Selling Digital vs Physical Products on Etsy: Which Earns More?

Let me tell you about something I’ve learned the hard way.

Selling digital products online isn’t as easy as it seems.

A lot of YouTubers and TikTokers make it look so simple.

Just make something digital like printables, an online course, or an ebook.

Then put it up for sale online.

Easy passive income starts rolling in while you chill on a beach 🤑.

Well, let me break it down for you…that’s not quite how it goes.

I’ve tried selling both digital stuff and physical products.

Trust me, it’s way harder to actually make good money from digital items.

Why is that?

I’m glad you asked!

There are a few main reasons:

• It’s super easy for people to copy and share your digital files
• People expect to share one purchase with family and friends
• Bulk orders are a hassle with digital products
• Customers value physical items more than digital downloads

Let me give you some examples to explain what I mean.

Copying Digital Files is Too Easy

Think about this a little bit.

If you buy a cute set of printable posters from an Etsy shop, what’s stopping you from sharing those files with your friends and family?

You paid for it once, so they can just use your files too.

The same goes for online courses, ebooks, graphics, you name it.

With physical stuff like shirts or printed posters, at least each person needs their own item.

You can’t just scan and copy a real mug!

That makes it way harder for your single sale to get shared around for free.

Even if a seller tries to lock down their digital files, there’s not much stopping someone determined to find a way to copy them illegally.

That’s just the reality of selling virtual products, unfortunately.

People Love to Share!

Speaking of sharing… you know how people are.

If Uncle Bob buys one cool poster file from you, his entire family of 10 people will probably end up using it too.

So your one $10 digital sale turns into the same item getting used by 10 different households for free.

But if Uncle Bob bought a physical printed poster instead, now every single person needs to pay you for their own copy to hang on their wall.

10 people, 10 separate $20 sales for you!

Which makes you more money?

Bulk Orders Are a Pain for Digital

Here’s another situation.

Let’s say a school wants to buy 50 copies of your poster design to hang around their building for an event.

If it’s just digital files, you know that the school will just buy a single copy, and then print out 49 extra versions themselves for free.

But if it’s physical printed posters, now they need to buy all 50 posters from you at full price!

That’s a big payday compared to one digital sale.

So for bulk orders, physical wins out big time when it comes to making more sales and profits.

People Value Physical Items More

You know how it is – we all just appreciate physical items more than some digital file on a computer.

You can hold that printed poster in your hands, hang it proudly on your wall, and really show it off.

A digital version just doesn’t have the same cool factor.

That’s why customers are usually happy to pay $15-20 for a printed poster, but would hesitate at paying even $5 for the same exact design as a digital download.

Physical items simply seem more valuable to us.

More perceived value means you can charge higher prices and make more profit in the end.

So those are the big reasons why I’ve found physical products make significantly more money compared to digital items, at least in my own experience trying to sell both types online.

Now, I can hear some of you saying “But wait a minute! Aren’t digital products supposed to be awesome passive income that just keeps making money while you relax on a beach?“

The Passive Income Myth

Okay yes, that’s the common idea pushed about digital products like ebooks and downloadable art.

The idea is that you only have to do the work once to create the files.

Then you can just upload them to a shop and cash will start rolling in automatically with zero extra effort required.

It’s not totally accurate.

Don’t get me wrong… digital items definitely require less hands-on work to make each individual sale compared to a physical product you have to create and ship out every time.

So from that view, yes digital has some passive income advantages.

But you can’t just set it and 100% forget it forever either.

Digital products still need regular maintenance and effort too:

• Updating listings and download pages as websites change
• Adding new features to keep products fresh
• Responding quickly to customer questions and complaints
• Keeping up with new rules and terms for sites you sell on
• Plus marketing to keep driving new sales!

So while there is less work per sale, it’s not zero work.

You still have to put in consistent effort to keep that passive income stream flowing smoothly for digital items.

And physical products sold through print-on-demand companies like Printful or Printify can run pretty passively too these days!

You just upload your design once, and then the company prints and ships out each order for you automatically.

The amount of maintenance work can be really low, just like digital items.

In my opinion, both digital and physical products need some level of consistent effort to keep the business going.

They just require different types of work. So don’t buy into the myth that digital equals zero effort required!

Physical Products Are Faster to Make

Here’s one more big advantage physical products have – they are usually much faster and easier to make!

Let’s look at an example.

For a popular digital poster design set, chances are it includes 7 or more different high-resolution poster graphic files.

And each of those detailed graphics probably took hours or days to design, lay out properly, pick colors, etc. That’s a ton of work!

Compare that to making just one basic printed poster design.

All you need is a single good image file and you’re done – upload it once and it’s ready to get printed and sold over and over.

Plus, customers buying digital products expect way more flexibility too.

They’ll want different file formats, paper sizes, layouts, and options.

So for that one digital poster set, you may need to create and upload 20 different graphic files to cover everything.

More work for you, less profit!

With printed posters, make one design and you’re set. So much easier!

What I Think About It

Okay, let’s sum this all up.

Can you still be super successful selling digital products only? Absolutely, there are definitely people out there crushing it with online courses, downloadable templates, graphics, and more.

Certain niches and strategies can make digital files a great way to make money.

BUT – from my personal experience actually trying to sell both product types over many years… physical printed products just make more money more easily overall.

The sales tend to be higher, the income is more passive than you’d think, they are faster to make, harder to illegally copy, and customers value physical items more.

That’s the honest truth as I’ve lived it.

Selling digital stuff is not this amazing goldmine of easy passive income like you see on YouTube.

Lot of work for less payoff in my books.

Of course, this is just my two cents based on my own online business journey so far!

I’m definitely curious to hear from others who have been there too.