1. WHAT ARE
INFORMATION PRODUCTS?
Strictly speaking, information
products include all books, reports etc. In the Internet context, the term
refers to electronically deliverable, knowledge-based products.
Information products are also
referred to as "digital goods" and "knowledge-based goods".
If it
delivers knowledge and you can e-mail it to the customer or offer it as a
downloadable file, then it qualifies as an information product.
So information products are files on
your hard drive that you send out electronically. Tutorials, e-books etc
2.
WHY INFORMATION PRODUCTS ARE GREAT
FOR THE NET
- Information products can be created with little or no money.
- Information products can be reproduced in any quantity - it is as simple as copying a file. Even if you sell a million copies, production costs stay zero.
- With information products, inventory and the problems around keeping an inventory are completely eliminated.
- With information products, shipping costs and problems around shipping are completely eliminated.
- Because it is delivered electronically, the time-lapse between purchase and delivery is negligible.
These advantages are enormous - and
they can give you the edge you need to make your business a success.
Hard goods have to be manufactured
from raw materials using machinery. You'll probably have to hire someone to
oversee the production. You'd have to have a system for keeping inventory - and
again someone to run that. You'd have to ship the products - with someone to
oversee that - or outsource the shipping function to someone else. These
overheads make it difficult to be competitive.
Information products are cheap, easy, convenient and fast.
The kind of thing you can create and sell all by yourself.
3.
DIFFERENT KINDS OF INFORMATION
PRODUCTS
4. INFORMATION PRODUCTS AND PERCEIVED VALUE
The major disadvantage of information
products lies in its perceived value - in other words what the customer thinks
it is worth before she buys it.
If it's a real book, she knows that
it probably wouldn't get published if it were no good. She knows it has been
spell-checked. With an e-book, these assurances
are not there. Anyone can slap an e-book together and offer it for sale.
She also ends up with some data on
her hard drive - not a book in her hands. People simply like to hold
things they buy. Many people shop to feel better.
There are a couple of effective ways
to add to the perceived value of information products.
You could reassure your potential
customer by showing testimonials from happy customers, by offering a free download of part 1 while offering part 2
& 3 for sale, by offering a full, money-back guarantee etc.
You can also add to the perceived
value of information products by increasing the price. Every product has a level of price resistance. The ideal
is to find yours by experimenting and then set is just below that mark. Don't
make the mistake of pricing low because production cost is zero. Price it
according to the benefits it provides.
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