How a Website Lost 90% of it's Value in 2 Months

[tolkein]

The general considerations when buying a website are always the website's traffic and it's monthly earnings. Unfortunately, many buyers fail to ask for the referrer statistics. Here is a real-life example of how this one single factor reduced a website's value by 90%.

The website in question, is an unofficial fansite for one of the most recognizable soccer player in the world. It was listed for sale at the end of August and the seller asked for a minimum bid of $2,000. This seemed fair based on the site's traffic and earnings at the time:

Statistics
- unique visitors: 22,000/month
- pageviews: 80,000/month
- Adsense earnings: $227/month

However, upon closer inspection of the Webalizer statistics, it was found that 78% of the page views came from search engines, and 93% of this came from Google Images.

The seller later revealed that the website was ranked number 1 on Google Images for the soccer player's name. This puts the site at a high risk because it meant that the site could possibly lose 70% of it's pageviews, and thus earnings, if it fell off the top spot.

Fortunately, nobody bought the fansite at that time.

Almost a month and a half later, the website was listed for sale again. It's ranking on Google Images had fallen from 1st to 88th position, causing it's unique visitors to drop to only 6,000/month. Adsense earnings also fell to about $40/month. The website was finally sold this time and for $200 - 90% off the original minimum bid price.

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- Article from larrylim.net
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[Genialnames]

sorry, I typed in the wrong post.
(I deleted the previous entry and put this instead) :notme: :notme:

 

[yeppers]

it didnt lose 90% of its value, it didnt sell so it never had that value in the 1st place

I must disagree with you - Just because it didnt sell, doesnt mean that the VALUE of the site wasn't $2000!... A house may be valued at around $400,000, not $0 just because it hasn't been sold yet! Obviously the site isn't worth that now due to the loss in revenue, but at that point, with the lack of knowledge that ranking #1 in Google images could infact do harm, $2000 really was the value of the site.

Many people value a website on average monthly earnings * 12... In which case the value would've been even more.

The point larry was making is that you should be careful when buying a website, and do your homework if your willing to spend $2000 on one. It pays off.

just my opinion.

 

[kingfisher]

Very interesting. thanks for that ....i might see the full article