The Problem With E-Books
by: David Coyne
One of the most popular online ventures is selling e-books. People are hungry
for information; that’s why they’re on the Web in the first place.
And e-books are cheap to produce and distribute.
However, I’ve come across quite a few new online entrepreneurs thinking
they’re going to strike it rich selling a $20 or $30 e-book.
They’ve failed to do some simple math.
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Suppose you sell an e-book for $30. Deduct $5 off your $30 sell price to
account for advertising and other costs. That leaves you with $25. You’d
have to sell 1,000 copies a year to make $25,000. That’s a lot of copies!
Even if you did sell that many, 25 grand isn’t exactly going to put
you on Easy Street.
Another factor is competition. Many e-books with resell rights have also
be purchased by hundreds, possibly thousands, of competitors.And if you’re
selling an e-book as an affiliate, you’re usually limited to 50% or
less of the sell price.
The key to making large amounts of money selling information products is
that you need resell rights for at least one higher priced item.
Say you have duplication rights to a product that sells for $400. If you
sold just 6 copies of this product a month, you’d be pulling in $2,400
in sales. That’s $28,800 a year. If you sold 12 a month, you’d
make $57,600 a year. Sell 24 a month and you’re raking in $115,200
a year.
“Wait a second” you say. “What about my costs to duplicate,
package and ship the product?”
Here’s the beauty of the information marketing business: people pay
for the value of the information, not the physical medium on which it’s
delivered (e.g. paper, audiotape, videotape, CD etc.)
It’s dirt cheap to duplicate information products. It’s easy
to duplicate a CD-ROM on your computer and blank CDs are less than a dollar
each.
I have an info product that I sell for $397. To duplicate, package and ship
it via UPS, costs me $60. Subtract $50 for advertising. That still leaves
me with $287. That’s a huge profit margin.
So instead of concentrating all of your marketing efforts on low priced
info products, be sure that you have one or two higher priced items that
you’re actively promoting.
Use e-books as a stepping stone to upsell customers. Once they’ve
purchased a product from you, you’ve established a relationship with
them. Someone who’s already down business with you is five times more
likely to buy than someone who hasn’t.
About The Author
Dave Coyne is a copywriter, marketing consultant and president of DC Infobiz.
Get his FREE REPORT on how to start your own Information Marketing Business
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