Selling Digital Products on Your Website

As we all know, PayPal provides a very easy and convenient way of receiving payment for goods. It works all over the world, and most people that buy or sell products on the Internet will have used PayPal at some stage.

One problem faced by many website owners though is how to deliver digital goods, for example, accounting software products after a PayPal payment has been received. To achieve this, you need to use a piece of software that enables a website and PayPal to communicate with each other. You can either write the software yourself, or you can purchase a software product that has been specifically written to do the job.

PayPal allows you to place links or buttons on your website for any products that you want to sell via your website. The buttons can take the buyer directly to the checkout where the payment is made, or the product can be added to a shopping cart allowing further purchases to be made. Either way, PayPal can be configured to call a special Instant Payment Notification (IPN) URL to report the products that have been ordered and whether payment was completed. The software that does this is known as an IPN handler.

When the IPN handler is called it first authenticates the call to make sure that the call has really come from PayPal and has not been tampered with in any way. The IPN handler then creates secure links for each of the downloadable products ordered and emails those links to the buyer. The handler will often also display a thank you page for the buyer after the transaction. This page will normally also contain the same links as the email.

The IPN handler will not contain the actual location of the downloadable file on the web server, but will use a secure method for supplying the file. This way, there is no way anybody can download the file(s) without going through the PayPal process.

The links are often set to expire after a preset period of time, for example, 30 minutes, 2 days, 20 days, and so on. When the buyer clicks one of the links, the IPN handler verifies its authenticity and allows the download to be performed. Some IPN handlers can even lock the download link(s) to the IP address of the buyer.

The IPN handler needs to be installed on the same web server as the website and will contain various pieces of information, for example, the name of the website, the identification number or name of the product, the price or the product, and so on. The IPN settings in PayPal need to be set up to communicate with the IPN handler on the website. This is simply a case of setting up the URL of the IPN handler so PayPal knows where to look.

A standard PayPal button can be placed on the website to initiate the purchase. The button must use the same product identification number or name that has been set up in the IPN handler.

So, in summary, PayPal is used to create the button and to set up the IPN settings; the website has the payment button installed on it; the website also has the IPN handler installed on it, which processes the transaction.