Sellers of ebooks and other downloadable digital products have had a nice ride, but the days of the 0.99 cent auctions are over as they know it.

But it's not the end of the world.

While the new policy has banned digital items from standard auction listings, they may still sell digital products (ebooks, audios, videos, etc), but these products will be restricted to eBay's Classified Ad listings only.

Their Classified Ads have been around for over a year now virtually unknown and/or misunderstood. Out of millions of users, only a few thousand have used the Classified Ads section. But now that "hidden tool" is being shoved into the lime light ASAP with the new policy change.

So what are eBay's Classified Ads?

eBay's Classified Ad section was developed to act as a tool for lead generation. But marketers can't complain about that. After all, those 0.99 auctions were not about the money, but about collecting leads. With eBay's classifieds, you're given a "green light".

However, seller beware. Unfortunately, even eBay's staff have proven to be rather confused about the Classified rules at this stage, despite having been an option for over a year. Their "fuzzy logic" has resulted in ads being rejected leaving sellers confused.

The rules are completely different for Classified Ads.

- There is no bidding with a Classified Ad listing.

- There is a flat fee of $10 for a 30 day ad. A great deal compared to PPC (pay per click) advertising! Your cost per lead can be much more cost effective!

- The "Feedback" system does NOT apply.

- Transactions between buyers and sellers do not take place on the eBay network.

- You are encouraged to get your prospects' contact info. So the use of opt-in forms falls in line with the purpose of this format.

- You can also adjust / revise your active ad at anytime to increase conversions, etc.

Side note: Classified Ads appear alongside eBay's standard auction listings. So your listings show up in the same results as standard auction listings when someone searches the site.

For answers to eBay's frequently asked questions regarding Classified Ads, go to http://pages.ebay.com/help/sell/f-ad.html

So what is a seller of digital products to do?

Your options are clear.

# 1 - Learn to use the Classified Ad section and restructure your business model.

# 2- Start selling your digital products on a physical data CD and/or DVD. A profitable solution.

By opting for #2 you can continue to use the standard auction format and the feedback system, but you'll need to convert your digital products into data CD's which can be viewed on a CD rom drive.

You then have two additional options. Duplicate and package the CD yourself, or outsource the fulfillment.

Your best choice is to outsource. It's easier than you think. I use Kunaki.com. At the time of this article, the fee is $1.75 per disc. At such an inexpensive cost, it makes outsourcing a serious option and a quick solution to the new policy change.

The advantage of selling physical products are many. Physical products have a higher perceived value which means you can charge more. Customers love getting something tangible that they can hold in their hands. They won't mind paying more for that convenience. Additionally, you'll be separating yourself for the "herd". Most people will not take this route. Their laziness and/or lack of knowledge is your gain!

Although eBay's policy change was shocking and sudden, ebook authors and resellers, and other digital product sellers can turn the new policy change into an advantage by taking action right now. The sooner you adapt and revise, the sooner you reap the rewards.

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