Forum Moderators: phranque
We've looked at sales, growth, stock, all the basics of business analysis.
He has excellext (most 1st page results) on most of the KW's related to the product line. That worth anything?
TIA,
Spinner
PS: if the top guns on here have done something like this already, I'd be curious to know what the approach was..
excellext (most 1st page results) on most of the KW's<That worth anything?
To an unsuspecting or inexperienced buyer it's worth lots, but in reality its worth little. In a brick and mortar enviroment, the lease of the location(s) can be looked upon as an asset, and a potential buyer has a pretty clear indication of what his fixed costs will be to remain in that location, As we have seen this past week from L$, "location" costs are a moving target, and positions can change with the wind.
I can see Brett's Logic, and that cool, but PR, isn't that a Google thing?
The site makes more than Brett's value for it's PR of 6, makes around the PR 7 range.
So if the PR value is THAT important, what are we really saying about the other SE's ranking? They don't matter?
This is the part that I find difficult to talk about on here. Can't really post the URL, to get into a deep discussion. The site is Home Decor based, if that helps any.
OK, then, do we all agree that the PR value is KEY in determining the Site's Real Value?
TIA,
Spinner
PR and SE placement in general is too transient. I'd fall back to the rule of thumb for small business sales; 3 to 5 times annual sales.
Which, btw, works very well.
Would you still apply same concept?
Spinner
I operate under the same model. Yes, I think the 3-5 rule is likely to be the best place to start with a valuation. Then, I'd add some things to justify or even raise the high end, such as does it have a killer, brandable domain? Trademark? How long (I'm talking years here) has it sustained top 5 status in the major engines? Is it in the BOW? How dependent or independent are sales from current management? What level of staffing will it need to take it to the next stage? Does the site "bolt on" to a potential buyer's existing brick/mortar business?
Surely the costs in developing the website eg say, $500,000 would have to be included somewhere in the valuation.
Many thanks
Hope that helps
As for valuing a site on PR, I think that's bad business.
PR and SE placement in general is too transient. I'd fall back to the rule of thumb for small business sales; 3 to 5 times annual sales.
I think it is overly optimistic to use offline valuation methods for online businesses. The "pure" online business that I have heard of being sold has mostly been valued between 6-12 months profit.
1. Number of clicks you get in Google for search phrase
versus what it costs per click to AdwordSelect for that search phrase.
I remember a thread where Webguerilla mentioned that normal SERP's get about two to four times the amount of clicks than Ads do. In a way that makes normal clicks a factor more valuable.
2.Same for Overture and its affiliates.
3. Then you can multiply by conversion and relate it to added value/margin of that specific product.
If nothing else, the first two points give some satisfaction value to the Webmaster/SEO's work.
1. Number of clicks you get in Google for search phrase versus what it costs per click to AdwordSelect for that search phrase.
Why wouldn't you want to look simply at overall useful traffic? I think the best method, when taking traffic and users into the equation, is too look at how mnay users you're getting per day/week/month, figure out how many of them are valuable users (ones that are good for the site, either by marketing, paying, or contributing content) and which are throw-away (one-time visitors, non-targetted visitors).
A site could be getting 2,000 click-throughs a day for the phrase "silk curtains" on Google, but the site could be getting just 4,000 valuable users a day total. Another site might only be getting 1,000 clickthroughs a day for "silk curtains" but have 12,000 valuable users a day. Which is more valuable? That's why doing it on a per-search engine basis is not a good way to value it.
I recommend going with, like you (WebSpinner) said, all the basics of business analysis - combined with only select web-only analysis considerations such as:
1. Valuable traffic
2. Rate-of-return
3. Purchase:Visitor ratio
4. Site growth potential as far as scalability and the ability to add on functionality.
5. The quality/experience of the web-development team
As far as the first page results, I'd take that into consideration, but more on the end of the website, how it affects users - not for the sake of a first place position alone (though it can definitely be used to sweeten the pot as a selling point).
We recently had an eComm site of ours evaluated by a V.C. lawyer and he didn't even consider search engine placement.
