The Benefits of Selling Online Courses vs Other Ways to Make Money Online

There are many ways to earn money online. How can you find the right fit for YOU?

If you are thinking about starting your own online business, you may be tempted to dive into the first business model you see that promises results in a short timeframe.

Many entrepreneurs start by investing time in a seemingly low-risk business that appears to guarantee a few easy bucks, without thinking about the long-term impact of sticking with that particular venture.

This can result in getting stuck with something that doesn’t provide meaning or real value to you and your customers, and in the worst-case scenarios, might even be a business that is unethical or illegal!

If you are looking for a business model that allows you to share your passions with the world, solve your customers’ problems, provide real value and results and promote positive change, then online courses are for you!

As an online course creator, you are making money by sharing your knowledge and skills.

In fact, you don’t have to be an absolute expert on a topic in order to become a successful online course creator. As long as you are one step ahead of your students, you have valuable information to offer those who are in the same position you once were, and who are looking for results. That is all it takes to start building your own online course.

Keep reading below to learn about the main benefits of selling online courses, membership sites, or digital products versus other popular online businesses.

1. Low Initial Investment

You can start your online course business with a very small initial investment. The biggest investment you will need to make is your time.

From a monetary standpoint, the only investments you have as a course creator are the online course software platform you choose, some optional pieces of equipment to record great-looking video lessons, and potentially a marketing budget (which isn’t necessary or even recommended to start with).

If you are on a tight budget, selling online courses provides a low-risk investment. However, if you choose to promote your business organically - to avoid spending large amounts of money on paid advertising - it could take time to see results.

If you are looking for a way to validate your idea and get those initial sales before investing large amounts of time, we recommend preselling your course. Learn more about pre-selling your online course in this article from our blog: How to Pre-Sell Your Online Course and Profit Before the Launch

Overall if we compare online courses with other ways to make money online, this business model certainly requires a smaller initial investment.

If you decided to start an eCommerce store or sell products on Amazon instead, you would have to buy the physical products in advance, spending a large amount of capital before making the first few sales and waiting a long time before breaking even, because you'd likely need to immediately reinvest any earnings into your next shipment of products.

2. No Physical Product Involved

Not having to deal with any physical products is a huge advantage of the online course business. If you were to start an eCommerce store, you would have to:

1. Find a supplier or produce your own goods: If you want to sell a specific product online without manufacturing, you would have to find the right supplier that produces it for you. You would need to invest time and money into finding the right supplier and have the trial product shipped to you at a significant cost. Not to mention if you decide to manufacture your own product - unless you already own a factory or you wish to sell just a few handcrafted goods - it is a highly complicated process.

2. Purchase bulk products in advance: once you find the right supplier, you would have to purchase a minimum order quantity of products, usually in the thousands. This is a huge investment that you would have to undertake, especially since you don’t have any guarantee of making money.

3. Deal with stock and returns: selling a physical product means that you have a limited amount of stock your customers can buy. This means that you constantly need to keep an eye on your stock quantity to ensure you don’t run out. Also, there is always the possibility of shipping damaged products to your customers, dealing with returns and refund requests - usually at your loss.

So overall selling online courses is a hassle-free business compared to eCommerce! That said, while digital products have their benefits over physical ones, it may be harder to “convince” your potential customers to purchase your online course.

This is why - when selling online courses - you should focus on solving a specific problem that your audience is facing, and clearly communicating the results of your teachings to any potential customers.

Read more about communicating the results and benefits of your online course in this article from our blog: The Most Important Thing You Need to Know When Creating an Online Course - Build it Around a Result

3. Your Business Revolves Around Your Passions

Any online business requires you to commit a large amount of your time and patience in order to see positive growth.

If you spend your time doing something you are passionate about, you’ll have more chances of being successful.

As a result, you’ll be more motivated to start working every day, creating content, and recording lessons for your online course.

If you do not believe in your product and don’t enjoy spending time building your business, you won’t be able to sustain it in the long run. Being an online course creator, on the other hand, allows you to monetize your knowledge and create a business from your hobbies or passions.

4. You are Creating Something Truly Unique

Anyone can find a product and resell it online.

But each online course is different and impossible to replicate. Sure - you may have some competition in your niche - but the way you teach, structure your lessons, build content and provide value is truly unique and distinctive of your own brand and personal experiences.

This allows you to scale your business and compete with others in terms of value, not price.

If you were to start an eCommerce store or a dropshipping business (where you find a pre-existing product and resell it online at a higher price) you would be competing with thousands of other businesses who sell exactly the same product as you. These types of business models allow little room to build customer loyalty and do not provide any added value.

If you are selling the same exact product as your competitors, why would any customer choose you instead of them?

The only competitive advantage you could aim for is to lower your price and settle for very low margins.

With online courses, as you are selling something truly unique and one-of-a-kind, you can easily justify a higher price in terms of the value you are delivering to your customers, which brings us to point number 5:

5. You are Providing Value

With an online course, you are teaching something new to your students, you are educating them, solving a specific problem for them; you are providing them with a specific result they are aiming to achieve.

In the online course business, you help people solve a specific problem, provide real value, and can even change your customers’ lives. By doing so, you end up building a business that has meaning, one where you’ll feel motivated to invest time and effort.

“Having an online business has given me the career satisfaction I always craved but struggled to find as a military spouse. It has given me a real sense of purpose by helping so many business owners in need and allowed me to live the lifestyle I have always wanted!”

Gems Collins, Founder of Gems Collins LLC

6. High Profit Margins

Financially speaking, one of the best things about online courses is that you can easily achieve high margins from your sales.

With very few costs to subtract from your earnings - the only expenses you have are if you decide to pay for advertising and a few equipment fees (ex: video lighting, a professional microphone) - the sky is the limit with online courses.

Also, there are no set rules on how much you can charge for your online course. If you provide tons of value and real results to your students, you can justify a high price, and therefore high margins.

If we compare online courses to any eCommerce-related business, the difference in margins is huge. If you are selling a physical product, the cost of producing and shipping that product to your customers takes up the majority of your earning, and paid marketing can eat up the rest if you don’t use it well.

Generally in eCommerce, the profit margin does not exceed 30%. This means that if you own an eCommerce store and you sell a $100 product, only $30 from that sale will end up in your pocket.

While profit margins for online courses highly depend on the creator, and how much money you choose to invest in advertising, you can easily achieve a profit margin of 70%!

7. No Commissions on Your Earnings

Another great financial benefit related to online courses is that you don’t have to pay a commission on your earnings.

If you decided to create an App and sell it, you would have to give up a 30% commission of your sales to the App store (both Apple and Google play) or a 15% commission if you have a subscription plan.

However, keep in mind that some online course marketplaces charge a commission on your earnings. For this reason, we recommend choosing an online course platform that doesn't charge any commission on sales you generate.

Learn how to pick the right online course platform in this article from our blog:

Top 10 Things to Look For When Choosing the Perfect Online Course Platform.

8. You Don’t Have to Build Your Own Software

So far we have mainly compared online courses to eCommerce business, and you could argue that a good option is to build and sell your own software, as there is no physical product involved.

However, building software is an extremely complicated task that takes time, effort, and specialized knowledge. If you are not a professional developer, building software is not a walk in the park, and you may want to hire someone to do the job for you.

But to have an online course you need software to support it right?

Yes, but no worries! At Heights Platform we have done all the hard work for you. We have built online course software that allows you to monetize your knowledge by selling online courses, membership sites, and digital products through your own branded learning platform.

9. You Can Work from Anywhere in the World

That’s right. All you need is a laptop and an internet connection. More importantly, as there is no physical product involved, you do not have to worry about shipping times and fees and you can attract students from any county. With online courses, your audience can be the whole world! 

“Having this sort of flexibility and control over my own schedule also allows me to spend considerable amounts of time improving my ability to teach well. Additionally, because all I need is a computer with an internet connection, I can be wherever I want. All around it's been a great experience.” 

Jonathan Roberts, Founder, and Director of the Ancient Language Institute.

Are You Ready to Start Selling Online Courses?

So overall selling online courses is a fantastic way to monetize your knowledge. It allows you to be flexible, create real value in the world, and build a business you are passionate about.

Like any other business, online courses are not a magic trick to get rich quickly. To succeed in this business, you need to be willing to put in the time and effort to build an audience and generate valuable content.

Our founder discusses this in more detail in this video from the Heights Platform YouTube channel:

However, compared to physical eCommerce products, building software, or selling an app, online course businesses are definitely less complicated and easier to scale.

One of the main issues that online course creators face, is the “imposter syndrome”, a feeling of not being good or expert enough to teach others.

Paris Hansch is an online course creator at Heights: we asked her to give a few words of advice to other creators who are just starting out in the business:

“I have a ton of advice for newbies in general but this is probably my top one:  Act before fear. There is no greater skill to have as an entrepreneur than to just get things done. The longer you wait to act, the more time you have to convince yourself it's a bad idea, that you're not capable of it, that you should put it off and wait for a better time. 99% of the time this is just the anxiety in our brain trying to stop us from doing something new and scary. So if you're thinking about making an online course, just start. Don't wait for a time when you're less busy, or when you have more money, or when you're not juggling so many things because that time won't come -- if it had, you would have changed your life years ago! Be brave, and take that first step.”

Paris Hansch - Heights Platform creator

If you choose Heights Platform's all-in-one online course software, you’ll have all the tools necessary to succeed in the online course business. Start creating your online course today.