As the new marketing manager at Flippa, my first week has been spent learning as much about the marketplace and the users as I can. There’s no substitute for “Eating one’s own dog food“, however, so over the weekend I purchased my first website from the Flippa marketplace. Here’s the what, the why and the how I went about my introduction to the marketplace.

Choosing An Auction

The website that caught my eye was pregnancyworkoutdvd.com. Why did this grab my attention? Pretty simple really, my wife’s expecting so I have pregnancy on the brain (If you’re reading this darling, no, you look fine, you don’t need to workout!). The site was in the lower end of the market in terms of price so it was a good way to dip my toe in and test the waters.

Using the analogy of stocks, this type of purchase is a speculative investment. The website is young, not making any money and will need time spent on creating more content, but it has a solid foundation and ticked some important boxes.

Here’s the due diligence and domain analysis I did that lead me to my first website purchase:

Keyword Research

This website is clearly targeted at people searching in Google for the keyword phrase “pregnancy workout dvd”, so the first step is to find out how many searches are being done. There are a stack of keyword research tools out there, paid and free, but Google’s Keyword Tool will do the trick (it’s free!), giving me a rough indication of the number of searches being performed for this keyword phrase.

As you can see above, Google’s keyword tool suggests that “pregnancy workout dvd” receives 6,600 searches monthly. That’s 220 searches per day which is reasonably healthy for a highly targeted niche such as this. Google results are generally on the optimistic side so let’s round it down to 200. If I’m in position #1 for this keyword I might expect to receive about 56% of this search traffic (according to a Cornell University study). That’s about 120 visitors per day if this site can rank #1 for this one keyword phrase.

Competition Analysis

Next we want to find out how competitive this niche is. Competition analysis is an in-depth topic and it’s worth checking out some of the posts over at Sitepoint for more details. For basic metrics, I use Firefox with the SEO Quake Extension to display competition metrics, which will give me an indication of how difficult it will be to achieve a #1 ranking for this site.  The current #1 position site in Google’s results has the keywords in the title, a PR (page rank) of 3, but doesn’t include the keyword in the domain name, another factor that can influence search rankings.

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Another simple metric I use to establish competition is to find out how many other pages appear in Google for a phrase search. In this case there are 8,040 other pages in Google’s index:

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8,040 results is low. Anything under about 100,000 results means that the niche isn’t over saturated. Try some other searches and you’ll see what I mean.

So I’m happy with this niche; there’s reasonable traffic available for the keyword and I’m satisfied that the competition won’t prevent me from ranking well for this keyword search phrase. So how do I know how much I should pay for this website?

Website Valuation

In this particular case, the site isn’t generating revenue. The Flippa stats, available to the right of the auction, or a quick Whois search tells me that it’s less than a month old. There’s no data available for the domain on SEMrush.com (another handy keyword research tool), but Google shows that a basic search for the core keyword phrase shows that the site is already ranking at position #8. Pretty good for a site that’s less than 1 month old and shows that the developer knows his stuff.

Other important items to check:

  • Copyscape – make sure the site doesn’t just duplicate content from another. This particular site lists DVD’s for sales with blurbs referenced from Amazon, so I’m comfortable with a little bit of duplicate content.
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  • Google Analytics Traffic – If traffic stats aren’t already listed on Flippa, request them. In this case I didn’t (but I probably should have) as I was satisfied with the other metrics.
  • Seller Profile – Make sure the seller has a good trust rank in Flippa.

Being a WordPress fan I was also happy to find that this site uses WordPress therefore making it easy for me to updated and add content.

Even though I’m proficient at using WordPress and I can cobble together a site, if I wanted to build something like this from scratch and do some basic Search Engine Optimisation, I know it would take me about 10 hours of work. That was the clincher. After all the research, $397 seemed like a reasonable price to pay for a site that would take me 10 hours to build and get ranking.

If you’d like to learn more about choosing a niche, developing a site and getting it to rank, check out The Thirty Day Challenge, it’s a great (and free) resource for learning the finer details.

What Next?

In a coming post I’ll share some of the steps you need to take after you’re bid has been accepted and you’re ready to take ownership of the website.

Amendment: Thanks to those who pointed out that I underestimated my monthly traffic stats. I’ve since amended these. It’s a good lesson – always double check your figures. The amendments suggest that this site would receive significantly more traffic than first calculated if it reaches position #1.