Selling Digital Products on Shopify: The Complete Guide in 2024

Believe it or not, selling digital products could achieve a much greater margin on Shopify. For those who may wonder what digital products are, digital products are intangible items such as e-books, Software, templates and so on.

But why is making a profit by selling digital products much easier than conventional products on Shopify? One of the answers is the cost. There is no inventory cost and delivery cost, which normally eats up the margins. Moreover, you don’t need to worry about the supply since most of the digital products can be replicated again and again seamlessly.

With an array of advantages, there are more merchants selling digital products on Shopify. If you also want to sell digital products on Shopify, this page is all you need.

Is it possible to sell digital products on Shopify? 

Yes, it is totally possible to sell digital products on Shopify. Shopify is not only for physical goods but also for digital products. Generally, digital products are accessible to customers right after they make a purchase.

There are three main types of digital products that you can sell on Shopify, including non-fungible tokens, digital downloads and services.

1. Digital downloads

Digital downloads are the digital products that customers can download on their terminals. You need to upload digital files when you set up the selling channel so customers can access the files once they pay. Digital products such as graphics, music and videos are most popular on Shopify.

2. Non-fungible tokens

Non-fungible tokens are digital identifiers that demonstrate proof of ownership of digital products based on blockchain technology. Every token is non-replicable, hence many people find the value of collecting them.

Though NFTs sound confusing, selling NFTs is as simple as selling any other products on Shopify. A more detailed explanation will be elaborated in the next section.

3. Services

If you wish to sell your services through Shopify, you are essentially using Shopify as a channel to connect to your potential customers. Once they make a purchase, you need to take over and provide the service that they ordered. Selling services is not as simple as selling digital downloads or NFTs because there is more work for you. 

How to sell digital products on shopify? 

Following the instructions below, you can easily set up your digital products on your Shopify store.

1. Install the Digital Downloads app

To sell digital products on Shopify, you need to install the Digital Downloads app on Shopify. You need to find ‘Apps and sales channels’ in Settings and click ‘Shopify App Store’. After that, search for Digital Downloads and install the app.

2. Add your digital products and files

To add a physical product, you need to create a product in the Shopify admin and upload digital files on the product page via the Digital Downloads app. Uploading multiple files is allowed on the Digital Downloads app. It is highly recommended to bundle multiple files and compress them into a .zip file.

3. Set up the fulfilment settings

Digital products can be delivered to customers in two ways.

If you wish the files to be sent out automatically after the purchase, you need to select the option. Customers will be emailed a link to download the files.

You can only select the option to send out the download link manually. This option is mostly used when the product is combined with physical and digital products.

4. Build up your email templates

Since the download link will be attached to an email you send to your customers. You can also personalise the email template. It is highly recommended to include a detailed description of the digital products and the instructions.

5. Set a Download restriction

You can set a download limit on the Digital Downloads app. The download limit is the number of times that a customer can download the product. If you have more than one file, you can set the download limit for each file individually.

10 best apps for selling digital products on Shopify 

1. Easy Digital Products-EDP

EDP is a powerful tool for selling digital products. EDP has a very friendly interface, which is also easy for a new beginner. Within a few clicks, you can transform the product into a digital product. You can customize the interface and the download button. There is one special feature of EDP. You can protect your digital product with the advanced license key feature.

The free plan allows you to have 30 digital orders every month and you can only have 3 digital products listed in your store. However, if you upgraded to a pro plan, which costs you $9.99 each month, you will be able to list how many digital products you want.

2. Filemonk

Filemonk provides an excellent 24/7 customer service. There are other ways to protect your rights by disabling refunded order access and watermarking your PDFs. Just in three steps, you can easily start your digital product-selling business. Filemonk has made every process very easy for store owners with no experience.

With the basic plan, you can only upload up to 250MB and have only 30 orders each month, which is not enough for many merchants. Moreover, you won’t be able to use the PDF watermark function. Therefore, you should upgrade your plan if you use Filemonk. There are three more plans, costing $10, $20 and $50 per month.

3. SendOwl

SendOwl is a tool that is suitable for all sizes of businesses and creators to facilitate selling digital products such as subscriptions, videos, PDFs, designs, access codes, online courses and many more. If a customer completes the purchase, SendOwl will automatically send out the relative files for the digital products. It is a one-stop platform for selling digital products, encompassing all the functions that you need in the business.

SendOwl is not free of charge, but you can enjoy the 14-day free trial. During this period you should explore the functionality of this tool and then decide whether you need this tool for your business or not. You can use all the features no matter whether you choose the $15 /month plan or the $39f/month plan. The only difference is the storage size, with 100GB and 200GB respectively.

4. Courses Plus

Studying online has become a trend nowadays. With more people looking for online courses, more merchants are selling online course resources. With Courses Plus, you can easily start selling your online courses or coaching programs in your Shopify store.

The free plan allows you to upload up to 5 lessons in your store and you can’t unlock many other functions such as quizzes, certificates, limited-time course access, subscription and so on. The $29.99/month and the $79.99/month plans increase the number of lessons to 20 and 100 respectively. The most advanced plan costs you $199.99/month and you can unlock all the functions, with no limit on the number of lessons in your store.

5. Single-Video & Music

Single-Video & Music is the tool that helps you monetise your video content via Shopify. You can add the live-shopping feature to your store. By streaming from your storefront, you can direct your viewers to buy your digital products. You can also sell admission tickets or rental access to your livestreams and videos.

Single-Video & Music provides a free installation and usage, in which you can use all the common functions. You can also enrich the functionality by paying more. There are $24/month, $49/month and $119/month plans for you to choose.

6. FetchApp

FetchApp facilitates automating the delivery of digital products in your Shopify store. There are also download limits by quantity and time via FetchApp. FetchApp does not take commission fees on Shopify sales, which is friendly to merchants. Apart from that, the low monthly subscription fee also attracts a lot of merchants.

Though the free plan has the essential functionality that you need, there is only 5 MB of storage space. 5MB storage might not be adequate for large merchants. With a higher subscription fee, you can unlock more storage space up to 5GB.

7. Sky Pilot – Digital Downloads

Sky Pilot allows you to sell and stream digital products in your Shopify. With Sky Pilot, your digital products can be well protected. Each product will have a product tag and top-tier security to protect your digital content.

There is a 14-day free trial for merchants to experience the tool. In this two-week period, you can use up to 100MB of file storage. You can also upgrade to more advanced plans, with higher storage space.

8. Appointment Booking App | BTA

Appointment Booking App is an all-in-one tool that is suitable for all kinds of industries. You can book classes, appointments, rentals, events and so on through BookThatApp. It is a good way to earn the trust of your clients by providing such a structured schedule. You can even customize the colour to match your brand. Moreover, customer service stands by 24/7.

If you are subscribed with a free account, you can have up to 10 bookings and unlock some basic functions. With the $25/month plan, you can have up to 50 bookings and have on staff account to manage your store. The Premium ($49.95/month) and Business ($110/month) plan allows you to have 350 and 1,000 monthly bookings, with 10 and 20 staff accounts respectively.

9. RecurrinGO!

RecurrinGO! The app is a subscription app that helps you to manage your subscriptions seamlessly. Utilizing the subscription app generates more subscription revenues and keeps existing customers by providing convenient services, such as sending digital invoices. RecurrinGO! also provides flexible subscription rules.

There are four plans for you to choose from, namely Starter, Basic, Plus and Pro. Different to other tools, RecurrinGO! charges transaction fees. If you are using a free subscription, RecurrinGO! charges a 3% transaction fee for each subscription item. the transaction fee decreases to 1%, 0.5% and 0.25% with the increasing prices.

10. MenuLock – Disable Right Click

Many merchants suffer from content thieves. Nowadays, MenuLock acts as a perfect security guard. Once you use MenuLock, other people cannot use ‘right click’ and ‘save as’, protecting your content.

The free plan protects your text and images, but it only works on a desktop. The complete version costs only $1.99 a month but you can also access it via your mobile. 

Digital product taxes on Shopify 

The tax rates that we are going to talk about only apply to the European Union (EU). Whether it is physical products or digital products, the buyers will have to pay value-added tax (VAT) that applies to the countries they are living in. It does not matter where the seller is. However, in some regions, there is no sales tax on digital products. Therefore, you should always check the local tax regulations.

Before having sales, you need to register for VAT in all the countries where you have business. In EU countries or regions, you need to register for Mini One-Stop-Shop (MOSS).

On Shopify, you need to enable VAT rates for digital products and for each country. In this way, once a sale is made, the corresponding VAT will be automatically applied to the bill.

To enable VAT rates, you should go to ‘Settings’ and find ‘Tax and Duties’. After that, you need to click ‘Charge VAT on digital goods’ in the ‘Tax calculation’ section. Additionally, you need to go to the collections page and click ‘Digital Goods VAT’. The next step is to add digital products to the collection. Remember to save all the changes.

What’s Next? 

This page provides a detailed description of digital products and elaborates on how to sell digital products on Shopify. Selling digital products is a great opportunity for starters and existing Shopify store owners.

We have also collected and summarized the 10 best tools that you help you with selling digital products on Shopify. It is highly recommended to use a platform called ‘Channelwill’. Channelwill is a one-stop platform for e-commerce. You can find almost all the apps that you need to start your business selling digital products in your Shopify store. If you have any questions, Channelwill’s customer service team is always worth turning to.