Income Report – September 2011
It’s been a particularly interesting September and we have quite a bit to cover in this report. We had our best month ever by far when you consider our gross revenue at over $25,000 for AdSenseFlippers, but we also had a few things happen that have shaken it up and have us making changes to further our goals in the long-term. I’ll be going through the Good, the Bad, and the Ugly about where we’re at and what’s been going on with our sites, our revenue, and our goals for the future.
In last month’s Income Report you might remember us debating whether we should sell more sites in the short-term to improve cash flow or whether we should hang on to more sites for the long-term passive income. It’s a tough decision, because we’re faced with a hot market when it comes to website buyers and feel we should “strike while the iron is hot” so to speak. At the same time, we’re very experienced at building up niche sites that earn, but have almost no experience at building out a $40-$100 site to a $200-600 website and know we could find massive success if we get some practice and experience at doing this. Ultimately, we decided we wanted the cash up-front and sold $19,445 in public Flippa auctions alone this month. We’re not planning to spend the revenue here for a while, but this cash injection should help us accomplish a few of the projects we have planned through the end of the year. We understand there’s usually a “learning curve” in starting or trying anything new and it’s nice to have the extra cash to help you fund and work through your early mistakes and disasters so that you can get them out of the way!
We’ve started to do a much better job in getting ourselves out there and networking with others in the industry. It’s well known that the Internet Marketing industry can sometimes feel like you’re working “on an island”. In this case…we literally are on an island!
While there are some serious benefits to living and working out here, one of the disadvantages is that it’s easy to feel disconnected from the rest of the world, particularly when it comes to work. One of our long-term goals is to expand our brand and start building relationships that can grow and branch into other projects in the future and we’ve had an excellent start with this in September. We’re networking with a group of other professionals in and outside of our industry, setting up interviews with (both as interviewer and interviewee), and are following through on our comittment to start putting more content on video, try out podcasts, etc.
About a week into the month, it turns out that just over 100 of our sites had been “tanked” or had seriously dropped in the rankings, virtually overnight. (Not deindexed…for a detailed description regarding the difference click here) We’re far from conspiracy theorists, but our first reaction was that Google had punished a good chunk of our websites based on something we were doing. After thinking it through, we realized how very unlikely it is that we’re even a blip on the radar screen for the search giant and started looking at other possibilities. The worst part is that a good portion of those sites were doing quite well as far as earnings, so it was heartbreaking to find all of that value shot down the drain in a very short timeframe. After some research, we found that:
- All affected sites were on the same hosting account
- Not all sites on the hosting account were affected
- Most of the sites had their content copied, word for word on other sites
That being said, we can’t say with certainty the cause of the problem. Our best guess is that these two people found a portion of the sites on that hosting account and copied all of the content from our sites. (One of them created them on individual sites, the other created sub-domains on a site) We’ve attempted to contact both and have filed DMCA requests which took the sites down, but the damage had been done. (The not-so-funny anecdote here is that their sites were never ranked…we all lose here, ugh) A more-worrying concern was that it was not simply a duplicate content issue, but a larger referendum on our sites in general, but we couldn’t find any substantial evidence pointing to this, so we’re hopeful.
Ouch! Even more painful, we found that a couple of our network sales that were in the process of being transferred, but that were still on the server were affected as well, hurting our customers! We’ve been in contact with the buyers and have promised to make it right as we believe the responsibility lies with us. They’ve agreed to sit tight while we go through the process of recovering those that are recoverable and replacing those that are not with sites that are as valuable or better than those that were not recovered.
So…what do we do? First, we took inventory of our sites. We looked at previously sold sites (they’re ok) and then broke our sites up into groups:
- Older sites that were ok
- Older sites that were tanked
- Newer sites with CTR Theme
We were already planning to sell off a good portion of our sites this month anyway, so we selected samples of older sites that were unaffected and earning, broke them up into networks, and sold them off. We kept some of our sites that were earning well and many of those sites that were low-earners with a plan to expand/improve them in the future. We’ve made the decision to break up all our current and new sites into much smaller groups for hosting purposes and have removed some of the identifying characteristics for our sites across the entire network.
Our plan with the tanked sites was to:
- Significantly alter the content on the first page (Taking this opportunity to make significant improvements in providing unique, valuable information to the users)
- Switch themes
- Switch hosting accounts
- Remove as much identifying information about us from the sites as possible
- Add content
- Add unique look/feel to the sites to distinguish them
- Additional links built
This took QUITE a bit of work, but it looks like it’s slowly paying off. We’ve had at least 5 of the sites recover already, although not quite to their former glory as of yet. This did significantly impact our ability to create sites this month and dropped production down to only creating 86 sites this month. Still, based on the revenue those sites were generating, we thought the additional expense (both in actual cost and value lost from lowered production) was worth it.
Another issue we ran across is that our trial with CTR Theme seems to be costing us quite a bit. With the sold sites, tanked sites, and an increasing number and overall percentage of our sites being built with CTR Theme, we’ve seen declining returns and statistics across the board on the sites. We’ve been rotating ad placement across all of the sites, but not one of the options seems to come close to the numbers of ProSense. We have enough numbers to back it up at this point. It’s particularly discouraging, as I really LIKE CTR Theme and think it looks WAY better overall. If it were close we’d probably stick with it but, as it is, we’re going to have to look for a change, I think…it just isn’t working unless we’re missing something.
At the very end of September 2011, Panda 2.5 rolled out. As with previous updates, we found some of our sites go up while others went down, but the problem with this update is that it negatively effected our top earners more than our bottom earners, costing us quite a bit. We’ve seen some bouncing around the last few days so we’re hoping that, like previous updates, we’ll see some temporary changes/adjustments and things will get back to normal, when looked at in aggregate. That, mixed with sold sites, tanked sites, and CTR Theme underperforming sets us up for a bleak month or two when it comes to revenue.
Our greatest question/concern/challenge is this: Is what we’re doing really a viable business model at scale? Are we really providing valuable information to the web or are we not really adding anything?
If we’re being honest with ourselves, our early sites did very little to answer the searcher’s intent or queries. As stated before, our goal was not with the user in mind whatsoever and it was our Content Managers who started to improve this. That being said, our newer sites provide more value, but still aren’t at a level where I think they answer Google’s litmus test regarding Panda.
We want to change that. Ultimately, we want to provide enough information to where the user feels we went above and beyond answering their question or need regarding their search query. We’re looking at this long-term and feel this is the only viable option, considering the directions the search engines are heading. How will we get from here to there? Here are some of our thoughts:
- Individualize the sites
- Add enough content to the sites to make them “complete” and fully answer the questions in the niche
- More individualized attention to each site, making adjustments that are niche specific
- Improved content on all sites
I can’t help but look at the above points and hear/see an old-school cash register popping the drawer open for each point….Ka-ching! This is going to cost us. Still, I think we have enough margin here to be able to squeak it out and, ultimatly we might find that the increased revenue offsets the costs. (hoping!)
With everything going on above, our AdSense income was less than stellar this month, coming in at $3,695.68 in total. Our best day was on 9/7/11 at $192.19 (Our worst day on 9/30/11 at $68.83) and our daily average was $123.19, down from last month’s $137.91. With the selling of sites across a range of months, it makes tracking them by month considerably more challenging. What I’ve done is included the sites we sold this month in the averages, even though they didn’t earn for the entire month. I figure this will give a more conservative figure overall:
Predictions become even more difficult. I’ve taken out sold sites to show you what we should be at, without the changes, which gives a pretty good picture of the hole in our revenue we’ve had this month:
Things were much easier with a predictable path for growth! Still, I think in the long term, tracking these numbers will make it infinitely easier to determine potential, better understand where your risks are, see where you’re improving/declining, etc.
We were able to sell off good chunks of our network this month with some variance in multiples. We think that putting larger packages together was counter-productive, in that it saves us more time by grouping them together in larger amounts, but it takes them out of the price range for most of the $1,500 – $3,500 buyers. Also, we grouped one network together under the “furniture” niche, thinking that someone might be more interested in a package that was targeted towards a specific industry, but what we’re finding is that the people who buy our sites are less concerned with the industry and more concerned with the sites as revenue generating machines. We were hoping that there would be more potential value for someone that’s in the furniture niche and knows how to better monetize, but were surprised to find it didn’t happen. I’m guessing that if it were in a different industry we might have had more success and so we’ll try this again in the future.
We’ve had a few more private sales this month with some success. As a test, we’ve also launched our Buy Our Sites page, where you can review the stats on various sites and pick out those you’re interested in purchasing. We like the “Build Version 0.1 Strategy First” approach as it allows us to test the market without spending any money designing something that has no real interest. Early interest in this looks extremely promising and we plan to expand this in the future.
We’ve also added a section where you can buy another EMD for the exact niche we’re targeting. Our thought was that we’ve already built a successful site in that niche that’s earning and we might as well offer it up to our readers rather than letting some other marketer snatch it up. I don’t know if this plan is something we’ll stick with, but you can check it out here and see if you find something you’re interested in.
We’ve done nothing with our niche sites to promote any new affiliate offers, but have had a few new affiliate sales through AdSenseFlippers. I’ve broken out our affiliate sales below in the summary.
Something we’re really interested in is the PayPerCall model. We had experience with a local search company offering their services to small businesses via PayPerCall. We’re not looking to add customers that way…we’d rather arbitrage our search volume into calls and take a percentage from those that already have customers. I’m quite familiar with some of the bigger networks that have a ton of PPCall customers, but I’m pretty sure none of them offer affiliate programs on a smaller scale. I’ve looked into ShareASale which seems to offer something like that, but I haven’t looked into it enough, I guess. Anyone have any experience with this that can point us in the right direction? (We’re thinking service industries…carpet cleaning, movers, etc.)
Overall we’re happy with how this month turned out, but we’re a bit nervous about the future. While intellectually I know and appreciate change and adapting, it’s a bit harder when you’re forced to put it into practice! In the end, I’m sure that we’ll come out stronger and ultimately provide more value for ourselves, but also for our advertisers and those searching for products and services.
Sites Created: 86 (168 last month)
AdSense Earnings: $3,695.68 ($4,275.23 last month)
Flippa Sales: $19,445.00 ($6,510 last month)
Private Sales: $2,762.60 ($3,600 last month)
- Domains: $50.00
- Sites: $2,712.60
Affiliate Sales: $108.51 ($50.00 last month)
- SENuke X: $44.10
- BuildMyRank: $17.70
- SubmitYourArticle: $0.15
- Market Samurai: $46.56