Written by Tom Ewer on 17 March 2014
Generally speaking, web design is a service profession, meaning that you get paid in exchange for your time and skills.
The problem with exchanging your time for money is that if you can't work for whatever reason, you don't get paid. Saving up an emergency fund for times when you're ill or short on work is always a good idea but it can only take you so far -- this is where passive income can come in handy.
What is Passive Income?
The term "passive income" means different things to different people, but in basic terms you can think of it as being work that you do once but can be paid for many times over. For a writer whose regular income comes from writing magazine articles, a source of passive income may be publishing an e-book.
In this example the book is written only once but can be bought an infinite number of times. While no writer would expect to sell a book priced at the same rate per word that they get for an article, if they can sell the book enough times it could generate significantly more income than a normal one-off payment.
Why Selling Web Themes Makes Great Business Sense
Even if you usually charge per hour or per project, the same principal can apply in the field of web design. It's easier than ever before for web designers to make money by selling pre-built themes and templates, which can turn out to be great money spinners if they're popular.
Let's say for example that you normally charge £500 to create a custom WordPress theme for a client. If you sold the same design as a licensed premium theme for £50 per license and 10 people buy it, you'll make the same amount of money. However if you sell it to 100 people, you'll make £5,000 -- 10 times your normal rate!
The most popular themes on sites like ThemeForest have been sold thousands of times, so these figures are certainly realistic. The trick to being successful in this business model are anticipating and then providing designs that have mass appeal and marketing your products well.
Picking a Platform for Theme Design
If you're already used to designing for CMS software and blogging platforms like WordPress and Joomla, you'll already be familiar with the idea of creating themes. If you're used to building bespoke sites or you don't code at all, it's also possible to sell standard HTML/CSS templates and PSD designs ready to be handed over to a programmer.
WordPress currently has the largest share of the CMS and blogging software market, with 19% of all websites being run on WordPress. This means that there are a lot of people looking for WordPress themes and so it's a great place to concentrate your efforts.
One of the downsides about building WordPress themes is that so many other people are doing it so you'll be up against some stiff competition. If you prefer a less crowded marketplace, you may wish to specialise in one of the other software systems like Joomla, Drupal or Shopify. As there's less choice for consumers, you'll be able to charge more for a well-designed template but remember that you'll also probably sell fewer licenses simply because the target market is smaller.
How to Sell Themes and Templates
There's nothing to stop you from selling themes directly from your own website, but unless you have a very large following it will probably be difficult to market your designs effectively. For this reason, many designers choose to sell their templates through an online repository.
These sites will usually take a percentage of each sale but they have the huge advantage of getting your designs in front of thousands of pairs of eyes. Going back to the e-book example, you can think of it as selling your book through Amazon rather than just on your own website.
There are several theme and template repositories that you may want to consider:
You can also often list your designs directly on the official repository for each CMS. Usually these will offer you a way to link back to your own site where you can earn more by offering a bundle package of two or more themes at a discounted price.
If you can build up your brand and reputation enough, it's possible to run a business solely selling themes -- just check out Graph Paper Press and Elegant Themes for a couple of examples of successful theme businesses.
It can be difficult to justify spending time on creating themes and templates when you know you're not going to get a chunk of cash after completion, but it's worth putting aside a little time to build up some passive income.
Selling multiple licenses for themes not only offers the potential for earning you more money than a single-owner site design but also really does let you "earn money while you sleep." A good theme can keep on earning you money year after year, unlike that one-off client website.
Do you sell templates and themes or do you have another way of generating passive income? Do you think web design is shifting to more of a product-based than service-based model? We'd love to hear your ideas and opinions in the comments.