Website Financial Review Factors - Listing and Survey
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And that's not that easy. Although I would like to focus primarily on the buyer today.
I present various factors that could have an influence on the price calculation and of course I would like to know from you how you approach the evaluation of a website/blog if you want to buy it.
Website Rating
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| Website Financial Review Factors - Listing and Survey |
I have already dealt with the subject of website evaluation here in the blog here and there in the past.
Today I would like to collect as many opinions as possible from readers of this blog. Of course, especially by those who have already had experience buying websites.
Of course, the following factors are also interesting for salespeople, but there are already two different points of view. The seller naturally wants to get as much out of it as possible, but can at least use the following factors and calculation methods to define the limit value below which one does not sell.
So from a seller's point of view, this calculation is also important, but ultimately it's about what someone is willing to pay.
From a buyer's point of view, on the other hand, it is difficult to judge and to know what a site is worth. It must be worth it for buyers to spend the money.
Factors
Since I do not want to set up a general formula in this article, but rather encourage discussion and the exchange of experiences, I will now list various factors and criteria that could be included in the price calculation.
These are the points that currently go through my head when I look at a potential site to buy.
Website in General
First, a few factors that affect the website in general and are rather soft:
- Software
What software does the website run on? Is it a well-known solution that is easy to expand (e.g. using plugins) and that is actively being further developed. Or is it an individual software solution where you are tied to a developer or where it is very difficult to change something yourself? - Type
What kind of website is it. A community, such as a forum or more of a classic website. Many things, such as administrative expenses and income potential, depend heavily on the type. - Age
How old is the project? Is it just being created or is it an established project? - Layout
Is the website layout something special and unique or does it urgently need optimization? - Personality
How dependent is a website/blog on the previous operator? Is this rather in the background or do the regular readers connect the blog with the blogger? How many people would stop reading the website if the main owner changed? - Soft factors for the website as a whole are difficult to include in specific calculations. Nevertheless, these can have a major influence on the purchase decision and also on the purchase price.
Statistics
Statistics are not unimportant when calculating the value of a website.
But even if the previous values are important, the past itself is not important, since only the future counts for the buyer. Accordingly, not only should actual values be assessed, but development and future potential should also be assessed.
- Visits, Unique Visitors, Page Views
These values are always worth a look. On the one hand, you should also look at how the values have developed over the past 12 months and whether certain trends can be foreseen for the future. - Bounce Rate and Length of Stay
These two values are also quite interesting, as they say, something about how intensively the readers are occupied with your site. - Average Development
As already said, the current actual values are not meaningful in and of themselves. The current PageViews can be 100,000, for example, which in itself looks very good. But it makes a huge difference whether it was 200,000 in the previous month or whether the development was steadily increasing in the last few months. - Access
Sources Where do the visitors come from? The proportion of search engines, websites, and direct visitors also says something about the risk if one of the access sources collapses. - I think statistics are very important because they are clear facts and describe the current situation very well. But one can also derive forecasts from these figures. The statistics should come from a trustworthy source.
Domain
The domain of a website still has a lot of influence and should, in my opinion, be heavily included in the calculation.
- Age
To assess a domain one can include age among other things. The older, the more trust domains have often gained. - History
In doing so, one must not lose sight of the history of the domain. What was previously on this domain and are there any disadvantages as a result? - Backlink Distribution and Quality
What about the backlinks of a domain. And what quality are these backlinks? - Keyword Domain
Even if Matt Cutts is now declaring war on the preference of keyword domains, it can be an advantage if important terms appear in the domain, but on the other hand, it is easy to remember and write. - The domain already plays an important role, especially if the project has been established for a long time. Through free, but also professional SEO - Tools can be something about the domain to find out.
Content
We come to the content-related factors. Because, of course, the content of a website plays a major role. Google uses many factors that are not directly related to the content. However, the ultimate goal of Google is to have the best content at the top of the search results.
- Topic
On the one hand, the topic is of course important. How do you know about it yourself, is the topic trending, how many are interested in it, and what income opportunities are there? - Scope
How much content is there at the time of sale? The more content there is, the more search engine rankings there are and the more traffic is possible. - Quality
But quantity is not everything, the quality has to be right too. Is it unique content or is it copied texts? The latter would greatly reduce the value. - User-Generated Content
The question of whether the content mainly comes from users also plays a role. It doesn't have to be negative, but you have to be able to classify it and assess what it means for this specific website. - Know-How Requirements
What knowledge is required of the buyer to be able to continue to fill the website with content? If you don't know yourself, you may have to buy the content. - The content is an important factor. Here too, one should consider the opportunity costs. What would it cost to create or buy this content yourself now?
Today, a lot of traffic still comes from Google, the dominant search engine in Germany. Therefore you should also look at the search engine key figures.
- Rankings
Even if many websites get traffic from thousands of longtail search terms, you should look at important rankings. - Ranking History
But here, too, one should look at the development so far and recognize whether there is a healthy upward trend or whether there have been or are currently problems. - White Hat / Black Hat
It is sometimes difficult to assess whether black hat methods have been used that may later lead to penalties by Google. OnPage can be judged with the right know-how. OfflPage will be more difficult. - Penalties
Have you already been penalized by Google in the past? - Professional SEO tools should be used to assess the current situation and especially to assess the development to date. They may cost money, but they can save a lot of money if you recognize possible problems with them.
Key Figures
There are still some interesting key figures, but their meaning is quite controversial.
- PageRank
The PageRank is hardly meaningful today. If at all then you can tell whether a site has possibly received a penalty from Google. On the other hand, it may still have a certain value when selling links. - Alexa Rank
If I look at the estimated page views that Alexa gives for self-employed online, then I have to say that Alexa has next to no value. The estimated values are far from reality and this also raises the question of how meaningful the Alexa rank, for example, is. - Dmoz and Wikipedia Entry
Not all backlinks are equally important. While the time of the Dmoz is running out, Wikipedia is still very important on the web. Getting backlinks from this can have positive effects. - Social Web
Certain rankings or the number of Facebook fans and Twitter followers. - RSS and Newsletter Subscribers
Regular readers are valuable and therefore the number of RSS and newsletter subscribers should be included in the calculation. With the latter in particular, it is of course not unimportant how they came about. Has the previous owner bought addresses? Did people have to subscribe to the newsletter to download a download and didn't want it? You should take a closer look. - KPIs are such a thing. They were developed to allow a quick assessment of complex issues. However, very often they are not exactly meaningful and reliable.
Costs and Effort
Let's get to the running costs and effort of the website in question.
- Regular Costs
What is currently incurred for hosting, external employees, etc. every month? What else may be added because you do not have certain know-how? - The Average Expenditure of Time
This should not be underestimated. How much work did the previous owner put into it every day and what do you expect yourself? - Marketing Costs
Do the good visitor numbers only come about because X euros are spent on AdWords ads every month? What about paid backlinks? - In the end, what counts is the net income of a website. Therefore you have to know exactly how high the costs are. And of course, how much effort the site makes is also important.
Income
Here we come to one of the most important, but also one of the most difficult factors to assess.
- Income
What is the current income? So you can calculate what the site will earn if you don't change anything. - Income Development
How is the income development? If the income stagnates, you have to calculate differently than if there is constant growth. - How Well Monetized
That's where it gets difficult. Is the current income the maximum or has it been poorly monetized so far? - Sources of Income
Which sources of income are in use and which sources of income could be added? - Potential
In general, one should not only look at the current state of income but above all try to assess how the income potential looks in the future. - The most important thing for most website buyers is future earnings. The current income is of course important, but also your forecast of what is generally possible with this website. And for that, you need experience, because no tool tells you.
Your Opinion
Now I would be very interested in which groups of factors you consider important or which you may even be missing from my list. You are of course welcome to write in the comments.
Calculation Methods
In an upcoming article, I will show you what concrete options there are to calculate the value of a website.
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