Website flipping is becoming a lucrative source of income for switched-on entrepreneurs from all corners of the globe.
In fact, the popularity of website flipping is steadily on the rise worldwide for three key reasons:
- More people are turning to online businesses to generate an income
- As a general population, our capabilities for website design and maintenance are increasing
- There are more websites on the internet than ever before!
But what exactly is website flipping, and how does it work? Keep on reading to find out…
What does website flipping mean?
Website flipping is the process of buying a website with the intention of selling it for profit at a later date.
Generally this means making improvements to the website once purchased, whether they be aesthetic, structural or traffic generating.
The term ‘flipping’ actually comes from the real estate. Flipping real estate or flipping houses involves investors buying a property, renovating to add value, and then selling the property it at a higher price.
Website flipping is essentially the same process for the online world. In other words, think of websites as ‘online real estate’ that can potentially be renovated for profit.
How does the process work?
Much like renovating a house for profit, the basic process for flipping a website is quite straightforward.
- Firstly, find an existing that shows potential website
- Next, make some improvements to the website to increase its perceived value
- Finally, sell the website for more than you invested in it
Of course, to maximise your profits, there are some tools and tricks of the trade that will assist you with each of these steps.
How to flip websites
There are a few tricks and tools that I will suggest to aid in your website flipping journey.
You may find that the cheaper price brackets are littered with plenty of thorns between the roses. This is the unfortunate state of the industry; now that website flipping has grown in popularity there are a few devious (or simply clueless) sellers out there trying to take advantage of new-comers to the industry by
beefing up their numbers temporarily with cheap traffic. Please be wary of this.
Another great set of tools for gauging true site performance and potential are the website traffic analysis tools such Google Analytics and Similarweb. A website seller should be agreeable to granting you temporary access to Google Analytics so that you can look at traffic and conversions over the past 12 months, and where it has been coming from. You’ll also be able to use Google Analytics to understand how much of the traffic is coming from paid channels, to provide more insight into the website’s current marketing budgets. If a website owner is not willing to provide Google Analytics access, be suspicious. They may have a valid reason for not being able to share and that’s ok….but they may also be hiding their website’s history because they’re trying to dress mutton up as lamb.
For whatever reason, if you want to seek another source of potentially useful website analytics data visit Similarweb.com and enter the website URL there. This tool will give you and indication of the website’s history and reputation, and is a handy data source for a quick sense check (however compared to Google Analytics the data is less accurate due to the off-site methods used for data collection).
Lastly, is the aspect of monetisation and traffic generation. This is the ‘secret sauce’ to flipping a website for profit and unfortunately there are no hard-and-fast rules, formulas or tools to achieve this. The most important thing for those who are new to website flipping, is understanding all of the the options that exist to generate an income online, and picking ONE to focus on for your first project.
How to get started flipping websites?
If you are just starting out with website flipping, I’d suggest signing up for a free account on Flippa.com (the Flippa app is also a handy option if you are on the move a lot) and watch a couple of auctions from start to finish. This way you will be able to study the types of questions that are asked by other bidders, the quoted revenue and how it impacts the website’s asking price ratio, the typical momentum of a website auction and the success rate of auction sales.
The aim is to build up your confidence until you can spot a good buy. As tempting as it may be, don’t dive in and buy a renovator on a whim until you know what you are doing, otherwise it could cost you thousands.
Over to you
Website flipping is a great way to generate online income for those who are willing to invest the time in planning and have the patience to wait for the right websites to become available for sale. Have you had any successes flipping websites? I’d love to hear about your experience in the comments section below.