Acquiring an established website is quite simply the online substitute of purchasing a brick and mortar business, seeing as it comes with the same advantages, challenges and risks. On one hand, you conveniently bypass the tedious initial period of developing, promoting and monetizing a website. Furthermore you can expect to earn profits from day one, you inherit an already engaged audience base and you possess an instant presence on search engines. But on the other hand, you will be buying a functioning enterprise along with all its existing shortcomings. As such when buying a website it’s important to find the perfect balance. To ensure that the website you are buying will be able to benefit your business and make you money.
So, how do you ensure that you get a great deal and avoid a scam? Here are 7 crucial factors that you should consider when you decide to buy a running website:
Check The History
Appearances can be deceptive, particularly in online settings where it is easy for owners to remain anonymous and artificially inflate visitor traffic to make a website seem lucrative. This is why it is imperative that you analyze the history of a prospective website to unveil any peculiarities and gauge its true potential.
Utilize tools to analyze every crucial aspect of the website, such as Domain History, which lets you view the ownership history and Wayback Machine which shows snapshots of the website over the years. These tools will help you verify if the website actually is what it claims to be, thus securing you from scammers who attempt to sell websites that have previously been used for illegitimate purposes.
Existing Revenue Streams
Websites earn money via multiple means including Pay Per Click Ads, product sales, affiliate income and paid banner ads. Since these revenue streams will be your bread and butter, it is crucial that you analyze the risks associated with each stream.
A good tactic is to diversify your income by going for a website that uses multiple independent sources of revenue, so that even if one of them faces turbulence you can still remain profitable via the others.
Analyze Financial Reports
Analyze expense and revenue reports in order to analyze critical aspects such as sources of revenue, consistency over the years, and whether all these metrics work for you. These reports will also give you an insight into the potential of the website to sustain its profitability in the years to come.
However, prior to evaluating these reports, we recommend that you determine their authenticity, because it is easy to forge numbers on the web. One way to assess the accuracy of provided figures is to request the ‘read and review’ rights from Analytics which give you a detailed look into the workings of a website without posing any threats to the owner.
Confirm Quality of Traffic
The common perception is that traffic volume is directly proportional to profitability, and while that is true in certain situations, it’s not always the case. All incoming traffic cannot be monetized, and therefore, it is important that you identify the quality of the traffic that a website receives.
For instance, traffic from a particular country may be more valuable than traffic from other countries. Here are some elements you should analyze to gauge the quality of traffic on a website:
- Make sure the website has high and consistent levels of organic traffic, because it indicates that the website hasn’t suffered Google penalties.
- Find out the distribution of traffic over devices as this element effects monetization. Traffic from PCs, for example, tends to be more lucrative as opposed to mobile traffic.
- Ensure that the website’s social media channels are engaging customers and increasing traffic.
- Identify the volume of organic traffic on landing pages, as it will highlight which pages or keywords are bringing in the most visitors. It is safe to opt for a website that attains heavy traffic from hundreds of posts as compared to a site that is heavily reliant on a handful of landing pages.
Get An SEO Report
Strong SEO is crucial for ecommerce platforms. Therefore, carefully evaluate the SEO side of things prior to buying a website. Start by conducting a manual Google search on your own, then switch to tools such as SEM-rush to dig deeper to assess the quality of backlinks as well as internal links, relevance of keywords, legitimacy of SEO techniques employed by the website along with other SEO signals.
While such tools aren’t foolproof, they are recommended as they provide information about a prospective website and help to highlight potential concerns. These potential concerns can include anomalies like the existence of only a few backlinks that generate most of your traffic or the application of black-hat SEO techniques.
Look For Market Sustainability
Digital marketplaces like Flippa are swarming with people who analyze existing websites for inspiration and information to replicate them. Opt for a website that operates in a market that has room for multiple providers so that you do not lose your profitability if a new competitor comes along.
Consider The Ongoing Management
One thing most buyers overlook is the time and expertise that go into running a lucrative website. Therefore, make sure that you have the experience, time and resources to manage your acquisition.
For instance, you may feel tempted to buy a website that attains revenues of up to $10,000 per month, however, you may have to spend several hours each day to place new content on the website, monitor ads, place deals and interact with customers.
On the other hand, you may have to hire a resource to do these things which might lower your profits. If you aren’t certain that you can effectively manage the website, a better option might be to outsource the task to a reliable service provider.