Website Flipping 101

If you have a knack for spotting untapped websites with high growth potential, you should consider buying and reselling them for a profit. Known as website flipping, it offers huge earnings potential while allowing you to work from your home or office. You purchase underdeveloped websites at a low price, fix them up and sell them at a higher price. While that may sound easy enough, though, you must follow a strategic approach to succeed with website flipping.

How Much Money Can I Make Flipping Websites?

There’s really no limit to how much money you can make when flipping websites. If you have the necessary funds to purchase websites and the skills to improve them, you can earn thousands or even tens of thousands of dollars per flip. But like flipping real estate, there’s a possibility you could lose money on bad flips. To minimize this risk, you should thoroughly research prospective websites, purchasing only the sites that you can confidently improve.

You’ll typically make money in two ways when flipping websites: selling the purchased website as well as monetizing it while you own it. The value of a website is primarily influenced by its historic revenue, with many webmasters selling their sites for the equivalent of 12 to 24 months of revenue. A website that generates $400 per month in affiliate sales or ad clicks, for example, may sell for $4,800 to $9,600. Because historic revenue is so closely tied to a website’s value, it’s important that optimize your purchased websites to generate more revenue. In addition to offering a supplemental stream of revenue, it makes your websites more attractive to prospective buyers, meaning you can sell them for a higher price.

Website Marketplaces vs. Brokers

Sending cold emails to prospective websites that you’d like to purchase and flip is generally a waste of time. Unless a webmaster specifically says that he or she wants to sell the website, you’ll encounter rejection after rejection. A smarter and more effective way to purchase websites is to use a website marketplace or broker.

A website marketplace is an online platform that connects webmasters looking to sell their sites with prospective buyers looking to purchase sites. Although they have guidelines that sellers and buyers must follow, website marketplaces have a low barrier of entry. After creating an account, you can begin browsing their listings for the perfect website to buy and flip.

Some of the top website marketplaces include:
• Flippa.com
• eBay.com
• Marketplace.DigitalPoint.com/Sites
• Sedo.com
• WebHostingTalk.com

A website broker, on the other hand, is an organization — typically with an online platform similar to a website marketplace — that vets all websites before listing them for sale. When a webmaster lists his or her website for sale through a broker, the broker checks the website and verifies the accuracy of the webmaster’s provided documents, including traffic logs, revenue and search rankings. Only high-quality websites that meet the broker’s criteria are listed for sale, and some brokers only list websites that earn a minimum amount of revenue, such as $1,000 per month.

Some of the top website brokers include:
• FEInternational.com
• EmpireFlippers.com
• WebsiteBroker.com

Choose a Website to Flip

The success of your website flipping business will be dependent upon your ability to choose the right websites to purchase. If you’re unable to improve or otherwise add value to a purchased website, you probably won’t sell it at a higher price than what you paid. Therefore, you should choose neglected or poorly optimized websites. If a website has been neglected by its owner, you can improve it by adding new content, updating the design and optimizing it for higher search rankings. Once improved, you can resell it at a higher price.

Signs of neglected or poorly optimized websites include:
• Articles or blog posts with an old “publish” date
• Low search rankings
• Web design that isn’t mobile friendly
• Page load times (PLT) of 4 seconds or longer
• Lots of broken links
• Pages with missing title tags and meta descriptions
• Multiple pages with the same content
• Monetized with ads or offers that are irrelevant to the website’s visitors
• Few backlinks

Not all neglected or poorly optimized websites are worth buying. A 500-page website that’s riddled with coding errors, for example, would be painstakingly difficult to fix. And if a website consists of nothing more than a basic theme with no real content, you’ll have a difficult time improving it. To increase your chance of success, purchase websites that aren’t fully optimized but have decent traffic and revenue. You should be able to view both the traffic logs and revenue documents of websites listed for sale on marketplaces and brokers.

Also, pay attention to websites’ operating costs. A website may earn $1,000 per month in affiliate sales. But if it costs $800 per month to advertise the site, it will only net $200 per month. Generally, you should purchase and flip websites that generate most or all their traffic from free channels like search engines, social media networks and referring sites.

Fix Up the Website

After purchasing a neglected or poorly optimized website, you should begin to fix it up. Go through each and every page to ensure that the content is properly formatted, the code is clean, and there’s a unique title tag and meta description present. If the website has an outdated design that’s not compatible with mobile devices, change it to responsive design.

The most important thing you can do when fixing a website to flip is search engine optimization (SEO). This includes publishing relevant content and building backlinks to achieve higher search rankings. As the website’s search rankings improve, it will generate more organic search traffic. And with more traffic, the site will generate more revenue, thereby increasing its value.

Use an Escrow

Always use an escrow when purchasing or reselling websites. An escrow is essentially a third-party entity that acts as a mediator of a transaction. The escrow holds the buyer’s money while awaiting confirmation that the website was delivered. Once the buyer has confirmed that he or she has received the website, the escrow releases the money to the seller.

Escrows are beneficial for both buyers and sellers. When buying a website, there’s a risk that the seller has provided false claims about his or her site, such as the amount of traffic or revenue it generates. And when selling a website, the buyer may attempt to reverse the transaction by claiming the website was never delivered. An escrow service prevents problems such as these by serving as a mediator between the buyer and seller. Some website marketplaces and brokers offer their own escrow service. Alternatively, you can use Escrow.com when flipping websites.

Track Your Website Flipping Expenses

Website flipping is a business, and you should treat it as such by tracking all expenses associated with buying and reselling your websites. The biggest expense you’ll incur is the initial purchase price of a website. But whether a site costs $100 or $10,000, you can write it off as a business-related expense on your taxes. Other expenses you may encounter when flipping websites include professional web design design services, content creation services, search engine optimization (SEO) services and advertising.

You probably won’t earn thousands of dollars on every website that you flip. Some flips will be more profitable than others. If you remain committed to the process, though, flipping websites can provide you with a stable and reliable source of income.