Choosing Affiliate Marketing Products: Digital vs. Physical Product

One of the first steps to do when getting started with affiliate marketing is choosing the right product to promote.

As you know, there are countless affiliate products that you can choose to promote in your blog or website that making a decision can be a daunting task.

To help you make come up with the right choices, it is imperative to consider the following:

  • Your audience
  • Product value
  • Product quality
  • Profitability

You need to promote products that your blog audience would actually find useful and valuable. After all, they are the ones who will buy the product. And they won’t buy anything that they don’t need or want.

The product should also be of high quality and value. Ask yourself if the product is something that you will use for yourself. It should come with features and benefits that will help resolve a problem or make your life more comfortable.

Then finally, you need to take into account profitability. It’s a must to know how much you will earn as a commission when you promote this product and get it sold. It’s better to go for products that will give you higher profits.

In addition to all these factors, you also need to decide whether to sell physical or digital products.

In the past, there is only one type of product: physical product.

But since the dawn of the internet, digital products have emerged. These are products available in electronic format and can be sent through electronic means (e.g. as a downloadable file through email).

In this article, we will help you decide which of the two is more suitable for you. Making the right choice is a step closer to affiliate marketing success.

Physical Products

Let’s start with physical products. Most of the products that you will see in top affiliate networks are tangible items that would actually have to be shipped to the customer. Here are the pros and cons that you should know about.

Pros

# 1 – Easier to sell

You might think that a digital product is easier to sell.

Well, it might be more convenient as you don’t have to worry about shipping, but the truth is, physical products sell more easily.

It’s easier to convince a customer to buy a physical product than a digital product.

Why?

Some people still have a hard time grasping the fact that digital products are real. For them, if they can’t hold something with their two hands, it’s not a real product.

This is the reason why physical products are easier to sell.

This is something you’d want to consider when getting into affiliate marketing, particularly if you are not that confident with your sales and marketing skills.

# 2 – Less competition

The fact that physical products are more difficult to create than digital products means that there is less competition with the former.

There are not too many manufacturers producing the same product unlike with digital products.

For example, you might find only 10 brands competing as essential oils but there is more than one million make money ebooks that you can find online.

Less competition brings us back to the first advantage. This makes physical products easier to sell. Many affiliate marketers can attest to this.

# 3 – Lower refund/return rate

It has also been proven by many affiliate marketers that physical products have lower refund and return rates.

Sometimes, even when a customer is not satisfied with a physical product, he/she might opt to skip returning the product because of the hassle of having to ship it back. Instead, the customer will just keep the product and just buy another one.

This is advantageous for affiliate marketers. One thing that you have to know is that when a customer returns a product or requests for a refund, the affiliate will not get the commission from the aborted sale.

Cons

# 1 – Lower commission

If you’ve been reading about affiliate marketing, you’ve probably come across claims that you can get paid up to 50 percent of the total sale made.

While this is true for some affiliate products, most physical products would only have you earning between 4 and 15 percent of the product price.

As most affiliate marketers will tell you, the commission for physical products is lower than what digital products offer.

This is probably because it is more expensive to produce a physical product and so the owner needs more of the profit to get the ROI more quickly.

# 2 – More expensive

Physical products are more expensive than digital products.

Even though physical products are easier to sell as mentioned earlier, there are times when you would also find this challenging to do because of the expensive product price.

For example, a beauty product can cost anywhere between $20 and $100. But an ebook that provides beauty tips would only cost $5 to $15.

This can be a problem for affiliate marketers especially those who want to sell more quantity to make more earnings.

# 3 – Shipping costs

The shipping cost is another issue that you’d have to deal with.

Yes, you don’t have to worry about the shipping process because that is not included in the job description of the affiliate marketer.

That is something for the merchant to worry about. But the shipping cost does have an effect on you. This makes the product more expensive and therefore, harder to sell. This is especially true for products that are heavy or require special shipping or handling.

Digital Products

Now, let’s take a look at the pros and cons of digital products. These products are transmitted electronically usually through email. Examine its pros and cons to determine if this is right for you or not.

Pros

# 1 – Higher commission

The best benefit that you’ll get from promoting and selling digital products is the high commission.

Physical products are more expensive because of the need to purchase raw materials, spend money on manufacture and production, take care of packaging, storage and shipping and so on.

All these costs are passed on to the customer so that the product creator can earn money.

This is also why physical products offer lower affiliate commissions.

Now since all these processes are not necessary for digital products (production only has to take one time and the product can be sold a number of times), the product creator can afford to provide affiliate marketers with higher commissions.

Some digital products offer up to 70 percent commission of the total sale made.

# 2 – No shipping necessary

Since there is no need to ship the product and it can be delivered instantly to the customer on the same day it was ordered, it is more convenient for all parties—the affiliate marketer (who will also get the commission more quickly), the merchant and the customer.

When you choose to sell physical products, you will need to wait until the product has been delivered to your doorstep before you can get your commission. This can take anywhere from three days to several weeks. And when the product is returned, you also won’t get your commission.

With digital products, you can instantly get your commission since the product will be delivered instantly.

# 3 – Wider audience base

As there’s no shipping restriction, meaning you can deliver the digital product to anyone in the world, you will obviously have a much larger audience base.

You can choose to sell your digital products to people on the other side of the world without having to worry about how you are going to get the product to them. You simply have to provide them with the link, and the merchant will send them the digital product file once they make the purchase.

Cons

# 1 – High refund rate

The biggest problem with digital products is the high return and refund rate.

Since anyone can create a digital product as production is much cheaper, there has been a serious decline in the quality of these products.

Some ebooks, for example, do not offer any new information but are just a re-hash of what can already be found in the internet.

When customers are not satisfied, they request for a refund. And because there’s no need to ship back any product, it’s less of a hassle for them to do so.

# 2 – Issue with quality

Speaking of quality, this also poses another problem for you as an affiliate marketer.

Aside from the high refund rates, which means less earnings for you, your reputation can also be at stake when you make the mistake of promoting a low quality digital product.

This is why, it’s absolutely necessary that you double check the quality first of the digital product you’re planning to sell before you do so. This way, you don’t have to put your online reputation at risk.

Making the right choice when it comes to what type of products to sell is one of the first steps in succeeding as an affiliate marketer. This and many other strategies will help you turn this online business model into a reliable source of income.