Simon at Bloggasm has been asking himself a question that I hear increasing debate over ‘how much money is a blog worth?’
Simon’s seen attempt to put values at blogs which seem overblown (for example the one that Dane came up with at Business Opportunities which was based upon the WeblogsInc sale to AOL and how many inbound links they had. Simon rightly points out that the values that system gives are somewhat inaccurate (problogger is currently worth $2.45M!). I don’t think anyone ever took the Business Opportunities measure as a seriously accurate measure (for many reasons) – however Simon’s pushed on to see if he could come up with a formulae for calculating a blog’s worth.
You can read his methodology and calculations here (problogger is worth $151,457 under this system).
Of course, no formulae will ever be able to give you an accurate figure for what a blog is worth because there are so many factors to consider. Simon’s methodology breaks down because it is based upon Adbrite and BlogAds (ad systems that work well in some niches but terribly in others). To show it’s inaccuracy I look at my own blogs and can see that while ProBlogger is worth $151K in this measure I have a blog that earns 10 times as much that is worth just around $10K.
Having said that – it’s nice to see someone attempting to get their head around the question and I think Simon’s done some reasonable work.
Ultimately a blog is worth what a buyer is willing to pay for it – a figure that is based upon many things including it’s income (current and projected), it’s influence, it’s dependancy upon the blogger (and whether they’ll continue once it’s sold), it’s incoming links and SE ranking, it’s longevity, type of readership (ie search engine, loyal readers, RSS) the blog’s growth curve, domain name value, traffic, the topic etc.
Some of these factors can be measured but many can not.
Would you sell your blog? How would you value it?
There are several standard and acceptable ways to value companies. Blogs should be no exception. Ultimately, valuations come down to profit contribution and the acceptable return on your investment.
Should blogs be valued any differently?
Pierre Cutler
I wouldnt even consider buying a blog that is identified by the blogger. If they have a strong personality, it is probably the reason that a lot of readers keep coming back. If they leave, the blog loses it’s reason for being.
I no longer read some popular blogs that were bought and lost the blogger.
That’s an interesting way to value blogs. I like this valuation better than business oppurtunity’s. I was questioning the system until I read
“5. If you have less than a hundred people linking to you, your blog probably isn’t worth anything yet from a buyer’s standpoint.”
But I don’t think the art of putting a value on blogs will never be mastered.
I would have to sell my blog to someone who bears the same name as I. The market is pretty small ;)
My blog is worth $12,106.32 according to this formulate. Not bad. However, you have to be careful on this. Because if someone figure out what blogs are worth or an accurate measure of valuing them, before long someone will be taxing them. :)
Blogs should be valuated like any other business. Anywhere from 8 – 24 times monthly profit is a good ballpark number.
The range would be adjusted with various considerations, in the case of blogs the biggest factor would be the “cost” of having a different blogger. In the case of ProBlogger, losing Darren would be considered a big blow to the ProBlogger “brand” and therefore lower the valuation. If a blog has a more generic blogger, then it is worth more at sale.
Other factors would only influence the price slightly: growth in topic potential, technicals [site platform] and missed monetization oppurtunities on the site.
Funny that Simon’s formula values gossip/movie/television blog almost four times more than blogs on literature/books/art/poetry/or a publishing-industry blog..you know, the ones likely written by actual *writers*…. Ah well. Story of our culture, I guess.
My 4 week old blog is worth $1,693.62. not bad since it cost me $9 but I really dont think anybody is going to pay me that much for it…yet!!
The problem lies with the word “blog”. Blogs are evaluated largely by specialist blogging tools and outfits which are technology-related. Once you break out of the vice-like grip of the blogosphere, you’re valued in a different marketplace. For example :
* how does it look to general shoppers;
* is the material marketable by other means, say, print;
* is your archive a “resource” that’s usable by researchers;
* what is the quality of the content;
* what is the value of the small but unusual demographic attracted to your ultra-niche site?
There are many more differences. The “blog” branding is a casing that restricts your freedom, your choice and your growth prospects in an infinitely variable world.
I’d value it off the monthly profiits. I agree with Jon 8-24 months would be about right.
– Bryan
http://www.BryanCFleming.com
Each blog would have to evaluated on their own merits so it would be pointless to standardize it.
Maybe I’m just a sentimental fool, but I’ve always believed that a blog often has much more value to the one who writes it than anyone would ever be willing to pay. I’d be lucky if my blog earned enough to pay my electric bill each month. Still, if someone shoved a $10,000 check under my nose, I’d probably turn them down. It’s my work, and it’s worth more to me than any figure a financial analyst might tag on it. Just my two cents.
[…] Gefunden beim ProBlogger. […]
Whilst having a rough idea of what your blog might be worth is great in theory, but unless there is another party willing to pay that amount then the whole exercise is largely a waste of time.
It seems that the monetary value of a blog would necessarily depend on it’s current and potential income. Other than that, if it is a personally branded blog that will lose it’s blogger in the transfer, then value will obviously be lost. If it keeps the blogger or bloggers, then most value would logically be retained.
I checked my blog and I ended up OWING money…
a blog is only worth how much the highest bidder pays… And I think a lot of blogs aren’t for sale at all, so why bother about the value…
Whatever methodology is used for an estimated value, the biggest problem I currently see is the wide differences in traffic estimates between the various common stats tools.
I actually see this as a short-term business opportunity … since the principles of HTTP are pretty well known, why, oh why hasn’t someone come put with a tool that actually produced consistent results.
I’ll hold up Performancing’s stats system as an example. It frequently is significantly different in its counts of Google ad clicks than is Google itself. I have no idea who’s right … and both of them vary widely from the three different statitics systems my host provides (which never count the same number of visitors, either). Since Google pays me I’ll accept their count, but to be able to present evidence that shows they are right? can’t do it. At at present the nascent science of blog valuation resembles a real estate appraisal firm who can’t accurately measure the square footage (or meters) of a property … all the more complex formulas are out the window if you can’t determine the size of the pie to begin with.