What Is a Digital Product? Definition, Examples, and How to Sell Them Online

Digital products are everywhere—from ebooks and online courses to software keys and downloadable templates. If you’re looking to start or scale an online business, digital products are one of the most profitable and flexible options available today.

In this guide, you’ll learn what a digital product is, see real-world examples, and understand how to sell digital products online step by step.

What Is a Digital Product?

A digital product is a non-physical item that is created, sold, and delivered entirely online. Unlike physical products, digital products do not require inventory, shipping, or manufacturing.

Once created, a digital product can be sold unlimited times with minimal ongoing cost—making it highly scalable and profitable.

Key characteristics of digital products:

• Delivered electronically (download, email, or account access)
• No physical storage or shipping
• Can be automated after purchase
• High profit margins

Examples of Digital Products

Digital products exist in almost every industry. Here are some of the most popular types:

1. Educational Digital Products

• Ebooks and PDFs
• Online courses and video lessons
• Exam preparation guides (IIT JEE, NEET, CBSE, etc.)
• Tutorials and webinars

2. Software & License-Based Products

• Software license keys
• Activation codes
• Game keys
• SaaS subscriptions

3. Creative & Media Products

• Music and audio files
• Stock photos and videos
• Graphic design assets
• Fonts and icon packs

4. Business & Productivity Tools

• Notion templates
• Excel spreadsheets
• Website themes and plugins
• Marketing toolkits

5. Memberships & Subscriptions

• Private communities
• Premium content access
• Ongoing learning platforms

How Digital Products Differ from Physical Products

Digital and physical products may both be sold online, but they work very differently behind the scenes. Understanding these differences is essential for choosing the right business model, pricing strategy, and delivery system.

1. Nature of the Product

Digital Products

• Intangible (files or access)
• Examples: ebooks, online courses, software, license keys, PDFs, music, memberships
• Delivered electronically

Physical Products

• Tangible, real-world items
• Examples: books, clothing, electronics, accessories
• Delivered via shipping

2. Inventory & Storage

Digital Products

• No warehouse needed
• Unlimited stock (sell the same file infinitely)
• No inventory management costs

Physical Products

• Require storage space
• Limited stock
• Risk of overstock or running out

3. Delivery Method

Digital Products

• Instant delivery via download links, email, or account access
• Often automated using apps (e.g., digital delivery or license key apps)

Physical Products

• Shipped via courier or postal services
• Delivery delays possible
• Tracking and logistics required

4. Cost Structure

Digital Products

• Low upfront costs
• No manufacturing per unit
• No shipping or packaging costs
• High profit margins

Physical Products

• Manufacturing or sourcing costs
• Packaging and shipping expenses
• Returns and damage costs

5. Scalability

Digital Products

• Extremely scalable
• One product can serve 10 or 10,000 customers with no extra effort

Physical Products

• Scaling requires more inventory, storage, and logistics
• Higher operational complexity

6. Automation & Management

Digital Products

• Highly automatable
• Orders, delivery, and access can be fully hands-off
• Ideal for passive income models

Physical Products

• Manual processes involved
• Inventory, packing, shipping, and returns need constant management

Why Digital Products Have Higher Profit Margins 💰

Digital products are popular because they offer much higher margins than physical products.

1. No Manufacturing or Shipping Costs

Once created, a digital product costs almost nothing to deliver. No courier fees, no packaging, no lost shipments.

2. Sell the Same Product Unlimited Times

You create the product once and sell it repeatedly without additional cost.

Example:

• Create an ebook for $100
• Sell it 1,000 times
• Your delivery cost is still $0

3. Instant Delivery Increases Conversions

Customers love instant access. No waiting means:

• Higher customer satisfaction
• Fewer abandoned purchases
• Better overall experience

4. Lower Operational Effort

No inventory management, no warehouses, and no logistics. Everything is automated.

5. Easy Global Sales

You can sell digital products to customers anywhere in the world without worrying about customs, shipping zones, or delays.

How to Sell Digital Products Online (Step-by-Step)

Step 1: Choose the Right Digital Product

Start with a problem you can solve. Educational content, tools, and automation-based products perform especially well.

Ask yourself:

• What knowledge or asset do I already have?
• What do people search for or struggle with?
• Can this product be delivered digitally?

Step 2: Create Your Digital Product

Depending on the type:

• Write an ebook or guide
• Record video lessons
• Generate license keys
• Design templates or tools

Focus on quality and clarity—digital products rely heavily on trust.

Step 3: Select a Selling Platform

You need a platform that supports:

• Digital file hosting
• Instant delivery
• Secure access
• Payment processing

Shopify is one of the best platforms for selling digital products because it allows full control over branding, checkout, and customer experience.

Step 4: Automate Digital Delivery

Manual delivery causes delays, errors, and poor customer experience.

Using a digital delivery app on Shopify lets you:

• Instantly deliver files or access links
• Automatically send license keys
• Protect content from unauthorized sharing
• Manage updates and re-downloads

Automation is essential if you want to scale.

Why Digitally Is the Best Delivery App on Shopify

Digitally is widely regarded as the best digital delivery app for Shopify because it’s built specifically for professional digital businesses—not just basic file downloads.

Unlike generic apps, Digitally supports files, license keys, subscriptions, and gated access in one seamless system.

With Digitally, merchants can:

• Deliver digital products instantly after purchase
• Automate software license key delivery
• Upload license keys in bulk using CSV files
• Secure downloads with unique access links
• Control expiration, download limits, and access rules
• Sell subscriptions, courses, and memberships easily

This makes Digitally ideal for businesses selling:

• Software and activation keys
• Online courses and exam preparation content
• Digital subscriptions and learning libraries
• High-volume digital downloads

Who Should Sell Digital Products?

Digital products are ideal for:

• Educators and coaches
• Software developers
• Content creators
• SaaS businesses
• Exam preparation platforms
• Agencies and consultants

If your product can be downloaded, accessed, or activated online, it can be sold digitally.

Frequently Ask Question

1.What is a digital product?

A digital product is a non-physical item that is created, sold, and delivered online. Examples include ebooks, online courses, software license keys, PDFs, templates, and memberships.

2.What are examples of digital products?

Common digital products include ebooks, exam preparation guides, online courses, software keys, SaaS subscriptions, stock photos, music files, design assets, and productivity templates.

3.How do digital products get delivered to customers?

Digital products are delivered electronically through instant download links, email delivery, or secure customer account access. Delivery is usually automated using a digital digitally app.

4.Do digital products require inventory?

No, digital products do not require inventory or storage. You can sell the same digital product unlimited times without worrying about stock or warehouses.

5.Are digital products profitable?

Yes, digital products are highly profitable because they have no manufacturing, shipping, or packaging costs. Once created, they can be sold repeatedly with very high profit margins.

6.What is the best way to sell digital products online?

The best way is to use a reliable eCommerce platform like Shopify combined with an automated digital delivery app to handle instant access, security, and scalability.

7.Why should I use a digital delivery app on Shopify?

A digital delivery app automates file delivery, license key distribution, access control, and re-downloads. It eliminates manual work and ensures a smooth customer experience.

8.Is Digitally a good app for selling digital products?

Yes, Digitally is designed specifically for professional digital businesses. It supports files, license keys, subscriptions, gated content, and bulk delivery—making it ideal for scaling digital sales.