6 Ways to Sell a Website, and 4 Ways Not to Sell One

This guest post is by Mathew Carpenter of Sofa Moolah.

It’s gotten harder and harder to generate a stable income as an affiliate over the past two years. From Facebook’s decidedly anti-affiliate mindset, to the lengthy list of regulations that search engines such as Google have released, generating stable, consistent, and stress-free paid traffic isn’t as simple as it once was. For thousands of affiliates, it’s been a major frustration and a potential business killer.

But alongside the “Google slaps” advertisement disapprovals and the massive flock to second-tier ad networks is a change in the mindset of many affiliates. Instead of focusing on the hustle of direct-response advertising, many successful affiliates and product owners alike are looking to search or socially-powered websites as a source of traffic, a source of sales, and as a source of income.

I’ve been following this same formula—alongside some other online business models—for the past few years, and while it’s far from the cash cow that a giant advertising campaign can be, it’s a form of income that’s significantly more reliable and steady. Advertising and sales checks from blogs and search-powered websites tend to be quite constant—at least more so than the average ad campaign.

Six steps to a successful site sale

These six rules—and four anti-rules—can help you develop and sell your own web properties, to generate a strong and reliable sideline income in addition to your main online venture. Despite the comfort of steady and recurring passive income, it’s often the case that you need short-term cash to fund other websites or advertising projects. In that case, be sure to put these six tips for selling your website into action.

1. Understand your website’s long-term value in advance

The average sales price of a successful website tends to range from six to ten times its profit on a monthly basis. While this can sound fairly hefty—particularly for a website that generates several thousand dollars monthly—it’s really a fraction of the type of value assigned to offline businesses.

Think about Facebook’s current valuation—the ludicrously high $50 billion. Does this reflect the website’s current earnings? No. While the website is profitable by all accounts, it’s far from those levels of profitability. The valuation reflects the website’s long-term value—something that can be applied to your own websites too.

So instead of thinking in terms of short-term revenue for your website and monthly profit, think in terms of your website’s potential for revenue growth over time. If you’re trying to sell a site that’s a real social media hit, for example, or a website with a growing search presence, use this potential as an indicator of its value and price it accordingly.

2. Know your audience, and know how to sell them

The biggest mistake I see being applied to website sales is one that’s repeated in almost all aspects of online marketing: using the same tactics for very different audiences. Just as you’d use different sales tactics to sell a car than you would to sell a bag of candy, you need to use different tactics to sell different types of websites.

Know your audience, and understand how they’re going to respond to your website auction. On one of the bigger marketplaces like Flippa, it’s important to remember that people value revenue data or profit information above anything else. For an independent website investor, information about your website’s potential for growth may be more important.

3. Research successful website sales before listing your own

When asked about how he acquires new skills quickly, productivity guru (and now fitness author) Tim Ferriss explained that it’s best to look at people who have achieved massive success in a short amount of time. It’s a philosophy that can be applied to everything from online marketing to selling your own websites, and it always produces good results.

Instead of going with your gut when deciding on how to present your website for sale, look at other websites that have achieved high sales prices in the past. What information do they disclose? Which sales tactics and pitches do they use to frame the auction? By reverse-engineering sales information from successful website auctions, you can vastly improve the results of your own.

4. Take steps to optimize profits before making a listing.

There’s nothing worse than seeing a website for sale that’s barely been optimized. From blogs that lack even the most basic advertising to affiliate websites that reek of poor conversion testing, if an online property hasn’t been optimized, it’s never going to reach its true value at sale. If your site is on the market without any profit optimization, you’re making a huge (and potentially costly) error.

Test different advertising networks, different ad creatives, and different affiliate offers on your site before you put it up for auction. Test different ad placement, different monetization methods, and a lengthy list of different lead capture strategies. Unoptimized (or poorly optimized) websites can be great deals for buyers, but they’re never a good option for you as the seller.

I’ve optimized many of the websites I’ve sold to increase profits by as much as 415% before making a sale. Small changes, particularly to the wording surrounding your call-to-action text or ad placement, can make a huge difference in the amount of income that your website generates.

5. Use a popular outlet that attracts the right audience

There are hundreds of auction sites out there that allow you to list your website, but only a select few are worth your time. The most popular is Flippa, which, despite its reputation for occasional shady websites, is actually the best option out there. I’ve sold two websites on Flippa for mid four-figure sums recently, one of which achieved an ROI of over four hundred percent.

Don’t, however, confuse a large audience with a good audience. If you own a website in a specific niche, for example, it’s almost always better to appeal to others in your niche directly instead of an all-purpose outlet like Flippa. As I said in step two, it’s important to know the type of people you’re marketing to, not just the amount of potential buyers that you have access to.

6. Minimize “fluff” statistics, and focus on the substance

“Fluff” statistics are, to me, information that’s impressive when explained in an auction, yet utterly meaningless when it comes to your website’s ability to generate income or influence change. The types of statistics I’m talking about are total pageview information—generally information that has no tie to real profitability—or data about how much traffic your website generates in total.

Instead of offering this type of information to potential bidders, highlight your website’s strengths and offer real data to buyers. Talk about how many unique visitors your website gets, your biggest traffic sources, and the value of a visitor to your website. “Fluff” statistics are only worth mentioning in one situation: your website is overvalued and you’re desperate to complete the sale quickly.

How not to sell your website

I’ve mentioned what you should do when selling your website. Now, it’s time to cover some of the most common errors that are made by those auctioning websites. While some of these tactics can help you, particularly if your website isn’t valuable, most will push away the types of buyers you want to attract. Ignore them at your own peril, as they’re definitely techniques to be avoided.

1. Load your auction with worthless data and needless hype.

Nobody cares about your blog’s unique design, its flashy navigation system, and the level of praise it has received from others in your niche. They do care about its potential for generating revenue or, in rare circumstances, its level of influence in its niche. In most cases, it’s best to leave subjective data such as critical praise or “best blog in ___” type feedback off your website’s auction page.

On the same note, don’t load your auction page with fifty-point red headers and sales copy. Look at rule two again—you’re marketing your website to other marketers. Instead of pulling out every last direct response trick in the book, offer information that’s of value to people. It’s very hard to sell to marketers, and it only gets worse when you employ the same tactics that they use on a daily basis.

2. Capitalize on temporary fads, short-term events, and crazes

I see this type of mistake all the time on Flippa. Marketers—typically newbies—buy a domain that is loosely related to the latest celebrity death, put up a generic two-page WordPress site, and think it could be the next big thing. These auctions tend to be loaded with potential-driven sales copy and an overwhelming contempt for their potential customers, all in an effort to make a quick buck.

Here’s what they all have in common: they rarely, if ever, make a decent profit. While the owners of these websites may make a few dollars on the sale, it’s rarely enough to even consider. The best type of website for onward sales is one that’s loaded with long-term potential, not some hyped-up spur-of-the-moment domain name.

3. List your website but make little or no effort to monetize it

The only thing worse than overselling a website, as above, is underselling it by failing to spend any time on monetization. This mistake is constantly be made on Flippa, although unlike many of these errors, which are made by newbies, it’s the professionals that tend to make this one. Always short on time and challenged by other projects, they list websites without even trying to monetize them.

Any signs of profitability—even a Google Adsense block atop your page—are a good thing for lifting your sales price. While websites occasionally sell based on their unrealized potential alone, it’s not at all a common occurrence. Take the time to test your website’s profitability level, and even when it’s not a winner, let people know that it’s at least capable of generating income.

4. Defining your website’s potential without thinking long-term

Browse any auction website and you’ll see descriptions where the merchant has been, shall we say, a little too optimistic about their website’s future. No, it probably won’t become the next Facebook, and no, it probably won’t triple its revenue in two months. While these examples take long-term prediction to its extreme, they’re a good indicator of how a little long-term thinking can help with your sales.

Website aren’t bought to immediately be flipped—at least, not in most cases. For the most part, they are bought as a fairly long-term investment (by online standards). Be upfront and clear about how your website is performing now, but don’t forget to include a description—even quite a salesy description—of how it could perform in the future.

Have you successfully sold a website before? If so, how did it go? Did you break even, lose money, or make a profit on the sale?

Leave your own experiences in the comments and let me know if you’ve got any suggestions on how to sell websites more effectively. I’ve seen plenty of very different techniques do well in this field, and it’s always an interesting to experience how well people are doing with less orthodox tactics.

Mathew Carpenter is an 18-year-old-business owner and entrepreneur from Sydney, Australia. Mathew is currently working on Sofa Moolah, a website that teaches you how to make money online. Follow Mathew on Twitter: @matcarpenter. Follow Sofa Moolah on Twitter: @sofamoolah.