Introduction: Adventures in Buying Websites

April 2, 2008 |

Last month’s purchases results are in and there are some surprises, both pleasant and not-so-pleasant. The Portal video game website that was purchased at $700 had claims of 40,000 uniques per month and about $40 in income. Among many others, one reason for this purchase was it’s revenue increase potential through improving the CTR or $/click. At 40,000 uniques per month, you should be able to squeeze a bit more than $40. After buying the website, I finished it’s transfer about March 4th so I don’t have a full month to assess, but close enough. I had a variety of transfer related issues which I’ll discuss in future posts.

Google Analytics is saying the about 31,000 unique visitors. I say “about” because I had to do some extrapolation because after buying the website I didn’t get the analytics code on it until mid day on March 6th. As far as revenue, the claim of $40 a month in total website revenue was all for Adsense. Again, adsense wasn’t setup at day one - it was more like the second week of the month due to challenges in converting the website’s adsense code to the new style and getting my channels and pub ID straight. Even considering this, the results were a little lower than anticipated but there might be a reasonable explanation.

For the partial month Portal video game website brought in $19.73 with a CTR of .22 - yes, that’s an ugly CTR! That will be one of my focuses. In addition, I had in mind an affiliate program that fits this niche a bit better, and implemented it mid month. The half month from this new affiliate program bought in just over $14 so the site came in at about $38 for the month.

$38 actual earnings for the month after buying the website lands me at an annualized ROI of 67%. There are no expenses associated with this site other than the fraction of the monthly hosting (pennies). Extrapolating out for the partial month income streams, I am going to predict I will come in at around $47 next month, giving me an annual ROI of about 78%

What kind of “Introduction” is this?

Good question. And if you are still reading at this point, then you are definitely the type of person that will enjoy this blog. Buying websites is a mixture of art and science. Since this is an overused description I will be more specific. The science is the analytical assessments, the website pricing and valuation methods, the traffic analytics, accounting items, and forecasting techniques. The art is smelling and then smoking out a rat that just paid for two months worth of traffic to pump and dump his site on an unknowing investor. The art is determining that a bland made-for-adsense site that has little end user value is not worth the same as a site with equal traffic, conversion, and profit numbers but also has more meaningful information or interaction the user will find valuable.

In my posts I will cover both the art and science of buying websites for investment purposes. There will be “while shopping” posts related to what I am seeing offered in the market. These will divulge what I may consider to be a scam or bad deal typically evolving undisclosed information from the seller. For my own market interests, I will never go into detail about specific sites I am bidding on or pursuing…but that should be obvious. For every website I buy, I look briefly at many and seriously review about a dozen.

There will also be “performance” related posts that will disclose details about how my purchased websites are performing after the deal. The information above is about one of the sites I purchased last month (I currently budget about $2k a month for buying websites…this could be one or a few sites. Months ago it was much less, it will hopefully continue to grow as I make more and more successful deals buying established websites). It was no accident that I started right into the details and data related to an actual website I bought, thats what this blog is about.

I am not linking to providing actual URLs to websites I purchase for two reasons. First, I buy websites related to almost any niche under the sun. This website, prowebvalue.com and more specifically this blog about buying websites is typically not realted to the topic of the websites I buy so I don’t want a link recorded between them for seo reasons. More importantly is I want to cut down on untargeted traffic - if there was a link provided everyone who reads this blog would visit the link and for the most part that would be untargeted traffic that is little or no use to me and screws up my stats and analysis. I don’t really care if anyone knows the actual websites I’m talking about, it’s really just about the reasons just mentioned.

So with that unconventional introduction to a blog about buying websites I’ll leave you to ponder the information above and the photo below. I’ll be back shortly to discuss more performance metrics from last month’s purchases as well as my experiences hunting for the next websites to buy.

fare thee well

buying websites and drive you to do silly things