Comprehensive Step by Step Guide To Creating Passive Income By Selling Electronic Products Online


If you want to create something that perpetually sells itself, and you just see money landing in your account at regular intervals, this post is for you. It really is doable, and there is nothing in it for me to share this with you, except that I adore this stuff.

But first things first. I feel like a real dork posting this. But I have spent so much time studying this topic, and so much time learning the ins and outs of how this all works that I’d feel like a bigger dork if I didn’t share it. Ask any of my friends, and they will tell you that I randomly talk about this stuff all the time. The rabbit hutch (wait for it) comes up all the time. I talk about my little e-book sales, all the time. I’m constantly talking about this stuff, not because I’m all about rabbit hutches, but because I’m all about passive income, and learning how to make this work.

I am so fascinated with this topic that I have spent years just studying and studying and testing and testing to see how the internet and passive income could possibly work. And so this is just a fantastic hobby for me, just a serious OCD fascination that I have… so yeah, I have to write about it. I’m nearly certain 4 people will find this post, and benefit. And that’s fine, because I’m writing this mainly for myself as a log and status update for what I’ve done, and tried, and how I’ve learned and grown on this topic over time. Ok? So if this benefits you? Awesome. You and I, and those three other people? We are all in this together.

My First Attempts
My first attempts at creating passive income started years ago with a curious question about how Google worked. All I started out trying to learn was, are there ways in which I can make the Google Demigods smile upon a particular post? And at that time, I had just built a rabbit hutch – and I literally and arbitrarily decided, why don’t we set up the best possible search engine optimized (SEO) post I can dream up. Let’s research content best practices, and metatag best practices, hosting, speed optimizations, code optimizations, everything. I figured… let’s make this page just twinkly for Google. And it took a couple of months (because that’s how long Google took to respond to new content back then) but I slowly started to see my page about the world’s best rabbit hutch, slowly move up the ranks. Gradually I learned what mattered and didn’t matter as I tweaked and changed things and watched as the ranking slowly moved up the results list. Page 4, Page 3, and oh the day when I first saw that page hit page 1?

If you are interested in those results, you can read about my findings just from the SEO optimization about that page here. At the beginning the page was just me heralding how awesome it was. Then people started asking me for the plans. And I was like, oh, yeah sure… so I drafted them up in a crude fashion and started making them available for free. Thousands and thousand of downloads later, and only after just a couple months, I realized the SEO work, and the plans themselves were a bit of a hit. So, I then thought – heck, I’ve been getting up to a hundred or two downloads a day, now I wonder, what will happen when I start charging for them?

But before I did that I actually had to do some work. I made the plans easily readable. I created a walk through for how to create the hutch. I created a cut list and a purchase list. I tried to think of absolutely everything. Right? So that is tip number one, figure out what your potential customers need, not what you want. And once I had done that, I created a small in post ad, and then pointed the link on the site over to Paypal instead of to a direct download. Right? And voila, I was accidentally generating income. I danced a jig with the very first $4.95 purchase. Occasionally I would need to help someone re-download the plans, but otherwise, money just started coming in after the initial download. And in the past three years, with this single plan, I’ve generated over $3,000 in passive income. Please remember, this was all by accident. My goal was not to set out to sell $3,000 worth of rabbit hutch plans. (Does anyone, ever, set out to sell rabbit hutch plans? I didn’t anyway. And good lord’a’lmighty do my friends give me grief about it. But then I buy the next round and tell them the rabbit hutch plans were buying.) I have taken what I learned from this test, and I’ve parlayed it several different successful new products. My most recent success is a site that sells an e-book, an excel sheet, and an access database of information from the Bible. Here, check it out:

Want to try it yourself? I’ll walk you through the detailed steps below. Follow the steps to a T and I promise you, that the next thing you know, you’ll be seeing revenue as a result.

Comprehensive Step by Step Guide To Creating Passive Income By Selling Electronic Products Online

button-1Step One – FIND A PRODUCT

Knitting-PlanFirst and foremost, our goal is PASSIVE. We don’t want to ship anything. Our goal is to not fulfill physical orders or lose money to fulfillment centers. And so, to that end, we need a product. Take a deep breath. Remember? I sold RABBIT HUTCH PLANS for crying out loud. An e-book on a niche segment of knowledge. A video. A tutorial (like this one actually could work – notice I am NOT selling this!) Plans work as I’ve mentioned. Game walkthroughs. Travel guides. Really anything that can be downloaded via the internet will work. For our example walk through, I found these funny knitting plans that we’ll use as our example. Obviously stealing someone else’s idea won’t work. I’m just using these as my example demo for how one COULD sell these online. I just think they’re funny.


button-2Step Two – CREATE YOUR PRODUCT
knitting-planFor my mustachio scarf product thing… I would begin by creating my plan drawings post haste. And then, out put the plans as PDFs. Simple enough. After finishing up the actual knitting plans (what do knitting plans even look like? I have no idea. Never mind, I just found one and included it here, because I’m that kind of giver.)

You could sell the plans by themselves, but I’ve found, you are way way more likely to sell your plans if you have a walk through included. I’ve also noticed, that if your training course, or your e-book, or your how-to plans, is for something that is complicated enough to assist the user, but not too complicated that the potential buyer doesn’t get overwhelmed you’ll be more likely to sell the item. An e-book on how to play the piano probably won’t sell much, too complicated. But I bet an e-book on how to tune your own piano probably would. Does that make sense? So with this litmus test as a guide, I’m doubting we will sell many of these mustachio things… maybe they are too simple? But who knows, that’s another thing about creating your product, you just never know until you try it.

I created a ski rack once for my garage. I made it for a little over $10 with a piece of 2×6 and some dowels. I told everyone about it on a page that I worked hard on the SEO, and then I just gave the plans away. I’ve been meaning to start selling them, but just haven’t gotten around to it. They’ve already been downloaded a couple thousand times, so I know they have potential as a for sale item.


button-3Step Three – Host Your Product
Once you have your product created… your next step is to host it and sell it. There are a lot of ways you can host your new product. A million options. But just work with me here… I do this stuff for a living. I am currently developing sites in the Philippines and around the world. I’ve managed and supported billions of dollars worth of transactions in my work life, and I know a thing or two about this side of the equation. Ok?

To start hosting your product, you just need a good URL (SEO ready – please go read this if you have questions) for your product and a host provider. For our scarf plan project I’d go with something like or, or something like that. You want to hit the most likely search key phrases that people will be using.

If you already have a blog, that will work – I did it that way initially. But if you really want to do well from an SEO standpoint, I’d create a dedicated site. It is super super cheap, and it will pay for itself almost immediately. You can literally get a website up and running, on your own, for a couple bucks a month. Over at Bluehost, you can quickly, and cheaply setup a very very powerful hosting solution to begin showing off your new mustachio scarf things right away. For example, you can get a site, and domain name at Bluehost for something like 5 or 6 bucks a month. They’ll give you a free domain, one click word press install, really everything you need to start showing off your mustachios. (Can I just say how much I love the word Mustachio? Thanks for that.)

Just as a comparison, I created my site in a weekend. I bought a cheap wordpress template from themeforest – which I highly highly recommend, as their support is phenomenal, and their themes and their updates are brilliant – applied it to my new bluehost account and voila. Sure I had to put in long hours that weekend to get it just the way I wanted it. But once I had it up and running, it was like a snowball running downhill on it’s own. If you get moving on this piece of it, and you have questions, don’t hesitate to ask in the comments section. I’d be happy to help answer your questions.

Also, another fantastic way to make all this happen in one single solution is via a company called Shopify which will let you build an online store. Through shopify you can do all of the above in a single hosting solution. You can take credit cards for purchases, and utilize their easy to use shopping cart solutions. Shopify is a great way to make your online business make magic happen quickly. Check them out and build an online store today.

button-4Step Four – Connect to Paypal
There are other methods other than Paypal, but I have found them to be extraordinarily simple to setup and use. Once you have setup your initial Paypal account and connected it to your bank, you can then start setting up your product by setting up a product sale button. One of the nice things about Paypal is that it allows you to not only setup your products, but you can also setup product types, features etc. For example if you wanted to sell your knitting plans in different yarn color variations (would that even be a thing?) then you could sell a Green version, Blue version, etc. You could also sell your knitting plans with or without the walkthrough for different prices etc. But probably the most important detail (besides price) is where Paypal should redirect the user to upon successful completion of the transaction. For example, – right? I’ll explain it’s importance in a second but let’s walk through the process from beginning to end, and then it will make more sense.

Once the user clicks the sale link on the page you are pitching the product on, you will use the custom link created in Paypal for the product you created to link out to Paypal. Paypal will complete the transaction and transfer the funds to your Paypal account. Once the payment is completed, the user will be linked over to the web page you added in the Paypal product setup. So you will have to create a CONGRATULATIONS!!! Page where the download either automatically starts, or you can create a button that will let them download the product. Here, I feel like I’m writing way too many words – here’s a diagram of the flow of how the process should work.



Yes, I could have visio’d this diagram for you – but I much prefer sketching. So let’s be clear, there are only really three boxes here that we are talking about. The far left three either happen accidentally, or by your promotional efforts on social media. But they aren’t required. What you have to do is; A) create a product page pitching your knitting plans B) Create a Paypal checkout page  C) Create a success page that let’s the user download the world famous knitting mustachio knitting plans.

button-5Step Five – Promote Your Product
As I said just above, depending on what you did at the beginning of this process, you might have already done everything you need for this step already. If you created a fantastic domain, and some really great content talking about your product, most of the time, Google will find you on their own. Obviously, you can also buy Google search ads, or create facebook campaigns for really tight demographics (Women, who like little house on the prairie, Katie Perry, and weightlift – just kidding! I have no idea who would buy these mustachio plans!), or search criteria, and it may give a huge boost to your sales. I have only just started buying ads on Google for my Questions website… and the data isn’t definitively back yet as to whether they are beneficial for that particular website. I do believe they could be if tuned correctly. It’s just a matter of finding the right mix. But personally, I have had great success with just SEO optimizing my page and allowing Google to do it’s thing. So step five is optional, and totally up to you.

From there it’s all tuning and learning to optimize the checkout funnel and your advertising strategy. Next time, I’m certain that I’ll have more information on the ad space. But again, that single page will find it’s audience if you used a good domain that targets your product well (funnyknittingprojects, bestknittingplans, or some such… just think about what people will be searching for in this space) and hosted on a good hosting solution like Bluehost. Connect up to Paypal, and voila… you are on your way. Don’t hesitate to ask questions. I’m happy to help.

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