There are countless entrepreneurs who are buying, growing, and selling websites as a way to make money online. This industry is growing rapidly, and investors are doing transactions worth millions of dollars every month.
But, finding success in buying and selling virtual real estate is just as challenging as investing in real estate in the physical world. There is inherent risk involved, which means you need the right knowledge and skills to do it effectively.
If you are looking to get started in this lucrative industry, read this article to discover 15 tips for making money by selling websites.
1. Choose the Right Niche
Niche selection is key to success selling websites. Instead of targeting an industry, do keyword research to help you target a subset or “niche” within that industry.
By looking in the right niches for websites to purchase, you avoid making the mistake of buying an unprofitable website based on a passing fad. Instead, you will be able to choose websites with evergreen content that will remain popular and useful for the long term.
Here are a few evergreen niche examples:
- Money and finances
- Health and wellness
- Sports and hobbies
- Food and recipes
- Relationships and personal development
- eCommerce
- Small business
- Education
The great part about niches such as these is that they can also be expanded into multiple sub-niches.
For instance, a large, overarching topic like “health” can be broken down into sub-topics like mental health, emotional health, food and diet, exercise, and so on.
This helps to reduce the competition and allows you to build a loyal readership faster than you would if you were competing with larger websites that cover a broad range of topics.
2. Know Your Money and Time Limits
Before you consider buying a website, first take inventory of how much money and time you will be able to invest. Purchasing a website comes with risks, and this means that you should only invest what you are willing to lose.
No matter how attractive a website may seem, the truth is that no investment is guaranteed, so if you can’t afford to lose the money or time, then don’t invest.
Once you’ve decided on a budget, plan out how much time you will be able to work on the site. If you buy a website that is already making money passively, then you obviously won’t have to make as many changes as you would buying a starter website.
However, you may still have to implement changes in areas that need improvement so you can increase your ROI (return on investment) from the sale.
3. Find Websites Worth Buying
Although starter websites are fine, profitable websites are a lot better. It’s possible to build out and sell an unproven website before it has even begun earning.
However, although this method has the benefit of not having to wait 12 to 18 months for your website to mature to the point that it’s making money, it also has the downside that almost everyone can do this.
All they need to do is get cheap WordPress hosting, publish a few pieces of content, and then sell the site, which means you’ll probably have to sell your website for a very low price.
So, when finding websites that you can buy and sell, it’s worth taking the time to identify the ones that will be worth your while.
Here are a few key performance indicators to consider:
- How much revenue does the website generate?
- How consistent are the earnings (e.g. are there spikes and dips? Are earnings seasonal? For instance, some websites, like a lingerie store, can experience earning spikes during the period leading up to valentine’s Day) or a subscription coffee service might see a spike around the Christmas holidays.
- Is the income generally passive (that is, it isn’t entirely ad-based)?
- Does the website have upside potential? In other words, can you identify ways for maximizing traffic, expanding revenue sources, and improving existing graphic design and content?
4. Do Your Due Diligence
Before you buy a website, you need to take the time to do your due diligence. This includes focusing on things such as:
Why the Site Is Being Sold: For instance, find out if people’s interest in the topic or niche has been slowly declining. Or maybe the website has been flagged by Google for duplicate content? Or could it be that the owner is simply tired of running the website and wants to move on to something new?
Proof of Traffic and Revenue: Usually, it’s easy to verify traffic levels using Google Analytics and other tools. Look at income reports to gain a clear idea of what to expect from the website, revenue-wise.
Is the Seller Trustworthy?: As previously mentioned, buying and selling websites involves a certain amount of risk. However, you can help mitigate that risk by ensuring that you only buy from trustworthy sellers. Some websites have seller profiles with ratings, feedback, and more that you can check before making a decision.
Check their Link Profile: This is one of the most important things to do before deciding whether or not to buy the site. Find out whether the links are purchased or if they are white-hat links. If the website relies on search engine optimization (SEO), will you be able to maintain the link quality and quantity after you purchase the site?
5. Make an Offer
Once you’ve found a website you like (and after you have conducted the proper background check), it’s time to make your offer.
On some website listing platforms, you will find a price listed. If that’s the case, start with an offer that is lower, but don’t low-ball.
For instance, you can start at 70% of the seller’s asking price. This gives you a bit of wiggle room, particularly if there are some negative things that you uncovered about the website, such as issues in content or design that could be improved.
If there’s no price listed, use what you learned while doing your due diligence to come up with a reasonable amount to offer.
6. Use Simple Website Monetization Strategies
If you’re building a website with the intention of selling it, the best thing to do is to start with the simplest monetization methods possible. If you purchase a site that is already monetized, make sure that you are familiar with, and can continue utilizing its monetization strategies.
For instance, some websites use dropshipping as a monetization method, and while selling physical products can be quite lucrative, you need to be aware of how this type of business model works so you can employ it effectively after you’ve purchased the site.
Some of the most popular monetization methods that are easy to implement include:
Google AdSense: When you allow Google to display ads on your site, you get paid per ad view or click. This monetization method is virtually maintenance-free, and once set up, you don’t have to do much except work to grow your traffic so you can earn more from your ads. If you want to learn more, check out our Guide to Google Adsense.
Affiliate Marketing: Affiliate marketing is yet another effective website monetization method that you can use. Simply join an affiliate network like Amazon Associates, Clickbank, or CJ Affiliate and get paid a percentage of any purchases made through your referral.
7. Improve the Site
Once you’ve purchased the website, and it has been transferred to your name, you can then start making your virtual real estate more valuable.
Determine which areas can be improved, and implement a plan for doing so. Here are some of the main things you might consider doing to help you grow your monthly profit:
- Improve the Content: Create a solid content and SEO strategy to rank for important keywords and improve website traffic. Review articles like this Wix vs. Shopify comparison post are particularly great for bringing more traffic and leads to your site.
- Include Affiliate Opportunities: Explore different or additional affiliate opportunities, or negotiate better deals to help maximize your website income.
- Enhance Your Marketing Strategy: Consider investing in things like paid advertising and social media to further grow your revenue.
- Build an Email List: Create and nurture an active list of subscribers so you can add even more value to your website.
Pro Tip: You can outsource most of the work for improving your site. For instance, you can hire a writer or find email marketers and graphic designers on sites like ProBlogger or UpWork.
8. Build Your Site for Users and Not for Search Engines
Anyone can get cheap hosting and build a website in any niche. But, only unique websites will sell for a premium. If your website looks like it was built using a template that looks like hundreds of other websites online, this won’t work well in helping you get a good price for your site.
Buyers want a website that looks like it was created by someone knowledgeable in the niche. They want a clean-looking, non-formulaic site and they’re willing to pay higher amounts for the right website.
So make sure that your site is built for users first in order to maximize your profits from the sale.
9. Evaluate What Your Site Is Worth
After you’ve improved your website, its value should obviously go up. You can then do the math and figure out what your website is worth now.
This is similar to the work you did when you were deciding on how much to pay for the website, only now you are on the other side of the equation.
Luckily, there are plenty of online marketing tools you can use to help you each step of the way.
Here are a few things you must take into account when evaluating the worth of your website:
- The increase in traffic since you have been in charge
- The increase in revenue, and how consistent the income is
- How many revenue streams your website has (and their likelihood for continuing)
- The size of your social media following and email list (loyal followers are a lot more valuable than one-time website visitors)
- The value of your domain name. If the name incorporates a popular keyword, relevant buyers might find it more valuable.
- How much work the site will require to maintain profitability
10. Maximize Profits Leading up to the Sale
When you’re getting ready to sell your website, you need to find ways to cut down on unnecessary spending or expenses.
This is important since the price of your website will be based on a multiple of its net monthly profit.
So, by reducing expenses, it helps you maximize that profit. Do this for at least six months prior to the sale.
11. Seek Strategic Buyers First
Whether you use a website marketplace or hire a broker, your best bet is to look for a strategic buyer for your site.
The strategic investor may be willing to pay more for the site than a portfolio investor. That’s because while the latter may value your website only using a multiple of profit, a strategic investor might have more to gain from your traffic, site users, and so on. – as long as they are in a similar niche.
Most website marketplaces offer services to help you find interested sellers quickly at a more affordable rate than using a broker.
Flippa also offers brokering as a service, which helps to save you time and money. The benefit of using such a service is that it allows interested buyers to come to you, as opposed to you having to do the work of finding them.
12. Negotiate the Sale
Once you’ve found your buyer (or they’ve found you), it’s time to negotiate the sale. Figure out a sale price you can both agree on and then work out the terms and other details of the sale.
If you are using a broker, they can help with the negotiations and do all the proper paperwork. When accepting payment, always use an escrow service in order to avoid scammers (and show that you aren’t a scammer yourself).
Most marketplaces have built-in escrow services, but if you’re selling on your own, you can use a 3rd-party service.
13. Plan a Smooth Transaction
If you want to find the best buyers for your site, you have to plan for a smooth transaction. For instance, write clear SOP’s (standard operating procedures) that the buyer can easily follow after purchasing your website.
This will make your site a lot more attractive to buyers, and potentially help you maximize your profit.
Making the transfer is something that a broker can help you with if you are unsure of the process. They will be able to provide you with the proper technical steps to take so you can quickly and easily transfer the website to its new owner.
14. Keep Running the Website until after the Deal Is Done
If your website looks neglected, it will lower the sale price. That’s why it’s crucial that you continue to run your site until after the sale is completed.
This is important whether you are listing your website through a website broker like Flippa.com or on an auction platform.
Continue running the site as though you were going to keep it until the deal has been completed.
15. Avoid Common Pitfalls
It’s common for sellers to make mistakes selling their first couple of websites. If this happens to you, don’t worry, but rather, use your failures as a learning experience so you can improve your website-selling skills with practice.
Conclusion
Buying and selling websites can be a lucrative business, but it’s not for everyone. In order to be successful as a website flipper, you need to be able to spot undervalued websites that you can improve with minimal investment in money and time, and then sell them for a good profit.
These 15 tips for making money by selling websites will give you a leg up building a lucrative business.
Inspired to sell your website? Read up on others who have successfully sold their businesses here.
If you’re ready to sell, check out our First Time Seller’s Guide.
