We’ve Already Hit a Snag with Project WHO. No Willing Buyers?

For the life of us we cannot find a willing seller in this niche. It’s killing us. We thought we had someone bite for $12k and then they simply stopped returning our emails. Maybe it’s because Adam offended them with our first offer (you can go so low that you offend the person and they think you’re an idiot…that’s probably what happened).

Or maybe our offer legitimized the site in their eyes and they felt inspired to start working on it again (we’ve been watching it and it’s been sitting dormant for months now).

This has definitely solidified our ideas about the money flowing through this niche. It’s probably a bit more than we originally planned because it seems everyone’s making enough money to want to keep their site. Even in the Prosperly SERPs.

Step 4: Making the Offer(s)

Once you have your list of favorite sites, the contact information, etc. you begin reaching out to each seller.  It’s okay to be fishing multiple offers for the same niche simultaneously.  You obviously are not contractually obligated to purchase if two sellers come back at the same time.

Here’s where you can use your negotiation prowess.

A few quick tips re: negotiation:

  • If possible, get the person to name a price first.  Since you’re likely soliciting the purchase, the odds of that happening are slim (unless you’re dealing with a complete nitwit).  I love when people contact us to purchase one of our sites:  “How much would it take for you to part with yourdomain.com?”  Yeah…right.  BUT, if you can get them to show you a card, go for it.
  • In relation to point one, use anchoring.  Retails shops do this all the time when they post the retail price and the sale price. Ever heard of the MSRP? Yeah, car dealers do it too all the time.  Anchoring doesn’t need to make logical sense.  In the book Winning Decisions by Russo and Shoemaker, they prove statistically that the anchor still works even when completely baseless.  How could you anchor your prospect?  Giving them your “budget” is one way.  Even letting them know you’ve bought sites for as much as $### works.  Again, it doesn’t need to make logical sense, but it still works.
  • When you’ve been given a good deal, take it.  Don’t be greedy and don’t burn bridges.

To make our job easier, we actually have templates that we’ve perfected (you should especially perfect your subject line — a lame subject line means your email is ignored.  “LOVE YOUR SITE!” is not effective) when pitching to potential sellers.

This isn’t rocket science, simply let the seller know you’re interested in purchasing their site and were hoping to open a dialog between them.  Some emails will bounce, some will be ignored, etc.  This is all just part of the game.

When you have a seller that bites, you’ll need to do a bit more due diligence about that site.  The best thing you can do is have the seller give you read-only access to their website stats.  If they’re using Google Analytics (you can tell this by looking at their site’s source and checking for the GA code) then simply have them add your gmail.com email address as a user.  You’ll then be able to dig to your heart’s content.

If the seller is not willing to give you as much traffic data as you’d like, walk away.

We’ve found 95% of sellers are more than willing to give you any information you need to help the deal go through.

So, once you’ve done your due diligence, seeing that what you had originally surmised is true, or close enough, you can make your first offer.  Give the seller your lowest fair offer.  Adam and I have lost opportunities to buy a website because we low-balled the potential seller so badly they simply ignored us.  If you’re trying to purchase a site and would reasonably pay $12,000, do not offer $750.  It’s counterproductive.

If the seller accepts, get a contract to them so everything is legal and straight-laced.  We have a standard contract we use.  You’re welcome to use it as well if you’re part of the Prosperly Beginners.  We’ve lost out on some great deals in the past because we didn’t have the buyer (in this instance) legally bound to purchase and they walked without giving any reason whatsoever.

In the next step, we’re going to talk about the mechanics of the purchase and the importance of taking control as quickly as possible.

How We Make Money

  1. Step 4: Making the Offer(s)

How Focused, Good Design Made Us $27,500

This is from a site we purchased in November of 2008.  We bought Holly for $,2500 (our most expensive acquisition at the time) because we saw serious potential:

1) Increase the site’s rankings (0bviously).  More visitors means more money.

2) Improve the site’s design.  We saw this as seriously low-hanging fruit and you’ll know why when you see the original site.  So…here’s the original:

Original really crappy design

You see what the site’s lacking?  Focus.

What is the visitor supposed to do when they land on this page?  Click on Adsense? Click on one of those cities listed below?  Try and find a hotel reservation through that form?  And why is there that welcome text there?  Visitors know what they want to do when they’re searching for hotel reservations…they want to make a reservation.  They don’t care about your site.  It’s obvious that the previous owner was adding that content for SEO purposes, but they put it in one of the most prominent spots on the site…bad new.

So here was our first pass with a redesign:

Holly in progress

Notice a few things.  Now answer this question in two seconds:  What do we want the visitor to do?

The site is monetized by doing lead generation for hotel reservations.  We’re using the a second-tier middleman.  What this means is that we’re generating leads for Middleman 2, who is paid by Middleman 1, who is paid by the hotels.  It’s obvious where we’ll go once we have traffic worth bragging about:  Middleman 1 (and perhaps a few deals wit specific hotels that would be very lucrative — those types of relationships are profitable, but that’s for a different post all together).

Anyway.  We offer some quick links to cities which sends them to the same page except it has the City form field already filled in.

What’s the real key here?  Giving the user what they want.  Anything else is much less profitable.

Our final design once we ironed out some kinks:

The final design of Holly

We took out the city bit in the form (it was distracting) and moved the familiar logos (familiarity is key when getting conversion from visitors) to the top.

What about content for SEO?  That’s all where I put the big black box.  What about other content?  Writers are adding content constantly, but the content always plays second-fiddle to the action we desire our users to take:  get a reservation.

What Have the Results Been Like?

Since we purchased the site, traffic is up 1,303%.  But that doesn’t tell us how well the new design is doing.  Here’s the key stat.  Before we purchased the site, revenue per visitor was two cents.  Our revenue per visitor for the prior 30 days is twenty-six cents.  A 1,200% increase.  We can’t wait to get our traffic higher so we can negotiate with a more profitable affiliate provider.

At any rate, do you see what a bit of design does to help you make money?  Instantly?  This is what makes flipping websites so unbelievably valuable.  If you buy the site for $2,500 and then turn around and increase its earnings by 1,200%… (remember, that increase can be attributed directly to the redesign itself, which took us three hours) what is the site now worth?  $30,000.

Monetization Strategy. Is the Traffic There?

Our monetization for WHO is going to be plain vanilla affiliate commissions.  Why?  No customer service.  No overhead.  We’re the invisible middle man and we love it that way.

It’s not like we’re the only affiliates in this industry.  We’re going to need to bring something new to the table.  We will.  It’s going to be high-quality, never-done-before, link-attracting content.  The same old rule applies:  Give visitors value and they will love you for it.  I’m talking about the kind of content where one article takes 12 hours to research, write, and pull together.

The big question isn’t whether we can deliver great content–we know we can.  The real question was the traffic.  So we dug in to Google’s keyword tool and found a breakdown of traffic based on first-page rankings.

The competition is fierce, so we’re looking at our worst-case scenario:  ranked 9th.

At the 9th ranking we’d be bringing in 1.45% of searchers for our most competitive phrase.  What is that in absolute numbers? 26,000 visitors per month (I rounded down slightly).  This includes no long tail and no other competitive phrases at all.  Yes, that’s completely unrealisitic ,but this gives us a conservative number from which to base our decisions.  We obviously hope for more upside, but would be happy with even our lowest estimate working out.  This tells us we can proceed.

We know we can convert between 1-2% of visitors into an affiliate commission, and we know that affiliate commissions in this industry run between $100-$125.  So we’re looking at these ranges:

$100 > $26,100 – $52,200

$125 > $32,625 – $65,250

So, we can base our income estimate on one key phrase, converting at an abysmal one percent, at the lowest affiliate commission available making us $26,100.  If we were to actual hit our ranking target here, the real income will be triple that.

That’s quick and dirty, but that’s all that’s necessary.

Adam can write about all of the prospecting he did.  He found two potential candidates.  It’s too soon to tell, but I think we’re going to get one to bite on an offer.  If not…we may need to keep prospecting.

Project WHO: A Path to a $60,000/mo. Income Stream

  1. Project WHO. Follow Us On Our Journey to Build a $60,000/mo. Income Stream.
  2. Monetization Strategy. Is the Traffic There?