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Adsense websites evaluation question

Discussion in 'Site Flipping' started by Rotem Guez, Apr 23, 2013.

  1. Rotem Guez

    Rotem Guez Power Member

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    Hi guys,




    I know that usually when calculating a site's value, the basic assumption is taking the monthly revenue and multiplying by 10.
    I'm trying to find a way of evaluating an adsense site and then placing an offer (for sites not in process of sale).
    Naturally, in order for me not to make a joke of myself or go bankrupt, I'd like to know what you think and even whether you think it makes any sense to try and figure out the profit of an adsense site using outside checks alone.
    I'm trying to figure it out myself, but the more I try, the more my brain gets burnt.. :)


    Thanks in advance to anyone who'll try and help :)
     
  2. fukkedup

    fukkedup Registered Member

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    I've been stuck with this before... valuing a site on projection figures.

    would love to hear some expert advice.
     
  3. utterlyadrift25

    utterlyadrift25 Jr. VIP Jr. VIP Premium Member

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    I'm not entirely sure where you heard that you multiply the sites value by 10. That calculation is of little consequence in assessing the potential value of a site.

    A few notes before using before the methodology. Obviously this isn't going to be totally accurate, as there is no way of working out exactly what volume of traffic sources (without a shit load of effort) are referring so we can only assume on based on data likely available.


    1. Create excel sheet with the columns: KEYWORD, VOLUME, RANK, CTR, ACTUAL, CPC. REVENUE. Add a single cell with 68% somewhere. Add 1% in another cell.

    2. Determine keywords the site ranks for either manually, or using a tool like. Add them to the keyword column.

    3. Determine search volume for the keywords. Add to volume column.


    4. Find the organic rank for the site for each keyword either manually or using a tool. Add them to rank column.

    5. There are several white papers / case studies that are available online for you to read. These will tell you what the baseline CTR rates are for specific organic positions. Add these CTRs to the relevant column.

    6. Multiply search volume of keyword by CTR to work out what the approximate volume of traffic is receiving.

    7. Find out what the average CPC is of each keyword using G keyword tool or something similar. Add these figures to the CPC column. Now you want to multiply actual search volume by CPC and the 1% and 68% and that will effectively be the estimated revenue for the keyword the site ranks for.

    We have assumed 1% to be the number of visitors who click on an ad for each page on the site. This could be higher or lower but quite frankly its impossible to know without access to their Adsense panel. We have used 68% to be the estimated percentage that goes to the publisher (G keeps the rest).

    Now we have a model to work out potentially what the Adsense revenue contribution is by keyword. Add all the revenue column and you will have the total monthly revenue from organic only.

    The only other things left to establish is the likelihood that the traffic to the site will grow, the value of the site content and design / platform itself, as well as the amount of effort that has been invested into any associated SEO / Social Media campaigns (which I am assuming will be part of the buy) given that the profiles and links should remain intact. I needn't tell you that social signal is a key factor now in the search optimisation equation.

    Finally, think about the longevity of the site ie will this site tank in a few months / years time?

    Based on all this information you should be able to make a reasonable offer.

    I have sold a site at 36x the monthly revenue because it was worth it. This was over two years ago and the individual actually made some improvements to it and managed to make even more money so he has not lost out.

    If the above is too complicated for you then you are probably better off not buying sites that are not listed.

    Good luck.
     
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  4. Rotem Guez

    Rotem Guez Power Member

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    Thanks for the time utterlyadrift25!
     
  5. utterlyadrift25

    utterlyadrift25 Jr. VIP Jr. VIP Premium Member

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    You are welcome.
     
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