will offer some revisions for their services, not all of them do that. Revisions will allow you to request a freelancer to make some changes if you are not happy with the delivered project. So make sure the revisions are always included in the service package.

Setting Up The Etsy Store & Listing Your Digital Downloads:

setting up etsy store

Creating an Etsy store and listing your products is a very straightforward process.

To start, sign up for an Etsy account, and click on Start Selling.

Then, fill in the necessary information, and come up with a nice branded name for your shop.

The next very important step is to add photos of your products (in your case snapshots).

Add as many high-quality images as possible to visually describe the product to your customers, and pay the most attention to the thumbnail – the main image of your listing.

If your product is printable, you can take the extra mile to print that product and add a printed version photo to the listing.

If your product is a planner, notebook, journal, or anything else that contains multiple pages, you can take another extra mile and upload a video as you walk through that product.

Once finished, another important step is to fill in the listing details.

There you will provide a good description of the product as well as optimize it for SEO (Search Engine Optimization).

Etsy SEO:

Etsy’s SEO is a critical process for effectively displaying your products to buyers. Here you want to optimize your listing for the best possible visibility and discoverability on the search.

Titles, categories, and tags are the three factors that Etsy takes into consideration when looking at your keywords, so you want to do your best at this stage.

create listing etsy

Your title should include the specific keyword that you have found during your keyword research process, for example – Gardening Journal For Mom.

It’s also common to add some product attributes to the title, like color, style, size, etc., but that’s not necessary as you can do that in the other sections.

After that, choose the category that best describes your digital product by typing two to three words into the search box.

Then, it’s time for describing your product in the description field. Etsy does not take product description into the account for SEO, but customers take it for buying your products, so you can use it as a little sales letter.

The shoppers will only see a few lines of your description at first, so make sure you write something catchy at the beginning.

Once you finish with the description, it’s time to add tags, which Etsy considers when ranking your products on search. There you will be able to add up to 13 tags, and those can include your product’s shape, color, style, function, occasion, etc.

When doing search optimization for your listing, only include the keywords that are relevant to your product, and don’t duplicate them because there’s simply no point to do that.

Apart from titles, categories, and tags, there are more factors that Etsy takes into account when ranking your listings. The platform also monitors the number of sales you have made and the number of positive reviews the customers left.

Pricing Your Product:

Another step when uploading your listing will be to price your products.

The general rule of the thumb is not to price your products too low.

While many sellers think that low pricing will encourage buyers to buy more, often pricing your products too low will put off buyers from buying. It’s simply because your product will look cheap and undervalued.

But at the same time, you want to maintain a reasonable price, which isn’t too high as well.

Here are the things to consider when pricing your digital products on Etsy:

  • Look at how much your competitors is charging for similar types of products
  • Take into consideration the amount of time you have dedicated to creating a product
  • Consider the amount of money you spent to make the product (including paid resources, software, or freelancer)
  • Don’t forget a 0.20 cent listing fee and 5% transaction fee deducted by Etsy once you make a sale

In terms of product quantity, since you are selling a digital download, which never runs out of stock, you can set the quantity to 999.

Uploading Your Product:

The final step of the listing creation on Etsy is to upload your digital downloads.

If you are selling a product bundle you can upload up to 5 files. The maximum size of a file you can upload is 20 MB, so if your file is bigger than that, you can compress it and upload it as a ZIP file.

And if the ZIP file is still too big, you can upload your digital product to a could storage platform, like Google Drive, or Dropbox, and then upload a PDF file to Etsy containing a link to that file on the cloud.

By that, your customers can download a PDF file, and click the link inside to access all the products they need.

Marketing Your Digital Products:

The clever idea would be to put some additional work into the marketing of your products instead of just waiting for them to sit and generate the sales.

Optimizing your listings, and uploading nice-looking product images is already a good start in Etsy product marketing, but there’s definitely more that can be done.

Here are the other ways how you can effectively market your products:

Share your products on Pinterest: Pinterest is the most popular social media platform for finding ideas for printable and digital products. Visitors go there to find various planners, journals, stickers, templates, and other product ideas, and they typically have money to spend. This platform works as a visual search engine, so you have a great chance to demonstrate your artworks, and invite people to visit your Etsy store.

Be active on Instagram: Instagram is another great place for demonstrating visual content. With the help of hashtags and consistent posting, you can reach an endless audience, and some of them may be interested in your Etsy products. If you have spare money to invest, you can also hire brand ambassadors who could promote your brand even further.

Build an email list: The email list is the most profitable marketing channel for many Etsy sellers. If you want to really succeed in this business, you will have to build a subscriber list through your website or social media channels. There you will be engaging with your followers by sharing useful and helpful information, as well as letting them know about the new products, discounts, coupon codes, and freebies.

Start blogging: Blogging is a great way of driving organic traffic to your Etsy store. You can either blog on your website, or on YouTube,  but if you can do it on both platforms, that’s even better. For blogging, you will need a specific topic and a lot of content related to it. Once you publish enough content and start getting some traffic, you can introduce your Etsy store and products to your audience.

Try Etsy ads: To hit good sales figures on Etsy, you will definitely need to run the ads at some point. Although many people will tell you to stay away from ads until you are not advanced, you can also run them in the beginning to get important data about your product as well as to gain some customer reviews.

Create a Facebook group: While Facebook is not the most organically active social channel, Facebook groups are always thriving. If you have a specific niche in mind (like beauty, healthcare, fitness, etc), create a Facebook group with like-minded people, and offer them your digital products as a solution to their problems.

While all these marketing channels can boost your visibility and brand awareness, unless you are willing to work hard, or want to hire somebody to manage them, it’s hard to be active everywhere.

Instead of leveraging all marketing channels at once, try to be good at one or two at first. Pinterest is a great way to start promoting your digital downloads, and once you get a decent follower base over there, you can shift your focus to the other social channels.

Meanwhile, by being active on any social platform, try to grow your email list and constantly communicate to your subscribers.

Email marketing does not have to be hard these days, as you can prepare everything in advance and automate the whole process, so make sure you incorporate that at the very beginning.

Top Tips For Successful Digital Product Selling on Etsy:

market digital downloads on etsy

We have covered the most essential steps for researching, creating, selling, and marketing your digital downloads. However, that is not it, and we have some more to share with you.

In this bonus section, we will give you some additional tips and tricks that will help to maximize your selling chances on Etsy.

Do Competition Research:

In conjunction with keyword research, which is a must-do process to find gaps in the market, you should also do competition research.

To do the competition research, go through the listings that are marked as “Popular Now” or “Best Selling” and find out what makes them successful.

Is the title, photos, or description that makes them sell well, or it’s just an amazing product? Also, try to find what could be improved with these listings, and the best way to do that is to read the customer reviews.

In addition, have a glance at the overall list of products displayed on the first pages. Perhaps there is something missing, and you could provide that? Maybe all of the templates are in pink colors, and the market would need some in black?

Focus on Customer Service:

Great customer service is a must when trying to compete with other sellers on Etsy. The more positive reviews from the customers you will get the higher Etsy will put your listings on search.

To get good customer reviews, you will need to have a good product in the first place, which matches the description you provide on the listing.

But that’s not it.

You should always try to overdeliver your services. A good suggestion would be to include a little freebie with your main product, and that will spark some good emotions for a customer, even if he doesn’t use that item.

Also, try to follow up with a buyer once he makes a purchase by asking him if everything was fine, and if it was, perhaps he could leave a positive review for you.

Actually asking for a review increases the likelihood of a buyer leaving one, so it’s always a good idea to just ask.

Create Different Variations of a Product:

You have to think smart and try to save time when creating digital products, and it’s often wise to make slightly different versions of the same product.

Since you spend so much time creating a digital product, why not tweak it a little bit, so you could have more products out of it? This may significantly increase the chances of sales, as the customers will have more options to choose from.

The best variation of a product would be to design it in different colors, but you can also offer it in different sizes, fonts, layouts, and styles.

Offer Discounts:

Like any other successful online store, your Etsy store should run the promotions.

Discounting certain items is a great way of urging customers to buy. You can also create special coupon codes for your subscribers, social media followers, or customers who have already purchased for you.

In addition, you can package your digital products into a bundle and sell them for a discounted price, which is another great incentive to buy more and save more.

Beware of Trademarks:

By law, you are not allowed to use registered trademarks in your designs, especially if you are willing to sell them. The trademarks may come in the form of text or images, and they can include brands, characters, or themes.

Not only big names, like Disney, or Marvel are subject to copyright infringement, but also the artworks, and design elements, especially if you randomly take them from the web and use them without the appropriate license.

Etsy views intellectual property policy very strictly, and it can immediately take down your store if you commit a copyright infringement.

Test Test Test:

Some of the products you will list on Etsy will sell more than the others, and it’s always a good option to run tests to optimize your listings to the maximum.

You can run A/B tests by duplicating the listing and changing some of its attributes, such as title, photos, pricing, or even description, but you want to test one thing at a time.

You will have to get enough visitors to your product to determine if there is anything that needs to be changed in the listing. Wait until you get at least 100-300 visits to the product until you come up with solid conclusions.

To speed things up, you can try Etsy ads. Although you may not make your money back, you will get important data quicker, and that will help you to better optimize your listings.

Final Words:

As we clearly proved, selling digital downloads on Etsy can be a profitable business model, which can potentially generate six or seven-figure income.

There can be numerous benefits of selling digital products on Etsy, but the biggest ones are that it’s easy and costs almost nothing to start.

However, if you want to significantly enhance your chances of success, it is definitely recommended that you invest a little bit into the best Etsy keyword research tool – Sale Samurai.

This small investment can save you tons of time, as you will find the uncompetitive products that the market needs faster.

After all, no matter where you are selling your products, success will come after trial and error.

It’s all about experimenting and finding what products you like to sell, and what the market wants to buy from you.

The truth is, many of your digital products on Etsy won’t make any sales at all, while some of them can bring significant amounts of profits.

If you don’t try enough, you won’t know what could be working for you, so get ready to create many many products to find the real gold.

Best of luck while selling on Etsy!