Saturday, January 12, 2008

The Value of Online Real Estate - Some Small Sites = $$$

Over the past few years it has come to my attention that many site owners, bloggers and developers do not understand the full value and potential of their own sites. And this realization comes via one-to-one conversations with various people who make a living online.

From my experience, it appears the largest group of people believe traffic is the only measure of a site. A smaller group understand that PageRank, links & search rankings are also of value. But more than a dozen more factors come into play.

A small site, or page, in the current market can generate revenue bases on several factors including: Traffic (of course), Niche Market Traffic(Moms, Teens, Gamers, etc), Age of Domain and/or PageRank, The Domain Itself, Incoming Links, Feed Subscribers(Community), Captured Email Addresses, Amount of Content, Potential for Future Revenues(Acquisitions) and there are probably some I forgot.

Traffic and Domain Names are widely accepted as being valuable, so lets look at some of the lesser known factors. And thanks to the SEO & social media queen, DazzlinDonna for reminding me to disclose that not every small site is gold, and sites that makes money requires constant work.

PageRank: If your site only has a small ranking of 4, and no other measure, you can at least sell text links for about $10-40 per month, per link depending on the theme of your site. But dont let big brother Google(GOOG) find out!

Incoming Links: This is one of the major factors modern search engines use to determine the value or authority of a site. Links from big sites count exponentially more than links from small sites or pages with little value as perceived by search engine algorithms. Technorati uses this as its main measurement and problogger.net, is worth $4,966,822.92 according to their formula. In actuality, the long term value of this blog is probably 10 times this figure.


Feed Subscribers:
In addition to quantifying the amount of community members a site has, this figure can be directly correlate to revenue numbers. Shoemoney estimates that each subscriber for him translates into approximately $2 per subscriber per month.

Email Addresses: Can be sold to companies who collect demographic data or leads and can be used constantly in marketing campaigns by the site that captures them.

Amount of Content:
This is widely accepted as a measurement of a blog and site these days considering search results as real estate. "Content is King," just ask Mark Jackson of Search Engine Watch.

Potential for Future Revenues:
Just ask the creators of http://treehugger.com/ which just sold to discovery communications for 10 million us dollars. Also, jumptheshark.com went for millions, youtube.com went for more than a billion and the list continues....

More Evidence Around the Web:

How Top Bloggers Earn Money - businessweek.com

Ashley Qualls and WhateverLife.com: Case Study of a Teenage Millionaire

101 Ways to Monetize Your Website or Blog

When Should You Monetize Your Website?


Bottom Line: Your site is worth more than you understand.
 
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