Calculate the Value of a Blog or Website
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| Image by Mudassar Iqbal from Pixabay |
But how do you find out what a website is worth? Which factors should you consider?
In this article, I'll introduce different approaches on how to calculate the value of a blog or website. I will also present a few services that can help.
Calculate the Value of a Blog or Website
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| Calculate the Value of a Blog or Website |
Most start a blog or website of their own and then try to make money by building in advertising, affiliate links, Google AdSense, and so on. But things don't always go as desired, you lose interest in the website or want to concentrate on other projects.
Then there are the possibilities to earn money with this website or the blog in another way, for example by selling the blog or the website for a profit.
But many do not want to start from scratch but want to buy an existing blog or website to develop it further and earn money with it. Some even buy websites cheaply, expand them further and then sell them at a profit.
Whether you buy or sell websites and blogs, the question always arises of how to determine the right price/value.
Is There the Right Price?
First of all, it has to be said that there is no such thing as THE right price. With values that are very difficult to define, like that of a website, there will always be different results. If you negotiate with different buyers/sellers, you will usually come to different purchase prices.
You must be clear yourself about what you want at least to have or what you want to pay at most. Whether a buyer/seller takes part or even goes beyond it is then a matter of negotiation.
The following is about how you can (reasonably accurately) determine the value of a website or blog yourself using various methods.
Value of a Website Based on Revenue
If money is already being made with a website, the price of a website or blog is usually calculated based on the existing income.
There are many different approaches. Some just take 12 times last month's earnings, others take last year's earnings. Still, others average the last 6 months and use that as a basis.
A website could be valued at 12,000 euros if it has earned this amount in the last 12 months (after deducting expenses).
There is no hard and fast rule. In my opinion, however, you shouldn't stay below the annual revenue if you sell a website
Advantage of this calculation:
- You can calculate the price based on concrete income that already exists. That gives planning security.
- This data can be well documented (extracts from partner programs, account statements ...).
Disadvantage:
- When buying, you have to rely on the information provided by the seller (you should ask for evidence).
- Blogs in particular are often very dependent on the blogger. The question arises as to whether the income will remain at this level.
You should consider the following points:
- How well has the website/blog been monetized so far? Are the revenues at the limit or is there still potential?
- You also have to pay attention to the expenses. Is there a lot of money being spent on paid links, advertising, or Google AdWords? What is the bottom line?
- You should always see the income in the context of the effort. Anyone who works 100 hours a month for 1,000 euros is not as efficient as someone who works 10 hours for 500 euros.
- How have your earnings developed in the last 12-24 months? Is there a positive or negative development?
Value of a Website Based on Potential Revenue
Instead of based on current income, you can also calculate the purchase or sale price based on future income. But that is “reading coffee grounds”. It is difficult to estimate future earnings. You need a lot of experience, preferably in the same industry.
Can you get better monetization, get higher Google rankings and generate additional traffic?
If you are sure that the income will reach a certain value in the future, you can use this as the basis for the sales/purchase price.
Value of a Website Based on the Number of Visitors
Traffic is a very popular way to determine the value of a website. One of the reasons for this is that banner advertising is often billed at CPM prices, i.e. per 1,000 page views. But other sources of income, such as Google AdSense, also benefit from high visitor numbers.
If you take the number of visitors as a basis for pricing, you should pay attention to reliable figures. Even if a lot of people don't like Google Analytics, the numbers are quite accurate (in my experience) and they are above all comparable to others who also use Google Analytics.
Another important factor is the question of whether the number of visitors can still be increased. How many visitors does the direct competition have? How well are different traffic sources developed (use of social websites, position in Google ...)?
You should also keep a close eye on the development of visitor numbers. How is the course over a long time? Google Trends, for example, is very suitable for this. This is a very good way of analyzing interest in certain topics and estimating future developments.
In addition, individual traffic peaks (e.g. mention on a large portal) drive the number of visitors up and distort the picture. But such traffic peaks are difficult to plan. Therefore you should leave this out of the evaluation.
The following tool gives you good and detailed data on the (estimated) number of visitors to a website.
Similarweb.com
On Similarweb.com you simply enter a domain and the tool then analyzes it. Data is already available for a large number of websites and can then be displayed.
It shows the estimated number of visitors, but also the pages per visit, the length of stay, and the bounce rate. Further data concern, for example, the traffic sources and the social media visitor numbers.
Another interesting tool that can be used to determine the value of a website based on the rankings (and thus indirectly the number of visitors) is the following.
XOVI Domain Value
This little free tool from XOVI provides some basic SEO data for websites, which is very interesting.
Among other things, it calculates the ranking value of a domain. This is the amount you would have to spend in Google AdWords to get comparable visitor numbers as this website if it weren't in Google's top 10. So basically it's a financial evaluation of a website's top 10 rankings, which is very interesting.
This value is of course not 1: 1 the purchase or sales value, but it is a good comparison value and an interesting basis.
Calculate the Website Value
A value can now be calculated in different ways with the researched visitor numbers. But you should always focus on real achievable income because the number of visitors alone does not say that much. Since each topic can be monetized differently, the visitors are also worth different amounts, so to speak.
Example 1
If you know the price for an advertising banner that would fit thematically on this website/blog, you can multiply the number of visitors by the CPM price. So if I were offered a banner for a website that brought me an income of 5 euros per thousand PageViews, then the value of my blog with 50,000 page views per month could be calculated as follows:
5 euros x 4 banner spaces x 50,000 PageViews / 1,000 = 1,000 euros / month
So that's the income for a month. For the sales/purchase price, you would then have to multiply this monthly income by a factor that each determines differently.
For example, you could calculate like this:
Sales price = monthly income x 12 months = 12,000 euros
Example 2
You can find out the click prices of AdWords via KWFinder.com or the Google AdWords Keyword Planner. 68% of this can be earned on average via AdSense.
If you have found out in this way, for example, that the main keyword of a small website generates an average of 1.20 euros in revenue per AdSense click, then you could do the following calculations
1.20 euros x 1% click rate x 50,000 PageViews = 600 euros / month
This value can also be multiplied by a factor (e.g. 12 months).
Value of a Website Based on the Backlinks
The backlinks of a website or blog are also often used as an evaluation criterion. If a website or blog has high-quality backlinks and lots of them, then that is worth something.
It would also be important to know where these backlinks come from.
- Are there almost only backlinks from directories or social websites? Or is there a broad base of backlinks?
- Did the links arise naturally over a long time or was there a massive amount of help within a short time (e.g. through a large competition with mandatory backlinks)?
- Is there a good link distribution or only poor-quality backlinks?
- etc.
Various backlink tools can be used to analyze a website's backlinks and assess their quality.
With the backlink checker from majestic.com, you can see, for example, what level of trust the individual backlinks have and whether they are followed or nofollow.
How one then evaluates these backlinks, in the end, is not so easy to say. If you have experience with it, you can certainly assess the value of the existing backlinks. Even sites like Seedingup * and backlink Seller * You can watch and analyze what individual backlinks cost about and thus roughly estimate the value of a site based on these backlinks.
In a survey, I determined how the readers of my blog rate the individual evaluation options:
What is the most important criterion for calculating the price of a website?
- A mixture of everything (33%, 170 votes)
- The previous income (29%, 145 votes)
- The number of visitors (19%, 97 votes)
- The possible income (18%, 89 votes)
- The backlinks (1%, 7 votes)
Number of participants: 508 (1 vote)
Most (33%) do not only use one method but assess several factors. But a good 30% mainly use the previous income to define the value of a website.
This is followed by the number of visitors (19%) and the possible income (18%).
However, only a few determine the value of a website based on the backlinks alone (1%).
Other Metrics
There are of course many other metrics that are typically checked when evaluating a website or blog.
- RSS Readers (Blogs)
A blog that has many loyal RSS subscribers has a good and stable base. Feeds that are delivered with Feedburner are the best and safest way to compare. To do this, you can simply get an insight into the tool. If someone gives their feed numbers without resorting to Feedburner, I would at least be more careful. - History
You should always look at what was to be found on a domain months or years ago. The Wayback Machine is well suited for this. If the content is stable and there hasn't been any dubious content before, that's a good sign. - Newsletter Subscribers
If the website or blog offers one or more newsletters, a large and good quality subscriber list (high opening rate and low bounce rate) is of course also worth a lot of money. - Social Media Profiles
Most websites now also have social media profiles. If these are well maintained and have a lot of active followers, then that is also worth a lot. - Expenditures
I have already addressed this point above, but I want to point it out again here. The expenses should be included in the evaluation. The net income is crucial. - Competition
Last but not least, you should look at how the competition has developed. Have new big players emerged that threaten the success of a website?
These factors alone do not allow any conclusions to be drawn about a purchase price. But they affect the price found by the other methods.
Other factors that determine the buy/sell price could be: an economic crisis or boom, current trends, previous sales of similar websites, etc.
Online Reviews
Because the subject of website value is so opaque, many programmers have taken the pains to create tools online. These can be used to calculate the value of a blog/website. However, you should be very careful with the values displayed. You can tell by the fact that the values are quite different.
Here some examples:
Websiteoutlook.com
Websiteoutlook.com outputs a few values and a dollar value. This looks quite low for Selbstaendig-im-Netz.de at around $ 21,000. The estimated number of visitors was very close to the reality in my tests.
Siteworthtraffic.com
On Siteworthtraffic.com you simply enter the domain and the tool then calculates a value. Here it is also broken down how much is likely to be earned with advertising and what the number of visitors per month is. At just $ 6,244, the value is well below what the website is worth.
Siteprice.org
The calculation tool Siteprice.org needs some time to determine the value. 14,697 dollars were determined at the end, which is also far too little because of the income. For example, the number of visitors was set significantly too low and thus also the estimated advertising income.
Worthofweb.com
The tool Worthofweb.com an amount of 43,653 US dollars is for my blog out what's better, but would still not move up for sale. The monthly income is estimated and there are interesting estimates of the traffic. Social media and user experience are also taken into account.
Mysitewealth.com
On Mysitewealth.com you can also calculate the value of a website. The result was $ 35,842. Various data were used for this.
Projektify.de
At Projektify there is no computer, but a kind of questionnaire. You have to answer 5 questions here and then you get a price calculation. This is the first approach and, above all, it asks a few important factors that play an important role in the price.
The bottom line is that the big differences clearly show that the calculations are by no means reliable. Based on my current monthly income, I would also set the sales price of my blog significantly higher than these tools did. So you can give a small impression and throw out a few interesting values, but nothing more.
The value of a website should be determined through a manual evaluation using real data.
Supply and Demand
In the end, you have to be aware that supply and demand have the greatest influence on price. Nobody wants to buy a website, you won't get the calculated price. If many buyers want a website, the price usually goes well above the calculated value.
In this context, I would like to briefly return to the topic of auctions. This is of course a great way to let demand determine the price. But you should set a minimum price that corresponds to the value you have calculated yourself. You should also ensure that as many people as possible hear about the auction.
It can be problematic that some buyers (e.g. companies) have too long of decision-making paths. These could be locked out of an auction on eBay that lasted only a few days, which is not very useful.
Conclusion
There is no way to find the one price for a website or blog. Many factors and of course the current supply or demand lead to individual pricing.
But you can at least get a reasonably accurate picture of the value of a website or blog based on some factors.
How do you go about determining the value of a website? What tips can you give?
Related Video: Calculate the Value of a Blog or Website
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