Sometimes, you do not want to sell physical goods. Your expertise lies in your ability to create. The thing is that going to freelance websites and selling your talent is not going to make the cut anymore.
It is a lot better to build a website of your own, so you can showcase as many of your non-physical goods as possible. And this is where Gumroad can help you.
It is built for artists who want to be able to sell their materials. But is it worth it and is it the right choice?
Here, we will review this online platform and take a look at its features, pricing, and business model. In the end, you should be able to decide if you want to take your talent here and sell from this platform.
What is Gumroad?
Gumroad is not an online marketplace. It is a platform where you can build your own website or landing page and then display your craft. When you register for an account, you will be able to create a link for what you are selling, and then use this link on social media or send it directly to your clients.
The client will click on this link, and he will be able to purchase what you are selling, such as digital goods, written materials, music, and so much more.
It is through Gumroad that you will deliver the orders, and it is also through this platform where the clients can pay.
With Gumroad, you are not operating like you would in an online marketplace. In online marketplaces, there are hundreds of freelancers offering the same services as you do, and then customers have to make a choice who among all of you is the best fit for his needs and budget.
With Gumroad, it is like as if you are sending a client your very own online brochure. It does not charge you high fees, and it has great analytics to help you know how your customers behave, which of your services are in demand, and so much more.
How does it work?
To start using Gumroad, you must first create an account. Next, you need to set-up your payment information, which includes how you will pay your fees and how Gumroad will transfer your earnings to you in cash.
The next step is to create your portfolio. Here, you can upload samples of your work, write a little bio about yourself, add your photo, or add products. This is the profile that your customers will see if they click the link you sent them.
Once this is done, you will receive a link from Gumroad that you can share to the whole world. You can share it in your social media channels, your website, or even create paper flyers for distribution.
People have the option to like your link or become a follower. If they decide to order from that link, they need to enter their credit card details to get the job or order started.
After they pay, they will receive a link where they can download the order. Gumroad will now transfer the funds to your account, and this happens every Friday.
Note that there are fees before you receive your payment, so you need to factor that in your pricing.
Although it works like a social media channel, Gumroad is actually more than that. It is packed with marketing and analytics tools that you can use to improve your sales.
With Gumroad, you automatically have a shopping cart where customers can put her purchase. Along with this shopping cart is a payment gateway where customers can enter their credit card information, or pay you via PayPal.
The way you get paid is through direct deposit or PayPal. If you are from the United States, the United Kingdom, Canada, or Australia, the direct deposit will be paid in your country’s currency. If you are not from these countries, the only way you can get paid is through PayPal.
As a Gumroad seller, you have to provide Gumroad with your account number and routing number. This will allow Gumroad to transfer payments to your bank account. If you prefer PayPal, a Personal PayPal Account should be okay. You do not need a Business PayPal Account.
Also, you will be paid every Friday once all the fees have been deducted from your earnings.
Gumroad does not pay out its members in any other way, such as Payoneer or Stripe. The only two ways are bank account and PayPal. Bank accounts are only usable in four countries, while PayPal is the ONLY option if you are not from these four countries.
This is a feature where your customers will be able to create an account and store their purchases online in Gumroad’s database.
This is great if you are selling digital products. For example, you may be a musician who creates song snippets for advertisements. After a customer buys a product, he can leave this product in Gumroad for access later on.
You can also be a course provider. In this case, your customers can download your video courses, or leave them in Gumroad so they can access the courses anywhere, anytime.
Since Gumroad is focused on digital goods and products, a feature such as this is a great way to attract customers. The files can be accessed anytime, to be used at the customer’s convenience. This is great for online courses since most people typically only study during their break time.
They do not have to spend storage space on their mobile devices since they can access your files any time they want for as long as they are online.
This feature works best for digital products that are instantly accessible. If you are a writer, this is a great feature that you can use so your customers can read your materials right away.
For example, you may have written a series of articles or instructional materials. If your customer bought an article, he could read it right away, with no need to download or wait for you to send them their copy. They also do not have to create an account if they do not want to.
But if they want to get their files stored in their device, the need to download it.
This feature is great for on-demand products like instructional videos, how-to articles, or even musical pieces that can be owned by many people.
Since most of your products are digital goods, it is quite obvious that you need to be able to send files to your customers. With Gumroad, you have the flexibility to send files to a customer’s Dropbox or Kindle.
This is an automated process, and the customers only have to click on a link to start the file transfer process.
This is important because each customer has a different preference about how to access his files. And a simple file transfer service like this can make a customer want to buy your product now.
From a customer’s perspective, he does not have to buy or download another app just to store your files and read, listen to, or watch them.
Although Gumroad was made primarily for artists and those who sell digital products, you can also sell physical goods here.
The thing is that on this platform, you can sell anything that you created. So if you are a woodworker, a craftsman, or a painter, you can post your items for sale on Gumroad.
For digital goods, you can also create offer codes. These are coupons that provide discounted prices to customers. You can create coupons and discounts based on percentages or fixed amounts.
You can also choose to sell in different currencies. This is a valuable tool to be able to sell internationally. Most customers feel better if they buy in their own currency because it is easier to understand how much the cost would put a dent on their budget.
When you sell here, you can create different cover pages for your material. You can use images, videos, and audio.
You can also rent out films. If you have created a short film, customers can rent it, and they would have 72 hours to watch it. It is like renting a film from big companies like YouTube, Amazon, iTunes, or Google Play.
For physical products, it is your responsibility to package, label, and ship the items. You can also create codes to give discounts and be in full control of your coverage. What this means is that you can choose to sell in specific countries only, or sell to the whole world.
Gumroad also allows you to offer subscriptions. Gumroad will charge the customer’s credit card or PayPal account on a regular basis, but you have to ensure that you deliver your products in a timely manner.
Gumroad has a powerful analytics feature that can tell you how your business is performing. With this feature, you can build your audience and learn more about your customers.
From your dashboard, you can see how many lifetime followers you have, how many of these followers bought your product, and whether your follower count is increasing or decreasing.
You can also see if people are more likely to buy your products form mobile devices or from laptops. The analytics feature can show you how many people downloaded your product, or how many chose to simply watch, listen, or read it.
If you know all these things, you will be able to tell yourself if your marketing strategy is working. You can make informed business decisions as to whether you need to change your strategy or not.
Gumroad has an app in iOS that can also show your real-time updates about your sales performance. The Android app is still in development, but Gumroad has a plan to launch an Android app.
Auto Updates and Messaging
You have the tool to send an email update to your customers, especially those who have a subscription. So apart from being an online sales platform, you can use Gumroad as an email marketing material.
It is an important tool, so your customers feel that they are special. If you want them to make repeat purchases, you can send codes or discount coupons through email, and this should make them buy more of your products.
Your account can also allow you to create automated responses. For example, you can auto-generate a thank you note to anyone who makes a purchase. You can also create notes for upsells, and your customer who is in the process of buying will receive a notification whether he may want to add another item.
A widget is a little button that you typically see on mobile devices or on websites. If clicked, it will take a customer to a page where you redirect them.
The widget you can create here is useful if you already have a website. The widget has a buy now button, so customers can click and add your product to their shopping cart.
The widget allows you to create buttons where customers can complete a purchase without leaving your site, or embed the products you have on Gumroad to your website.
You can post your Gumroad products in your social media accounts. In these posts, you can add a snippet of information to tell potential customers why they should visit your Gumroad profile page and make a purchase.
You can tell them who you are, what you are selling, and what the customers can get if they buy your product.
In the social media posts, you can add a link, which, when customers click, will take them to your Gumroad page and take a closer look at your products and services.
This is the cherry on top of Gumroad. With this, you can create a program where sellers can re-sell your products and earn a commission.
Usually, you need another service provider to allow you to create this program. But with Gumroad, it is already baked in what you are paying per month.
Affiliate marketing is a process where sellers will market your products. In return, they get a commission for every sale. The trouble with affiliate marketing is that you need software to run it, manage it, and monitor the results.
Gumroad allows you to do all this, and you can track the sales per affiliate marketer, and then pay them accordingly.
Fees and Pricing
So, how much do you have to pay for all these features?
There are two types of memberships. One is free, and the other is the Professional or Premium account. It is free to create an account, but you cannot use all the features mentioned here.
If you go for the free account, you can create as many products as you want and post them in your Gumroad profile. You can also sell unlimited products a month, which is great because many online selling platforms like Amazon limit your sales to about 40 to 100 sales only if you do not pay a monthly subscription.
However, the free account only lets you send four updates to your clients per month, and only one automated workflow or message.
And for a free account, Gumroad will charge you a fee of 8.5% + $0.30 per sale.
For the Premium Account, you will get all the benefits and features of the platform. However, you need to pay $10 per month and get a discounted price of $108 if you pay for an entire year of subscription.
The fee per sale for a premium account is lower, as Gumroad will only charge you 3.5% + $0.30 per sale.
With this account, you can send unlimited updates and workflows, customize your Gumroad profile site, use third-party analytics, and so much more.
In a theoretical scenario where you are selling a product at $10 each, it will only make sense to pay the subscription if you are making at least 21 sales a month.
If you do the math, you will be earning a net income of $186.35 per month for 21 sales at $10 each after all sales and subscription fees have been deducted.
In the free account, you will earn a net of $185.85.
The difference may not be big, but as you sell more, you will be able to save on the costs of fees.
Gumroad is made for artists and creators who do not want a limited kind of service from their selling platform. Usually, you can display your services in online market places, but you have too much competition, and the typical transaction fee is 20%.
In Gumroad, the highest you pay is 8.5%. Also, many online selling platforms only allow you to create subscription-based courses, but they do not allow you to sell books, artwork, or physical products.
Gumroad is special because it is a program that lets you sell everything you can create from music, videos, tutorials, online courses, comic books, physical arts and crafts, and so much more.