EFP 40: Branding And Growth Strategies For Startups And Entrepreneurs
“Build it and they’ll come” sounds great, but the reality is a bit more complicated and most Startups, Bloggers, and Entrepreneurs know this all too well. How do you get in front of potential customers? When you do…what do you say?
Branding and Growth Strategies that Work
These questions and more are what we set out to have answered from Ophelie from Flippa.com. We’ve
stalked followed her on Twitter for a while now and she wrote a guest post for us several months back. She has that uncanny ability to be everywhere online and we wanted to ask her how she does it!
We’ve written a ton about selling strategies on Flippa, how to not get scammed when buying sites, etc. but we thought it would be interesting to delve into her expertise a bit and find out more about how she manages and grows their brand online. She’s a pro as an interviewee, but I do think we softened her up a bit and squeezed some gems out…definitely worth a listen!
Check Out This Week’s Episode Here:
Direct Download – Right Click, Save As
Topics Discussed This Week Include:
- Joe’s struggling and pushing through “Development Hell”
- How to find your customers – strategies for connecting with your prospects
- Positive Vs. Negative criticism and feedback
- Balancing actionable customer feedback with outrageous feature requests
- Flippa Vs. eBay – Taking on the 800 lb gorilla…and winning!
- What’s selling and not selling on Flippa and Ophelie’s best tips to improve your sales price
- What to share (and not to share) on your Flippa listing
- Ophelie LeChat Marketing Lead @ Flippa.com – Sorry for butchering your name…ugh! 🙁
- Jeremy with Tradlands.com
- IntelliTheme – Affiliate launch coming in April!
- Marketing podcasts: Episode 31 and Episode 38
- ZenDesk – Great customer support SaaS
- Tweaky.com Offer – “Auction Assist” Flippa listing from our partnership with Tweaky.com
- Dan Norris @ Inform.ly – Working on content analytics…awesome stuff
- Andrew Knibbe – Flippa’s slides on $30M in site sales
- Responsinator – Great for testing responsive designs
Did you dig this show? Learn anything new? Give us a shout on Twitter or let us know in the comments below!
Announcer: Welcome to the Empire Flippers Podcast! Are you sick and tired of gurus who have plenty of ideas but are short on substance? Worried that e-book you bought for $17.95 won’t bring you the personal and financial freedom you long for? Hey, you’re not alone! Join thousands of others and their pursuit of niche profits without the bullshit. Straight from your hosts, Justin and Joe, from Empire Flippers.
Justin Cooke: Welcome to episode 40 of the Empire Flippers Podcast. I’m your host Justin Cooke and I’m here with Joe “Hot Money” Magnotti once again. What’s goin’ on buddy?
Joe Magnotti: What’s up everybody?
Justin Cooke: We’ve got a fantastic episode lined up this week. We’re going to be talking to Ophelie.
Joe Magnotti: Ophelie?
Justin Cooke: Ophelie.
Joe Magnotti: I want to always say Ophelia.
Justin Cooke: Yeah. [crosstalk 00:00:44] Ophelie from Flippa.com and we’re going to talking about branding and growth strategies. If you’ve ever struggled or wondered about how to build a brand, how to do outreach, and how to really scale a company, Flippa is a great example. We’ve got a great interview lined up.
Before we do that we’ll go over some updates, news, and info. Joe, what you got buddy?
Joe Magnotti: I’m in development hell.
Justin Cooke: (laughter) Tell me about, what’s going on?
Joe Magnotti: Well, between the site, the marketplace, and IntelliTheme I’m talking to a lot of programmers and developers and trying to get stuff done man. I just wish I could write code. I really do.
Justin Cooke: Yeah so based on our last episode we were talking about how to work with programmers when you’re not one it was pretty relevant because it’s something that we’re struggling with or working through right now. Shortly after that episode actually we’re reaching out and we’re making contacts for both to help with Empire Flippers, with the side specifically, with the marketplace section where we buy and sell sites, and then with IntelliTheme we’ve got a big launch coming up with that in April. We’re trying to batten down the hatches so to speak and get that ready to roll.
Joe Magnotti: Yeah I think I have a handle on it and I think that’s the way to do it. Splice it up and have more than one guy for each effort that you’re doing. Don’t try to have one go-to guy that’s doing everything. A jack of all trades. Have a specialist for each one of them that is the project manager for that particular piece of software.
Justin Cooke: Yeah, because what if one of them gets hit by a [inaudible 00:02:07], right? Of course, so next point, and this is the one that I think is fantastic, I love this and this is one of the reasons we do what we do, we got an email from Jeremy from tradlands.com. Basically him and his fiancee are building a clothing brand, a women’s fashion brand, and he’s not the marketing guy. He’s not the marketing guru kind of a guy. He’s like “How do I do this?”. He listened to the podcast episode 31 and 38 and then started implementing those strategies, dorking it out. Putting your targets and putting posts on their blogs, people in your niche, people that are well known in your nice. Anyway, they did it with someone who is really well known and they really looked up to. Made a couple of helpful related comments. She reaches out to them says “Hey I love your brand. Love what you guys are doing.” Gives them a write up and the next day they sell $1,700 worth of product. Whatever, they’re just killin’ it.
I got that email and I was like “Oh man that’s so cool. I love hearing stories like this.” It’s just cool. He took our strategy that you and I have been basically been testing through. We’ve been doing some work with it and it worked for us and just knocked it out of the park. Anyway Jeremy, thanks buddy. I really appreciate the email.
Joe Magnotti: Yeah Jeremy, that is really cool. I like the business too. Working with hot chicks all day and clothes that must be kinda fun.
Justin Cooke: Hot chicks and clothes (laughter). Alright then. Next point. We have a bit of a masterminds group going here in The Philippines. And it’s not a weekly call. We have established businesses we’ve all been around for a few years. I won’t talk about some of the things they got into but I can at least talk about some of the things we’ve been implementing since we had ours in February. The next one’s here in April. The first thing is we’ve put more autonomy into our team. Now Joe and I are pretty process driven managers and owners but we said let’s let them run with it a little bit. Give them enough rope to hang themselves kinda thing. I’m really likin’ it man, honestly.
Joe Magnotti: Yeah ever since I wrote that big long email to the crew and then we sat down, had dinner with the managers and explained to them what we’re gonna do I think that’s worked out quite well. I’m still waiting for that one bad thing to happen that makes me cringe and go “Oh I wish we didn’t do it.” I think we get so much more done. Chris Tucker was right when he said this to us, when he said, “You’ll get so much more done if you’ve focused on your business this way. If you approach your business this way that the failure percentage going up won’t affect you as much.”
Justin Cooke: Yeah, yeah, it totally makes sense. I remember reading that email you sent and I talked to you about it afterwards. I said “Good email, buddy.” You were like “Yeah, I was painstakingly crafted it and it was this whole thing.” But it was important to us because it wasn’t just changing it for a couple of people. We wanted to totally change the wave, the message inside of our business, right? That requires a bit more than just “Hey guys, here’s what we’re doing now.” Right?
Next thing I want to talk about is product sales. We’re doing really well with product sales. It looks like mostly on Empire Flippers the starter packs are going well. The Pro and the Premium where it has a couple of earning sites-
Joe Magnotti: Yeah which makes sense cuz there’s sites included in there plus you get all the tools. A lot of customers usually have some of the starter pack stuff so they’ll have hosting or they’ll have LongTailPro but they’re willing to take the jump for everything because it’s still enough value for them.
Justin Cooke: Yeah good enough deal. I like the fact that if you are just starting off, of course you don’t need anything. You can start with virtually no tools but if you want … The basic tools you need, you need a hosting account. It’s really helpful to have a keyword research tool like LongTailPro and having a theme that you can put it on right away. IntelliTheme is fantastic. I see there’s great value there.
The other thing is obviously the vetted sites, those are growing really well. People are wanting us to list-
Joe Magnotti: Yeah just to go back to the product sales for just a second, one other great success story out of there is Zendesk. I am loving Zendesk. Cuts down on email clutter. Let’s me communicate with the team clearly and the customer clearly. Let’s us easily know what’s done and what’s not done. If you guys have a little bit of customer support hell and you’ve tried managing it through email. Pick up Zendesk and run with it. The intro plan is $20 a year. It’s really easy.
Justin Cooke: It’s so funny. I wanted Zendesk when we were starting off. We were looking for something that we could use. And now because of the autonomy and us running a separate piece of the business I don’t know what the hell’s going on over there. I see notes coming in and products ordered. People are getting back to it. Now I just ignore it. I look down at it a couple of times, I figure I’m wasting my time focusing on that side of the business so I’ll leave it alone, let that side handle itself and focus on my area which is cool. It’s nice, right?
Joe Magnotti: Yeah it’s humming along quite well, so I’m very happy with that. And then the vetted sales, those are going great. We sold out of the initial vetted sites that we had.
Justin Cooke: We just listed some new ones this week so there should be some up when this podcast goes live depending … and we’re really close on the e-commerce site that’s up there for $64,0000. We got a bunch of people that are interested and no one’s pulled the trigger yet, but it’s really close. I bet it sells within the week. If you’re at all interested in getting that e-commerce site, the featured listing, jump on it because we’ve got several people that are on the hook basically.
Alright that’s it for the updates, news, and info. Let’s get right into our interview with Ophelie from Flippa.com.
Announcer: This is the Empire Flippers Podcast.
Justin Cooke: Justin and Joe with Empire Flippers here. We’ve got a special guest today, we’ve got Ophelie from Flippa. She is the marketing lead over at Flippa.com and we’re excited to have her on the program. What’s going on, Ophelie?
Opehlie Lechat: Hey guys, how’s it going?
Justin Cooke: Good. Good. Good. It’s great to have you on. We’re going to get into some of the stuff regarding Flippa.com, buying and selling websites probably in the second half. We’re basically gonna break this down into two different parts. The first will be more about your role and your job at Flippa, and a bit more about you, and the second part will be more about the company that you work for. So let’s get started right away. Tell us a little bit about your role at Flippa as it relates to brand awareness and management at Flippa.
Opehlie Lechat: Yeah, my role is marketing lead. I started at Flippa about a year ago in a digital marketing role which was really about interacting with our customers and future customers on social media over on our blog. That’s grown into a more general marketing role and one thing that I tend to do is really see where our current customers, or future customers, where they are online and what kind of problems I can help them solve. That’s really what it comes down to. Flippa is a marketplace for buying and selling websites but really we’re all about web entrepreneurship, building your business, selling your site, moving onto the next thing, and just growing your knowledge of what’s out there online and what opportunities are available.
Justin Cooke: What I’ve found pretty interesting is I’ve seen you everywhere online. You’re commenting on blogs, you’re in forums, you’re chit-chatting here and there which is really cool and that’s kind of how we bumped into each other. You spend a lot of time online in all these different places. Where do you find the most value when it comes to expanding the brand for Flippa? If one of our listeners is looking to expand their brand and they don’t have the staff that they can hire someone to do their marketing for them, where would you give them to go as some of the top sources for you as far as getting traffic?
Opehlie Lechat: The first thing I would say is take a look at Twitter. This is the advice that someone would have given three years ago so I’m a little bit retro here, but there’s so many great conversations happening and it’s such a great platform for people in our field to jump in and ask their questions. Everybody’s friendly, everybody’s open to answering these. I think that’s where we started chatting actually outside of the blog comments. Also keep on eye on blogs, keep an eye on the comments. Become really active in the community. It’s one thing to soak up all that really good knowledge that’s out there, it’s another thing to actually get active and ask good questions. And I get it, it takes a lot of courage to put yourself out there and ask the dumb questions but that’s how we all started.
Joe Magnotti: We just got off an episode of our old podcast, Ad Sense Flippers Podcast, where we were talking about getting out there in your niche and really talking and interacting with people. It’s interesting that we actually took our own advice and that’s how we met up with you.
Opehlie Lechat: Yeah, absolutely.
Justin Cooke: I’ve got a question for you, Ophelie. How do you measure your success? You’re out there commenting on blogs. How do you tell whether it’s working? I think that’s a problem that a lot of people have is they say “Okay, I’m in the forums. I’m on the blogs. I’m making comments, but how do I know if I’m actually getting any traction?”
Opehlie Lechat: One metric, it’s not super relevant to what I’m doing for Flippa, but it’s relevant generally and to being active online, is whether people are starting to ask you questions. Whether you’re able to answer people’s questions a few weeks or a few months down the line. As your knowledge grows, and again it’s a really intimidating field when you start. But as your knowledge grows you should be able to start answering those questions and participating more on the other side of things.
For myself at Flippa there’s one thing, I hope your listeners are gonna be pleased to hear about this, every time somebody leaves feedback on Flippa we ask them to leave feedback not only about the transaction that they’ve just done, so either on the buyer or the seller’s site, but also about Flippa and how they found their experience on the marketplace. Once a week everybody at the company, from the founders to our support team to our developers, we get a digest of all of these comments and all of these ratings and we all go through them. Obviously it’s very important to me in marketing. It’s really important to our guys in support.
Joe Magnotti: One of the things I think you and I talked about privately on email was some of the feedback we were getting from our customers or from some of the people that we work with was that it was hard to find good stuff on Flippa. They were finding it hard to dig through a lot of the auctions and find the right fit. That’s one of the reasons why we started selling some of the sites directly on Ad Sense Flippers. How are you guys addressing that in the future? Is that something you guys talk about all the time?
Opehlie Lechat: Yeah, absolutely. One thing that we need to do better is to make it easier for people not only to search for websites but to set up these lists and these safe searches and have results emailed directly to them. This is all stuff that is available and is out there but it’s maybe not quite as easy to use as we’d like it to be. Power Flippa users know about it. The newcomers to the marketplace are kind of overwhelmed. The number one request that we get is lower the listing fees which we can talk about a bit later if you’d like. Number two request is make it easier for us to find quality stuff. The tricky thing is quality is really different for everybody.
Justin Cooke: Yeah.
Opehlie Lechat: Not everyone is looking for a brand new website, but also not everyone is looking for something where they have a few thousand dollars to spend. What we’re doing is really finding out basic facts about each user before we send them to these listings. There’s one product in particular that we’re working on right now to help us do that.
Justin Cooke: I really like the idea of having some content that shows specifically how to make the searches to find the sites that a certain type of person would like. I don’t see a lot of that. That probably would be interesting content for Flippa, but even for third parties to create and show what kind of save searches will produce what kind of sites and really get people to be able to search Flippa better. I know you guys have the functionality, but it doesn’t seem used as well and that’s where I think the complaints there come from.
One of the things you get as a company is you get a lot of requests. You said you get a request to drop the listing fees, but sometimes the requests are valid or useful and sometimes they’re not. How do you balance those customer requests or those feature requests and how do you determine whether it’s a good request or it’s crap basically?
Opehlie Lechat: Really good question. I’ve pointed out the example of lower the listing fees as something that comes up all the time. It comes up in our blog comments, it comes up on Twitter, it comes up on those comments that I mentioned earlier that get emailed to the entire company. It’s everywhere. We take all the feedback on board. We don’t necessarily action everything but it all goes into consideration.
For example, for the lower listing fee, we had to look at that and obviously listing fees is part of how Flippa makes our money so we’re not necessarily going to be able to say “Sure, this is a common request. We’re just going to drop our listing fees.” What we did do is look at who was asking for lower listing fees and it turns out that was sellers of smaller sites, typically start-up sites or template sites, and those people were concerned that it wasn’t necessarily worth the investment for them set up a Flippa listing and pay the $29 listing fee without being certain that they’d be able to sell.
What we did instead is say “Okay, for this type of site we’re going to give you access to the marketplace with slightly different visibility and it’s $9 instead of $29 so that’s a pretty heavy discount.” On the other side if you did end up selling your site you’ll have a slightly higher success fee so it’s 15% instead of 5%. That’s one way in which we took feedback that at face value we weren’t sure we could action and it didn’t seem to be aligned with our business interests and really found out how we could make that happen for our users.
Justin Cooke: That’s interesting. I was gonna say on face value I would say dropping your listing fee seems to be a pretty bad idea. Aside from the fact that you lose revenue the lower the listing fee the more people could spam the marketplace or put more crap out. But by offering a different alternative gives them less visibility you’re able to answer both sides of the market. That’s interesting.
Joe Magnotti: Yeah I would definitely worry about that. It would introduce a lot more but you’re able to hit them on the back end so that they have to provide some sort of quality website in the end. Otherwise, they’re gonna have to pay for it.
Opehlie Lechat: Exactly, look at the end of the day Flippa doesn’t win if the marketplace gets flooded with crappy sites, and the sellers don’t win and the buyers definitely don’t win either. It’s really in everyone’s interest to encourage our sellers. Whether it’s really small sites, whether it’s fully developed businesses, to have something of quality that they’re offering to everyone.
Justin Cooke: Ophelie I’ve got a great question for you. I saw awhile back, I read a blog post, or it was actually a video I think. It was Tim Ferriss talking about how to deal with criticism. He put up an infograph and talked about the Air Force policies on positive comments, negative comments. It was a flowchart basically. I was wondering how do you deal, as a brand ambassador for Flippa, how do you deal with positive feedback versus negative feedback versus people just trolling on third party sites? What do you use to determine when and where to respond?
Opehlie Lechat: You pointed out earlier that I seem to be everywhere. I pop up in forums, I’m on Twitter, I’m active over email. I keep track of the mentions and the way that I decide whether to action something it comes down to how much help can I offer to someone? If it’s a criticism that’s really just vitriol, it’s really someone who had a bad experience, it’s been handled over support but there’s nothing that’s going to convince them otherwise and they’re just really complaining, or they have their own agenda for complaining about Flippa in a visible public forum, in these cases it’s really not necessarily worth it for us to get involved because the payoff is going to be really small and it’s just not where we’d rather spend our time.
When it comes to people who have questions or maybe hit on to some trouble and we can really help whoever it is and I’m not alone in doing this. I know some of our support guys do the same. Certainly our CEO Dave and our Operations Manager Andrew both keep track of what’s happening out there, and just try to offer some help and try to answer questions. In fact, if we’re talking about negative feedback you guys had a blog post. What was it? About a year ago? Called the Problem with Flippa? I think that’s it, where you outlined a few negative things about the marketplace which turned out to be actually kind of a positive post in the end. You guys did a great job with a clickable headline there. I was pretty active in the comments with that one and responding to the criticism and I really appreciate that you guys ended up amending the blog post with my responses where appropriate and we did a quick interview on that after.
Justin Cooke: Yeah it just kind of worked out that you added the verified Ad Sense like seriously a couple of days after that post. That was really good timing. That’s interesting.
Opehlie Lechat: That was a coincidence. Our developers are awesome but they’re not that fast that I can say “Hey guys, Ad Sense Flippers are saying this. We need to develop something right now!”
Justin Cooke: Yeah I know, right? Joe you got the next question.
Joe Magnotti: We have this kind of be everywhere technique that we use here. It’s interesting that you have the same attitude that we do where you have to approach third party sites very carefully because you can control the comments on your own blog but you can’t on others. We’ve had some firefights on our own blog where we had to remove the comments, but on other people’s forums or what-not it’s just sometimes better to walk away.
Opehlie Lechat: Yeah sometimes-
Joe Magnotti: We’ve found that hiring entrepreneurial types, it can be really tricky, right? Sometimes there’s just this window of opportunity and then they’re either gonna get too much experience or earn too much money and kinda wanna go off on their own. How do you balance the interest in being an entrepreneur with working with a larger company? I’m sure that’s something you said you used to do a lot of freelance work before we got on the call. A lot of our listeners are entrepreneurial types. How did you go through that kind of turnover yourself?
Opehlie Lechat: The way I ended up at Flippa is actually through an event called Start-Up Weekend which I know that you guys are familiar with, and if any of your listeners are not familiar with I really encourage you to check it out. It’s basically a concept where you have a weekend to develop a business as part of a team and then you compete against each other to see what the best ideas and the best execution are. I met the guy who’s now my boss, Dave, our CEO, through Start-Up Weekend. If he wasn’t looking for someone with entrepreneurial spirit and was looking to get into a start-up or that kind of a company, he probably would not have hired me.
You say that Flippa’s a big company, I have to maybe qualify that a little bit. We’re 15 people right now and we’re all working out of our office in Melbourne. We’re a small company. I’m currently the only full-time marketer. We have a few people on support. We have a bunch of developers, but overall the roles aren’t super well defined. There’s huge flexibility there for all of us to just really get involved where our interests are and that’s one way that I personally stay really motivated with my work. It’s also a field that’s just so interesting. There’s so much to do that I don’t think I could ever get bored and then start looking to spin off into my own. There’s so much opportunity at Flippa itself.
Joe Magnotti: Ophelie, we’re friends with some guys that I’ve hired, maybe 11 or 12 interns. We’ve hired a couple of interns ourselves. That is something that we’ve found that is interesting is that when you hire these entrepreneurs or soon to be entrepreneurs they tend to start to move on. I think what I’m getting from you at least is that it’s about the vision of the company and making sure that you feel that you’re driving the company forward. With a team of 15 and your role in the company I think that you probably feel that way. I think that anyone who’s looking to hire an intern that’s probably a good take away is to make sure that it’s more than the money. It’s more than just the lifestyle. It’s the vision and where the company is going. [crosstalk 00:21:40]
Opehlie Lechat: Sorry there’s just one more thing I’d like to mention on that. Dave, again the Flippa CEO, recently wrote a blog post on shoe string start-ups that was about defining roles within a business, and how when you’re a star-up and you’re small it’s really not a good idea to define everybody’s role so rigidly because it limits creativity and it limits how much involvement they’re going to have. If your business ends up changing you want people to be flexible and to be able to pivot with you and to just keep up whether it’s the same business or something entirely different.
Joe Magnotti: Yeah it’s one of the reasons your first hires are so important is to make sure you’re getting people that can be flexible that can wear multiple hats. In a start-up environment that’s obviously critical. Moving on to Flippa a little bit specifically. Flippa took on eBay. Whether Flippa’s a big company is definitely debatable but eBay that’s not debatable, they’re huge.
Opehlie Lechat: Yeah.
Joe Magnotti: What I think is interesting is Flippa took on a subset, a niche subset of that with the buying and selling of websites and I think the reasons they did it is because they owned them. They delivered more value, they just took it over. Talk to me a little bit about that, and I know it was before your time there, but what’s the story on that?
Opehlie Lechat: I love telling the story of how Flippa started. It really explains a lot about our company culture and what we’re trying to do. For those who aren’t really familiar with Flippa we were spun out of what used to be our parent company SitePoint which is in part a book publisher and also a group of web forums for web developers. What people were observing on SitePoint was that some developers would build a website and then decide to sell it and have an informal auction, say “Oh, whose gonna give me a few hundred dollars for this?” And people started selling their sites informally on SitePoint. Our two founders Matt and Mark really saw this is as an opportunity to grow a business that was really dedicated to selling websites with the tools that you need for that. Yes, you can sell a website on eBay or another non-dedicated platform, but you’re not going to get the search tools that you need. You’re not going to get the verification that we can offer you. You’re not going to get a targeted audience for that. Really Flippa grew organically from the behavior that was observed in forums.
Justin Cooke: I think that’s interesting for our listeners. If there’s a larger company out there and there’s a particular niche within that larger company that you know you can own and deliver better value for, it may be worth going after. I think the buying and selling sites marketplace or that industry, that niche, is gonna continue to grow over the next three, five, ten years so there’s definitely value there and it’s not too small. I think a lot of times people worry that “Well if I niche down too far it’s going to be too small.” I really don’t think that’s the case especially if you own it, right?
Opehlie Lechat: Yeah I have to agree with you on that. One thing to keep in mind is that not everyone is aware that you can buy and sell a website. It was certainly surprising to me when I first started at Flippa. It’s been surprising to people I talk to either in business or casual environments. People don’t think of websites as a commodity that you can buy and sell and really invest in. They might think of their website monthly revenue as something that’s bringing in a few dollars a month but not of the intrinsic value of the website that they’ve created. There’s still a lot of work to be done in bringing that idea to more people.
Joe Magnotti: Yeah that’s one of the things we did at Ad Sense Flippers, and now at Empire Flippers, is trying to teach people how they can sell their online properties. Not only build them but sell them because there’s a lot of value in that. In that vein, what do you think for first time sellers on Flippa, what do you think are two best tips or tricks that you could help them to get top value for their sale?
Opehlie Lechat: Take a look of what’s working out there. Take a look at how successful sellers are doing it. What kinds of sites are they listing that you could probably set-up yourself? How are they developing their listing copy? And that’s something that we’ll talk about a bit later. What can you do to emulate them? I’m not saying copy. It’s really not worth copying somebody’s listing, especially on Flippa. We keep track of that, we take down listings very keenly when that happens. But we talked a little bit about our search function earlier and it’s a great tool for buyers, but it’s also really really good for sellers to keep track of what’s happening on the marketplace and where they can fit in.
My second would tip would be to have a reasonable reserve and to be flexible about your sale, especially for someone who has developed a website from scratch. Maybe owned it for a few years, tried to grow it, maybe didn’t have as much success as they’d like. They have really high expectations and some anticipation about the money that they’re going to get out of it. It’s important to keep in mind that other people are going to value your website differently and to keep track of whether you’re looking to sell or you’re looking to get the price that you have in mind.
Justin Cooke: I love that Ophelie. If it’s your baby, right? It’s the site you’ve been working on for the last couple of years and you poured sweat and tears into this site you’re gonna have a much higher intrinsic value in your mind then it probably actually has. I mean, some sites have intrinsic value, they’ve got a lot of back end process that they’ve built out. But honestly, if your site is selling for less than $10,000, I can’t put a number on it, but you know what I mean. A smaller site, it’s not likely that intrinsic value that you hope and pray is there is actually there. It’s more of you just wanting to believe the value, you know?
Opehlie Lechat: Yeah there’s a balance to be struck there. You talk about back end development for example. One thing to keep in mind is that development can be really cheap these days. And this is unfortunate, and I know that I break hearts when I say this, but even if you spent a lot of money on your website and a lot of hours and a lot of your own time and you say “Well I’m a developer, my freelance billing is $100 an hour. I spent a bunch of hours on this so I’m gonna price it accordingly” that may not be how buyers are gonna value your website.
If you say “Well my website is worth X” that’s fine but if you’re expecting to sell you might need to be flexible on that.
Joe Magnotti: Yeah and it’s also interesting what you said about copy because we used to get our listings copied all the time and with the greet help of Flippa we were able to take down those copycats and prevent them from going ahead and using our copy.
Opehlie Lechat: Yeah, definitely. We can get back into what makes really good copy a bit later but it’s very important that it be unique.
Justin Cooke: You talked about the two best tips or tricks in getting top value in a sale, what are the mistakes? I know that Flippa has a sales rate of 60+%. 64 or 65% of the sites that are listed sell. Of the 35 or 40% that don’t-
Opehlie Lechat: I’m just gonna correct you on that. You might want to rerecord that. We’re actually hovering around 50% right now. I think we’re at 47 right now, so that’s a big enough difference that I’d rather it not go out as 60. My biggest pet peeve and this translates in terms of sales data, it’s not just something I don’t like to see on the marketplace, is really really really long sales copy with a lot of bonuses that eventually aren’t going to mean a lot to a buyer. Sales copy that doesn’t actually say much, and there’s one particular trend right now that I would love it, love it, if we could help eradicate, multi page listings with red and yellow highlights and bonus. I’m sure that if we allowed fancier HTML there would be blink tags and images and sparkly borders. Look, I get it. On some marketplaces that really works and that gets the attention of buyers. On our marketplace we have powerful enough search that if your site is well-described and if your listing is well put together you can trust that buyers are going to see it.
They’re buying a business. They’re not buying clothes. They’re buying sparkly shoes. They’re not buying a new car. It’s not about the bling. It’s really about proving what you can offer to the buyer. That’s the first mistake that I see done a lot.
The second mistake is holding a lot of information really closely. I see some sellers say “I don’t want to disclose too much about my site because I operate in a really small niche and it’s been really successful and I don’t want anybody else to overtake that so I’m going to hide all of my information. Maybe even buy a confidential listing so that nobody knows the URL of my website.”
I’m empathetic to that, but at the end of the day if your goal is to sell that website you need to give something to the buyers.
Justin Cooke: We see this a lot too where some people they try to hide behind the anonymity of the internet and what I’ve realized is that the people I want to buy from are actual people. I can look them up on LinkedIn. I can see that they’re real people. I know the person behind the site that I’m buying from. It doesn’t have to be that way but if you’re not so against it it’s such a better deal. People are gonna know who you are. They can look you up. They can see that you’re the real deal and they’ll trust you more because they can figure out who you are. You know what I mean?
Opehlie Lechat: Yeah absolutely. One other thing to keep in mind is that if all you’ve got going for your website is your keyword rankings and maybe a little bit of really neat SEO tricks that you’ve done, you really don’t have much going for you. If you’re so worried that someone is going to look at your site and scrape the content and replicate your success there might not be as much value into it as you think. Good traffic, the revenue, the way it’s set up, all those things go into creating value in a listing and those aren’t things that someone’s just going to be able to emulate by looking at your successful Flippa listing.
Joe Magnotti: Yeah so true because if the market changes for your particular niche and you’re in this very specific kind of area and you have a weak site then you could easily get blown out of the water and that’s where there’s not much value there. In that vein, what types of sites on Flippa are selling well right now? And which don’t sell very well?
Opehlie Lechat: It’s a really good time for you to be asking this question. A few weeks ago our operations manager Andrew went to Affiliate Summit West in Vegas and he gave a presentation on how websites make money. That was built on 18 months of data from Flippa listings. We looked at different niches, different implementations, different monetization methods, and worked out which kinds of sites make the most money and higher multiples. If anybody’s interested you can probably post a link to this. We put this presentation up on SlideShare and the last time I looked it was at over 30,000 views. We’ve actually presented it locally in Melbourne and in Sydney just last night and people love that presentation and it’s really good data. I want to share it as much as possible so please go check it out after you’re done with the podcast.
To answer your question more directly the two niches that are doing really really well right now: gaming and business. Those are top two in terms of multiples that we’ve seen on the marketplace. Sites that aren’t doing so well, internet marketing. Internet marketing sites tend not to sell for very high multiples on Flippa. If you think about it that makes a lot of sense. They generally have a shorter shelf life. It’ll be, for example, Warrior Special Offer that’s going out on Warrior Forum and it’ll make some revenue for a while and then die off as part of it’s general life cycle. That’s just completely normal. It doesn’t make a really good buy for buyers. Buyers are pretty savvy about that. They’re not going to invest the dollars in buying sites with a short shelf life.
Justin Cooke: I’ve seen those before where you have the click bank site or whatever that had a fantastic month and then it drops off from there. I could see why the seller would try to say “Hey look where my monthly revenue is off of one month’s revenue” but that’s probably not long lasting. Where do you see the market or the industry heading in the next one, two, five years? How do you see it developing?
Opehlie Lechat: One thing that we’ve noticed is that ad-only sites have not been doing as well as they have historically. For example, ad-sense only sites really haven’t been performing in 2012 and I don’t really expect them to start performing much better in 2013. Really it’s about diversifying your revenue stream. Yes, it’s always a good idea to have some ads on your website but it’s also a good idea to have some affiliates, to have some good content. Maybe drive some e-commerce. It can be drop shipping, it doesn’t need to be a huge ton investment. Although drop shipping sites don’t make as much money generally as e-commerce with stock because the closer you are to the actual point of somebody giving you money for a product the more margin you get to keep yourself. It’s a trade-off there.
Justin Cooke: Yeah the e-commerce you have, you have more money to play with now. That can be a good and a bad thing, right?
Opehlie Lechat: Absolutely.
Justin Cooke: It can definitely be more difficult too because a lot of times you have to actually source the products from China quite often and there’s a bit more hassle but it’s more interesting and there’s more margin as you mentioned.
Opehlie Lechat: The other thing I’d mention in terms of platforms historically we’ve seen WordPress and WordPress is still just huge on Flippa which is great because WordPress is really easy to sell. It’s really easy to use, so there’s a really big buyer’s market there.
One tip for your listeners, have a look at Tumblr. I know that when I say Tumblr people think of moody teenagers and wearing a lot of eyeliner, taking self photos and posting depressing poems but Tumblr has actually re-done their content management and it’s really good. It’s really easy to use. They’re doing really well with integrating media. I think it’s going to be a bit of a challenge [inaudible 00:35:13] WordPress. Some people who are new to buying websites and running websites might be looking at it as a serious alternative so I’m keeping an eye on that one for 2013.
Justin Cooke: I could see how Tumblr would be a lot easier to use for someone that’s just starting out. The fact that WordPress is so widely used is not surprising that it tends to be quite popular on WordPress. That’s one of the things that we started with was Ad Sense WordPress. These are things that people are most familiar with and gives us the largest market in terms of buyers, you know what I mean?
Quick question for you, we did a case study on a site, SGHoliday.com. It was a travel site that was on Flippa. I’ll link to it in the show notes, but the listing after the fact was deleted, so our link right now just goes to Flippa.com. Why would a completed auction after the fact get deleted? We’ve had this question from buyers. I’ve heard sellers wonder this too. Can a buyer or seller request a deletion after the sale to protect the niche?
Opehlie Lechat: Yes, they can and actually in this case that’s what happened was my magical administrative powers I went and looked at the listing. I can’t really go into details as to what happened there obviously for privacy reasons but what I can say publicly is that either the buyer or the seller opted to hide the listing. It’s a small fee that we charge just to discourage from everyone doing this. There’s a lot of value in ended listings, especially won listings as I mentioned earlier it’s a great research tool for sellers. But we understand that sometimes, especially sites that have a lot of really heavy user base, they don’t want their users to Google the forum or the blog and for Flippa to show up as one of the results and then they find out “Oh this site was purchased. This site was sold. This is how much they’re making from it.” That’s just information in some cases it’s best if it stays hidden.
Joe Magnotti: Well that’s very interesting. How much, can you share with us how much you charge for something like that?
Opehlie Lechat: I don’t know off the top of my mind but I will find out right now and you can start recording again …
Justin Cooke: That’s cool. That’s really interesting. I didn’t know that was possible. That’s a good share actually.
Joe Magnotti: Yeah actually we would be interested in stuff like that because sometimes our niches and we sell a whole grouping of sites and our customers say “Oh well now that auction has been up there for a while a lot of people have looked at it, saw it was a successful action, and now I’ve noticed more pressure or competition in my particular niche that one of the successful sites was in.”
Justin Cooke: That was the exact reason we started selling sites directly was because we had those requests and we said “Oh that’s kind of smart. I didn’t know that.”
Opehlie Lechat: Well there you go-
Joe Magnotti: That’s cool.
Opehlie Lechat: It’s $30 at first and it can be applied either by the buyer or the seller at the end. Again, this really shouldn’t be applied across the board just because either party feels like hiding the listing but it’s a really useful tool and it’s something that I see used a lot in higher end auctions and really narrow niche auctions as well.
Justin Cooke: I understand the value for Flippa leaving it up too because ultimately it’s more traffic the more content you have out there, right? It could bring more people to the marketplace. Speaking of getting more people to your auction, how important is the sales copy when it comes to Flippa auction. We talked a little bit about the search that you can do on Flippa as far as finding different sites, and you talked about the highlighting and internet marketing tools. By the way, I know someone bought some $29 e-book that told them to make it like a long form sales copy page and that’s why they’re doing the highlighted and the red fonts and the crazy stuff. What kind of sales copy do you think is effective? What is useful on Flippa?
Opehlie Lechat: The first thing that people are going to notice about your listing is the title and it seems really basic but I see some sellers putting the URL as the title for their listing not realizing that the domain name is gonna be displayed right below the title anyway. It’s useful space. I think we give something like 80-85 characters, so it is a bit short, but it’s really useful space to grab the attention of your potential buyers. I like to do something like “Page Rank Three” and then mention the niche site, something about the revenue. That information shows up in the search results but it’s good to have it there in the title so it’s the first thing that the buyer is going to see.
When it comes to the actual listing copy, look, put yourself in the buyer’s shoes. If you were new to the marketplace and you were looking at this listing what would you want to know? What would you want to find out about this website? Personally, I’d like to know when it was started, when it was developed. I’d like to know the platform. Is it custom coded? Is it a WordPress site? How is it monetized? That’s all valuable information and you would be surprised at the number of sellers who just think that it’s obvious and they don’t need to mention it. That is the most important information. It goes way ahead of what the original owner thought that they would do with the website and where they planned on taking it. You’re obviously looking to sell it, it’s up to the new owner now to see what they’re going to do with it. It’s not worth dedicating a lot of time to your plan for the website.
Justin Cooke: It’s funny the empty listings are the one that I often tell buyers look for those because it’s harder to find them because they’re not as obvious in search. They don’t have the best headlines, but it’s great from a buyer perspective because they’re gonna get less views. You might actually be able to sneak in a deal. I don’t understand sellers that don’t fully flesh out that information. One of the things we do is at the top we put a summary, right? People just want a quick and dirty on the auction they’ll get that data, and then we really dive into the details throughout the rest of the copy thinking anyone who really wants to dig in a little bit and find out the real data it’s better for them. Obviously one of the things you should do is be very clear about who you are, why you’re selling it.
One thing that I’ve seen sellers do is they try to put too much … this has potential, it could potentially be earning … Let’s say it’s a $150 a month site and they say it could potentially be earning $1,500 a month. The problem there is the buyer may attribute way more than that $1,500 a month. You putting a limit on it may actually limit the potential in the buyer’s mind and then other people may think there’s no way this could turn into a $1,500 a month site so I know that the seller is trying to cheat me or mess with me. I think leaving the potential in the potential buyer’s mind is probably the better option there.
Opehlie Lechat: Yeah if the buyer is searching Flippa and they’re looking at listings, they obviously know that they want to do something on-line and they want to own a website and grow it themselves. They don’t necessarily need the seller to tell them what the potential is. They’ll find out on their own. They have good ideas. They’re either going to keep the website as it is and just try to get more visibility on it or they have an idea for how to grow it and maybe do a pivot.
Justin Cooke: As you know you share an office with Ned over at Tweaky.com. We’re going to be testing through with him helping people write their auction copy. It’s to be much more direct, straight forward, and have the information people need to get seen in the search results and to boost their traffic through Flippa’s natural traffic sources. We’ll link to that in the show notes, but we’re gonna be beta testing it, but we’re excited to have that rolling out.
Opehlie Lechat: I was thrilled when Ned suggested that as a product. We get a lot of requests for people who say “Can I pay you extra and have somebody at Flippa develop my listing and write it for me?” That’s something that we offer as part of our premium listing package. We don’t write the listing itself but we do offer help in editing it and optimizing the listing description and just making sure that everything is there.
There’s about 200 new sites listed on Flippa everyday, so unfortunately, as I said we’re a 15 person team, we don’t right now have the time to go through every listing but there are cases in which people really do need the help and they could use a hand. The more knowledgeable and experienced people do this the happier I’ll be.
Joe Magnotti: I don’t know if we could do 200 a day either but [crosstalk 00:43:19].
Opehlie Lechat: Wasn’t that the deal? I’m out! Forget it.
Justin Cooke: I’m gonna be doing the first few myself as we test through it. So yeah, please no. Please not 200.
Opehlie Lechat: As we talked about a bit earlier, buyers don’t tend to be interested in the replication costs. Development is cheap, you can outsource everything. They might not even like the site the way it is developed right now. They might not like the design. They might be looking to redesign everything as soon as they take ownership. For the sellers who are putting a lot of stock in their design dollars and their development work, it’s not worth highlighting that quite as much.
Joe Magnotti: Yeah it gets to why people would want to skip over that. Like we said in the beginning of the conversation, development doesn’t cost as much as people think it does these days. Do you think we’ve missed anything that we’ve been talking about? Something that you maybe want to highlight for our listeners? Something that’s valuable?
Justin Cooke: And we’re totally stealing this from Andrew Warner at Mixergy. I heard him doing this recently, I loved it. Basically, was there anything that we should have asked you or could have asked you that you think would provide value to our audience?
Opehlie Lechat: One thing that I really want to mention is that you pointed out a bit earlier that there’s a bit of a knowledge gap. There’s a lot of information out there that’s not being shared as well as it could be. As I mentioned I’m the only full-time marketer at Flippa but what I’ll be focusing on for the next little while is really growing our content and making sure that we can reach people and give them ideas and help them develop their entrepreneurial thoughts and help them just jump into the business and do it safely and knowledgeably.
When it comes to things you didn’t ask me about, fraud. I’m surprised. Every time I talk to anybody that’s all that they want to talk about. Fraud on Flippa.
Joe Magnotti: We really have had, knock on wood or whatever this plaster board is that I have for a desk. We’ve had very good luck with Flippa. All of our auctions have gone through, been successful, and people have been returning customers, good people to work with. I think that’s why we don’t look at it as a major concern.
Justin Cooke: From a seller’s perspective there are definitely some fraud auctions. I know you guys work hard at shutting it down. What I think is interesting though are the ones that are like not clearly fraud. Let’s say for example, I’m a supplier out of China and I build an e-commerce site, right? I get it selling and I’m selling way under cost to make a huge profit. I then sell that site, right? And then someone gets this great profit margin and then I bump up the rate so that it’s reasonable again for me. That’s the kind of stuff that Flippa can’t even deal with but it’s interesting how people’s minds work, you know what I mean? How they go about trying to make an extra buck.
Opehlie Lechat: Yeah absolutely. You mention luck, that you’ve been lucky in not not having any case of fraud. I’m not gonna call that luck. It comes down to due diligence. The marketplace can do a lot of work and we do a lot of work in suspending auctions and validating information. We pull in data from Google Analytics, we pull in data from Ad Sense. There are so many ways for buyers to validate the information. At the end of the day no one cares more about your money than you do. That’s just universal across the board. I don’t think anyone smart is buying houses for significant money without doing an inspection and I don’t think that at the same time that anybody should be buying a website without doing some proper, thorough due diligence.
This applies both on the buyer’s side and the seller’s side. I hear a lot of complaints that “Oh well I accepted this bidder and then they ran away and they never responded to my messages after bidding so I had to restart my auction. It’s really easy to contact a buyer before you accept their bid application. That’s one way that we’ve changed our system in the last 12 months. Now instead of accepting in every individual bid you have the chance to accept the buyer from their first bid. Really really important. Take the time, ask them a few questions. I like to ask for a LinkedIn profile just because it’s a good place to see their real world business interaction. Are they somebody that has a bit of an online presence? Do they seem to be knowledgeable about this kind of thing? Do they have good feedback on Flippa? This is all really important stuff. And I get it, it’s really exciting when you get bids for your auction and it’s easy to skip that step, but you will be very very glad at the end of the day to have gone through that extra time.
Justin Cooke: Yeah we ended with some buyers who Joe and I both thought, we said “Wow man. Wow. I don’t know if this is gonna be a good deal.” And it ended up going through, no problem. It was fantastic. We were pleasantly surprised and with the auctions we’ve done we were sure that one of them would be charged back or something like that. With PayPal we were very happy to see we didn’t have any problems.
Ophelie, we’re coming up on the end of the interview, tell us really quick where can we check you out? On Twitter? On Flippa?
Opehlie Lechat: Yep I am really active on pretty much every message board that’s out there that’s related to the business. I’m active both on Twitter under my own personal handle which is Ophelie Lechat and you’ll have my name written out in full letters for those if you didn’t catch that. It’s not the easiest name to spell.
I’m active there and also on our Twitter feed @Flippa. I’m always interested in striking up conversations, helping out with people creating their listing, troubleshooting any auction troubles that they have, or talking about life in Australia as a Canadian. It’s lovely down here and I love to chat about that.
Justin Cooke: Awesome. [crosstalk 00:48:45]
Opehlie Lechat: I’m also really active on the Flippa blog. As I mentioned a bit earlier we’re doing a really big content push to get a lot of information out there to people. We blog right now about twice a week on the Flippa blog. That’s gonna be stepping up soon so keep an eye on blog.flippa.com for some really good content coming up.
Justin Cooke: Cool, Ophelie. We’ll I’ve been really impressed with your content strategy, your reaching out to third parties, blogs, forums, that kind of thing. I’ve been really impressed with it and I’m sure that good work will continue.
We’re now finishing up the interview but we’re heading into our next section which is the niche business idea and I’ll tell you a little about this. We came up with this because there are projects that we just don’t have the time to work on or maybe we don’t have the skill sets ourselves to work on. But they’re out there and they’re ready to be taken down by somebody. Give us an idea or a niche business idea that you’ve had bounce around in your head that you think someone should take on.
Opehlie Lechat: Content has been on my mind. I think I’ve mentioned it three times at least during this interview. I was at conference called Content Marketing World over in Sydney just a few days ago and one thing that came out of that is no one is doing content marketing metrics really well. Even social metrics. There are so many services out there and no one’s doing it really well but if you focus really narrowly on content, how content is shared, how your inbound links are from guest posts that you’ve published elsewhere, or even blog comments. All that seeding work that really smart people in marketing are doing, it’s really hard to quantify. I would love to see someone disrupt that and just do a really good job at it.
Justin Cooke: I know that Dan Norris over at Informly is working on something with that with his product and I’m gonna be chatting with him about that soon so he’s really looking to track those metrics. He’s got some great posts on that, I’ll actually link to them. He talks about where he got the traffic from, how many subscribers he got, what traffic is good traffic and what traffic is bad traffic for content. It’s really interesting.
Opehlie Lechat: Yeah it’s funny you mention that. Dan and I were chatting a bit earlier today so I know he’s got some ideas in that field and I’m looking forward to seeing what he does.
Joe Magnotti: Well thanks for being on the show and we’re going to wrap it up right now. Justin I know you usually take this so sorry.
Justin Cooke: (laughter) Ophelie thanks for being on the show. We really appreciate having you here and we’ll talk to you agan soon.
Opehlie Lechat: My pleasure guys, anytime.
Joe Magnotti: Bye-bye now.
Announcer: You’re listening to the Empire Flippers Podcast with Justin and Joe.
Justin Cooke: So what do you think, Justin? It was great having Ophelie on the program. I thought it was really interesting she talked about that SGHoliday.com case where, I didn’t know this, a buyer/seller request that a site get removed from Flippa.com. That’s pretty interesting. On special cases, right?
Joe Magnotti: Yeah I think that it’s worthwhile. You have to pay for the service but it’s very cheap and if you have a large site-
Justin Cooke: Help protect the buyer in the future that kind of thing.
Joe Magnotti: Yeah I think it’s a good idea to do something like that and protect your asset.
Justin Cooke: I’ll tell you Flippa is super sharp for hiring her and fantastic for keeping her, because I see her all around town. All around online mentioning Flippa and she is just a pro man. She’s great at it. As far as expanding their brand, helping to mitigate confusion over their product and their services, I think she does a fantastic job.
Joe Magnotti: Yeah and Flippa in general is they do just a fantastic job at everything. I love their site. I love their look and feel, their UI. Obviously they have some problems, we talked about that in the interview but they’re getting there and they’re definitely the kind of company that we want to be friendly with.
Justin Cooke: Definitely. Let’s get right into our tips, tricks, and plans for the future.
Announcer: The Empire Flippers Podcast.
Justin Cooke: Okay our tip for this week is a site called Responsinator.com. Basically we’ve had a ton of problems with our responsive design and how it’s seen on different tablets and phones and that kind of thing.
Joe Magnotti: Yeah and before you guys email us and tell us it doesn’t work on your iPhone 4S or something like that, I know because I’ve been to Responsinator.com. Yeah, we’re really working on that and this tool really helps. It actually shows a little picture of the device and then shows what your screen will look like on that device. It’s really cool and it makes it less about the resolution and more about the device which is nifty.
Justin Cooke: Yeah I mean designers and developers are gonna laugh at us about this because I’m sure they have about eight million other tools but for us, business guys that aren’t really in that space, Responsinsator.com can do it for you. Show you everything you need. It’s fantastic.
Joe Magnotti: And it’s free.
Justin Cooke: Well that’s it for Episode 40 of the Empire Flippers Podcast. Great having you with us this week. Make sure you check us out on Twitter @EmpireFlippers and we’ll see you next week.
Joe Magnotti: Bye-bye everybody.
Announcer: You’ve been listening to the Empire Flippers Podcast with Justin and Joe. Be sure to hit up EmpireFlippers.com for more. That’s EmpireFlippers.com. Thanks for listening.