Buying Websites for Fun and Profit

If you’ve decided to try your hand at making money online you’ll soon find that one option you have is to purchase an existing website. Between auction sites, webmaster sites and marketplaces dedicated to sites for sale you’ll see that there are a lot of websites available for purchase. At times purchasing a site can give you a great head start to making money online but there are a number of things you need to consider before you buy an existing site.

Know the Niche Trends

photo credit: jvreeIf you see a site that looks interesting you’ll want to be sure you understand the current trends in that site’s niche. If you don’t already know the niche well be sure to do some research first. You want to particularly look for a niche where market forces have recently changed. One recent example is web directories. These lists of sites are very popular locations where webmasters can add their site - sometimes for free and sometimes for a fee. Aside from the very large and well know directories however, the primary advantage of being listed in a directory was for backlinks in the search engine. You’ll notice that I said was. The search engines - and Google in particular - recently made some changes that diminishes the value of links from a directory. While this may not have affected traffic and listings in directories yet it is likely that these types of sites will continue to diminish in value over time. When you’re buying a site - or building one - in a niche that’s new to you, you’ll want to be sure that the niche is growing or stable and not contracting.

Look for a Site with a Unique Advantage

If you’re going to buy a site instead of building it yourself you’ll want to be sure that the site you’re buying has some sort of unique advantage. That advantage can take many forms - perhaps you’re not a great designer and the site you’re considering has a fantastic design. Maybe the site has some well established traffic - this is vital for community sites where building initial traffic is the most difficult. Sometimes the site has a great domain name or ranks well in the search engines. Ideally you’ll want to buy a site with a well established market position. As an individual, it’s unlikely that you can buy a site like Facebook that has a huge established position but a site that’s considered one of the best its own small niche will still have an advantage over a newcomer.

Be Sure You Can Grow the Site

If you follow some of the “purchase a site” discussion on a webmaster’s forum you’ll see lots of questions like “how much time does it take to run the site”. Those people are setting themselves up for failure because they’re only concerned with “can I maintain the site”. If you’re buying a site you need to ask yourself “can I grow the site”. If you can’t add content, improve the design, fix the SEO, drive traffic or improve the monetization of a site then it’s not for you. It’s tempting to buy a site for 5x its monthly income and expect you’ll be profitable in month 6 and in some cases that does work but the truth is that most sites that aren’t growing are declining. Even if the current owner claims they spend only a few hours a week on the site. This doesn’t mean that you need to be an expert in the content, SEO, design and monetization - it may just be enough that you’re willing to learn these things or hire outside help. More important however is that you have at least some initial ideas on things that you can do to improve the site.

Beware Buying the Wrong Part of a Site

photo credit: wheneverWhenever you buy a site, regardless of what you might think, you’re only getting part of it. That’s because part of the assets of a site is the site creator. For some sites the creator is inconsequential - no one really cares who’s behind a site like Flickr. But for other sites the creator is practically the only asset of the site. This is the case if the primary draw to the site is the identity of the creator or if the creator is an important part of a community site. If the creator of a site is famous (even if just within the niche) or a good portion of the site’s traffic is made up of friends and family of the creator it’s safe to assume that much of the site’s traffic will be lost when the creator leaves. A blog with a single author is very difficult to take over as is a forum where most of the questions are directed to or answered by the site’s creator. While the site may otherwise look good chances are the you won’t be able to recover from the loss of the key asset.

Is Buying Right?

While there are a number of pitfalls to avoid, buying a site can be a great way to start making money online or grow your money earning assets. With a bit of research, an honest assessment of your own abilities and a willingness to work after the purchase, buying may let you own something you could never build on your own or merely give you a months or years headstart toward building your own market leading property.