Welcome to our Monthly Business Report for February, 2015.
After a strong start to the year in January we took a bit of a step back in February.
Ok…a big step back.
To be frank – February was the worst month we’ve had to date at Empire Flippers. We’ll get into our take on the reasons for that in the details below.
We’re clearly not happy with how February turned out, but there were a few lessons learned and some bright spots leading us to believe the negative trend won’t continue.
As always, our goal is to share with you our successes and failures in business in the hopes that they help you build and grown your own profitable business.
We’ll cover everything in depth but first, let’s take a look at the overall numbers for the month of February.
Our hope is that this report encourages, inspires, and helps you as you build your online empire.
Our poor sales in February led to a rather dismal month. This was the first month since we’ve been in business that we did less than 5-figures in top-line revenue and, with some of the issues I’ll mention below, we were in the hole pretty deep for the month.
Here’s a look at all of our revenue streams over time:
TOTAL Revenue: $9,577.30 (-$27,466.25)
Alright, so that’s a look at our overall numbers. Now let’s dig into the details to find out exactly where that money came from.
Here’s a look at our all-time brokered site revenue:
And our month by month chart:
With only $30,202.20 in website sales, this was our worst month since December 2013. Our revenue came in at only $4,934.97 – a full $25K less than we took in for January.
There were a few reasons for this:
This led to much more inventory than we’d ever had before that we needed to move, but it just wasn’t happening. There were still plenty of depositors and interest, but none of them were pulling the trigger on closing the deal.
It also didn’t help that Joe, Mike, and I headed out to Phnom Penh, Cambodia for the last week of the month for a visa run. It wasn’t something we had to do to renew our visas in Vietnam, but we spent a full week in Cambodia which doesn’t have the best internet access and isn’t the best setting for knocking out work.
All that being said, we’re setting ourselves up for an excellent March and agreed to make some changes to give us a strong close for the quarter.
We had a decent month for new listings in February, pulling in $3,358.00 for the month.
It’s good to see we’re still strong on the supply side with both new and repeat sellers. We’re starting to see more 6-figure websites and businesses listed which is attracting more buyers in that range. We’ll continue to head up the value chain and are currently accepting listings up to $1M in value.
We’ve sold a few copies of Long Tail Pro as an affiliate, but there’s not much in earnings to speak of here. We have nothing planned in this area, but I’ll continue to list it as a place I can stick any revenue that doesn’t apply elsewhere.
We have no revenue here to speak of, but we spent some time in February hashing out all the details and are on track to launch this by the end of Q1. The goal is to work with a few high net-worth investors to build $1M in assets by the end of the year. Based on the success of our beta testing, we’ll roll this out more publicly in 2016.
In the meantime, I’ll still report on what’s going on here behind-the-scenes, but might have to leave out some of the details. (Specific sites or businesses purchased, investors, etc.)
Here’s a peek at our blog traffic, podcast downloads, and email list for Februay.
For a short month, we continued to do extremely well in terms of traffic and brought in 34,196 visits.
This is a trend for us and, after a very long time of relatively stable traffic, we’re finally starting to break out and see some growth.
Here’s a look at our traffic sources for the month:
We saw 10% gains in both organic and direct traffic. We’re doing really well with some of our important keywords and are in the top 10 positions for many of them which has helped to drive the right traffic. We saw a nice bump in FB traffic in February as well.
Our top content for February:
A majority of our traffic went to the marketplace. We’re finally getting to the point where the marketplace is the focal point of our business and the content is secondary – mostly lead generation for our main business.
Here are our top three posts:
Here were our top referral sources and all goal conversions for February:
Our referral traffic was pretty consistent and includes the usual suspects.
Skipping a podcast episode in February didn’t help our numbers and we dropped down to 12,783 downloads from 13,519 the previous month.
Not a ton of growth here, but the quality of our listeners is solid and many of them are customers. (Buyers and sellers) We’ll continue with the podcast and hopefully improve a bit on the consistency!
We’ve to grow our contact records and ended with 27,733 for February – up 1,678 from the previous month.
We had a total of 17,906 active email subscribers at the end of February.
On the surface, that seems like an awful lot of email subscribers and I’d have to admit that it does add up to quite a bit of revenue for us each month.
It’s important to keep in mind, though – this wasn’t an overnight success. It’s been a long, slow journey starting back in May 2011. It’s taken nearly four years to get our email subscriber base to where it is today.
There are ways to artificially boost that number, but the real value is in building a relationship with your subscribers based on honesty and trust. You just can’t manufacture that.
We strongly believe that our customer experience helps set us apart from our competitors and that’s one of the reasons we measure our success (or failure) in this area every month. Keep in mind that the majority of our feedback and comments are overwhelmingly positive, but I’m highlighting the positive and negative equally for clarity.
Here is some of the behind-the-scenes feedback we’re getting from our customers.
Once again, we saw a bit of a dip with our customer satisfaction rating and a pretty significant (negative) increase in our response times even though the overall number of tickets decreased.
Here’s a look at February’s numbers:
Vs. January’s numbers:
With 10% not getting an initial response for 8-24 hours and another 7% getting their response in 24+ hours, that’s just unacceptable. This is especially true considering how little business we ended up doing in February and 52 less tickets to handle.
We felt the effects here with some depositors (rightfully) grumbling that it took too long to get them the information and we’ve added an extra week (3-4 weeks) for our vetting process)
Ideally, I’d like to see 90% or more of initial tickets handled in 8 hours or less with less than 2% taking more than 24 hours.
We’re working on this – our newest apprentice will be managing the customer service process and implementing changes to improve these metrics.
A quick (unofficial) glance shows a total of 217 good/satisfied tickets with a total of 6 bad/unsatisfied tickets.
Here’s a comment from a happy buyer:
And one from a happy seller:
Here’s feedback from an unhappy potential customer:
This guy was asking a question about whether his (primarily local) business could be sold on our platform. Instead of answering the question, our agent said it would be “best to speak to Mike”, dropped a link to setup a call, and marked the ticket closed. As far as I know there wasn’t any follow-up from Mike and we didn’t even attempt to answer the question.
I ended up hopping in to answer it more fully, but not until after we’d received the negative feedback. (It would be a tricky sale for us. Possible, but not ideal) This was a case of passing the buck that I wasn’t happy to see, honestly.
Here’s another from someone who felt we didn’t properly address their question:
This was a fairly simple question that we answered poorly. The answer from our team was basically, “It’s up to you”, but that’s not much of a response. I ended up following up to let him know that WP sites are better to sell, but that if he’s considering listing in the next 3-6 months he’s probably better off leaving it as-is to avoid changes heading into the sale.
The silver lining is that this potential seller did ultimately end up listing (and selling) his site with us in March, so I think it all worked out!
There’s no way around it – we had a really shitty month and were pretty disappointed about it.
With less than $10,000 in total revenue, this was our worst month in business since we’ve started – even considering our AdSense Flippers days and our outsourcing company.
Why did this happen?
1. We spent too much time on “hopeful” deals
Quite a bit of effort/energy was tied up in a $100K+ deal that fell through. For every hour we spend on the phone with someone that may be looking to buy in the next few years, there’s someone we should be talking to that’s ready to buy right now. We have to get better at acting on our more immediate business interests and trusting that our plan from our strategy meetings will help us achieve our long-term goals and objectives.
2. Brokering websites is a streaky business
Some months you’re up, some months you’re down. While we had a good last week in January and a good first week in March, those numbers aren’t reflected in our February report. It was definitely a bad four-week period
To be honest, it’s probably more actionable for us to look at where we’re at quarterly rather than monthly.
3. Lack of focus on sales
Our Marketplace Manager (Mike) has taken over much of the sales role in our company, but I think that led Joe and I into a false sense of security. It’s a good reminder that you can’t completely outsource or delegate sales. As a founder, you’re always responsible on some level for the sales in your company and we should have stepped back in here.
4. Reversing deals done via credit card fraud
Not even accounted for in this report is the $25K+ we lost to a Russian syndicate that scammed us with stolen credit cards. We haven’t mentioned this much publicly as we’ve been gathering information and exploring our options. Now that this is mostly over, I’ll be publishing a detailed blog post in the next few weeks that will dig into all the details.
So… definitely not our best month! We’ve had plenty of time to dig through some of this, unpack it, and make changes for March. Hopefully, I’ll be putting out that post in the next 2-3 weeks with many more positive numbers to report.
That’s it for this month’s report – thank you for checking it out! Please feel free to share if you think others might find it useful too:
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So how did your month turn out? Any thoughts or comments you’d like to share? We’d love to hear from you!