What You Should Know Before You Buy That Website

December 12, 2015

1:10 pm

Web properties are the most undervalued investment opportunities and thus hold such a high potential for profit. ‘Tis the season to invest in this type of business, while it still hasn’t gone “mainstream”.

Investing in websites could lead to some considerable revenue in several ways. The most common way to go about it is by allowing others to advertise on your site. You could monetize in Pay-Per-Click mode through Google Adsense, or simply sell some ad space, usually banner ads or sidebar ads. And then there’s affiliate marketing, which is not technically advertising, but somewhat close to it. It would just entail you promoting (or selling) another company’s product on your site or blog. You could even set up shop in your site and start selling your own products, if you so wish. Another possibility is to simply build out the site, and flip it — that is, set it up, improve it, or basically just add some value to it, and then sell it for a nice profit.

And these are just a few of the possibilities. It’s not the kind of thing you’d buy on an impulse. A good guideline is this: when you’re considering a site, imagine yourself buying a house or a commercial property.Wouldn’t you visit the place first and look around? You would want to look inside and check out the rooms, the foundation, and the wirings. You would also want to look outside and check that it’s in a good neighborhood. And wouldn’t you want to know whether the current owner is truthful and trustworthy?

The same thing applies to buying web properties. You need to do your due diligence before you part with your money; check that the site is truly worth the investment. Ask the seller some questions and find out as much as you can about the site’s traffic and earnings, and ask to be shown the site’s analytics. This is pretty standard, and thus any reluctance or outright refusal from the seller to show you the inner workings of the site should be considered a red flag. More importantly, do your own research using the SEO and analytics tools available to you on the web. Any inconsistencies between what the seller tells/shows you and what you learn from your research should also be warning signs.

Here are the things you should know by the time you’ve done your work:

  1. How the links were acquired
    Get an idea how many are paid links and natural links, and whether or not they’ll stay after the site is sold. You don’t want a site with disappearing links. Check also the link neighborhood — you don’t want a site that has any association with scams or sleaze.
  2. How exactly the site is being monetized
    The usual answer would be via Adsense or Amazon or both. It could also be something else, but just make sure where the revenue from the site comes from. Check whether the earnings are regular throughout the year or peak and dip in certain months.
  3. Whether the site content is unique
    You only want content that is unique — i.e. not plagiarized.
  4. If the tools, themes, and/or plugins that came with the site are free
    It’s a nice bonus if they are free, but not an absolute must.

A good tip for going into the web properties business is to always apply whatever investment principles that you’ve learned in your other ventures as well as good old common sense . If they’ve served you well in the past, they would also apply to any business you get into online.

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Greg Nunan is a digital marketing consultant and Founder of Winning Edge Digital. Greg specializes in building and flipping websites for profit and offers free Content Marketing and SEO information at his personal blog, IMFlare.com.

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