There are countless entrepreneurs who are buying, growing, and selling websites as a way to make money online. This industry is growing rapidly, and investors are doing transactions worth millions of dollars every month.
But, finding success in buying and selling virtual real estate is just as challenging as investing in real estate in the physical world. There is inherent risk involved, which means you need the right knowledge and skills to do it effectively.
If you are looking to get started in this lucrative industry, read this article to discover 15 tips for making money by selling websites.
1. Choose the Right Niche
Niche selection is key to success selling websites. Instead of targeting an industry, do keyword research to help you target a subset or “niche” within that industry.
By looking in the right niches for websites to purchase, you avoid making the mistake of buying an unprofitable website based on a passing fad. Instead, you will be able to choose websites with evergreen content that will remain popular and useful for the long term.
Here are a few evergreen niche examples:
- Money and finances
- Health and wellness
- Sports and hobbies
- Food and recipes
- Relationships and personal development
- Small business
The great part about niches such as these is that they can also be expanded into multiple sub-niches.
For instance, a large, overarching topic like “health” can be broken down into sub-topics like mental health, emotional health, food and diet, exercise, and so on.
You can niche down even further and focus on one health and fitness item, such as paddleboards to help people stay active while having fun.
2. Know Your Money and Time Limits
Before you consider buying a website, first take inventory of how much money and time you will be able to invest. Purchasing a website comes with risks, and this means that you should only invest what you are willing to lose.
No matter how attractive a website may seem, the truth is that no investment is guaranteed, so if you can’t afford to lose the money or time, then don’t invest.
Once you’ve decided on a budget, plan out how much time you will be able to work on the site. If you buy a website that is already making money passively, then you obviously won’t have to make as many changes as you would buying a starter website.
However, you may still have to implement changes in areas that need improvement so you can increase your ROI (return on investment) from the sale.
3. Find Websites Worth Buying
Although starter websites are fine, profitable websites are a lot better. It’s possible to build out and sell an unproven website before it has even begun earning.
However, although this method has the benefit of not having to wait 12 to 18 months for your website to mature to the point that it’s making money, it also has the downside that almost everyone can do this.
All they need to do is get cheap WordPress hosting, publish a few pieces of content, and then sell the site, which means you’ll probably have to sell your website for a very low price.
So, when finding websites that you can buy and sell, it’s worth taking the time to identify the ones that will be worth your while.
Here are a few key performance indicators to consider:
- How much revenue does the website generate?
- How consistent are the earnings (e.g. are there spikes and dips? Are earnings seasonal?
For instance, some websites, like this lingerie store, can experience earning spikes during the period leading up to valentine’s Day) or this subscription coffee service might see a spike around the Christmas holidays.
- Is the income generally passive (that is, it isn’t entirely ad-based)?
- Does the website have upside potential? In other words, can you identify ways for maximizing traffic, expanding revenue sources, and improving existing graphic design and content?