As an affiliate, you’ll hear people claiming that digital products are better for affiliate marketing because they (typically) offer higher commission rates.
But is it really true? Are digital products really better for affiliate marketing? And if they are, should you only promote digital products?
Well, the good news is that those are precisely the things that we’re going to be taking a look into in this post, so let’s dive straight in & get to it.
Are Digital Products Better For Affiliate Marketing?
The short answer is no, digital products aren’t necessarily “better” for affiliate marketing.
You see, even though digital products generally boast higher commission rates than physical products, the commission rate alone isn’t the only factor you should be focusing on.
Instead, you should be focusing on the conversion rates of the products & working out how much you will earn on average across all of the sales you can convert.
For example, let’s say digital product A which costs $100 has a commission rate of 80%. This may seem great, but let’s say it also has a conversion rate of 1%.
From 100 clicks to that offer, you would earn an $80 commission. Not too bad.
But now let’s say physical product B which costs $100 has a commission rate of 20% which is lower, but a conversion rate of 5% which is higher.
From 100 clicks to this offer, you would actually earn $100, even though the commission rate is much less.
So in that instance, the physical product with the lower commission would actually earn you more money.
Yet if you take a look at them side-by-side below, the digital product seems like the obvious choice:
- Digital product A: 80% commissions
- Physical product B: 20% commissions
So what’s the takeaway here?
Well, the takeaway is that it’s not about commission rates or whether the product is physical or digital, it’s all about relevancy to the audience.
The product that will ultimately earn you the most money is the one that is most relevant & helpful to your audience at the time they view your promotion.
Why Do People Believe Digital Products Are Better?
The main reason that people claim digital products are better is simply that they generally pay higher commission rates to affiliates.
They also argue that they’re better because you don’t run into issues with stores being out of stock of the items that you’re promoting.
And it’s true, these are 2 good advantages of digital products.
Because the creators of digital products don’t actually need to manufacture things or pay for shipping, they can typically afford to pay their affiliates higher commissions.
But not always.
In fact, there are many digital products where the companies struggle to pay as much in commissions as some affiliate programs do for physical products.
Well, because online advertising & technical support can be very costly. So whilst you may think a high margin is easily achievable, that’s not always the case.
This means that if you see a digital product offing an excessively large commission rate to affiliates, you should always be a little wary.
Does this mean they’re not offering good support? Or that they’ve overpriced their products?
It certainly could do, so it’s always best to do some due diligence & check before promoting so that you don’t get a backlash from your audience.
The Bottom Line
The bottom line here is that whilst on the surface, digital products may appear to be the obvious choice for affiliates due to their high commission rates, it’s not always the case.
In fact, as we highlighted further up in this post, when you factor conversion rates into the mix, physical products could actually outperform digital products.
But overall, you should not be focusing on whether a product is physical or digital. You should be focusing on what product would best help your audience.
It’s that product that will help you to earn the most amount of money in the long run.
So hopefully this post has helped you to gain a better understanding of what types of products you should promote to your audience.
And if you do happen to go down the route of promoting digital products, we’ve actually gone ahead & listed the 10 best digital product affiliate programs.
So those would be worth checking out for sure.
And if you happen to have any questions or comments, don’t hesitate to leave them below. We always love hearing from our readers.