Justin Cooke

June 25, 2011

There is quite a bit of gray area between ethical sellers and those that are outright scammers on Flippa.  While plenty has been written about the obvious frauds, I wanted to focus on a few of the less obvious points that can help you decide whether or not to put your bid in for that next auction.

As regular sellers and potential buyers, we’re often monitoring the auctions on Flippa to get new ideas for our own auctions and looking for under-valued sites.  We hope that our sharing will help you save a buck or two.

It’s important to not get sucked into thinking that any one auction is a must-buy…there were plenty that came along before and there will be plenty that come along after that would be a good fit for you.  Letting go of that nagging feeling that you just HAVE to buy an auction allows you to look at the auction more critically, keeping you away from those auctions where something just doesn’t seem quite right.

  1. No Google Analytics – While some sellers argue they’re trying to remain under the radar by not including Analytics, it also means that you may be looking at inflated or false numbers.  Flippa allows for verified Google Analytics and anyone looking to sell their site should at least install Analytics for the duration of the auction to allow potential buyers access or at least a few days worth of verified screenshots.
  2. Short Revenue History – Many product launches include a certain amount of hype, pre-sales, etc.  Even though the last 2 weeks of revenue has been phenomenal, you don’t want to get stuck purchasing a fizzling, dwindling product with a short shelf life unless you are certain you can keep up the level of hype and buzz surrounding the launch.  Don’t get caught up in with through-the-roof 2 week sales numbers.
  3. Traffic To Revenue Ratio Doesn’t Match Up – We’re extremely aware and monitor closely our traffic to revenue and pageview to revenue statistics.  (If you’re not sure or don’t have anything to compare it to, you can get a rough idea here.)  It’s common to see sellers with numbers that are slightly better than ours, (Not sure if we’re really below average or if they’re puffing up their numbers!) but when we see auctions that are doing 5, 7, even 10 times the ratios that we have in a niche and with a monetization strategy we’re familiar with, we know something’s not right.
  4. Didn’t Claim Paid Traffic In The Auction – A great way to find out if the seller is using paid traffic without having to ask is by checking their verified Google Analytics.  Look at their top keywords and then check Google to see if the site is ranked for those keywords.  If not, there’s a good chance those keywords were purchased via paid traffic.  You can also check to see the top referring links and contact those sites to see if the links are paid links or not.
  5. Auction Numbers Don’t Match – It takes us quite a bit of time to make sure we report the exact numbers when it comes to earnings, traffic, rankings, etc.  If you find discrepancies between what they’re stating in the auction and what’s showing in the screenshots or through your research you may want to question the seller about it, particularly if the error worked out in their favor.  While it could be a simple mistake, if they didn’t take the time or it wasn’t important enough for them to get that right, what else might they be missing?
  6. Research The SellerSellers that are difficult to track or pin down online always raises red flags for me.  If I’m not able to easily research the actual person that’s selling me the sites, I tend to think it’s intentional and that they don’t WANT me to find out who they are.  You can dig a little further by Google searching the seller’s username (many people will use the same username on multiple sites including forums, social media, etc.) or digging into the site that’s being sold.  Most sellers will try to promote their auction through social media and will give you a good starting point into looking at their background, their history, etc.
  7. Slimy Sales Tactics – Buying websites through Flippa can be an exciting process.  Sellers are excited about the influx in cash and wonder how much they’ll ultimately receive while buyers are hoping they’ll find a diamond in the rough. The sellers that play to your greed using tactics like false scarcity, fear of loss, and grossly inflated projections give you some insight into the mindset of the seller.  For whatever reason, they feel it’s important to hard-sell you on the site, which is not something I’m interested in.

Don’t want to worry about sellers trying to pull one on you? Our own Marketplace only lists websites that have been fully vetted by us. You’ll get exactly what you expect.

Check out our Marketplace’s websites for sale.

Like what we had to say?  Let us know if you have any other useful tips for buyers in the comments below!


Make a living buying and selling websites
Sign up now to get our best tips, strategies, and case studies
Discussion
Leave a comment
  1. Jusharra says:

    I love this post and the insight you provided about Flippa. I am still a beginner to the business flipping industry and I have tried to start by selling a few domains that I have. Right now I’m learning about both ends of buyers and sellers and have seen a few of the tricks mentioned in your article coming across auctions. I hope to get better and become a major player one day in this Industry. Great insight again. Loomfor

  2. […] Check out our tips for Flippa buyers here or our podcast episode about how not to get scammed on […]

  3. […] Our post on avoiding Flippa scammers […]

  4. Rei Brazilva says:

    Justin, I’m having trouble figuring out if you are pro-Flippa or anti-Flippa. I just read a blog made by you promoting sales in Flippa. A little confused. That’s all

  5. […] Check out our tips for Flippa buyers here or our podcast episode about how not to get scammed on […]

  6. Ken Muise says:

    Hey guys,

    Just found the site yesterday and still going through all the posts. Justin…thanks for stopping by m place today.

    I got a question: Is there anything I can really do when I find out someone sold me a site with paid traffic or is it more of a “well, son, you earned your Flippa wings today. Heh, heh..”?

    Great site. I plan on visiting daily. Peace.

    • Not much you can do. You can leave negative feedback, but that won’t really get you anything. You could try a charge back on your card or with PayPal, but since he did in fact deliver the site, you probably won’t win.

      Next make sure to dig deep in the Google Analytics for stuff like this.

      Thanks for stopping by and sorry it didn’t work our for you on Flippa.

  7. Jenni says:

    Great list. I would add bounce rate to number 4. I saw an auction recently where the Google Analytics screenshots showed the bounce rate was 0.02% – highly unlikely, and when checked with the poor rankings it showed it was paid traffic. Still made a huge sale though.

    • jwcooke says:

      Wow…

      0.02% Bounce Rate? Yeah, something fishy going on there for sure! Nice addition, Jenni…nice blog, too!

    • Janez says:

      Well you can create low bounce rate by not placing the analytics code on pages where you send the paid traffic to and your’d have to have a ton of paid traffic. Low bounce rates on sites that don’t look like they’ve been attracting a ton of pageviews or time spent on site is a red flag.

  8. Jon says:

    Whenever I see sellers try to sidestep verifying their Google Analytics I see a red flag. Also, I’m sure a lot of this isn’t common sense to most folks who may not be active in this space so good on you for sharing this advice.

    You should do your due diligence and only buy when you have a clear picture of what you’re buying. Your instincts are likely right if you think something’s fishy with the numbers.

    Keep walking the straight and narrow, Justin!

    • jwcooke says:

      Jon – Thanks for the comment! Totally agree with you regarding Google Analytics…it’s so easy to setup that, if you’re planning to sell, you might as well and if you DON’T I assume something’s wrong. Plus, Flippa allows you to send it verified through GA giving buyers some assurance that the GA is real.

      What’s difficult for ME as a buyer is a rough one…I find a site that I think has real potential…but I might not be the best one to take it where it needs to go. It may be because I lack a particular skillset or I really don’t know the market/competition well enough to know the space well.

      BTW, liked your post about Hyundai…definitely a smart move. I’ll respond to your email this weekend, I swear!

      • Jon says:

        Thank you very much for reading my article. Take your time replying to my email; my hope is we’ll have a lot to discuss :)

  9. Justin gilchrist says:

    Hi Justin

    Good round up of the pitfalls. I think everyone would be better off if Flippa forced bidders to read this info before being let loose on the market :)

    • jwcooke says:

      Thanks for stopping by, Justin…HUGE fan of FlipFilter. You provide some awesome insights over there.

      Yeah, we’ve had previous and potential buyers asking us about some auctions that make us cringe. Others are a bit more tricky. One problem I’ve had is that it’s MUCH easier to tell someone it’s a bad idea than it is to take a risk, stick your neck out and say go for it. I’ve been digging through for examples of sites that I like and including them as well with my reasons why. Seems to help.

  10. peter says:

    Good post, I would also suggest avoiding sites that use the word “potential” and turnkey autoblogs.

    Could you give a more specific example of traffic to revenue ratio? Not sure what you mean…

    • jwcooke says:

      Peter – What I meant by Traffic to Revenue ratio is this:

      Let’s suppose you have sites primarily monetized by AdSense using decent Ad placement and knowing your CTR and CPC is reasonably good. Let’s also say that you’re getting 10,000 unique visitors per month and making around $800.00 per month. That gives you an RPU (Revenue Per Unique/User) of $0.08.

      If you’re looking at a site that has similar Ad placements, is in a similar niche, etc. and yet it’s claiming to have 1,000 visitors a month and making $500.00 per month (RPU of $0.50) there’s probably something wrong.

Leave a Reply

Your email address will not be published. Required fields are marked *

Have a site to sell?
Sell Your Site

Click here to find out how much your website is worth