If you take the time to understand websites, you’ll begin to see a bunch of parallels with real estate. Websites are the equivalent of internet real estate and they can be used as investments, sources of recurring income, and places for storing assets. And much like houses, websites, under certain circumstances, can be flipped for profit.
What is Website Flipping?
Most people are at least somewhat familiar with house flipping. Made famous by HGTV shows like Fixer Upper, house flipping is where you purchase a home that’s in need of a little TLC, put some work into it, make it pretty, and sell it for a profit. What most people don’t realize is that there’s an opportunity to do the same with websites.
Much like real estate, websites can be bought and sold on online marketplaces. Often times, people will sell websites at a deeply discounted rate when they can no longer spend time on them. By swooping in and purchasing these sites, you can potentially fix them up and sell for a profit.
5 Tips for Optimizing a Site
Just as house flipping looks easy after watching an episode of Fixer Upper, flipping websites may seem easy after reading a case study like this. The truth, however, is that it’s very challenging. You need to know what you’re doing and it’s not something that can be done without a game plan.
With that being said, you’ll want to heed the following advice:
1. You Make Your Money When You Buy
As is the case with physical real estate, you make your money when you buy the website. If you overpay for the site, you’ll spend all of your time and energy just trying to break even. If you get a good deal, you have a lot of cushion to work with. Remember that sellers are unloading their sites for a reason and use that as leverage to negotiate a better deal.
2. Look for Untapped Revenue Streams
When evaluating a website with the intention to purchase, you should be looking for untapped revenue streams. Ask yourself, “Where can I make money that the website isn’t currently utilizing?” Options include advertising, premium services, virtual and/or physical products, consulting, etc.
3. Clean Up the Surface Level Issues
When searching for a good investment, you should be looking for websites that have potential and are simply squandering it. If you’re lucky enough, you may even stumble upon some websites that are already doing okay, but have horrible design issues and layout flaws holding it back. In real estate terms, this is like having dated wallpaper, cheap countertops, and horrible paint colors. It can all be replaced for pennies on the dollar.
4. Build Your Email List
As you’re flipping the site, build up your email list. You can either keep this email list for yourself after you sell, or throw it in as part of the website and charge the future buyer a stiff premium.
5. Track Your Progress
Finally, make sure you’re tracking your progress every step of the way. When you go to sell the website, it’s extremely helpful if you can point to specific ways you’ve enhanced the value – including improvements in areas like SEO rankings, traffic numbers, and revenue.
Ready, Set, Sell
Once you’ve done everything you can to optimize your website and enhance its perceived value, it’s time to sell. There are a variety of options here. Most people either work their own professional connections or use a website marketplace. Whichever method you choose is fine, but be prepared to negotiate and provide prospective buyers with as much information as they need to make an educated decision.