Flipping Pre-Made Domains
Most of you are familiar with Domain flipping. The practice has become quite popular over the past year and for good reason – there is money being made buying and selling used domains. The idea is a simple one. Buy an aged used domain and build up its PR, Traffic and yes RSS subscribers and then sell the domain for a decent profit. In my opinion the buyer in most cases pays far too much and in many cases really far too much. I have talked about what I think a blog or website’s real worth is elsewhere (What is a Blog Really Worth) but to put it simply – it’s worth should be based on what it earns and not on it’s popularity. Many a buyer has learned this the hardway and yet the market continues to pay for style over substance.
In most cases the buyers believe that they can find a monetization package that will work for the purchased domain. This rarely happens though. Popular sites garner large buyouts because they seem to promise traffic and everyone knows that getting traffic is the hardest thing to get online. Get the traffic first and figure out how to make money from it second. Lots of people are losing a lot of money following this mantra.
I don’t necessarily disagree with the principle behind this thinking but I have always maintained that all traffic isn’t equal. Search traffic can be monetized. Social traffic is very hard to make money from. If you are buying a site and it doesn’t have steady search traffic then beware or you will pay too much.
There are lots of social sites for sale – what I don’t see are keyword SEO’d domains for sale. What I would really like is to be able to start a campaign on competitive niche and find 5 or 6 keyword relevant solid PR domains for sale. Oh and a consistent stream of search traffic even if small. This type of domain lends itself to Adsense income and has PR to pass which makes it far more useful than buying a popular social site.
And this brings me to this blog.
I want to see just what is necessary to produce a keyword optimized blog with solid PR in as few steps as possible. If a formula exists I want to find it and then duplicate it over and over in order to produce ready to use – income producing domains right out of the box. And then sell them.
I have not posted much on this new blog for a reason. I want to know what the trick is in avoiding the sandbox. Is it frequent posting? I’m thinking posting has little to do with it. Is it quality backlinks? This I’m thinking has a lot to do with it. So far this blog has not been sandboxed by G and the only factor that can account for this is the fact that I have accumulated a number of quality links from my friends. This is entirely white hat – all the links are legit and come from a variety of trusted sites. I was given a PR0 during the last update which could be seen as low but I see it from a different angle. The blog was less than a few weeks old with 2 posts on it in a highly spammed niche and yet G still ranked it – low yes but ranked none the less. I suspect that by next update all the high PR backlinks will be accounted for and credited to this blog resulting in a PR increase.
Now I don’t plan on selling this blog. I plan on using it to test my theories and once I have worked out the steps I intend to start producing ready made niche blogs for others to buy. In most cases I hope to find aged domains with the right keywords in the URL and then tweak the blogs and build links. Aged domains are preferrable as they don’t generally get sandboxed. In most cases however aged domains are not available and I will have to start the blogs from scratch without being sandboxed. This is not something I am doing alone. Terry from The Honest Way and I are working on this together. In time I expect that we will need the assistance of a number of other friends in our little network and of course everyone will share in the profits.
What would you pay for a site that pulls in $10.00 a day from Adsense? What would you pay for a site with 3000 RSS subscribers but only makes a few hundred dollars a month?
I believe there is a business model here that can work and should be relatively easy to accomplish given the fact that we have built up a community of quality bloggers. You can make money online going it alone but the real money is in the networks. Just how many pre-made domains do you think a small group of us could churn out using our existing blogs as the anchors?
If you have some quality sites with PR3 or better and are interested in pursuing this model please contact me and we can discuss this further. Any ideas you have are more than welcome.
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I’ve never understood why anyone would want to sell a blog that makes consistent money. If you have a blog (or make a bunch of them) that are successful in making $10.00 a day, why would you sell it?
I understand why you would want to sell an unsuccessful blog that makes little if you can get someone to pay a lot more than it is worth. But that doesn’t seem like a great business model of ripping uninformed people off.
Maybe I am missing something but if you guys make quality blogs that make money, why on earth would you sell them?
Bruce,
That’s a good question and quite frankly if a certain domain should take off and make exceptional revenue then I wouldn’t sell it. However I have a number of existing (blogspot blogs) that can’t be sold but do make $10-$20 a day and while this is nice passive income I don’t have the time to spend working on them to increase the profits. I would much rather sell them and use the Capital to start more sites. I can wait a year and make $3000 with Adsense or collect that money now and re-invest. It really just comes down to whether I can increase revenue quickly with the least amount of work. Moreover I’m interested in finding a model that can make money for many of us without everyone having to wait extended periods of time.
I am not interested in selling unsuccessful blogs to some hapless victim. I want to provide ready made money earners to those people willing to put in the time necessary to take a $10 blog and increase its earnings. In this way both parties win.
Isn’t building something up (especially from scratch) just as much work or more work than maintaining it?
I guess if you want to make money faster I understand but I am very happy with slow and steady. Heck, my best niche blog doesn’t make $10.00 a day but I am super happy with what it makes.
Maybe I will be your first customer!
Griz,
I agree with you on this one. I have seen people overpay our their a*( with a domain that has been built up with RSS subscribers. The main issue I see is that those people subscribed because of who owned/wrote the site.
Once you sell it to someone new, you run the risk of dropping your RSS to zero.
Now, a niche site that makes $10 in adsense a day, that’s a different story. It is hard to estimate what it is worth, but my thoughts are this.
If you can prove an average of $10 per day in adsense income, I would say that the site would be worth 3 to 6 months of the income. So if it makes $300 per month, then I would think the site should sell for $900 to $1800.
Not sure if that is correct thinking or not, but I haven’t really researched buying preowned niche sites as I haven’t seen any really for sale.
I also, like Stay at Home Jobs, am wondering if you are trying to make a good income online, why would you sell the think making $10 a day for a “quick buck”? I personally would think it would be worth more to keep it in the long run. The exception would be keeping it up with new content if you have hundreds or thousands of them.
Just my $.02 worth of opinion…
Elliot,
Keeping the blogs is an option but it means work and the more you have the more work is involved. As a business opportunity I think this can make a decent return for a number of us without having to commit to long term maintenance. If I can convince you and a dozen or so others to join in I think we can create an ongoing production line of optimized blogs and make a good buck selling them. If the group would rather keep them and take the Adsense then so be it but it would mean deciding who wants to spend the time maintaining them and how much extra they should receive for the effort.
I’m looking at this more as a business venture in which we can pool our resources to create a product that would be otherwise hard to do or time constraining separately.
Give it some thought – start a new niche site and imagine how quickly you could build it up by yourself as compared to how quickly it would grow using all our resources.
I’ve started to buy pre-owned domains quite recently, and I’m amazed how fast they can rank for not very competitive terms. I’m sorry I haven’t discovered this earlier.
If you and Terry agree, I’d be happy to join your team in this business. I do have a bunch of blogs and web directories with PR, and I have a lot of time and willingness to learn more.
Hello Grizz,
Can you or any of your readers point me in the direction of a good “tutorial” or resource that explains the mechanics of purchasing a used domain. Not so much finding value, but more technical like how the auction process works etc.
Thanks,
Greg
You can check this out and this company definitely follows the model you are talking out in some form or the other.
http://www.websiteshub.com
They definitely have a model for making websites and selling them. For sure they have a huge network of sites.
I do not have a website with the kind of PR you are asking for but I am willing to participate in any such sort of model for sure.
Admittedly, I have never build up a blog to the 3000 subscribers level so that leaves me out of this genre. BUT, I do have some experience in buying aged domains as I buy a few each month for my online stores, which I am concentrating a lot on now for my supplementary income and I think I write reasonably good English. So if you need assistance in this 2 areas, I’m available.
What about buying an expiring or expired domain with a high PR, say 5-6, but you check the site out and instead of being parked the site is still there, everything is working, all of the links, pages, etc, they have copyright crap all over the site(which is usually BS), but this used site has a perfect url for a niche you want, and its on sale very cheap, about 10 bucks. if I buy the live domain can I get into trouble down the road? Can the last owner actually hold a case to get his/her domain back ? I seen the video where vic did this and made out on some loot but i’ve read other places that you can get f***ed in the *ss if they decide to take “legal action”. If the Url isn’t a trademark copyright can they still f**k you legally?
Buying a preowned, expiring, domain that has a trademarked name and a live site is tricky.
If it’s a big corporation with a lot of legal firepower and money, yeah, well, you’ll be screwed although you could make them look like total idiots to their stockholders for letting the domain expire in the first place and for being aggressive about going after you, ‘the little guy’.
If it’s a small to mid-sized corporation that doesn’t have a lot of legal firepower or cash then it depends on how aggressive you want to be. If you get private registration it’s going to cost them a minimum of $1000 to start the ICANN arbitration process and that can drag on for months before they can even find out exactly who you are. If they want to sue, that’s going to be even more expensive, at least $20K. It’s cheaper for them to pay you the $1000 or so to get the domain back. Of course, you can be nice and sell it back for less if you want.
Also a lot of it depends on your intent with the site. If you buy it and put up something directly related to the business of the previous trademarked owner or make it clear that you bought it as a cybersquatter, then they have a stronger legal case. If you put up an unmonetized and unrelated article directory, Scuttle, Pligg or personal blog it gives them less recourse.
Oops, I should have made this my own post on OpTempo. Free content for Griz!
@dwep
If you can tell me where I can buy those PR5-6 expired domains for about 10 bucks I think I can retire next month.
I have been flipping bans sites and currently I am thinking about selling my CRO blog as well so I can focus on flipping sites.
It is a lot easier than you would think. Tons of people willing to buy turnkey websites rather than having to do it themselves.
Well Griz, this is where you and I need to talk LOL. I think its been that way for some time now. I guess if you have 5 mins it would be a nice thing, so you can see what you could add to the mix on my end. I’m still here.
Sometimes I think that web developers undervalue their website revenue. A common method of valuating a business is a multiple of annual earnings. This multiple is usually between 1 and 3 times revenue.
So, if you have a site that is generating $10 a day, $300 a month or $3,600 a year, I think that $3,600 is a reasonable number. However, there is a huge assumption in this number. That assumption is that the $3,600/year is sustainable.
The question that I would like to know is, How long do you think these sites will continue to generate $3,600 per year? If you think that they will do this for 5-10 years then this is a steal. If you don’t think that these sites can sustain this revenue for that long, then this might not be a good business to be in.
Grizz, how long do you think these sites will continue to generate $10 a day?
Thanks Frank, you summed that up perfectly.
“What would you pay for a site that pulls in $10.00 a day from Adsense?”
I think Fred has already given you an average calculation and told you the problems with this.
“What would you pay for a site with 3000 RSS subscribers but only makes a few hundred dollars a month?”
Now that would depend on what type of campaign I wanted to work with and it certainly wouldn’t be Adsense.
If I wanted to build a list and promote affilate products, leads or my own products via email campaigns then I would think more about it.
But I would still want to see a reasonable number of search engine visitors as well as those RSS subscribers.
And I would think very carefully about paying a high price for a site like this and whether I actually wanted to go down that road…
@Bruce:
“I’ve never understood why anyone would want to sell a blog that makes consistent money.
If you have a blog (or make a bunch of them) that are successful in making $10.00 a day, why would you sell it?”
I have been thinking of doing this for some time as I have so many blogs which, even though ‘on auto’, still require ‘backroom work’ on daily basis which is not always possible.
Now I know the ‘going rate’ for these blogs is a few thousand dollars per batch (it would be more, but the work they would take in tranferring affiliate links etc makes it a tough proposition for someone new to this particular type of blogs…). And I am tempted…
Also aligned to this is that, while these blogs are pretty consistent money makers for now, time will make them less profitable for a number of reasons. So my thinking on this is, why not sell why they are making a profit and build again from scratch, re-investing some of that money in new tools which will do the job better for me?
This isn’t about cheating a newbie out of cash, because they will have a stream of income for now, while they learn and work on building for the future.
When I started out dong this, I would have liked that opportunity.
@Grizzly again:
As you may have already figured, I am interested in the flipping model (and the building to sell in the future model), but am wary of who I work with on this.
And although the blog in my signature is a PR2, I have others which are PR3 or more…
I may send you an email…
I was looking into selling one of my BANS sites, and I was unsure where to find buyers, there were a few in the forums, but not anything worthwhile. Where do you find buyers?
Thanks
JR
Hey Griz. Since you mentioned links to this site in the post I remembered that I hadn’t added your new site link to my BU Squidoo lens. I corrected it right away
Rhonda
I have PR to bring to the table, so I’d love to participate.
I also have PR and would love to play.
I have been an avid follower of yours for some time Griz but have kept fairly quiet – I don’t really blog much but have adapted many of your teachings to my slightly different (not blogging) model.
To say thanks I’ve popped a link and your bear avatar on my PR 5 flagship site http://joomlabear.com/ – hope that’s ok.
Big Bear
The way I see it for those of you looking at the “multiples” value of a site is take a look in the offline world at what a business is worth.
A general rule of thumb would be 10x the monthy net income, although this can vary wildly depending upon the many factors that are at play. But in the “real world” businessplace there are also no guarantees that any business will sustain its stated monthly net income for even one month post sale.
So don’t go worrying about what a site will make after you sell it. You sell it and wash your hands of it because its the job of the new owner to work it right and make sure it keeps generating — and keeps increasing — income. And not sit back in his chair with his hands clasped behind his head smoking a cigar and waiting for the dam checks to roll in!!!
big bear, i just got this one for 5 bucks, its still live, anchor2anchor dot com, found it on fresh drop, in the close out section. pr5 when i checked last
it looks like a real legit site and they are probably going to come at me, by looking at this site should I try an do anything with it or immediately register it private an try an make some duckets off it, because I have no intention of selling it back to them if they somehow contact me, frank educated me a little in the response but i am stiLL a little ehhhhhh….
again i am very new to this online business stuff, if anyone has any advice on what i should do that would be great…if not i’ll proLLy just turn it into a bans store or something related to news stuff, iono.
dwep
I just can’t grasp the real intent and the true logic of flipping domains right now. I’m really a dumb bum at this I guess I better go back to flipping burgers.
I think flipping is the way to go. i saw an interview with, I forget his name, but he was from hong kong, he had made millions building up domains and selling them.
I would rather buy remodel and flip a domain than be a landlord. i don’t like renters. I view ways on monetizing a site as renters….they come and go. Id’ rather build a site earn some monthly from it and when it is at its best sell it. let the other guy keep it up. Someone who is truly interested in the niche but not interested in SEO or IM.
Guys, from my notes taken from listening to the teachings of Max who purchased bloggingexperiment.com, you can sell an Adsense site for 10-18x monthly profit. This is based on his experience as a professional website flipper.
Membership sites sell for much more.
Personally, I would be concerned about seamlessly changing the Adsense code over to my account without knowledge of previous people’s experiences of doing it. It seems to be too easy for the EPC to change by large factors.
In case you didn’t notice, you are only allowed to cut and paste code generated in your Adsense account, you are not allowed to edit it. The new code is tagged with the date it was created.
~ Ned
i own a number of domains that i would like to flip…do i concentrate on a one at a time? or have multiple projects going? they do not have much traffic so minimal alexa rankings and no adsense income..is article marketing the best way to drive traffic to sites today?
thnx
mike
I think the cost (in effort) of entry in your idea is a key factor in success. One thing I’ve learned online is the only real difference in people who make money and those who don’t are two things 1)DESIRE and 2)PERISISTENCE.
In my veiw just not quitting separates 95% (or better) of the non-successful from the successful….Just like off-line. I saw the same thing in my commercial contracting company.
Here’s my challenge…Would the people who understand the value of “started” site buy one or start their own…
Who is your market. People seem to buy design, not function and value? I have several domain ideas that could do well… mass appeal and a purchase from a big player, maye that is what your talking. I checked on a domain owned by a B.C. resident. First words when he called back were, “hi, joe, if your thinking six figures then its for sale.” If that is more the market your into, then I’d be interested. I have a few blogs with pr.Get in touch if you would like to discuss the idea further.
Thanks for your transparency. Joe.
Any headway on a network? I’m interested and see the value in linking up, have something to offer, and work hard. I have several hundred pages up over half dozen or so blogs. I’d like to create an adsense income or 10- 12k per month
Ok, How does Google now not showing PR effect this whole game?
They are still showing it in the toolbar – just not in webmaster tools. PR still exists they are just downplaying its importance now.
My toolbars are not showing PR. Not at My home computer or at my daughters house. We live 35 miles from one another so I am not sure what is going on.
Same thing happened for me – but I don’t think it’s Google – try updating both your Firefox and check for updates to add-ons. Restart the Fox. This worked for me. Using Quirk SearchStatus plugin rather than Google toolbar – It’s slimline and you only get the info you want – PR, ALexa + Compete.
I only use the search status plugin in firefox and not the toolbar. The thing is both firefox and search status have been crashing on me a lot since the last firefox update. The search status bar tends to show “unrankable” quite a bit even for sites that I know have PR and Alexa rank.
It’s hard to tell who is causing all the problems – maybe the changes in G’s algo are causing problems for FF and this is causing trouble with the search status plugin… just guessing but things are all a bit whacked at the moment.
Griz, Denise,
I missed a step in my last comment – I was having the same issue with it blanking out and saying unrankable.
I contacted the search status guys via Twitter direct message (yes Twitter!) – they wrote back and said uninstall and reinstall search status plugin – this seemed to do the trick.
It only says unrankable now if I’m viewing secure https pages.
Hope this helps.
Thanks Big Bear – makes sense. so um… uninstall????
Tools > Add-ons > then click on Search Status and an ‘uninstall’ button should appear.
I restarted FireFox.
Then over to the SearchStatus site to re-install http://www.quirk.biz/searchstatus/
Sorry Joomla – I actually figured it out all on my own. There is hope for me yet but thanks for adding the instructions so I didn’t have to! I owe you yet again…
and some are lazy…
Thanks Joomla, I did not have the Search Status plugin. Now I do! Works good so far. Don’t have a clue what happened to my Google toolbar?
If you’re still working on this program I have PR and I’m a professional writer. I’d be happy to get involved in building sites to keep or sell.
Hi Griz, Great Redfox Video btw…. This idea can definitely work. I own and pursue domains w/PR as well. However, you can’t just buy an ‘expired’ domain and have the PR transfer. It will last for a while – just like the traffic and then stop. There is a way to get domains w/PR and have it transfer. These are highly sought out by people and are scare, that’s why I think you have a solid case. Drop me line if you get a chance. That is if this idea is still
in the incubator.
Merry Christmas to All !
Hi Grizz,
Happy New Year!
I have some PR2 and PR3 sites in micro niche. I also have some more unused micro niche domains (15 of them) but not getting the writers block out of me, as English is not my first language.
However, I would like to participate and be in your team.
Do let me know if I fit in.
Best,
Piyali