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How To Sell A Website

Guest post by: Timur Sultanov

Article Overview: If you have an existing website or domain name you no longer need and wish to sell it to an interested buyer for a one-time profit, or if you're a speculator looking to build a steady source of revenue by buying and reselling valuable domain names, this helpful guide will explain the steps you need to take to ensure a quick, easy and profitable sale.

How To Sell A Website

Establish a Reasonable Price for Your Site. How Much Can I Get?

Before you sell, it's a good idea to know how much the domain is worth. Market prices for domain names can run from a few dollars to thousands of dollars for premium names. The domain name "Loans.com", for example, sold for $3,000,000 just a few years ago. The key to deciding whether or not to sell a domain name you own is to determine its worth to you if kept and, alternatively, how much a buyer is willing to pay. You may have heard ‘rags to riches' type stories of cheap domain names resold for hundreds of thousands of dollars. During the good old days of the Internet boom this was possible. However, things have slowed down considerably since then and there it is very rare to hear of a domain name sold for more than $10,000. However, while big deal domain sales do occur less often in today's domain market, selling domain names can still be very profitable. Short, catchy, top level domain names are selling for upwards of $5,000 on the domain aftermarket. Other longer, but still usable, names may be worth hundreds of dollars.

Pricing is relative

Relative to your desire to sell, the type and timeliness of bidder inquiries (individual or corporate) and how well the sale price is negotiated should be considered. Don't try to fit your domain name into some 'proprietary pricing model'. Every domain name is applicable to a different target market. Determine who your potential buyers are before determining your asking price so you don't over or under estimate that price. Most names (~85%) sell for between 15%-40% of the asking price. Exceptions to this trend:

Fantastic names - Truly great names can command what a seller requests, unless that amount is unreasonable.

High asking prices - Names that have ridiculous or greedy asking prices rarely sell. Important!

Poor names - Names littered with hyphens, adult names,"U"s for the word "you", etc. Don't waste your time listing names like these. They rarely sell.

Determining The Site's Worth

Selling virtual real estate is a lot like selling physical real estate. Just like with the housing market, website “homes” (also known as domain names) can be purchased for a low cost, remodeled and decorated to look very attractive to potential buyers, and sold for a considerable profit. To understand how this works, first consider that you were in fact selling an actual house built on land instead of an abstract entity on the web. It would be impossible to price your home without doing extensive research to determine its worth. You'd need to take many factors into consideration, such as: size, landscape, curb appeal, the value of other properties in the area, the current buying market, and – perhaps the biggest factor – location, location, location! You'd never dream of arbitrarily assigning a sale price to your home without having some idea of its worth and what buyers might be willing to pay. If you underprice your home, you could be missing out on a substantial profit opportunity. However, if you overprice your home, you might not be able to sell it at all. That's why it's so important to have all the facts before putting your home on the market – and the same holds true for selling your virtual home on the web.

When determining your site's value, you may need to do some research online. It is often a good idea to compare different websites on the Internet and to see which sites catch your eye. You can make a mental note of the methods used on websites that were appealing to you; then you can use those ideas when creating or updating your own website. The design of a website is very important when you are trying to sell an existing site online. The design should be bold and colorful, but should not be too busy. You may want to use colors that relate to the theme of the site as well. For instance, if you are selling bottled water, it would be logical to use shades of blue on your website. However, no matter how brilliant the website design is, the purpose of the site must also be useful for the website to sell. A good website will revolve around an interesting idea or useful type of business. To reflect the purpose of your website, you should include clear, informative content that is easy to understand. A website with a clear and interesting purpose is very likely to sell on the Internet.

A Site's Value to Buyers:

These days most websites are valued by the number of visitors they attract. One common yard stick is your domain name is valued at $10 to $30 per hit per day. If 1,000 people land on your front page each day, your domain could be worth $10,000 to $30,000. Another optimistic way of looking at domain values is each unique visitor you get over the course of a month is worth $250. If the visitor clicks to a second page on your site, her presence is worth $500. By this measure, a site getting only 10 hits per day could go for $15,000. This strategy is a lot like the way traditional businesses have always been sold. The more customers a store has, the more it is worth to a buyer. That is a pretty solid way to value domains. It is a model that is likely to be around for a long time to come.
Here are some of the main questions a typical buyer will ask him or herself when considering whether or not a website is worth purchasing – and at what price:

Is the site making any money? Is there proof?
What is the potential for future profits?
Does the site have traffic? Is there proof?
Is the site attractive/well designed? Is it functional and user friendly?
When was the domain name registered?
How is the site ranked with the major search engines?
What does is take to maintain the site? i.e. hosting fees, content addition, promotion, etc.
Why does the owner want to sell the website?
If you've purchased a unique domain name with a great deal of potential value, it may not be necessary for you to have an existing website in order for you to sell your domain name for a profit. Typically, domain names will sell based on its performance in four key categories:

Commercial Development Potential – The ability of your domain name to be used as a brand, redirect, campaign address, etc.
Recognition – The relevance of your name to the market and how easy it is to remember.
Length – In most cases, shorter is better. However, a longer more obvious name can sometimes be more valuable than a short classified-ad contraction style domain.
Extension Value – This refers to the .COM part of your domain name. Currently .COM names still command the highest values followed by .NET, some national domains (such as .UK) and .ORG names.

Pricing The Site Correctly

Unless you are a true domain name expert, we strongly recommend having your site professionally appraised. In fact, this is probably one of the most important steps you can take towards ensuring a successful sale of your site. Appraisers are professionals and experts in their field, and they have the means and methods to conclude what your domain name is worth. As we mentioned earlier, if you place an exaggerated price on your name, potential buyers will be scared away from making a reasonable offer. If you undervalue your name, you may end up kicking yourself when your newly sold name rakes in millions – for someone else. Furthermore, an appraisal is a very handy thing to have when buyers want “proof” that your name is as special as you claim. In the end, it is an exceptionally valuable asset, available for a very small price.Preparing the business information for the Sale

After you have decided to sell your business for whatever reason and chosen an asking price that you can support (hopefully with some advice from research or, even better, through a professional appraisal service), you are now ready to talk to some potential buyers. Or are you?
Much like the asking price, the art of preparing your business for sale is not that easy. So, what do you need to successfully prepare the business and information? The list and needs vary greatly over business types, revenue sizes, verticals, and so on. For any business, the basic requirements for what you will need are quite similar. At the very least, you should have the following items:

Business Summary -- what it is and why you are selling
Business Plan/Marketing Plan -- if you have them
Asset List -- both tangible and intangible
Search Engine Rankings
Website Traffic Reports
Any Technical details
Financials (previous years and Current YTD financials)
Most recent completed year's Profit & Loss or Income Statement report and Balance Sheet -- if you have it
Sales Forecasts
Supporting documents for the Financials -- Tax, Bank, and/or Merchant Statements
The previous items will give all potential buyers a good idea what is for sale and probably a good idea if they are interested in pursuing the sale or not. However, that is usually just the beginning, so be prepared for many, many, many more questions.

Also, please keep in mind that your materials, presentation, and responses will be graded as part of the business in a way. Why? Because, how can your business be successful if you are unorganized, not well presented, and not able to respond quickly and concisely? This is what the buyer will be thinking. And in my experience, this is pretty accurate.

Market Your Website & Domain Name

There are various methods of putting your domain name up for sale. Decide whether you would like to sell your domain by owner or simplify the process and significantly increase your chances of receiving the best offer in the shortest amount of time by listing your domain name with a third party.

Marketing The Site On Your Own

There are 101 different ways to promote your domain name. One way we don't recommend is blanketing companies with unsolicited email. Writing mail to 200 banks asking if they want to buy FasterInternetBanking.com is not likely to win you many friends, nor make you any deals. Your time would be better employed using the methods listed below:

Update the domain name registration information. Many potential buyers will look at the information in the WHOIS database as a first step when investigating a name that they are considering buying. So make it perfectly clear that the name is for sale. Update the owner's name to include (This name is for sale) after your own name. Make sure all your contact information is current and accurate. Contact your domain name registrar to update your WHOIS listing.

Put a promotional website up. The other obvious way for a potential buyer to find out if a domain name is for sale is to visit the website. Don't disappoint them. If you don't have an existing website, get some web space from a decent host provider and put a simple, one-page site up, showing that the name is for sale. Include a form or at least an email address so that interested parties can submit offers.
Get the Word Out. There are two different types of e-marketing strategies that may help increase your sales.

Direct Marketing: Identify and Address Your Audience.

What types of businesses or individuals would be interested in your name? When you have identified your specific audience, you can take the next steps:

Visit newsgroups related to domain names and the nature of your name for sale. Post messages and begin discussions.
Subscribe to ezines related to the topic and find out where these people are on the web, and how you can contact them.
Once you have contacts, you can send out emails to potential customers.

Mass Marketing: Address Many.

As opposed to direct marketing, mass marketing targets a large amount of people, hoping for a small response. Some ways to do this are:

Participate in domain forums, ask questions and seek out domain resellers or people who may be able to offer you more tips.
Use search engines. Although search engines differ in their methods of operation and website submission, you can often submit your site for no cost.

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Related Forum Posts
Re: what position to request? - Hi Michael, Great suggestion from David, or you could try something around a design consultancy, How about Website Design Consultant, Design and Development Manager, Website Support and Development Manager or maybe Internet Business Development Consultant. Ultimately whatever you are comfortable with and good luck for the future, Mal.
Your advantage over others - Sell using your USP - unique selling proposition. Why should people buy from you, instead of your competitors? Think about it, why are you so great? It may be a hard question, but finding the answer can multiply the effectiveness of any advertising or marketing activities you undertake.
Re: How can I promote my site? - There are various useful techniques for promoting a website. In SEO the techniques could be "white hat" and "black hat" techniques. White hat techniques includes following techniques to promote website as per the search engine rules. - Search Engine Friendly Tags - Website submission to Search Engines - Website Submission to Social Sites (Like twitter, Facebook) - Articles Promotion & Press Release Promotion - Quality Directories promotion - Contribution to Blogs, Forums Black hat techniques can reduce website strength in the search engine and can treat site as spam that could be following. - Keywords Stuffing. - Hidden Links - Maximum Links of unknown sites.
Re: Top 5 Magazines For SEO - Hi, Thanks for the links GT, I already subscribe to Website Magazine but must admit that is the only one. Maybe I shoud cast my net a bit wider to see what the others have to offer, regards, Mal.
Re: When do entrepreneurs retire, if ever? - Why would you ever retire when you love what you are doing? Sell the business and start another one maybe - but retire - NEVER! You should all read, The 4 Hour Work Week - By Timothy Ferris. He talks about building your business so that you can take mini 'retirement's throughout your life, instead of saving it all up for when you are old. Great concept - what do you think??


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