Digital Product Marketplace’s store owner and operators have
a very long list of tasks to do in order to manage his/her digital product
marketplace well. This encompasses tons of administrative and
non-administrative works just to get their webstore all up and running. Digital
product marketplace owners have vendors to manage, customers to handle,
marketing strategies and tactics to implement, developers/programmers to relate
with and many other stuffs that would definitely consume there day.
This is now why it is essential to free some of your time and therefore concentrate on many important tasks for your online marketplace. But how? We need to learn and adopt an automated process that will lessen the burden of manually doing administrative works for your digital product marketplace.
Common Problems of Manually Paying Vendor Commissions
Here are some of the problems that a Digital Product Marketplace webstore owner most likely to experience when doing the manual payment to vendors.
Spend a lot of time paying vendors manually – Having only a few vendors and sales per week or month could still go through manual payments. But, if you are now getting more vendors and earning more sales, you may notice that you’ve been starting to spend a lot of time paying them manually than before, and it is not healthy especially if you also have other administrative tasks to pay attention to.
Vendors do not want to wait long to get paid – It is important as a marketplace owner to always keep your vendors happy. One way is not to delay or give payments for too long. This may happen if you have tons of vendors and sales needed to split and give payments manually, and maybe a few of them are already overdue. We shouldn’t let this happen or your vendors will feel unsatisfied with your service.
Adopt automated payments to easily scale up – As we have said earlier, business owners/staff should be doing something important for the betterment and growth of the marketplace instead of spending an awful amount of time in paying vendor commissions. This could actually prevent business upscale and growth.
Possible problems with ManualPayments – Making tons of vendor payments each day or week can cause you a lot of confusion and headache. From different calculations, percentages, splitting of payments, tracking amounts and others can quickly get above our heads. Thus, the manual process are very vulnerable to different mistakes and errors. This is one main reason as to why we should adopt an automated payment service.
PayPal is still the best and commonly used payment service – PayPal is still today the benchmark for most developers, vendors, freelancers, and customers on the web. Almost everyone has their PayPal accounts and you won’t get any trouble explaining things to you with regard to it. In conclusion, PayPal is the best practice for online payment solutions.
Benefits of Automating your Payment Processes
Business process automation is the use of technology to execute recurring tasks or processes in a business where manual effort can be replaced. It is done to achieve cost minimization, greater efficiency, and streamlined processes. Any business that wants to gain an edge over their competition should consider automation, which can simplify a company’s operations, not to mention speed them up by a great deal.
Automating your Payment Processes is essential when you are
operating a Digital Product Marketplace. Enumerated below are some benefits of
automating your business processes.
Quality and Consistency
Automation ensures that every action is performed identically – resulting in high quality, reliable results. Also, they will experience the same level of service from your business, thus providing a high-quality, consistent work output.
Time Savings
Automation reduces the number of tasks you and your employees would
otherwise need to do manually. This frees up your time to work on items that
add genuine value to the business, allowing you to be more innovative and
increasing your employees’ levels of motivation.
Improved Operational Efficiency and
Productivity
Process automation reduces the time it takes to achieve a task, the effort required to undertake it and the cost of completing it successfully. Automation not only ensures systems run smoothly and efficiently but that errors are eliminated and that your best practices are constantly leveraged.
Simplify Repetitive Tasks
Many employees spend most of their working day performing repetitive tasks, which can be both boring and when all of the alternatives are considered, unproductive. Automation software can, therefore, automate many of these repetitive processes, so your members of staff can focus on other areas of the business. This will allow you to use your staff more effectively, and it could even speed up the processes involved.
Greater Opportunities
Automation can open doors to countless opportunities for your business. Instead of wasting your time doing repetitive administrative works, business owners might be doing something that would greatly scale and increase business growth. This is how important automating your business processes is.
Automate Payment Commissions on your Digital Product Marketplaces
Your Digital Product Marketplace might have several vendors who needed to get paid off their commissions. Whenever a digital product has been purchased on your marketplace, your vendors needed to get paid manually, and this consumes and wastes a lot of your time. This could cause your marketplace growth a huge setback just by doing this repetitive administrative work manually, especially when you needed to pay many people of their commissions, every single day.
This is now why automating your vendor payment commission is very important if you are operating a Digital Product Marketplace. The Admin user may find it very difficult to track each and every sales and afterward payout vendors manually. So here comes a solution – the PayPal Adaptive Payments Plugin.
Introducing PayPal Adaptive Payments
This plugin works by automating your vendor commissions by
instantly and automatically splitting third-party commission up to 6 receivers.
This way, it will save you a lot of time in manually paying vendor commissions.
If you want to scale up your marketplace and want to work
with more and more vendors, we strongly recommend implementing an automated
solution brought by this PayPal Adaptive Payments Plugin.
Key Features and Benefits
Here are the Key Features and Benefits you can enjoy by
using this plugin:
The payment of third-party revenue can be done
instantly and it saves significant time instead of manually paying your vendor
commissions every time a sale has been made.
With the PayPal Adaptive Payments gateway
integration, you can easily split payments with up to 6 different receivers at
the same time. This plugin handles payments between the sender of a payment and
one or more receivers of the payment. It’s possible to split the order total
with secondary receivers, so you can pay commissions or partners immediately
afterward.
You can set each receiver up with a specific
percentage of the payment within the settings for this gateway. Not only that
but it provides configurations that can help you set this up as you prefer.
Lastly, you can determine whether you would like to use a Chained or Parallel payment type. Chained Payments: Your Store accepts the entire payment and secretly pays commissions to Vendors after the sale. Parallel Payments: The customer knows everyone who will receive payment upon checkout – as the payments are split visually at checkout.
Conclusion: Automate payments on your Digital Product Marketplace
Sticking with a Manual Business Workflow simply creates opportunities for delays and errors. Adopting business process automation, especially on paying vendor commissions, can improve organizational efficiency by automating redundant administrative and repetitive tasks. Remove those processes that are putting a strain on employee time and free them up with workflow automation, with this approach you will be able to accomplish more by using fewer resources and in a more efficient way.
In conclusion, vendor payment automation, if implemented
correctly, can help you in increasing the efficiency and accuracy of your payment
processes. This can make your vendors very happy and will surely affect the
growth and scale of your business.
WordPress today powers 30% of the world’s websites and leading eCommerce software such as WooCommerce are actually WordPress plugins which have proven that WordPress is much more than just a blogging solution.
When you are considering setting up a multi-vendor digital product marketplace you might want to consider using Easy Digital Downloads (EDD). EDD is the leading WordPress solution which is specialized in selling digital products and offers a marketplace extension as well. Unlike WooCommerce, Easy Digital Downloads does not come with any in-built legacy made for shipping physical products, instead, it is truly optimized in selling digital products. In this article, we will outline how to set up a multi-vendor marketplace platform in WordPress with Easy Digital Downloads.
If you are interested in more information, please download our Free eBook on How to Build a digital product marketplace on WordPress which contains even more comprehensive and detailed information on how to set up a multi-vendor marketplace for digital products.
Why create a Digital Product Multi-Vendor Marketplace Platform?
Sales for online marketplaces are expected to greatly double from $18.7 billion in 2017 to $40.1 billion in 2022 (MCFADYEN based on eMarketers). During the May 2018 survey made by Statista, 50 percent of global shoppers stated that they preferred to make first-time purchases at a retailer, whereas 47 percent of repeat buyers preferred online marketplaces. As per Statista, two of the top three reasons for purchasing at a marketplace instead of a retailer were more competitive prices and a broader selection of products available. Also 38% of all online shoppers in 2017 ordered from abroad.
Number of
Digital Buyers Worldwide, Source: Smartinsights 2017 based on eMarketer
First of all, why should your first choice be is to sell a digital product and not a physical product in your marketplace? The three main reasons are:
(1) No inventory required
(2) No shipping and handling problems
(3) Easier to sell worldwide
When selling digital products, a creator will
have the choice to either sell his digital products on his own website or using
a digital product marketplace. Below are the arguments why it can be a good
idea to start a multi-vendor
marketplace platform
rather than a single vendor store:
Selling a digital product is easier than selling a physical product
Buyers prefer choice and larger product inventories
Same launch costs as single-vendor websites
Low fixed costs enhancing chances of achieving break-even early on
Scalable business models with benefits in obtaining traffic (e.g. SEO and Social Media)
Types of digital eCommerce, Source: Pluginsandsnippets.com
Best is to start a digital product marketplace
only in a niche you are very familiar with as this will save you time and it
allows you to find solutions to problems quicker than when you know nothing
about an industry. Some people also say you need a large amount of passion. We
think it cannot hurt and will only help you if you actually care about the
products you will sell in your digital product marketplace.
Before starting a WordPress Marketplace – Market Research
Conducting market research is the very first
step we must work on and do before even building and starting our Digital
Product WordPress
marketplace. It is important to first conduct thorough market research
and study the essential factors which can affect and contribute to the success
of the business plan when starting a digital product marketplace.
Illustrative example competitor analysis, Source: www.pluginsandsnippets.com
An effective way
to conduct a market study is by starting with the closest competitors of your digital product
marketplace idea. Try to especially focus on the top 5 or 10 competitors
and thoroughly research their profiles to understand what and how they are
doing and where the market gap for a new digital product WordPress
marketplace might be. When analyzing competitors, try to analyze the
following:
What do they sell?
Number of Vendors / Products
Price ranges of their products
Alexa Rankings
Followers on social media
Sources of traffic
Strengths and weaknesses
Reviewing the strengths and weaknesses of
competitors should not only be in terms of how good their website appears but
more in terms of how good their business model is. Is this a marketplace
platform you believe can attract the interest of customers and vendors? If yes,
why? What do they do well? Which points they seem to neglect or where do they
show weaknesses? There might be an untapped opportunity where the market is not
served?
Doing this analysis properly will give you
more information about the marketing strategies and tactics of each of the
competitors and you will quickly figure out where there might be an untapped
opportunity in the market that deserves to be serviced by your new digital
product WordPress
marketplace.
SEO can offer a cost-effective long-term
marketing strategy for marketplaces since there is a lot of content placed
there. Therefore you will need to do keyword research which is the process of
finding and analyzing actual keywords entered in search engines. The objective
of the keyword research will be to figure out which keywords would be easy to
rank within our market niche, have decent traffic search volumes and show only
a low level of competition.
Another topic to research and check are
commission rates charged to vendors by similar digital product marketplaces. Standard commission fees for digital product marketplaces are somewhere between 10% and 30%. So
before deciding what it will be, please check first how many potential
competitors are charging to their vendors and see that your fees are in line
with the market terms for your market segment.
Setting up a Digital Product Marketplace
Just like in starting a simple Digital
Downloads eCommerce WordPress Website, the very first thing to do is to choose
your Domain Name URL and a Web Hosting Provider.
The Domain Name URL is the internet address
where Internet users can access your website. Registering domains will cost
from $10 per year upward, depending on the registrar and top-level domain
(TLD).
The next task will then be to select a
suitable web hosting provider that will host your website. You can choose
between a shared and a private server. If you have plans to make your website
large, you might be better off starting with a private server as otherwise, you
will have to move your website away from a shared account as soon as you get
more traffic.
As mentioned initially, you will need to install Easy Digital Downloads which is the leading solution in WordPress and fully specialized to sell digital products online.
Installing a Multi-Vendor Marketplace WordPress Theme
The next step will be to install a WordPress Theme for your new marketplace platform. There are numerous free and paid themes available which are covered in a previous article and summarized here:
What you need to watch out for is to install a theme that supports the Frontend Submissions (FES) plugin in EDD. In case your chosen theme would not support FES, you can still install the theme but then you will have to manually develop designs for frontend vendor pages which is costly and time-consuming to do. Therefore, better use a standard theme which already supports FES, to begin with.
Please note, the theme just needs to serve the
purpose to get you off the ground. You will have to rework your website many
times during the operations of your digital product WordPress marketplace.
We just need a theme to start with, makes your marketplace presentable and
helps us to attract first customers and vendors.
Frontend Submissions provides a full-featured front-end package to turn your Easy Digital Downloads powered website into a complete multi-vendor marketplace. It allows you to accept download submissions from third-party authors or vendors and allows them to list their products in your Easy Digital Downloads marketplace website.
By using the FES plugin on top of your EDD
plugin, you can build a store where vendors and creators can sign up, list
their products for sale, and manage their own accounts, all from within your WordPress marketplace platform.
For a multi-vendor digital product store, FES is the key marketplace
plugin for WordPress to use.
Commissions– An Essential Marketplace Plugin for WordPress
Commissions Plugin
The Commissions extension is what you need to administer the revenue split between your platform and third-party vendors automatically. The way it works is that you need to define the percentage of sales (the commission) your third-party vendors get on every product sale. For digital product marketplaces, commission rates should lie between 10% – 30% which will form your fee income.
The Commissions add-on is often paired with Frontend
Submissions, but it can also work perfectly on its own. Commissions can be paid
to any WordPress user at either a flat rate or a percentage of sales. It’s a
key component for any Marketplace plugin in WordPress and Easy
Digital Downloads.
Our PayPal Adaptive Payments, same as FES, the main marketplace plugin for WordPress, is a key WordPress plugin to use, as it automatically splits payments received between you and third-party vendors. This way, it avoids a lot of administrative work as the payment of third-party revenue can be done instantly and it saves significant time. This marketplace plugin for WordPress is a tested and true time-saver for all multi-vendor Easy Digital Downloads stores.
The plugin connects Easy Digital Downloads to the versatile Adaptive Payments gateway. With this gateway integration, you can easily split payments with up to 6 different receivers at the same time. You can set each receiver up with a specific percentage of the payment within the settings for this gateway. Also, you can determine whether you would like to use chained or parallel payments.
We do really like to recommend you to use this plugin and benefit from its very helpful and straightforward features. We have customers who spent a lot of time executing payments to vendors manually every month and is simply a lot of work which you do not need to do if you have an automated solution. PayPal Adaptive Payment Gateway is not actively promoted anymore by PayPal and you will need approval from PayPal before you can implement it. Nevertheless, we recommend using it as it saves a lot of time and as far as we are aware PayPal still accepts new users into its program.
The Reviews plugin from Easy Digital Downloads makes it quick and easy for your visitors and customers to review the products offered on your website and for leaving a rating. Reviews are a sign of engagement and trust, therefore installing such a marketplace plugin WordPress extension is a must.
After you have successfully set up your digital product
marketplace and installed the specific EDD WordPress plugins, the next
essential step to take is to be able to fill up your catalog with products, but
how? The answer is, we first need vendors to get on board with us. It wouldn’t
be a marketplace if there were no vendors. This means we will have to source our
first vendors who will contribute the digital products for sale on our
marketplace.
From where can you obtain first vendors
willing to sell their products with you? Based on our experience, vendors are
normally sourced from the following sources when starting a new digital product marketplace:
Creating your own products
Partner with vendors you know personally
Reaching out to potential new interested vendors.
Read our eBook for more insights on each source
of vendors.
Marketing Strategies for Digital Product Marketplaces
Once your WordPress marketplace has been
launched, promoting your digital product marketplace is important for
gaining the attention of future customers and prospective vendors. The process
of selling and promoting digital products is quite similar compared to how you
would sell and promote physical products on any eCommerce website.
Now, if you are looking for ways to effectively
market your digital
product marketplace, here are the strategies that should be tested.
Social Media Marketing
Social media refers to websites and
applications that allow users to create and share content as well as
participate in social networking with other users. Different Social Media
Platforms such as Facebook, Twitter, Instagram, Youtube and many other remains
a very great way to establish your brand and build an audience.
Keep in mind, depending on your target market,
there will be different social networks of relevance. E.g. management
professionals you most likely find on LinkedIn, developers there are many on
Twitter and Youtube, etc. Try to figure out which social media networks your
target audience is most active and these should be the social media channels to
focus on.
Social media marketing is an art by itself and
there are many techniques and tricks to be mastered. Most important we find is
to post regularly. For this, you can use a service such as Buffer which allows
you to put your posts in a queue so that you won’t forget to post at least once
per day.
Normally, the tasks are to review your posts,
compared to your competitors, research and learn what can be improved and
implement it. The key performance indicators (KPIs) normally are engagement
received, number of followers, retweets/reposts, shares, clicks which drive traffic
to your website. This all needs to be monitored on a regular basis. So be
prepared for a steep learning curve and lots of trial and error until you know
how to master social media marketing for your digital product WordPress
marketplace.
Search Engine Optimization (SEO)
Search engine optimization (SEO) refers to the
process of optimizing your website to be found by search engines. The objective
is to rank on the first page such as Google, Bing or Yahoo when somebody enters
a keyword in the search bar. The result will be that you will be getting free
traffic from organic search results via the search engines as you will improve
your website position in the Search Engine Results Page (SERP).
There are two sides to any successful SEO
approach SEO has two techniques to improve website position, On-Page SEO and
Off-Page SEO.
On-Page SEO
This refers to all the optimization tasks that
we do on our websites such as optimization of text titles, meta descriptions,
page titles, contents, image optimization by adding alt tags and descriptions,
checking keyword density in text, internal linking, creating sitemaps, ease
navigation, reducing page load times and many more tasks.
Overall, the on-page technique aims to
structure and present your website in a search engine friendly manner. This is
a very important task and to be done before even thinking about working on
Off-page SEO link building.
Off-Page SEO (Backlink Building)
This refers to all the activity that happens away from your website to raise your site’s rankings by building quality back-links. Building quality backlinks is at the heart of off-page SEO. Search engines use backlinks as an indication of the linked-to content quality, so a site with many high-value backlinks will usually rank better than an otherwise equal site with fewer backlinks. Below find some strategies you can use to obtain backlinks for your digital product WordPress marketplace:
Participating in Forum Discussions
Blogger Outreach
Guest Blogging
Press Releases
These are just some of the techniques which
can be used to build backlinks. Feel free to talk with an SEO agency, they
normally can provide you with additional options where to place backlinks and
can also help you work on that.
Email Marketing
An email marketing list can become a very
effective tool for communicating with your audience on a regular basis.
The first step in setting up your email marketing program is to install an onboarding process. Mostly this can be done by adding a subscription form at the checkout page to stay updated on news and product updates (e.g. install the Mailchimp extension). Another way is to add a widget or a popup window with subscription suggestions on your website.
Email newsletters should be sent on a regular
basis (e.g. monthly) but also not overdoing it as otherwise unsubscribe rates
will become high. For digital product marketplaces here, some ideas what
to put in your newsletters:
Present new products
Summarize new blog posts or research articles you have written
Present select vendor achievements or story
Present customer showcases and how your marketplace could help them
Introduce new features of your marketplace
Ask for user opinions on topics of interest
Only by tracking and comparing your newsletter
results you can figure out how to make your email marketing campaign more
effective and which changes lead to best results among your audience.
Now that we have successfully set up our multi-vendor marketplace platform and, have started
with marketing and vendor onboarding, we need to focus now our attention on the
operations of our digital product marketplace.
There are actually a lot of different elements
that we need to keep on our radar, constantly observe and work on in order to
enhance and improve our WordPress marketplace.
Sales Optimization
Normally the main goal of your digital
product’s marketplace will be to maximize sales and profits over the long-run.
In eCommerce we have 4 factors which determine your revenues as shown in the
following graphic:
This means you can maximize revenues of your digital product
marketplace when you seek to maximize each of the 4 revenue drivers:
Number of Visitors – See previously mentioned marketing strategies which will be needed to attract and grow the number of visitors
Conversion Rates – You will need to work on your website to best convert visitors into paying customers
Number of Orders per Customers – The more times your customers return and purchase from you, the higher your sales will be
Average Order Value(AOV) – Mostly depends on the price point of your products, how your products are packaged and how easy/difficult it is to sell them.
As for any eCommerce website you will need to
work on improving each of these four factors in order to max out your full sales
potential.
Vendor Management
Running a successful digital product multi-vendor marketplace platform means
keeping an eye on multiple vendors. Vendors come to your store with their own
ideas, expectations, and ways of doing things. You have to gather these
different vendors under one umbrella.
Your job as a store manager is to help vendors
sell as much as possible as easily as possible, while still retaining the
ability to make important decisions about your store. This means making vendors
happy while making yourself happy as the store manager.
Most digital product marketplaces will opt for curating all products they
receive from vendors for the following reasons:
Avoiding harm: Digital products are subject to
harmful code additions that might not be detectable by normal users. The worst
that could happen is that any form of digital code or program harms customer’s
computers. Therefore, it is important to review each product and know the
vendors you work with as otherwise, the risk may get too high.
Avoiding chargebacks: In the case of product
descriptions that would not be accurate, they will have a good chance of
requesting chargebacks as payment gateway providers will have the last say in
such cases. It is therefore in the best interest of the marketplace operator to
ensure product descriptions are accurate to avoid problems later on. Especially
products listed from new vendors will require a careful review.
Establishing a personal relationship with your Vendors: A product curation process will also establish a more personal relationship with your vendors. As the operator of a multi-vendor marketplace platform, your vendors are not simply your sellers but rather they are your business partners. It is very important to establish a good personal relationship with them. Why not use product curation as one way to do this? Especially smaller niche marketplaces have an advantage here as they can afford to deal with their vendors on a 1:1 basis.
It is very rare to see a digital product
marketplace that would not use a curation process to ensure a
high-quality of products are listed in its marketplace. However, we are still
checking for best practices on how to do this. Let us know if you know any good
example which should be listed here.
Monitoring How Vendors are Doing
As the operator of your marketplace, you don’t
simply source vendors and let them be on their own selling digital products on
your website. It is very important to also monitor how your vendors are doing.
You should, therefore, run different reports from time to time to benchmark and
compare your vendors to find out what works, what doesn’t and what are the best
practices that might help all the vendors to sell more.
If you find vendors who are
underperforming, first, check vendor profiles if all necessary information is
present in so that they will have a well-established identity that your
customers may see and observe.
The next step is to check their
product listings. Are the product descriptions accurate and are the products
well presented? In case of problems, does the problem lie with the seller or
with your processes? Is it easy to list products? Are there enough information
fields to completely present the products?
You might as well enhance and
optimize your website’s navigation and experience which would definitely help
your vendors get a sale.
Promote your Vendors on Social Media and your Blog
Advertising and promoting your vendors, along
with their products, in different Social Media Channels such as Facebook and
Twitter can be a good way to get visitors and help your vendors with marketing
their products. Remember, if your vendors earn, you earn, so it’s in your best
interest to help them market their products.
As part of your digital marketplace marketing
campaign, writing blog posts about vendor products can help you to create
additional content for your web page and offer your vendors another platform to
market their products. However, make sure the articles to be published comply
with the required quality standards you need to maintain for your blog.
Providing Vendor Resources
Working with vendors and helping them to
market their products will become an ongoing task. As such you will need a
process to help your vendors. In the beginning, vendors will have a lot of
questions as they will need to understand how to work with your digital product
WordPress
market place and what they will have to do to earn money.
Therefore, in order to anticipate their
questions, it is advisable to follow a pro-active approach. One way to do this
is to send out a series of education emails to new vendors upon sign-up. The
objective is to help vendors to complete their product listings and then in a
second step motivate them to list more quality products on your digital product
marketplace.
Building a Team
We all know that running a digital product WordPress
Marketplace is tough. When you’re starting out with your business, you
will have to do all the tasks required. From running and managing your
marketplace like updating and creating products, managing vendors, paying
commissions, sourcing more vendors, managing promotions, customer support,
handling social media accounts, SEO Management – the list of To-Dos is endless.
However, as a business owner, it’s better to spend your time doing what you do best – running and growing your company. But that’s not to say the routine tasks and administrative duties aren’t important because they absolutely are. Depending on your budget, you will have to consider hiring people. Normally you want to hire employees in a lean manner. So apart from hiring employees, you have the following alternatives to hire:
When your marketplace is very new you don’t
want to incur big costs at the beginning and first test out if there are demand
and interest in the products. Therefore, you should consider outsourcing tasks
first to freelancers then to virtual assistants until your marketplace produces
stable revenues and profits so that you can afford to hire employees.
Tasks you can Outsource
It is important to know what tasks you should
outsource before you start building your team – including freelancers and
virtual assistants who you can work with on a more permanent basis. When
considering to outsource tasks, look for manual, time-consuming work or tasks
that are repetitive, can be thought to others and where you are better off
using help rather than when having to spend the time yourself.
Here are some daily tasks you should consider
delegating:
Customer service: Answering emails
and phone calls from customers.
Social Media Management: Creating
content, responding to comments, and other community management tasks.
Store management: Reviewing product
descriptions, managing vendors, tracking KPIs
SEO: Off-page link-building
Technical operations: Website
maintenance, SEO management, and other administrative tasks.
Data-entry: Bookkeeping or
inputting data from different sources into a spreadsheet.
Etc.
Tracking Key Performance Indicators (KPIs)
If you want to know how your digital product
marketplace is doing, you need to keep track of your Key Performance
Indicators (KPIs). This is an important step to take to ensure that you are not
going off track.
Example dashboard of tracking KPIs
A key performance indicator – also known as
“KPI” is a performance measurement that impacts the result of your online
store. KPIs need to improve and achieving your objectives will provide
important milestones on your road to online success. Monitoring important KPIs
for your online store tells you whether your business is moving towards meeting
your objectives or not.
Essential KPIs you should track
KPIs for digital product marketplaces are numerous to track but important is to
focus on those where any change will impact the financial result of your
business. Tracking should be done at least on a monthly basis or even on a
weekly basis. The advantage of doing a weekly tracking is that you will find
out sooner in case of any problems and have more time to take action. If you
wait until the month-end, you might find out that too late that were problems
and it leaves money on the table.
We present a selection of KPIs which will be
useful to consider tracking on a regular basis for a digital product marketplace.
They are:
Website
Traffic (Number of Visitors)
Website Traffic
Average Time on Site
Domain and Page Authority
Alexa Ranking
Social Media Followers
Conversion
Rates
Conversion from Visitor to User
Conversion from User to Paying Customer (Free to Paid product)
Cart Abandonment Rate
New Customer Signups
Email list subscribers
Number of orders
Average
Order Values
Number of products
Average Order Value
Measuring KPIs on a regular basis is an
important step towards professionally managing your digital products marketplace
and finding the areas where you can still improve in order to achieve your
business goals. To really grow your multi-vendor marketplace, you need to monitor
your webstore’s performance on an ongoing basis and take actions every time
KPIs, move in the wrong direction. Once you’ve decided which KPIs you want to
track, make it a part of your weekly and/or monthly routine to follow them
closely.
Automating and Improving Processes
At the beginning of your website, tasks are
fine to deal with as they come up. But as you grow, these tasks get more and
more frequent, and the demand on your time and your team’s time becomes even
greater. After a while, these small tasks can significantly eat into
productivity; reducing output, creativity, and even profit margins.
You will be confronted with seeking new ways
to automate and improve your processes as your digital product marketplaces scale up and become larger. The objective
is to save time, money, and sell more. Ultimately, it provides gets your
business ready to scale-up exponentially. Automations include mostly:
Automating tasks and improving processes is an
ongoing task and there will be many more ways to save time and benefit from
automated solutions and improved processing. Obtaining a sufficient level of
automation is key to fully scale-up your digital product marketplace to
reach its full potential.
Website Security
Another important element that most eCommerce
companies need to consider from the very beginning is the eCommerce website
security. If you run an eCommerce website, you’ll know that they are a major
target for hackers, fraudsters and yes, even for your own competitors. Just
think about the thousands of user IDs, personal information, product catalog
and prices, financial information including credit card details a typical
eCommerce webstore has. That’s what makes eCommerce sites, big and small, so
attractive to cybercriminals to exploit and competitors to leverage on.
As your multi-vendor
marketplace platform becomes larger you will also find that you
will have to spend more time in making your infrastructure more solid and
enhance the security of your marketplace. Here are some basic measures you will
have to implement to keep your digital product marketplace save (among many
others):
HTTPS / SSL – today Google views it as an
outdated practice to use HTTP and punishes websites still using the old HTTP
protocol. Therefore, implementing a Secure Sockets Layer (SSL) certificate from
the start is a must. You can purchase one from your hosting company or a
reputable SSL vendor at affordable costs.
Complex Passwords – Insist that every user
have to use passwords that comply with a minimum standard.
Payment Gateway Security – While it may make
processing payments more convenient, having credit card numbers stored on your
database is a liability. In order to save your business from this terrible
fate, you should never store credit card information on your servers and ensure
your payment gateways security is not at risk. Today you can easily use
third-party payment processing providers such as PayPal or Stripe who will
manage all sensitive Credit Card information in a professional manner.
Firewalls – using firewall plugins and also
configuring your server firewall is a must to protect again malicious attacks.
Backup your data – Data loss due to hardware malfunction or cyber-attacks are not uncommon. And if you don’t back up your data regularly, you are at the risk of losing it for good. Employ automatic daily backup service so that even if you forget to do it manually, all your data will be backed up automatically minimum once a day.
These are just a few elements to mention and
to work on. As your digital product
marketplace becomes bigger, paying close attention to security becomes
even more important.
Conclusion: Building a Digital Product Multi-Vendor Marketplace Platform is a
Journey, not a Destination
Building a digital marketplace is a good idea
as today the trend goes towards creating specialized niche marketplaces that
can offer better know-how and a much more focused approach than a generalist
marketplace. Many buyers prefer to buy from a marketplace rather than a single
vendor store.
Easy Digital Downloads offers an open-source solution to run a digital product marketplace on WordPress by installing select marketplace plugins for WordPress. These are either freely available or are very reasonably priced. Also, many useful plugins are available on the WordPress plugin directory.
The marketing tactics require a bit a
different focus for a multi-vendor
marketplace platform
compared to a single vendor store. SEO and Social Media Marketing are two
important strategies to focus on, especially as traffic there is cheap in the
long-run compared to other sources of traffic.
Vendor management and tracking your Key
Performance Indicators are a must in establishing a successful digital product marketplace.
Activities and tracking of KPIs should focus on factors which will influence
users and revenues later on.
Ongoing work will be required and normally
only by keep testing and optimizing your WordPress marketplace you can exactly understand
how your marketplace business works and how to make it a success. Creating a digital product marketplace is not a
destination but one of the most interesting journeys in eCommerce. Feel free to
take it.
This article provides an overview of how to build, set up and operate your digital product marketplace in WordPress. If you are interested in more details, please download our Free eBook on How to Build a Digital Product Marketplace on WordPress which contains even more comprehensive and detailed information on how to set up a multi-vendor marketplace platform for digital products.
For any feedback or comments feel free to reach out to us as we are also interested in your input digital product marketplaces can be made even better.
With the rise of eCommerce and of the increasing number of people
preferring to buy digital products in the online market, many entrepreneurs
have decided to set up businesses selling such products. It can be a highly
profitable way to earn money online. They are quick to create, simple to
deliver, and something anyone with a few basic skills can get it up for sale
with some affordable tech and tools. Thought, it won’t be easy and it takes
real work to set up digital products. But, rest assured that if you have a good
digital products to sell online, there’s a market out there for you, no matter
how small it may be.
What are Digital Products?
A digital product is an intangible asset or piece of media that
can be sold and distributed repeatedly online without the need to replenish
inventory. These products often come in the form of downloadable or streamable
files, such as MP3s, PDFs, videos, plug-ins, and templates.
All types of digital products have their own unique advantages.
Some are easy to produce while others require tons of time and effort. Some can
remain marketable and valuable for a long time while others depreciate quickly.
Some are one-and-done while others require maintenance and updates, and a lot
of other things we can take into consideration upon choosing which digital
products to sell.
In our previous article, we have covered the Pros and Cons of selling digital products. Now, if you’ve decided to give digital product sales a go, but can’t think of a great niche product that’s perfect for you, then this list of digital products to sell is the only thing you need.
Why should you sell Digital Products?
Due to their demand, popularity and ease of distribution, many professionals
and entrepreneurs build entire businesses around these intangible goods or to
launch digital product lines.
What makes them especially appealing, however, is that digital
products can be created once and sold repeatedly to different customers without
having to replenish your inventory. Also, you will never have to worry about
logistics that most physical product sellers has to deal with.
You all have the control of what type of digital product to sell.
It mainly depends upon your own field of expertise, knowledge and niche. Don’t
forget to consider also your market needs and wants and some other factors that
will put your Digital Downloads Store on top.
The best Digital Products to sell online
EBooks
The emergence of devices like eReaders and smartphones have
skyrocketed the demand for ebooks. That is why self-publishing has become a
modern-day reality, letting anyone with interesting and knowledgeable idea to
offer the world the opportunity to post it online and make money from it. Put
words into documents, be it an eBook or a PDF, and turn words into value.
If you are good at writing, there is huge potential for you to be
creating and selling eBooks. This continue to be the most popular digital
products being sold online.
EBooks are very simple and flexible to create and market. If you
are just getting into selling digital products, this is the best choice to make
for your first product. They’re easy to make and sell extremely well.
WordPress Themes and Plugins
Digital products can also come in the form of intangible tools
that equip professionals to do tasks that either fall outside of their skillset
or take up a lot of time. That is why Software Developers are taking advantage
of the current fast growing eCommerce industry as people use more and more open
source platforms such as WordPress.
If you are good with coding, consider selling WordPress themes! Most premium WordPress themes sell for $50 to $100 each. Today, different plugins, themes, code snippets and extensions for WordPress are available online which can enhance the functionalities of various WordPress websites. If you possess the skills and knowledge in developing WordPress plugins or codes, this is definitely the best digital product for you.
Software
This is yet another major industry that has proven to be an
excellent revenue generator. The software industry is huge and is continuously
growing, especially with many businesses selling their software as a service
(SaaS).
Any person’s ability to write code of any kind can result in new,
useful products. Whether it be desktop software, web-based applications,
website templates, mobile apps, video games, or anything else powered by code –
you can literally turn it into cash. The possibilities are endless, and an
established market likely exists.
How to
sell digital products such as Software? The software can either be sold
online by either providing access to an online website service or by
downloading the software upon purchase. In addition to selling software,
related services can be offered as well.
Documents and Templates
Documents and templates are another popular categories to sell
online. Here the main objective is to provide standard templates which allow
customers to significantly save time and money while allowing a more
professional work output. Examples include e.g. report templates, resume
templates, application letter templates, presentation templates, spreadsheet
templates or templates related to any other software.
There are documents which are password protected, may include
large files, with variations on the same files, can be well suited for
recurring models like periodically revised or updated reports, and documents
shared freely as lead magnets.
Design templates are the perfect digital product for anyone who is
creative, visual and maybe even already freelancing as a designer! There are a
lot of document types that can be created and be sold online, and which may
depend on your market needs.
Audio Files
Audio files are a powerful medium for communicating messages, and there are many different types of audio digital products – which are very popular items to be sold online. The audio products industry is a billion-dollar industry. Digital streaming has crossed a major milestone with more than 100 million paid subscribers globally. Every customer streaming your podcast or listening to your music can contribute to your passive income.
Digital audio products can be in the form of recorded lectures,
podcasts, audiobooks, music tracks, sound effects, and many more. Songwriters
can also simply sell their songs on their own web shops in case they are not
interested to use any of the large platforms where the terms are mainly
dictated by Spotify and others. There also exist markets for selling audio
tracks only as in today’s online marketing world, many people required
background music for their videos, etc.
Design, Graphics and Digital Arts
Selling design, graphics and digital arts are perfect for people
that are both creative and passionate with art and design. It encompasses a lot
of product types such as design templates, business logos, drawings, sketches,
photos, arts but also animated or edited pictures – you can actually create a
wide variety of unique and valuable products.
The key to being successful here depends mainly on your creativity
and design skills. Good digital designs and artworks are surely worth selling
online!
Online Courses and Videos
One other interesting product category to sell online are online
courses and videos. E-Learning is an
industry rich in innovation, and is continuously growing – exploring new ways
to make different kinds of contents available to learners. Videos sold on
e-commerce shops are mostly educational and the reason why people are buying
them is that they want to acquire a new skill.
If you consider yourself an expert on a particular topic, creating
a video explaining a topic in detail can become a great way to package that
knowledge and sell it to others looking to learn via an online video course.
Stock Photos
If you have that photography skills as a hobby but wanted to earn
some money out of it, this is the perfect digital product for you. All you need
is a nice camera and decent photo editing software.
The widespread use of images for web design and blog publication
means there will be continued demand for high-quality, premium photos. With
excellent quality images, it’s possible to do very well selling your photos
individually or in bundles, or create a subscription-based website for your
customers.
Professional Services
Another category of digital products to sell online are actually
services sold as single projects or gigs (see the Gig Economy). Such services
which are likely being offered online for sale are virtual assistance, creative
writing, proofreading, legal, marketing, different kinds of consulting
services, translations and many more. Offering such services will mainly depend
on your focus set of skills and market knowledge in order to address an unmet
demand by the market to help other people.
These are just some of the examples of digital product you can
sell online. For sure there are even more digital product types which you can
consider depending on your niche and focus.
Top Tools for selling Digital Products
Easy Digital Downloads is simple to use and free to download. Get started today!
For merchants and creators of digital goods, there are a variety
of ecommerce platforms focused on selling downloads directly to consumers. With
these tools, merchants can control download and pricing structure, branding,
and where their products are sold.
Here is a list of platforms to sell digital downloads.
It’s fair to say that the digital products industry is growing at
an alarming rate. Given how profitable it is, budding entrepreneurs,
professionals, and artists are flocking to it. But before all of it, you need
first to come up and create the perfect digital product which suits your
expertise and skills well.
Starting to sell products online may be daunting, but deciding on
the product is the hardest part – it just gets easier from here. All it takes
it choosing a product from this list, putting together the digital assets, and
then launching your store. With a little ingenuity and upfront investment of
time, you can serve up irresistible value that can more than pay for itself
over time. Now, you have an idea what digital products to sell online.
