Buying Your First Website: A Case Study

The website that caught my eye was pregnancyworkoutdvd.com. Why did this grab my attention? Quite simple really: my wife’s expecting so I have pregnancy on the brain (if you’re reading this darling, no, you look fine, you don’t need to workout!). The site was at the lower end of the market in terms of price so it was a good way to dip my toe in to test the waters.

Using the analogy of stocks, this type of purchase is a speculative investment. The website is young, making no money, and will need time spent on it creating more content, but it has a solid foundation and ticks some important boxes.

What follows is the due diligence and domain analysis I did that led me to my first website purchase.

This website is clearly targeted at people searching in Google for the keyword phrase “pregnancy workout dvd”; so the first step is to find out how many searches are being performed on this phrase. There are a stack of keyword research tools out there, for purchase or freely available, but Google’s Keyword Tool will do the trick (it’s free!), giving me a rough indication of the number of searches being performed for this keyword phrase.

Figure 1. Google’s Keyword Tool

As you can see in the above figure, Google’s Keyword Tool suggests that “pregnancy workout dvd” receives 6,600 searches monthly. That’s 220 searches per day, which is reasonably healthy for a highly targeted niche such as this. Google results are generally on the optimistic side, so let’s round it down to 200. If I’m ranked #1 for this keyword, I might expect to receive about 56% of the search traffic (according to a Cornell University study); that’s about 120 visitors per day.

Next, we want to find out how competitive this niche is. Competition analysis is an in-depth topic, so it’s worth checking out some of the posts on sitepoint.com for more details. For basic metrics, I use Firefox with the SEO Quake Extension to display competition information, which will indicate the degree of difficulty achieving a #1 ranking for this site. The current #1 ranked site in Google’s results has the keywords in the title and a PR (page rank) of 3, but the keyword phrase is excluded from the domain name, another factor that can influence search rankings.

Figure 2. The SEO Quake Firefox Extension

Another simple metric I use to establish competition is to find out how many other pages appear in Google for a phrase search. In this case there are 8,040 other pages in Google’s index:

Figure 3. Competition research

A result of 8,040 is low. Anything under 100,000 results means that the niche isn’t oversaturated. Try some other searches and you’ll see what I mean.

I’m happy with this niche; there’s reasonable traffic available for the keyword and I’m satisfied that despite the competition, I’ll still be able to rank well for this search phrase. So how much should I pay for this website?

In this particular case, the site isn’t generating revenue. The Flippa.com stats, available to the right of the auction or through a quick Whois search, tells me that it’s less than a month old. There’s no data available for the domain on SEMrush.com (another handy keyword research tool), but a basic search for the core keyword phrase on Google shows that the site is already ranking at position #8. That’s fairly good for a site less than a month old; shows that the developers know their stuff.

In a coming post, I’ll share some of the steps you need to take after your bid has been accepted and you’re ready to take ownership of a website.