Starting a Digital Products Business: Should You Build Your Own Store or Use Platforms Like Etsy or Gumroad?

Launching a digital products business can be an exciting yet challenging endeavor. The decision to build your own store or use marketplaces like Etsy or Gumroad greatly depends on your business goals, the size of your venture, and your target audience.

Marketplaces vs. Your Own Store

Marketplaces offer a flexible and low-cost initial entry point for digital product creators looking to test the market. They provide a platform to distribute your products to a diverse customer base globally. However, it's crucial to recognize that while marketplaces are excellent for minimum viable products (MVP) and customer discovery, it's important to have a central location that you control, such as a website with a custom domain or an email newsletter, to retain and engage your audience.

Best Marketplaces for Digital Products

The best platforms to start your digital products business on include:

Etsy: Ideal for small businesses and individual creators who may not have a large inventory at launch. Etsy excels in providing a wide audience and diverse product categories, but it might be less suitable for large-scale or high-tech products. Gumroad: Perfect for digital creators who already have a community or want to distribute their products directly to their existing audience. Gumroad’s focus is on digital products, with easier setup and integration for creators. Stanstore and Beacons: These platforms offer a medium between Etsy and Gumroad, providing a bit more flexibility and control than Gumroad but still maintaining a user-friendly interface. They are ideal for growing your business with a mix of digital and physical products.

Transitioning to Your Own Store

As you gain traction and start making sales, it's essential to consider transitioning to a more robust platform that's designed for scaling your business. Platforms like Shopify are great options for this.

Building your own online community is a key step. Gumroad, for example, is designed specifically for digital product creators to sell directly to their communities, while Etsy's platform is more versatile and includes vintage, handmade, and unique products. This versatility can be both an advantage and a disadvantage depending on your specific product niche.

Strategically, leveraging marketplaces can help you build trust and credibility without investing heavily in an online store. It’s a low-cost entry-level approach that allows you to test your offerings and build a base of customers. However, relying solely on marketplace traffic may not be the most sustainable long-term strategy. Platforms like Etsy and Gumroad offer organic search opportunities, but they require strategic placement and optimization.

From DIY to Ecommerce: A Step-by-Step Guide

Here’s a step-by-step guide to building and scaling your digital products business:

Initial Entry: Start with marketplaces that offer a DIY approach (Gumroad, Stanstore, Beacons). These platforms are user-friendly and allow you to set up your products without extensive technical knowledge. Build Trust and Credibility: Use these platforms to establish trust with your community. Offer low-cost, no-risk DIY products to build initial sales and customer relationships. Integrate with Your Own Ecommerce Store: Once you have enough sales and have proven your concept, integrate your products into a website or Shopify store. This allows you to control the branding and offer a more seamless shopping experience. Grow Your Product Range: Expand your product range with mid-level and high-level products as your sales and customer base grow. This will help you generate a healthy and consistent revenue stream. Transition to Scale: As you scale, continue to refine and optimize your product line and marketing strategies. Leverage data to make informed decisions about your business growth.

By following these steps, you can effectively transition from a low-cost entry-level approach to a robust, scalable digital products business. Whether you choose to build your own store or use platforms like Etsy or Gumroad, the key is to focus on customer satisfaction, product quality, and strategic growth.