If you are thinking about creating a website that is a valuable asset, remember that not every website has value. There are a few elements that add value and you should carefully monitor how successful they are in your web property. If these elements of your website aren’t performing, or their performance is declining, the value of your web property declines — sometimes rapidly.
Websites are like businesses. If a business can’t attract customers it can’t make money. If a business is selling something that is too expensive or that nobody really wants, it won’t make money and customers won’t come back. If you regard your website as a personal creative outlet or a hobby that amuses your family and friends, it probably won’t have value if you want to sell it and get paid for all the work you put into its creation and maintenance.
Elements that Create Value
When I review websites for Latona’s, I look for these value-adding elements:
- Traffic. If nobody visits your website, you are unlikely to make money from that site. However, traffic is not the only element of value. For example, a brochure site may promote your brick and mortar business. It might explain how your services can benefit a client. Perhaps it even provides your clients with access to their account information or other useful online services. As a brochure, it might attract traffic, but it is a marketing asset for your business and its traffic is only valuable to your business. So, if you sell your brick and mortar business, it will add value to the total sale, but as a stand-alone sale it is unlikely to have much value.
- Revenue. If you have traffic to your website, but you don’t have revenue coming directly from the website, it will have limited value. Gertrude Stein was rumored to have told her clients that nobody wants and artist who can’t sell his work. The same is true for web properties. There are ways to create revenue with your website:
- Sell things. What you sell isn’t as important as the amount of revenue it produces. Obviously, the greater the revenue, the higher the value. You can sell things directly from a shopping cart on your site, or you can use your site to attract traffic to things you are selling on Amazon or on eBay. As part of a seller account on these large e-commerce sites, your referring website has value because it helps you to create revenue from sales. Alone, without transferability of your seller account, your website has little value. If you build a successful e-commerce web business, you must sell the entire enterprise including e-commerce platforms, supplier contracts, affiliate programs, and anything else that goes to make your site a successful revenue producer.
- Advertise. Traffic and advertising go together to produce revenue. When you visit some sites you will see ads for various stores and other businesses. Advertisers pay to have their ads displayed on your site and they pay more if your visitors click on their ads. Most websites get these ads through ad networks. Google AdSense is arguably the biggest and most popular ad network. You can also contract directly with companies to publish their ads on your site for a fee. You can also create an affiliate program where other websites market the products or services offered on your website.
- Content. You have heard that content is King. Well, if you want to attract traffic to your site so it produces revenues, one way to almost assure that is to produce excellent content on a regular basis. Good content that is original keeps your site listed high in the search engines and helps to provide organic search traffic, which is what you want.
- Longevity. If your site has existed for a year, it is not as valuable as a site that has existed for several years. A site that has been producing for years and shows a gradual rise in traffic and revenues demonstrates stability. Reliability of traffic and revenue is very valuable.
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