Valuing an Internet Business - that old chestnut
Discussion
KFC said:
Plenty businesses get away with doing something spammy for months/years before finally getting nailed for it and losing 90%+ of their traffic. The six figure part is irrelevant, it can still be all spam. I turn over 6 figures a month and 90% of that is profit, yet my business is probably worth next to nothing as its impossible to value it since all my traffic is coming from extremely dubious sources.
How true!I had a website that was number one in its niche for a few years and it made me several million pounds in profit. It was a popular website, gaining thousands of unsolicited links, but the competition were gradually chipping away at it with their dodgy black/grey hat techniques. To maintain my rankings I did the same for a while and the site continued to do well, completely unaffected by several Google updates. Then one day, out of the blue it got hit. The traffic went down to about 10% of what it was overnight and a few weeks later it was at 2%. The remaining traffic coming from Bing and Yahoo.
My view is that if you're selling anything online these days, Google want you to pay for your ranking using PPC. If you do a search on buying phrases, the organic results are full of news sites and other non helpful stuff. They don't want you clicking on organics, they want you to click their ads so they can creme off 90% of your profit.
Despite that I still wouldn't buy a profitable website even with 100% PPC traffic. An Adwords algo update could also wipe out that profit overnight. I saw this happen to someone a few years ago, and his company was spending a million a month on Adwords for a 9% profit. After the update he had to shut the company down and everyone lost their jobs. I would have liked to have heard the final phone call to his Google rep!
Webber3 said:
Despite that I still wouldn't buy a profitable website even with 100% PPC traffic.
I think buying a site with 100% PPC traffic is actually worse than buying one with 100% SEO traffic.With PPC, if a competitor comes in and decides to lose money to wipe you out, or they can get the product cheaper than you, or they simply want to buy market share and are part of a far better financed company, you're absolutely screwed. You're literally out of business over night. And thats before you consider any Google updates which could hit you.
At least if someone wants to steal all your seo traffic business for any of the above reasons, you have a fighting chance. With PPC they just need to out bid you and you're finished that very same day.
KFC said:
I think buying a site with 100% PPC traffic is actually worse than buying one with 100% SEO traffic.
With PPC, if a competitor comes in and decides to lose money to wipe you out, or they can get the product cheaper than you, or they simply want to buy market share and are part of a far better financed company, you're absolutely screwed. You're literally out of business over night. And thats before you consider any Google updates which could hit you.
At least if someone wants to steal all your seo traffic business for any of the above reasons, you have a fighting chance. With PPC they just need to out bid you and you're finished that very same day.
As I found you need products that require a reorder and that they remember to reorder from you. I have changed my offering and aim for 70% b2b by year endWith PPC, if a competitor comes in and decides to lose money to wipe you out, or they can get the product cheaper than you, or they simply want to buy market share and are part of a far better financed company, you're absolutely screwed. You're literally out of business over night. And thats before you consider any Google updates which could hit you.
At least if someone wants to steal all your seo traffic business for any of the above reasons, you have a fighting chance. With PPC they just need to out bid you and you're finished that very same day.
DSLiverpool said:
As I found you need products that require a reorder and that they remember to reorder from you. I have changed my offering and aim for 70% b2b by year end
In that case you're not going to be out of business overnight but you're doomed anyway. If you can't get any new customers, you're slowly going to lose old ones as they get around to checking if your deal is still competitive surely?KFC said:
Webber3 said:
Despite that I still wouldn't buy a profitable website even with 100% PPC traffic.
I think buying a site with 100% PPC traffic is actually worse than buying one with 100% SEO traffic.With PPC, if a competitor comes in and decides to lose money to wipe you out, or they can get the product cheaper than you, or they simply want to buy market share and are part of a far better financed company, you're absolutely screwed. You're literally out of business over night. And thats before you consider any Google updates which could hit you.
At least if someone wants to steal all your seo traffic business for any of the above reasons, you have a fighting chance. With PPC they just need to out bid you and you're finished that very same day.
KFC said:
DSLiverpool said:
As I found you need products that require a reorder and that they remember to reorder from you. I have changed my offering and aim for 70% b2b by year end
In that case you're not going to be out of business overnight but you're doomed anyway. If you can't get any new customers, you're slowly going to lose old ones as they get around to checking if your deal is still competitive surely?markcoznottz said:
It's more like black magic than business nowadays. At least with the yellow pages in the 'old days', you were in a fixed market for at least a year. It's difficult for a small business to know wether SEO or PPC really actually works, on any real sense.
There is a simple, unavoidable fact that most seo's absolutely hate being mentioned.If you're truly good at seo, then the last thing you need is customers. I don't need to hassle people to let me seo their businesses and make them money - I can do it for myself, sending the acquired traffic to websites where they fill in their information and these leads are sold on. This is all an automated process, so I just concentrate on the seo and everything else looks after itself.
If someone wants to sell you seo, the chances are they already know what they're doing doesn't work and they're going to sell you a bag of smoke. Or maybe they're just starting out and need someone to pay them while they learn what they're doing.
For the people selling seo, why exactly are you doing it? A 6 figure income with no clients is EASY if you're any good.
jammy_basturd said:
Because for some people it's not all about the money, it's not all about money put providing a service to people and companies that need it. The old supply and demand...
So you're providing a service out of the goodness of your heart???
If you only work with charities then I'll buy it... otherwise that statement sounds like a lot of horse s
t. Of course its all about the money.jammy_basturd said:
I'm not an SEO guy. But I imagine there are more companies out there requiring SEO services than there are those wanting sales leads.
Sure. Hence my "if you're any good...."If you're good at what you do, you'll outrank the other seo's trying similar. Leaving them admitting defeat and going to try and hustle crappy client jobs instead...
There are a few notable exceptions of course. Some successful seo's are well known speakers etc, and can parlay this into high paying, well known clients. For the guy shuffling about trying to bag a 1000 quid a month client.... he's either s
t or just learning what he's doing.jammy_basturd said:
Not necessarily. A great SEO guy might be able to service that £1000 a month client in one day per week, or per month.
Seo has evolved. Nobody can handle any serious campaign in a single day per month any more. In the past you might have got away with it via using link networks and text link brokers.... that ship has sailed long ago. If he can do it in one day per week then he's still only going to earn 5 grand a month. Buttons in comparison to what can be earned without clients. Plus he's going to need to work 6 days a week as all the paperwork and other random stuff is still going to need doing at some point.
KFC said:
jammy_basturd said:
Not necessarily. A great SEO guy might be able to service that £1000 a month client in one day per week, or per month.
Seo has evolved. Nobody can handle any serious campaign in a single day per month any more. In the past you might have got away with it via using link networks and text link brokers.... that ship has sailed long ago. If he can do it in one day per week then he's still only going to earn 5 grand a month. Buttons in comparison to what can be earned without clients. Plus he's going to need to work 6 days a week as all the paperwork and other random stuff is still going to need doing at some point.
KFC said:
DSLiverpool said:
Good quality content will always shine through
Sadly, that has never been true, and likely never will be true either. Crap content thats been skillfully spammed will always wipe out good quality content that hasn't been actively promoted.DSLiverpool said:
I can only speak from experience of my specialist Panasonic site, never had Seo or Adwords but regularly on page one for its manuals, guides and info. One day we will ramp it up but that's not anytime soon.
You're talking about a relatively uncompetitive niche. Write high quality content in a topic that is worth money to rank in and don't promote it and see what happens - it'll go down like a lead balloon.I'm competing with John Lewis, dixons, Argos etc anyone who sells Panasonic phones - we normally do ok.
You can't keep changing what people are saying to suit your view point.
I've noticed seo companies inc the one I use are becoming online business advisors as they can
See what's coming.
You can't keep changing what people are saying to suit your view point.
I've noticed seo companies inc the one I use are becoming online business advisors as they can
See what's coming.
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