Case Study: Build and Sell a Website for $10K in Only 8 Months
Justin: This guest post is from Doug over at NicheSiteProject.com and how he built, monetized, and sold a website with us for $10K+ in less than a year. He goes into some serious details and lays out everything in his process – from niche selection to preparing the site for sale. If you’re at all in the build-and-sell camp, you’re going to dig today’s post.
Stick around to the end for a free copy of his Niche Site Process book with even more behind-the-scenes details.
And now…over to Doug.
I sold a niche site for $10,421. I didn’t even know what a niche site was one year before the sale.
I always wondered how people were making money online. I heard stories, but they never quite made sense to me.
It was only when I got involved in niche sites that I really understood how to generate profit through the internet.
If you’re thinking about getting started with niche sites, keep reading, because this post covers the whole process.
Here are some of the essential facts about the site and the sale.
- Niche: Outdoor/Blue Collar
- Site launched: August/September 2013
- Monetization: Amazon Associates
- Total earnings (USD): $2178
- Completed Empire Flippers Application: April 6th, 2014
- Listed on marketplace: April 14th, 2014 – $10,421
- Sale price agreed: April 25th, 2014 – $10,421
- Transaction completed: May 7th, 2014 – payout – $8,858
- Total site profit: $10,479
Why would I sell a site that is making money every month?
Let’s talk about it…
First, I wanted to get the earnings upfront to invest in other projects. One could argue that if you have a site that’s earning money, you should not sell it and instead keep earning money each month. In this case, I was only generating about $500 per month. By selling the site, I acquired 20 months of revenue in advance (17 months considering the broker fees), or about $10,000.
Second, pure curiosity—I wanted to go through the process of selling a site. I’d never sold a site before and wanted to try it out.
Let’s digress a bit…
How I started in Niche Sites
I found Smart Passive Income in April of 2013. Pat Flynn’s first Niche Site Duel was eye opening! I had no idea you could make money online.
The SPI Podcast led me to Niche Pursuits within a few weeks. It was lucky for me because Spencer Haws was just digging in for his “Niche Site Project.” The Best Survival Knife Guide was starting to gain some traction by May 2013 when I studied the process.
Another big source of inspiration was the Empire Podcast. They had a couple years of shows already available so I had many, many hours to consume.
Plus, they offered a comprehensive book for free called Building a Niche Site Empire, and it was my playbook. I read that thing in one sitting!
(It’s still available on Amazon, though some of the details are a little dated.)
The details of internet marketing, hosting, domains, WordPress, and so on were all new to me.
By July, I had a couple websites earning a few cents a day from Google Adsense.
Those early sites weren’t going to make me rich, or even pay for hosting! However, they proved that it was possible to make money online!
I was kicking off one Amazon Associate site for the Smart Passive Income Niche Site Duel. A trickle of traffic was coming in, too.
I decided that I needed to scale and wanted to try my hand at a new site: the site that we’re talking about today.
The Niche & Keyword Research
I was looking for more keywords and started checking out different online stores for ideas.
I wanted to find a product that was appealing to a male, blue collar demographic. I ended up looking at one of the major online and offline outdoor retailers in the U.S.—Bass Pro Shops.
I find it pretty fun to walk around their stores since they have darn near everything.
I found a great keyword, plus secondary keywords, in an active niche. There was a pretty wide range of product prices, but the minimum was about $80. The most expensive models were over $1,000+.
That kind of price range is perfect—it was wide, and the average was over $100. It’s very profitable even with a minor amount of traffic.
The main keyword was in the format of:
The search volume was 3,600 exact matches per month.
There were two secondary keywords that caught my eye. They were closely related and basically synonyms, so let’s lump them together here. Again, the format was:
The search volume was 590 and 110 exact matches per month.
I can’t state the exact Keyword Competitiveness (KC) from Long Tail Pro from back then, since I didn’t have it at that time. However, once I had the ability to check, the KC numbers were in the low to mid 20s.
I sat on the idea for a few days since I knew I didn’t have time to act on it yet.
Eventually I couldn’t wait any longer, and I bought a domain for the new site.
I bought a domain around the end of August. It was a partial match domain name. Nowadays, I would probably choose a different domain name that has the ability to grow to a bigger website if things are going well.
The downside is that a partial match domain sort of locks you into the product line. For example, http://bestlefthandedscissors.com is pretty limited. It would be better to pick something like http://everythingforlefties.com so you could expand the site later.
I developed a plan for content generation that I would execute on for several weeks.
I planned out three main sections:
- Main Page: I arranged the site content to be one main page with general content about the niche and products. This was about 1,200 words.
- Product Reviews: The majority of the content would be in the form of product reviews. Each review was about 500 – 1000 words.
- News Story Curation: Finally, I added a short section of news stories since the niche is topical. These were short, about 100 – 200 words. I simply linked back to the original article as a reference.
The main page laid out the foundational knowledge for the product, like what features were available and why a potential buyer should care. The goal of the content was to solve the visitor’s questions by providing the right information. In this case, we carefully selected the keywords so that the visitor was looking for information about a product that he or she was about to buy.
For the product reviews, I looked through Amazon and selected a wide range of prices and products. I tried to find products that were 4 or 5 stars and more than 10 reviews.
For the news stories, I set up a Google alert for some keywords. Once or twice, I hired a writer to summarize a set of 10 news stories. I published them individually over a few weeks.
I outsourced all of the content creation to writers on oDesk. I provided an outline and very specific instructions about what to cover in the content. That’s one of the keys to working with any sort of virtual assistant (VA)—providing very specific and detailed instructions.
Once the content was in place, I started the link building process. I do four main stages:
- Blog Commenting
- Social Profiles
- Web 2.0 Blogs
- Private Blog Networks (PBN)
The PBN backlinks carry the bulk of the link juice in my process. This site had 25 backlinks from PBN domains.
None of the links were purchased from Public networks and the domains were privately owned. These backlinks were added over a two month period.
I made it clear in the sale that the PBN back links would remain in place. Plus, I would add five more links over the next month.
An aside about rankings: I didn’t keep very good records on the rankings. But I can say that the rankings started slowly and ramped up in a similar trajectory as the traffic.
The majority of the traffic came from one of the secondary keywords. The primary keyword never ranked higher than 9 or 10 in the Google search results.
The Empire Flippers Process
Listing the Site
The listing process was painless and self explanatory. I already had my information organized, and set aside an hour to fill out the application.
You can check out Empire Podcast #79 to prepare ahead of time.
Here is what I had to provide for the application:
- My personal info, including name, email, Skype, social media profiles, etc.
- Site details such as URL, date purchased/created, site history, backlinking efforts, etc.
- Screenshots of 30/60/90 day revenue details (gross monthly revenue, net monthly profit).
- Verified 30/60/90 day expenses (cost of goods sold, VA’s, content, advertising, hosting, etc.).
- Google Analytics data/access (Clicky is an acceptable alternative).
Selling the Site
Everything went really smoothly with the sales process. Michael from the support team had a couple questions about ongoing expenses.
My reply was a little long winded, but here is a brief paraphrasing:
Hi Michael – see my answers below. Let me know if you have any more questions or if you need more details.
1- $0 per month at this time. I have NOT added new content since January.
If you add 1 article per month it should cost about $5-6 per month and I can provide the article writer’s name in oDesk.
2- On average, about 1 article per month that is a product review. ($5-6 per month). As I mentioned I haven’t added new content in a while and adding more content is not necessary at this time.
On average, about 3 links per month. However, this varies per month. I have just added some backlinks last month (about 5) and I will be adding about 4 more backlinks in April. I don’t think more than 1 backlink per month will be needed in the near future over the next 2 months due to the high quality of the backlinks that have been added.
3- I have a facebook and twitter page but they have not been active. I can turn those over to the new owner.
I also have a g+ profile, and four web 2.0 blogs that I can include too. They are wordpress.com, tumblr.com, blog.com, and blogspot.com.
Joe came in after the initial vetting process by Michael. He verified the Google Analytics and helped nail down the expenses for the site. We arrived at a $40 per month expense for ongoing link building and new content.
That brought the sale price down, but seemed like a fair compromise.
I told Joe that it was fine to list at that price.
By the next afternoon, there was plenty of interest… There were 3 people that put down deposits within a day.
I just needed to add them to my Google Analytics account with viewing access so they could verify the traffic.
It’s interesting to note that 3 people were interested immediately for my listing at $10,421. If you look back at Greg Nunan’s case study, you’ll see it took about 20 days to get 3 deposits. That site was listed at $17,823 and eventually sold for $16,000 after some negotiations. It might be possible that the price of the sites has an impact on the number of depositors.
One interested person had a few follow up questions and here is a sample:
After a couple days of thinking, the person paid the asking price in full.
Awesome! Everything was moving very fast up to this point.
I will share one hiccup in the process, and it was my fault.
Some of the messages sent by the Empire Flippers team were marked as Spam by Gmail. This happened right after the sale which is a critical time in the process.
I was waiting to hear about the next steps from the Empire Flippers team.
I normally received a message from their Zendesk account quickly for every step of the process, but I didn’t get another message from the team.
After a few days had passed, I emailed them to see what should happen next—after all, I wanted to have the funds released. It turned out that the team was emailing me the whole time.
I’m not sure why the messages were identified as spam since I received all the previous messages, opened every single message, and replied a number of times.
It should have been obvious to me – check your Spam folder.
The Transfer and Validation
One of the biggest benefits to working with the Empire Flippers is that you don’t have to mess around with the site transfer. That was a big selling point for me.
Now, I know a lot of people are probably thinking, “Doug, it’s easy to transfer a site…”
I’m sure it is, but I really didn’t want to learn or spend my time on it.
Empire Flippers also updates all of the affiliate links, which is super helpful for the buyer.
Once the site was transferred over to the new owner and he validated the traffic and earning, the funds were released.
I selected the wire transfer for two main reasons:
- I didn’t need that money in my PayPal account. I’ve also heard some stories about people having their PayPal account frozen, which effectively locks down the money. Besides, I wasn’t in any kind of a rush.
- I didn’t want to pay the PayPal fees for the transfer. With a wire transfer, the Empire Flippers cover the cost on their side. Now, my bank charges $15 to accept a wire transfer, which was about 0.17%, and I assume most other banks will charge a fixed fee, too. PayPal would have charged about 2.9%. It only took 3 days to get the money in my checking account.
The sale was a success and the process was very straightforward.
Common Questions about the Site/Sale
I’ve received a decent amount of questions, so I have replied to the most common ones below.
How old was the site when it was sold?
The site was about 8 months old, or at least the domain was purchased 8 months prior to the sale. It’s key to note that that I didn’t do much with the site in the first 6 weeks or so. I was busy with some other things.
What was the overall profit?
The net profit was $10,479.
- The total revenue was $12,599, including the monthly affiliate commissions and the sale price.
- The total expenses were $2,120.
What were the expenses for?
- Initial Content – $200 (approximately)
- Link Building from the HOTH – $60
- Listing Fee with Empire Flippers – $297
- Broker’s Commission for Empire Flippers (15% of the sale price) – $1,563
How much was the site earning when you sold it?
It was making about $500 – $600 per month for the 90 days prior to the sale.
Is this considered passive income?
The work was front loaded over the initial three months. After that initial push, the income was mostly passive. The buyer can now do the minimal work to maintain the site or spend some time expanding it out.
How much time did the whole site take to build out?
It was about 50 hours over a few months. I honestly didn’t keep a close record of how much time I spent on anything. It was pretty fun so I didn’t really consider it work. Keep in mind that the 50 hours were focused effort on completing a set of known tasks. I probably spent another 5 hours working on the sales process, too.
$1,563 in fees? A 15% broker fee is high! Why didn’t you sell with Flippa?
I’m sure that Flippa does a great job, but I am pleased with my decision. While the EF fee might be considered high to some, the net result was great. My site would have sold for less at Flippa since it was a younger site.
The Empire Flippers also handle the touch points with the potential customers. And they transfer the site to the buyer, which is really helpful to a person like me who doesn’t really want to fiddle around with that. That’s all a complicated way to say the extra cost in the form of fees was, in my opinion, worth it.
How much do you think you could have sold on Flippa?
You never really know with an auction site, so it is impossible to say. The longer the site has historical earnings, the higher the sale price. Also, if other assets are included—like an email list—that can boost the value, too. Here are some basic guidelines that you might expect to get on Flippa:
- 3 – 6 months: 6 – 8x monthly multiple
- 6 – 12 months: 8 – 12x monthly multiple
- 12 – 18 months: 12 – 16x monthly multiple
- 18+ months: 16 – 18x monthly multiple
*Note: The figures above are just rough estimates of what you might expect and every site is unique.
In addition, I created a free spreadsheet to help you determine if you should use Flippa or Empire Flippers. It’s not 100% accurate but it can give you a pretty good idea about which sales path you should follow with some general assumptions. You can get your own copy of the spreadsheet by following the link here.
Are there any other details about working with Empire Flippers that are important?
There are a couple things to mention –
First, the process of applying and listing with Empire Flippers is simple but it does take some preparation and time. I talked about it at length on Authority Website Income.
Second, they get the job done. Here are the facts:
- Empire Flippers sell sites at a 20x monthly net profit. The monthly net profit is calculated by averaging the last 90 days of revenue minus any costs (content, link building, virtual assistant). If the niche is seasonal or if the business has been running for years, then the sale price will be based on 12 months of earnings.
- Empire Flippers sell almost all of the sites they list – 90%+ of the sites in the marketplace sell.
- The niche and URL are kept private and not shown publicly. The websites are only revealed to the serious people that pay a 5% refundable deposit.
- Empire Flippers have a rigorous vetting process to ensure they only list high quality websites. They reject about a third of the websites submitted.
Details about the Site
Now, let’s get our hands dirty and look at the details about this site.
The traffic was slow to ramp up. You can see the Google Analytics image below and you can hardly see any traffic until December. Then, by the end of January there were about 75+ visitors per day.
The slow rate of growth initially was my fault. I just didn’t set aside time to work on the site until early December.
You can see a little bit of a dip in the traffic in April. That follows the Google Trends search volume for the main search terms, so that was expected.
Here are the monthly earnings from Amazon. Even though the traffic was not impressive in December, the site still pulled in over $100. The earnings were generally consistent starting in February.
How You Can Create a Niche Site From Scratch
To create this site, I simply repeated a process—The Niche Site Process. It’s the same process that I used for building the site that we’re talking about today, plus another niche site that has grossed over $12,500 at the time of this writing.
Creating a Niche Site is the Best Way to Get Started!
A lot of people are really into authority websites right now. I don’t blame them—the ceiling for an authority website is very high, valued in the millions. (See Digital Marketer’s Survival Life)
A niche site has a much lower ceiling in many cases. However, it’s all relative. For a regular guy like me with a full-time day job, making an additional $10,000 is absolutely game-changing!
Here is a flowchart for the overall process:
(It’s really similar to the process that Spencer Haws used at Niche Pursuits, and that’s because I learned most of it from Spencer during his niche site project.)
If you aren’t familiar with the overall flow of the process yet, please check it out.
Here is a quick overview:
Pick your niche or topic
- Idea generation
- Keyword research with search volumes
- Primary keywords
- Secondary keywords
Pick a domain and set up your site
- Partial match domain name
- Purchase hosting
- Complete WordPress/theme set-up
Content Management Plan
- Which products to review
- Other post topics
- Publishing schedule
- Blog commenting
- Social profiles
- Web 2.0 blogs
- Private Blog Networks (PBN)
A lot of people have questions about link building so I want to get into some details. Things change FAST in SEO, so keep that in mind.
This is what works for me and a few other business friends.
I like to get a base set of links with blog commenting. I’m talking about real comments on real blogs that add some value. It’s tedious and can be boring. Luckily, I have an awesome wife that helps out with the niche sites and she actually enjoys doing blog comments. Here is the way I find many potential blogs that allow comments within my niche quickly.
I created several social profiles, as well. All of the profiles were included with the sale. I generally create the profile to include the backlink to the site. That’s it, though—I don’t actively participate on the respective platforms. The usual suspects are involved:
- Google Plus
Web 2.0 Blogs:
I like to have a few free blogs that have posts with content relevant to my niche. It’s great since they are free and you control the anchor text of the backlink; plus, you control the whole post. These two points mean you have full control to ensure the backlinks are as relevant as possible.
I also included all of these Web 2.0 sites in the sale. Here are some of the Web 2.0 Platforms:
Building Web 2.0 blogs can be tedious (and my wife doesn’t find this activity fun) so I outsourced some of this work to a company called The Hoth.
It’s a bargain in my opinion, and a turnkey solution to this portion of link building. They do a better job than me anyway!
Here is a guest post I wrote at Dumb Passive Income with my exact process if you’re building these on your own.
Private Blog Network Backlinks:
Private Blog Network (or PBN) backlinks are the powerful links that got this site ranking. If you are new to PBNs, here is a quick definition:
A PBN is a set of domains that you or another individual owns. A PBN is made up from expired domains. An expired domain is a domain that was owned at one time and had content–the website was lived in and the webmaster cared for the site.
The purpose of the PBN is to provide backlinks to your money sites. Since the domains have a history, the authority of the domains is high meaning the links carry a lot of link juice.
You get the same advantages as the Web 2.0 Blogs, like controlling the anchor text and the relevant content, with the added benefit of high authority.
Listen to the podcast from NoHatDigital about Private Blog Networks. Or, if you prefer the written form, read Building a Private Blog Network over at CloudIncome.com.
Nowadays people are a bit leery of PBNs, so it might be a negative in some people’s eyes. It is key to note that there is a big difference between a Private Blog Network that a person owns versus a public blog network accessible to anyone willing to pay.
Regardless, if you are looking to sell your site, you should disclose public and private blog network backlinks. They will be found anyway, so you are better off sharing the information up front and building trust with your potential buyer.
The whole process went extremely well. The site sold faster than I expected and it’s a great model for niche sites.
Here are a few key takeaways:
- About 90 – 120 days out, start checking out your backlink profile so you can address any spammy links that may exist.
- Including social profiles, Web 2.0 blogs, and even PBNs can add value to the asset.
- Be prepared to provide the real ongoing effort in the form of time. You may need to monitor your tasks for 30 days to get a true understanding of your efforts
- Be prepared to provide the same kind of details about the ongoing costs, like link building, new content, or anything else.
- Check your spam folder if you stop receiving messages during the process.
- It may be more economical to get the money wired rather than sent through PayPal. Check with your bank for fees.
- It is important to have stable earnings with a slight upward trend. If you are seeing exponential growth, then you might be selling at a low price point. If that’s the case, wait it out.
Creating a niche site from scratch and then selling it is a viable business model. It is especially attractive if you do not have much capital to invest.
You can follow the niche site process to systemize the creation of the site. Working with the Empire Flippers is a great way to outsource selling the site quickly and easily.
Justin: If you’d like to dig in even deeper, Doug has shared his Niche Site Project book for free to all Empire Flippers readers.
Additionally, if you’ve been living under a rock the last few years and still don’t have a copy of the keyword research tool, Long Tail Pro, Spencer currently has a contest running to win a free copy – for LIFE! Not too shabby, eh? Check out the details here
If you’d like to ask Doug any questions he’ll be responding to your comments below!