Site Flipping Case Study (Pre Flip)
I’ve noticed a growing trend over the past few months and the movement behind site flipping. For those that don’t know site flipping at it’s core is the process of building a site quickly and then flipping it for a profit. The definition of site flipping could also be expanded to include buying sites and then flipping them for a profit. But for this case study I’ll be building a site quickly and then flipping for a profit. In general most of the posts I’ve read from bloggers have been pro site flipping and while I’m not going to say that’s a bad thing (yet), I’d like to write about the topic from my perspective before I flip a site and then after I flip a site to see how my opinion changes.
Case Study
I will be documenting this whole process over the rest of this week and into next week (however I will not publish the posts until after the sale is complete – see below for explanation). I have Nov 17th off as a vacation day so I will be building the site that day and posting it for sale the following day on SitePoint or Digital Point forums (most likely SitePoint). For those of you that are on the fence about site flipping be sure to subscribe to my blog’s RSS feed. I will be documenting the process on my blog over the course of November.
My Perspective (Pre Flip)
In my opinion (again as a pre flipper) site flipping seems like it’s just a substitute for a real 9 – 5 job. You spend most of your day researching a niche to build a site around, creating the content, launching the site only to put it on auction soon after. So you’re constantly working on creating a website that you will ultimately sell before it can begin to generate any residual income. If you take all this time to build a site the least you can do is have some faith that the work you put in will pay off in the form of a nice chunk of residual income as opposed to a one time (small) lump sum. If I do like the site flipping process what makes the most sense to me is to take a laddered approach to site flipping. In other words, I would build sites on a consistent basis (perhaps once a month) but give each site at least 30 days or more to generate some decent traffic before selling them. Then when the next month rolls around I have another site that has had 30 days to generate traffic before selling. The other problem I see with site flipping is that you could possible use up a lot of your great niche ideas on sites you flip instead of sites you keep around but I suppose this could be countered with dedicated time towards research.
So that is where I stand right now and I’m sure you may agree or disagree with some of the points I’ve made. I believe what makes the most sense when it comes to site flipping is to build a site targeting a specific niche or long tail keyword and wait until the site starts to rank well for that term before flipping it; however, in this case study I will fight my urge to hold onto my website and instead flip it the day after I build it. If you like the posts that follow during this case study I will certainly consider doing this again, but most likely I will try the build – wait for rankings – then sell approach.
Case Study Details
As I mentioned earlier, to help reduce the variables in this case study I will hold off on posting the URL of the site (as well as the steps I took to select the niche and build the site) until after the sale is complete. Most case studies I read from top bloggers are swayed by the fact that they post the URL to a site they’re building as a “case study” but if you’ve taken 7th grade chemistry you’ll remember that it’s important to limit variables as much as possible when performing a case study. Now how can you do that if you tell every one the URL to the site and drive traffic that the site would have otherwise not received? I also recognize that there are other variables that can affect this case study. The perfect example is that the sale price range could be determined by the niche I choose to build a site in and these are topics I will certainly address in future posts.
I expect all aspects of the case study to be completed by the end of November at the latest, so if you like to learn by example than I highly recommend you subscribe to my RSS feed. It’s going to be a lot of fun and I expect we’ll all learn something.
What do you think?
Got something to say? Click here to reply
I think that sounds like a fantastic idea. There is so much noise about site flipping these days, it will be good to read some honest feedback about how it works in real life from someone who’s not trying to sell something.
Shane´s last blog post..Making Money On The Internet Is A Big Fat Scam
[Reply]
Hardest part in my mind (as a total guess) would be that people primarily value a site based on it’s traffic. I think it would be hard to generate any significant traffic in 30 days. But if you can fix that it could work well. Thanks!
Brian
StartBreakingFree.com´s last blog post..Milton Friedman’s “Freedom To Choose”
[Reply]
I’m interested to hear at the end what you chose.
Did you choose a hot niche and write some articles for QS and sell it for a IM?
Did you choose a specific niche and write a blog with theme that is set for adsense?
That type of thing. I like the first one the best (if you’re a good writer) some Internet Marketers will pay a few bucks just to have a site set up with content so they can get good QS on GooG.
browie´s last blog post..Affiliate.com T-Shirts
[Reply]
Well it is really interesting if you ask me. Honestly, I really want to hear more about the results of this site flip so can’t wait.
I’m not too much into site flipping right now for a lot of different reasons, but I always like to hear about creative ways of making money online.
Ben Tremblay´s last blog post..Drive sales with offline marketing – going crazy
[Reply]
Hey all,
Thanks I’m glad that this sounds like a good idea and people are excited about it. I’m leaning towards a small niche for this one but I’m certainly going to keep in mind how much money can be made off the niche focus. I don’t want to go after anything crazy like chemotherapy treatments or lawsuits.
Hey Brian,
I think you’re right on the 30 day traffic mark. I just set that as an example date as I thought it would be easier to explain the concept of laddering using that. I think it would be at least 3 months to really see a significant difference.
I borrowed the concept of laddering CD’s . Which is to just buy a 5 year, 4 year, 3 year, 2 year and 1 year CD then when the first year is up reinvest that money into another 5 year CD so that you have a steady flow of high interest earning CD’s every year.
In any case I’m very excited about this. This will truly be a case study with as little variables as possible especially because I’ll be using a brand new Sitepoint profile to sell the site too
[Reply]
You knew I was going to comment on this one, right Chris? lol
Nah, I’m not going to write a novel here, but part of me wants to.
If you only wanted to grind out NEW sites to “flip” as your primary source of income it “could” be a 9-5 grind. However, if you did plan on going that route, I’d assume you were looking at website flipping as a real business model, and so it would be a good idea to outsource a lot of the work. That way, you do more volume for the same profit, and less work on your end (and thereby losing the “grind”).
And if we’re talking about flipping brand new sites, you don’t have to “spend most of your day researching a niche to build a site around”. It can actually take you about 10-15 minutes (ok an hour tops if this is your first time) searching the SitePoint marketplace. View what niches are selling like hot cakes in the past 30 days (in the Start Up Websites section).
Since you’re doing 30 days though, it will benefit you to research good keywords available to gain traffic by using ones that you can dominate through promotion/seo and gaining traffic faster and hoepfully sales or ad/click revenue.
If you’re going to wait 30 days, then focus heavily on gaining traffic, backlinks, subscribers and a couple sales. Don’t let it sit for 30 days just so it’s “older” when you sell it. You won’t get any more for a site that’s 30 days old compared to 24hours old if there’s not a big difference in stats.
The laddering is a great idea. If you like flipping sites, you can also flip 1 a week on top of the 30 day ones for extra $$ while the 30 day ones are building.
As for “using up niches”. You keep the killer ones for yourself! Sell sites that are “hot niches” (if you’re selling them quickly, while they’re brand new).
@Brian: It is very possible to get significant traffic in 30 days! Some people have different views on what is significant. You can make sales from dominating long tail keywords with low competition (and low volume). So, if you can convert 1:50, that’s 3 sales in 150 visitors. That’s significant, but not “high” volume. That will help sell your site though.
Also, buyers don’t base the value solely on traffic, although (obviously) it helps. Revenue from a consistent, targeted traffic source is number one. There are a ton of great marketers who know what they’re doing and snap up good sites for their network/portfolio. It’s not all newbie buyers looking for a “start”.
All that is based on flipping brand new sites. It’d be a “bit” of a different discussion if you were planning to build a site for 6 months-18 months with the intention to flip.
Chris, if you have Skype, add me.
Looking forward to your case study!
Good luck!
Jay
SuiteJ´s last blog post..5 Reasons Why Flipping New Sites Is Better Than Keeping Them
[Reply]
I’m quite interested to see. All the hoopla lately has got me a wee interested in something i didn’t think would.
Dennis Edell´s last blog post..10 Effective Joint Venture Ideas To Get You Started
[Reply]
LAWL CHRIS, it’s feng. I was reading shoemoney’s post about local marketing and saw your name. (I’ve been working on something similar the last month)
are you a full time affiliate marketer now? still in seattle? we should have lunch and catch up.
[Reply]
Hey Jay,
Yah I had a feeling you’d be commenting on this post. Great ideas – these are all things I’m going to consider. Either way I’m very excited to see how well it goes.
I’m also going to document the time from start to finish to I can calculate an hourly rate for my efforts as well
Feng – Hey what’s going on? No I’m not full time yet, primarily because my wife is back to school for her masters. But yah I’d love to have lunch and catch up. Yes I do live in Seattle too – send me an email through the contact form.
Chris Guthrie´s last blog post..Site Flipping Case Study (Pre Flip)
[Reply]
[...] here?? Be sure to subscribe to the RSS feed so you don’t miss anything!Chris is going to try site flipping and Jay has posted 5 Reasons Why Flipping New Sites Is Better Than Keeping Them.? Those are two [...]
I was planning to flip one website and keep a record of the flip in my blog. I think is great to see the behind the scenes of a flip.
Luis Mtz´s last [type] ..People who get scammed sometimes deserve it
[Reply]
I never tried flipping a website and since I heard and read it here I’ll get so much interested about it and I will soon try it. I love the idea of having a case study.
Sung Maybury´s last [type] ..Pet Food Brands
[Reply]