Many business owners or bloggers may not be able to tell how much their website is worth. This is because valuing a website can be a complicated task as there are many factors to consider when calculating the true worth of your online business. In this article, I’ll explain to you how to value your website based on the number of visitors you receive.
If you ask three website brokers to state how much they’re willing to pay for your website it is likely each will return with a different number. This is because there are different methods used to value websites. To arrive at a price they’re willing to pay to acquire your website they could come up with a valuation based on:
- Your website’s domain.
- How much revenue your website generates.
- Price comparison with website’s similar to yours.
- Amount of content and backlinks on your website.
- The number of people on your email list.
- How many years the website has been around.
For you or a buyer to consider some of these things when valuing your website is certainly a good idea. But if I was to do the valuation I would look at the two things I consider most important, traffic and revenues.
“A website isn’t worth anything unless it generates a lot of revenue, through lots and lots of traffic. Simple economics.”
That quote sums up my thoughts when it comes to valuing a website.
Your website can be search engine optimized, mobile friendly, rich in content and so on. However, if you have no web traffic or sales its valuation will be next to zero. If you’re lucky someone can buy it from you at a cost that may help you recoup the money you spent building it.
Calculating The Value Of Your Website Using Traffic
If your website has eyeballs that’s great! Those visitors will play a large part in determining the value of your website. It goes without saying that the higher the number of visitors coming to your site the higher the valuation of your website.
But note, the traffic you receive has to be the right type of traffic needed for your business to generate revenues. Anyone interested in your website will look into the quality of traffic. So if you receive a large number of bot traffic the price of your website would be close to worthless. This is because bots cannot be converted to paying customer.
The Source of Your Traffic Matters
I wish I could tell you that high web traffic numbers automatically make your website worth a big chunk of money. But I can’t. Where you get traffic from is crucial and some sources of traffic increase your website’s worth.
Most website buyers put a higher price on websites that receive most of their traffic from SEO.
This is because SEO traffic is seen as a source that will never run dry. Even with algorithm changes, you cannot lose 100% of your traffic overnight. With paid traffic, however, traffic stops once you stop paying for it.
To value your website using its traffic follow these steps:
- Begin by establishing how much it would cost to buy that traffic from Google Adwords for example. To do that you would have to do some research on the keywords driving most of the traffic to your website.
- Once you identify the keywords find the Cost-Per-Click (CPC) value for each keyword. For example, a website selling traffic like Web Traffic Geeks may have two keywords driving traffic to their site. This could be “buy web traffic” and “web traffic sources”. On Google Adwords, the approximate cost per click for each of the keywords might be $5.95 and $11.44 respectively.
- Let’s say the “buy web traffic” keyword brings 900 unique visitors and the “web traffic sources” keyword, 500 visitors. Multiple the number of visitors with the cost per click for each keyword. As shown below
Traffic Value Formula: CPC x # of monthly unique visitors for each keyword
$5.95 x 900 = $5,355 + $11.44 x 500 = $5,720
$5,355 + $5,720 = $11,075
$11,075 would be what you have to pay Google Adwords each month if you bought that traffic. Since you might not pay the maximum cost-per-click the final step in traffic value calculation is to multiply this amount with a percentage. Let’s take 45% this will give a more realistic picture.
Traffic Value ($11,075) x Percentage .45 = $4,983.75/month
Once you arrive at the traffic value you decide what that traffic is worth to you. The traffic will be valuable if you’re able to convert it to customers. According to Neil Patel, “Traffic Doesn’t Matter Without Conversions.”
A good conversion rate gives your website more value. But conversion can be a herculean task actually 98% of internet users who come to your website won’t convert.
Statistics by Invesp show the average conversion rate for E-commerce websites as of Q2 – 2018 was 2.86% globally, 2.63% in the US and 4.31% in the UK.
Calculating your website value using web traffic can be confusing particularly if you don’t like maths. A simpler way to calculate how much your website is worth is by using your revenue.. The amount of traffic you have will also be key in how large or small you revenue numbers will be.
How Much is Your Website Worth Based On Revenues?
To do this calculation you will need your monthly revenue numbers am sure that is something you have at your fingertips. Most website brokers usually multiple your revenues by 20-50 to give your website a price.
The multiplier used depends on the type of website you’ve created. Subscription websites, for example, get a higher multiplier because of their monthly or yearly recurring payments.
So if you earn $ 10,000 monthly your websites estimated value would between $200,000 and $500,000. Pretty straightforward right?
You may not want to do these calculations yourself which is understandable. One option many website owners use to avoid doing the calculations themselves is using several websites which claim to do site valuations.
But I would advise against using such websites. Their valuations are usually inaccurate and could lead you to believe that your website is worth more or less than its true value. To get the real value of your website talk to a website broker.
How Can You Sell Your Website?
If your not only looking to know the value of your website but want to sell it some of the credible website brokers you can ask for a price quote are FE International, Empire Flippers, and Flippa.
For a website whose value is below $10,000 Flippa is the best place to sell it. If your value is between $10,000 and $100,000 Empire Flippers would be the perfect market place. For the big boys whose websites are worth more then $100,000 the obvious choice is FE International.
Get More Traffic For A Higher Website Valuation
Since your website’s traffic determines how valuable your site is you should always work to increase your number of visitors. To do that you can work on your websites SEO, be active on social media, do smart email marketing etc.
However, if you want to increase your traffic fast work with Web Traffic Geeks. As a web traffic source, Web Traffic Geeks can get you the traffic numbers you want within hours of paying for one of their traffic plans.
Web Traffic Geeks traffic plans begin for as low as $70 for 10,000 visitors. If your willing to spend more prices go up to $750 for a traffic plan offering 200,000 visitors and a bonus 20,000. To ensure you get web traffic you can easily convert you can choose 3 countries and niches where you’re sure your product or service will sell.
How can you be sure Web Traffic Geeks will give you relevant traffic? The company has hundreds of expired domains which still get a lot of traffic. The traffic from these expired domains is what they divert to your website. These are real humans who are already looking to buy a product or service you offer. So you have nothing to worry about should you purchase a traffic plan from Web Traffic Geeks.
Remember you can have all the traffic in the world but if you’re not converting these visitors to paying customers you’ll websites valuation might not be a decent price.
Buy Web Traffic Now
The importance of web traffic cannot be overemphasized. Web traffic makes your website a valuable asset and the more visitors you’ve got the better.
With the right traffic, you should make money and ultimately the decision is yours to decide if you will sell the website or keep it. If you decide to cash out, you’ll be giving up a cash-generating asset for a load of cash.
But it if you hold on to your site, the future is uncertain. The revenues could continue to grow or the cash cow may dry up. Both decisions have significant risks to them so ensure you make the right one.