Digital Products: Advantages, Characteristics, Types, Examples, and How to Market Them

Currently, digital products are a lucrative business entity. Many new entrepreneurs have emerged thanks to the presence of digital products and the availability of platforms to sell or market them.

A digital product business can be started while you are still working in an office. This is because this business can be your additional income or passive income.

If you are one of those who are interested in building an online product business, then find out the complete information below.

Definition of Digital Products

A digital product is an entity or product and service that is created, marketed, and used using digital technology. In other words, a digital product is a product that does not have a physical form and can only be used in the digital sphere.

Some examples of digital product businesses that you must have used or use every day include:

• Google
• Facebook
• Grab
• Go-Jek
• Spotify
• YouTube

The brands above do not offer products that can be held or used physically. They offer digital products such as online social media platforms, online transportation services, music streaming platforms, and videos.

The digital product business is part of a long-standing digitalization effort. The Indonesian market also still has great potential for digital product businesses.

Advantages of Digital Products

Here are some of the advantages and benefits that can be felt from doing a digital product business:

• Reduce operational costs, because you don't need a warehouse to store products or pay shipping costs.
• Increase income and profits, because digital products have no recurring costs for production, so you can maintain cash flow including income to profit margin.
• Can be automated, in other words you don't need to supervise or present products manually.
• The products sold are more flexible, because they can be used for various digital needs and are easily accessible. For example, subscribing to Spotify on one account, you can listen again on any platform, from smartphones, laptops, to TVs.
• Products can be updated easily, because users and buyers don't need to bother going to offline (physical) stores or offices to get the latest version of your digital products.
• Environmentally friendly digital products that do not produce waste or vehicle gas emissions. So digital products have a very low carbon footprint.

Characteristics of Digital Products

The characteristics and characteristics of digital products that you often encounter include:

• No physical form: as previously explained, digital products do not have a physical form that can be touched. You will use another device to be able to access and utilize digital products.
• Interactive: users can interact with the product, change settings, and provide feedback or input directly. This helps businesses to develop their products to be better.
• Easy to get: no need to go to a store or travel far to be able to buy digital products. Simply with internet access and a device such as a smartphone, users can buy and use digital products. Examples include digital video and music content from YouTube.
• Upgradable: the process of changing or developing digital products can be done and given easily to users. They can still use digital products while updating the application.
• Maintenance costs are quite affordable: unlike physical products which if damaged must be taken to a service center, digital products can be repaired remotely. This will certainly reduce the cost of maintaining the product.

Types and Examples of Digital Products

According to Productfolio, here are some types of digital products and examples:

Applications or software

This type includes all types of applications on your smartphone or laptop. Starting from productivity applications, entertainment, design, social media, streaming, and others. Examples of these digital products are: Netflix, Spotify, YouTube, TikTok, Google Chrome, Microsoft Office, WhatsApp, and many more.

Digital content

Digital content comes in various types or forms, such as e-books, music, videos, articles, and podcasts. Examples of digital content are Instagram Reels, YouTube Shorts, online articles in the media, songs and podcasts on Spotify, and audiobooks,

Online platforms

Online platforms include various digital platforms that users use to interact with products, make transactions, and share content. Examples of online platforms include social media (Instagram, X, Facebook), e-commerce (Tokopedia, Shopee, TikTok Shop), and online marketplaces (OLX, Facebook Marketplace).

SaaS (Software as a Service)

This type of digital product is a business offering an application as a solution to their problems, and the application is managed by the business, not the user. Examples of SaaS are cloud-based collaboration tools such as Google Drive and CRM tools such as HubSpot.

Digital services

Digital services mean services offered via the internet, for example online courses (Skill Academy), telemedicine (Halodoc, Alodokter), and digital marketing services (SEO agencies and social media).

How to Market Digital Products

You can market and sell your digital products, from applications to digital services through various online channels, according to Shopify. Here are some recommendations:

1. Online stores on e-commerce or marketplaces, you can market your brand and create interesting content for your audience.
2. Ensure digital products on social media by creating a special account for your brand.
3. Sell your digital products in the appropriate category in e-commerce, use the right keywords to ensure your products come out when users search.

That's a complete discussion about digital products. It can be concluded that digital products are business entities that continue to grow and have an increasingly wide market. Moreover, with the development of technology, digital platforms have also changed to meet the needs of consumers or users.

If you are interested in building and running a digital product business, follow the Prasmul-Eli short program which discusses Business Development Planning in full.

In this class, you can learn directly from experienced business people, of course also in the digital field. You will also learn how to improve your competence in creating a comprehensive business plan and its effective implementation.

Interested? Visit this page to register for the program now!