Increased Net Profit By 56% After One Month: Case Study Of A New Website Purchase

I’ve bought a number of websites in the past few years and, with my latest purchase, a few friends have brought up some questions:

Which sites do I buy, and why?
What actions do I take to optimize these sites?

I hope to answer these questions with the case study of a recent website I purchased, and also show:

How after only one month in possession of the site, I increased ad revenue by 181%, overall earnings by 56.5%, and email subscribers by 4700%; subscribers that will, in turn, increase my earnings much more in the coming months.

My Newest Site Purchase:

Logo of my new site

(Note: I’m not writing out the name of the site I purchased or linking to it here for SEO reasons. Please google the name above to see the site)

By the time I saw this listing on Flippa, I’d been looking almost daily (usually 15 mins) for about a month. I had put a few bids on some other sites, but inevitably the auctions went over my decided maximum bid.

(Pro Tip: Decide your maximum bid before you get into an auction, and don’t let yourself get carried away in bidding wars!)

In the case of this listing, the briefing looked good, so I started digging deeper. Here’s what I found…

What I LIKED about the site

facebook-1084449_640

  • Over 300 posts of great content from a real expert in the field.
  • Excellent Google rankings for keywords (“team building activities”, etc).
  • Good quality and quantity of organic traffic.
  • The AdSense was under-optimized and wasn’t on every page.
  • The picture ad for the eBook (the main source of income) was being blocked by AdBlock (which could be easily fixed).
  • The sales copy for the eBook was good, but not great (room for improvement).
  • The email list was tiny because the owner wasn’t giving away a lead magnet (though he WAS offering a potential lead magnet included in the sale — the full rights to a shorter, different eBook).
  • The site came with 10 unpublished posts written by the owner (enough to buy some time while finding a content writer).
  • I knew the topic (and could write content myself if necessary). In my previous life, I had a job where my responsibilities included facilitating team building activities.
  • The owner was a REAL person, an established expert in the space, and used his real name on the site. He was also an authentic, good guy (I emphasize this because Flippa – and the internet in general — is notorious for scammers and lack of accountability).

What I DIDN’T LIKE about the site

Didn't Like

  • The domain name was .co.uk. On the plus side, the .com was included in the sale.
  • It was in a different niche than any of my other sites.
  • The sale included the eBook rights, but for three years ONLY — after that, the rights would have to be renegotiated. This would make it difficult for me to resell the site unless I bought the rights to the eBook outright (I didn’t know what this number would look like). Certainly not ideal, but not much in life ever is… In the end, this was a risk I was willing to take since I liked the niche and everything else about the site.

I asked the seller a few questions about his eBook sales, and I liked the answers he gave me:

Only three of his eBook sales were from his email list. The rest of his sales were all from Google traffic to his site. (This was good because it meant the sales of his eBook weren’t inflated by sales to his email list). Also, while he gave away some copies, he didn’t sell any copies to friends or family (again, numbers not inflated).

Winning the auction

After some bidding and negotiation, I ended up purchasing the site for a very reasonable $8,000 USD, which was 13.5 times the average monthly net profit (This was near the upper end of what I was willing to pay for this particular site, but about half of my buying budget at the time).

That meant if everything stayed roughly the same, I could expect to make my money back in a little over a year, and anything after that would be 100% profit.

One year is a very decent return period, but it’s not what I’m in the game for. I want to grow the site quickly, automate 99% of the upkeep, make my money back, and turn a profit well before the year is up.

With that in mind, here’s what I’ve done with the site so far:

First steps: Easy Wins

Easy Wins

In my first month of owning the site, I’ve focused on the “Easy Wins.”

If I had to guess, I’d say I spent a total of about 20 to 30 hours in total on the fixes below. I have other projects going on that tend to take up the majority of my time.

1. Optimize the AdSense

Before I bought the site, I noticed the AdSense was a bit sparse in the content itself. There was a banner ad on about ¾ of posts sitting about halfway down the page.

There was also a large banner ad next to the logo in the header, which I felt might cheapen the visitor’s first impression of the site (because it was bigger than the logo).

Screen Shot 2015-12-17 at 9.54.45 PM copy

Even though the click-through rate on the header ad was decent, I got rid of it. Instead, I added (336x 280) ads in the top right corner of all posts longer than 200 words (this position usually has a good click-through rate) and an additional banner ad to the bottom of longer posts.

Results:

Average monthly AdSense earnings before takeover: $73.33
January 2016 (post-sale) AdSense earnings: $205.94

181% increase. Not bad for the first full month with the site.

2. Fix the eBook Ad

Before I bought the site, I noticed that my AdBlock software was not only blocking the Google AdSense, but (more importantly) was blocking the picture ad on the sidebar that advertised the author’s own eBook!

Screen Shot 2016-02-10 at 5.02.40 PM

After looking at the code, I discovered that the png file had been named “ebook-ad.png”, which caused it to be automatically filtered by AdBlock (because it contained the word “ad”). The first thing I did when I bought the site was to change the file name, which allowed it to be shown even on browsers running AdBlock.

Results:

Average monthly eBook sales before takeover: $535
January 2016 (post-sale) eBook sales: $746

39.5% increase in eBook sales.

Again, not bad for the first month with the site, but I thought it would be much higher. I suspect that my aggressive AdSense optimization affected my eBook sales. My next step is to go back and see which pages convert the most traffic to eBook sales and then to remove the AdSense from those pages.

3. Implement a Lead Magnet to Capture Emails

The previous owner had a basic email capture in the sidebar, but it was averaging less than 1 signup per day. With an email list totaling 112 subscribers, it was clear that a solid list of subscribers just wasn’t his priority.

Experience has taught me that “the money is in the list,” so I started offering the lead magnet shortly after transferring the site. I added SumoMe’s plugin and offered the short group games eBook in exchange for an email address.

Lead Magnet
Results:

Average monthly new signups before takeover: 13.5 subscribers
January 2016 (post-sale) new signups: 648 subscribers

4700% increase in email subscribers. (see the graph below)

Wow… that right there is the magic of having a well-constructed lead magnet.

Increased Subscribers by 4700%

4. Create an Autoresponder Chain

I wrote and A/B tested a seven-mail autoresponder chain with MailChimp, which ends in a discounted offering of the eBook. It’s still early, but I should see the positive effects on my bottom line next month.

5. Optimize the Homepage

The main thing I did here was to change the Featured Posts on the homepage to posts that sent a higher percentage of traffic to the eBook sales page, with the goal of increasing eBook sales.

Actually, I expected that this strategy would give me a much bigger boost in eBook sales than it did. I think this is because I didn’t have the analytics on which pages converted directly to sales; I only had data on which pages gave the highest percentage of sales page leads.

Once I collect more analytics about which pages CONVERT to eBook sales (rather than just lead the viewer to the sales page), I’ll be making more changes.

Total Monthly Earnings

Gotta get more of these round shiny things...
Gotta get more of these round shiny things…

Without increasing traffic (in fact, traffic was a little low because of people taking holidays in early January), I’ve been able to see decent results in my first full month with the site.

Average monthly total earnings pre-sale: $608.33
January 2016 (post-sale) total earnings: $951.94

Overall increase in monthly earnings: 56.5%

This means that if my January earnings become my average, I could expect to make my money back in 8.5 months (rather than the projected 13.5 months when I bought it). That said, I plan to make much more from the site if my approach goes well.

Conclusion: Next Steps

Mike thinking
What I look like when I’m thinking hard.

I still think the site is “under-optimized” in terms of its potential earnings, so I’ve got a few more things I’d like to do work on.

  • Authority link building: I have tons of great content I can leverage to get more quality backlinks.
  • Redo the eBook sales page: The copy could use some freshening up.
    Build connections in the niche: Find other high-value products to offer from others in the space and create win-win relationships.
  • Build out the autoresponder: Right now I have a seven-email sales funnel that leads to the eBook. I’m looking for other product offers, and think I’ve found a good one. Will likely have a meeting next week with the owner.
  • Infographics and sharable content: I haven’t really experimented with this, but there are some people here in Chiang Mai that have been very successful with it.
  • Create a second eBook to sell as a package: not sure about this yet, but there is other content on the site that could be turned into another eBook.
  • Hire a content writer: The existing content is great, but Google loves fresh content.
  • Create a new product in the niche (I have an idea for something fun up my sleeve — we’ll see…).
  • I’m excited to build out this site more. It ranks for some great keywords in its niche, and with a little more work, it should be a good earner and a nice addition to my portfolio.

Before I purchased the site, the owner did a great job of creating valuable content and focused primarily on the front end of the sales funnel (i.e. a single, low-priced product). So far I’ve improved the lead magnet portion of the site (the free eBook I offer in exchange for an email address), but I don’t yet have any upsells or high-value products to offer. I’m now looking at building out the rest of the sales funnel, including middle and backend sales (see diagram below). I think there’s still plenty of room for growth.

Online sales funnel
Note: Above concept from Russell Brunson’s book DotCom Secrets

Further reading 

I was inspired to write my own experiences after reading this post on Empire Flippers, which also breaks down the steps taken when optimizing a purchased site. I also loved Chris Guthrie’s book, How to Invest in Online Real Estate

If you’re interested in this, here’s a few podcasts I love that inspire me in business:

The Web Equity Show

Empire Flippers Podcast

Tropical MBA Podcast

Feel free to leave comments with any questions you might have and subscribe to my mailing list to be the first to know of new developments on my road to optimal conversion.



While this is more of an overview, I’m more than happy to discuss details and help with strategies you can take to optimize your own sites!

610 thoughts on “Increased Net Profit By 56% After One Month: Case Study Of A New Website Purchase”

  1. This is just me testing the comment section on my new site..

    Looks like it works. So you should definitely leave a comment!

  2. Interesting read but there’s a lot of information in there that’s over my head. Mind you, I have no experience with website building or website flipping (the latter being new to me) so there’s just jargon (might not be there right word to use) or technical wording that I don’t understand. What’s your background in website development and where did you start? Real reason I’m interested: being able to work at home or on the road, and making my own schedule. Thanks for sharing 🙂

    1. Hey Pat. Agreed there’s a lot of jargon! I hope to create a glossary soon, but if you’re interested in the flipping business model, the “Further Reading” section is a good place to start (Guthrie’s book).

      I started out with just a personal blog, which taught me the basics of WordPress (the most popular platform to build sites on), then learned about the business side by reading blogs and books. I’m thinking of doing another post about books and blogs that have helped me — I’ll let you know when it’s up!

  3. Awesome content Mike. Keep it up with these posts.

    What do you suggest the best thing would be for someone interested in getting started with this type of work so they can learn the ropes?

  4. Fantastic tips! After freelancing for some time I’m finally stepping into the realm of monetizing my own websites. Your tips regarding adsense optimization are very helpful (and I really need to get a product up for sale).

    Thanks for some awesome content and best of luck with future purchases. I look forward to reading more.

    1. Thanks Rob! Glad you found it useful.

      Adsense is great, but if you’ve got a niche where info products sell (which you do), that’s usually much better money than advertising. Let me know when you’re ready to launch something and maybe I can help.

  5. Hey Mike, love the details and strategy that you go into here. I rarely come across an article where it’s just fact and you get to see the full picture.

    I’ve also shared your internship job. It definitely does seem like the world’s best internship!

    Looking forward to hearing about your other/future sites.

    1. Thanks Nick! I enjoyed doing this breakdown, so I’m happy to hear there’s interest.

      And thanks for sharing the internship!

  6. Goodd post. I ledarn something totally new and challenging on sites I stumbleujpon evesry
    day. It’s alway interesting tto resad throug arficles from other writers and uuse something frm theor sites.

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