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Info Product Business Model Explained

By Jamie Toyne

In the age of information sharing online, is it any wonder that the ‘information product’ has developed into its very own business model? With a step away from the physical products of brick and mortar businesses, selling valuable knowledge in a digestible format has become an extremely popular, as well as lucrative, business model.

If it is done right of course. So let’s dig into exactly what constitutes an info product business, explore their pros and cons, and explore some real life examples. We will even look at whether buying an info product business could be a good fit for you to make some money online, or whether it’s time to sell your existing info product business.

What exactly is an info product?

So first things first, what exactly is an information product anyway? An info product is not a physical product, but essentially a useful piece of knowledge or knowhow that is beneficial enough to sell to someone else. Think tips on how to lose weight or a course teaching you how to make money online.

This information is usually packaged up in an easy to understand format, think PDFs, videos, audio content, online platforms etc. Although many information products may include information that is already out there, it is usually presented with a unique angle from an authority in the field. And it is this value that people are often willing to pay for.

Have a product in mind and not sure if it is an info product? Check out our list of examples of info product’s here:

  • Ebook
  • Online course
  • Video
  • Audio
  • PDF
  • Webinar
  • Membership site
  • Cheat sheet
  • Report
  • Live Event
  • Coaching

How does the business model generate income?

An info product business model essentially makes money through selling an information product online. This could be through a one-time payment through PayPal or Stripe for a single purchase like an ebook, or it could charge a recurring fee through a subscription model, for example for an online course.

Usually an info product is free to make, or will usually only occur one-time, initial creation costs. It can then be replicated any number of times and sold again and again. This means it can be a lucrative business model with high profit margins. How useful or valuable your info product is to people can determine how many sales you make. Often it is needed to market the product to keep up consistent sales.

The positives of an info product business

There are many positives to owning an information product business, let’s take a look at what they are.

Low upfront costs

The great thing about an info product is that it is usually pretty cheap to make, or even free. It could be as cheap as creating a free PDF or may incur some one-time design or writing costs. Either way, you will not need to manufacture a physical product which means that investment costs are very low.

You can usually even acquire the information that goes inside your product for free through clever Google searching, or using your own speciality knowhow. Just be aware you may need to pay sales tax on your product.

High-profit margins

You can serve to make significant money from an info product business. The low start-up costs means higher profits as you are selling based on value. In some niches information products can sell for thousands of pounds.

Maintenance is also very cheap as there are no shipping, manufacture or delivery costs for your product as everything will be done instantaneously online. Therefore you have much higher profit margins than Amazon affiliate or Amazon FBA businesses for example, where a large percentage of each sale goes to the manufacture and fulfillment of the order.

No logistics

As well as being a low-cost business model to run, an info product business is also very easy to maintain. You won’t have to deal with logistical issues such as fulfillment issues, storage disasters, or manufacturing delays.

Passive income

This hands-off model doesn’t need constant attention like many other business models. After you have created your info product you have to do little else.

You may invest a little time each week driving traffic to your site perhaps through marketing or SEO, but this depends on your sales figures. One thing that may take up some time and effort is customer service and returns, but with the right systems in place, even this can be fairly minimal.

Do it from anywhere

Another great thing about an info product business is that there are no time or location limitations. You can work on your business wherever and whenever you want as all the magic happens online. This means it is a great fit for people who are looking to build a financially and location independent lifestyle.

The negatives of an info product business

So sounds great right? But surely an info product business is not all fun and games. What are the drawbacks to this business model before you jump in?

Picking the right niche

Although there are some incredibly lucrative niches for information products, not all of them can bring in the same levels of profits. It is important to research popular niches where there is a high demand for information such as health, parenthood, finance or language learning, to name a few. Information products in the money-making and wealth accumulation niche, for example, can sell for such high prices as they are essentially offering people life-changing value.

Check out the following popular niches for information products:

  • Health and fitness
  • Personal development
  • Making money online
  • Beauty
  • Parening
  • Pets
  • Languages
  • Travel and digital nomad life
  • Nutrition
  • Blogging, vlogging and freelancing
  • Art and design

Finding the right angle

As you may have guessed, in profitable niches, competition is high. And most information is already available online if you know where to look for it. Therefore it can be a challenge to create a successful informational product that really sells. It is important to focus your product on answering specific questions that people need answering.

You can identify common questions by searching forums and Facebook groups in your chosen niche. It is also vital to present this information in a way that is unique, easy to understand and straightforward to action.

People trust authority figures within a niche, so if you are a specialist in a certain area and can offer unique insights this would be ideal. It may also help you to build a brand around your product. If not it may take time to position yourself in the market so that people trust what you have to say.

Staying up to date

These days information is updating and changing all the time. Particularly technology. Therefore, although you only have to create your info product once, you may need to do some regular updates of the information in your product to make sure it is still relevant and useful.

Has your lead generation business course taken into account Facebook’s latest security update, or has a new discovery in nutrition made one of your eating plans less desirable? Keeping these things up to the minute can boost sales and extend the life of your info product.

Customer service

So you have found your niche and angle, but when actually running your business, customer service can prove to be one of the biggest challenges. It can take time to respond and manage customer queries and process refunds. Believe it or not, refund rates for info products can be higher than physical ones.

Don’t want to offer refunds? It’s your choice but remember this can harm how people view you and your product. There are ways to cut down time spent on customer service by creating FAQ pages for people to troubleshoot many issues themselves. You can also use many help desk software programs to help automate and manage customer issues.

You might try some of the following customer service platforms for semi-automated and intuitive customer management.

  • Freshservice
  • ZenDesk
  • LiveAgent
  • Salesforce Service Cloud
  • ProProfs Help Desk

Marketing

Marketing your info product business can be a challenge. But it is often a necessity in terms of driving consistent sales. You need to market your product as an authority and essentially build enough trust for people to buy your product over someone else’s.

That means sometimes it might take building out a whole sales funnel, following up to emails and putting in some hard graft to successfully sell your product. Check out some ways you can market your info product below to see what will work for you.

How to market your info product business

Marketing info products is a really important step in order to keep sales high. There are various different ways you can do this to not just maintain but grow your business.

Organic traffic and SEO

Building up organic traffic is an effective, consistent way to keep sales ticking over without too much effort or financial investment. Search Engine Optimization, or SEO, can be executed by creating useful content for your niche that you publish on your website or blog.

Your content will target relevant keywords helping you rank more highly in search engines and drive traffic to your site, in turn increasing sales. This tactic can also help you build a brand around your product and become an authority in your niche that people trust. This helps create a reputation and improve trust and sales over time.

Paid advertising

If organic traffic is not getting you the results you want, you can also diversify your traffic sources with paid advertising methods. This might come in the form of Facebook ads or sponsored posts, or other methods, that can help bring you sales boosts. Remember that paid traffic does not have the same longevity as organic traffic. An ad campaign usually only sees results for the length of the campaign itself, but that doesn’t mean you can’t get a great return on investment.

Create an email list

Another great option for marketing your product and growing your information business is building an email list. This way you can build up an audience with an interest in your niche, to whom you may be able to later upsell other similar info products to. You could also include affiliate links or other products you may offer in these emails. An email list can also help you become an authority in your niche or cement your reputation.

Examples of info product business

Time to jump into the real world and look at some actual case studies of businesses that use the info product model.

Digitalnomadacademy.com

Digital Nomad Academy has created a successful information-based business model offering an e-learning platform with useful information on how to become a digital nomad and have location independence while making money online. From guides, course modules, tips, case studies, tutorials and forums, they cover a large variety of info products. They offer highly desirable, actionable information and skills helping make the business into one of the most successful in the niche.

Rosstraining.com

Ross Training, as you may guess from the name, is a fitness business created by a boxing coach. As well as free blog content, video and advice, the website sells a variety of info products including ebooks and videos. Here is a good example of building a brand around the products you offer. Like Ross, many businesses build their brand around themselves as a personality and expert. As a trained boxing coach Ross has been able to position himself as an authority in fitness and create his own brand around this helping him to rise to success and make more sales.

Should you buy an info product business?

If you are thinking of buying an online business, you might be considering an info product business. But how do you know if this model will be a good fit for you? Ask yourself the following questions to get a better idea if this model could be your perfect match.Do you want a fairly hand-off business model?

If you are in the market for a business model that will make you a passive income, an info product business could be right for you. This is a fairly low maintenance model as long as you have the correct customer service systems etc. in place and have the right creators for any new products. This could be a great option for someone that already owns a portfolio of websites and is looking to add another addition to the pot.

Are you building an authority site?

If you currently own a site that you are trying to position as an authority in the niche, an info product business could help you do so. If you purchase a site that people already trust within the parenting niche for example, paired with your existing site it can help you become the go-to for all parenting problems.

Do you have the skills to improve an info product business?

Perhaps you are a dab hand at improving a website interface, making the checkout process smoother or implementing SEO. If so, you may find that you could easily improve an existing info product business and drastically increase profits without too much effort.

Do you flip websites?

Finally, this could be another good choice for you if you already flip websites for profit. As the profit margins are high for this business model, increasing sales and making improvements can make a big difference to profitability.

Buying an info product business

So you think buying an info product business could be a good fit for you? Make sure to do proper due diligence, there are a few things you should think about before you jump in.

Pick your niche wisely

As we have discussed, niche is important. You want to make sure the business you buy is in a lucrative niche, as well as one that is likely to stay in demand for some time, not just a passing fad. This is important for the longevity of your business. It is also wise to choose a niche that you already have knowledge or interest in.

If you can understand the information provided in the info products, you will likely be a much better judge of how valuable they are. It will also help you identify what your customers really want.

Reputation research

Before buying any business make sure you research, research, research. Check out any reviews and testimonials you can find on the company and its info products. This will give you a good idea about whether the business has a good reputation or a bad one. A negative reputation may mean that you find it hard to sell products in the future. It doesn’t mean this can’t be rectified, but certainly worth bearing in mind.

Beware of the ‘guru’

Many info product businesses are built around the personality of an individual. Think marketing masters, business gurus and fitness stars. If you are considering buying a business built around someone else, consider how important they are to the success of the brand and sales, and what will happen without them. It is best to steer clear of businesses that rely on one main figurehead, or at least come up with a plan to phase the business into a more company-based brand.

Check sales for consistency

Obviously a steady stream of sales is what you want to find for a business that you buy, but this is not always the case. Make sure you can see the sales figures for several months. New product releases can cause a spike in sales for example but you want to make sure your business does not rely on this. Unless you can implement alternative strategies to increase sales and turn this to your advantage!

Selling an info product business

If you already own an info product business, you may be considering selling. If so, there are some important things to prepare to make sure you can find the ideal buyer and settle the best price possible.

Show them the numbers

Anyone looking to buy a business wants to make a profitable investment. Therefore they will want to feel comfortable that the business they are buying can achieve consistent sales. It is best to prepare solid proof of earnings in advance as well as proof of traffic to keep the buyer’s mind at ease.

Offer them support

A buyer may also be concerned about the transition process so offering extra support here could be a deal clincher. You might offer to train them on the customer service system you use and any other systems they will need going forward. You may also pass on any contacts that you have for external contacts that may help create your info products such as writers, designers etc.

Lose the ‘guru’

If your info business brand is based around you as a personality, it might be best to transition away from this in the run up to selling. Perhaps you can move to a focus on the company as a whole or update the branding to do so. If you are integral to your brand, put a plan into place to how a new owner can adapt the business to stay successful without you.

Boost your reputation

Any buyer will want to take a look at your reputation before buying your business, so we recommend you beat them to it. If you have any negative reviews or a poor reputation, can you take some steps to do pre-sale damage control? Why not ask happy customers to leave reviews or testimonials, perhaps even offering an incentive to do so. Keep on top of customer service as well to make sure you are transferring over happy customers.

Conclusion

So there you have it, the info product business model unpicked. Info products are an incredibly effective and cost-effective way to make money online, boost your business reputation, and become an authority in a niche.

With high-profit margins and low maintenance, this is the perfect business model for someone looking to build or buy a hands-off business. Little to no upfront investment means the model is fairly low risk, with high-profit margins due to no manufacturing or logistical costs. Does it seem like a good fit for you?

Also Read: 6 Types of E-Commerce Business Models Every Entrepreneur Must Know About

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