Web based businesses being bought and sold around the world are faced with uncertain questions surrounding their value. How much value do they hold as part of a business sale?
Many business buyers strongly believe in using an ROI multiplier, as the value of many traditional businesses are determined. However sellers argue value also exists in the domain name, search engine rankings and link popularity. The cost of building the website is also often a consideration in determining the value.
Seasoned business people will tell you a business is only worth as much as someone will pay for it. Web businesses have a history of surprising us with seemingly outrageous sale prices.
How much value would you place on the domain name, rankings and links? Comments, please.
High search engine rankings in competitive spaces are undoubtedly very attractive for potential buyers. Why is it then buyers are so reluctant to place monetary value on the rankings as part of a business sale? Determining how much the rankings are worth is tricky, dubious and inexact.
Rankings are fickle because of the reliance upon the search engine. This third party is one you have no control over, and they can change their ranking algorithm at any time, without warning. There is significant risk in paying large sums of money for a marketing resource completely outside your control.
Undoubtedly, there in value in the rankings though. For many web businesses the search engine rankings draw a significant percentage of their customers. Consider also that the business may have paid a search engine optimisation company to achieve their rankings.
One formula I have seen used in valuations examines the keywords the website ranks for, and cost of acquiring the same customers through pay-per-click advertising. This formula also has the added bonus of giving you a realistic idea of what it will cost you to advertise on the search engines should something happen to your rankings in the future. Is the web business still viable if the traffic is fully paid for?
Do you have other ideas about the value of search engine rankings? Please sure your thoughts by commenting.
There are many reasons why you should avoid owning a domain name with a hyphen.
1. It’s harder for customers to understand.
Customers will trip over the hyphen and need to double-check your domain name. People stumble over hyphens. Don’t place any extra barriers in front of your customers, they’re fickle enough.
2. They sounds dorky when you say it.
Think about how you present a domain name with a hyphen over the radio. “Just log on to city hyphen of hyphen Cairns dot com for more details.” Seems kind of ridiculous, doesn’t it.
3. They’re worth less.
If you ever want to sell your business, there is more value in domain names without hyphens.
Many businesses use hyphens in their domain names to separate words, and therefore make them more clear in their marketing, particularly print marketing. Hyphens are also popular for new businesses where their business name has already been taken, or for competitive keyword rich domains.
Be creative with your domain names, and avoid hyphens. Anyone disagree? Please, your thoughts.
It’s a bad idea to register your own domain names. It’s easy to forget the domains you register, because it’s another year before they come up for renewal for a .com, and 2 years for a com.au. A pivotal piece of your registration is your email address. Your domain registrar will use it exclusively for corresponding with you when it comes time to renew your domain.
This is a problem for new businesses who might not yet have a business email address, and are using email@example.com or some similar email address at their ISP.
It is amazingly common for domain names to expire because the owner changed their ISP, and so their email address changed too. This similarly occurs with free online email addresses like at Hotmail, or Yahoo.
By having a company manage your domain names, you can have peace of mind your registration will always be renewed on time and your website will never embarrassingly go down due to the expiration of your domain name.
If you have purchased the domain for a future project or as an investment the consequences of not collecting your renewal email can mean losing your domain forever. Most recently expired domain names are purchased by domain-squatters, so the chances of recovering it after expiry are minimal or expensive.
Check with your web host as most offer a service to manage your domains.
I am eternally frustrated with the number of ISP email addresses like firstname.lastname@example.org I see in advertising. In newspapers, magazines, Yellow Pages and even on business cards it seems many small businesses are unaware this is so naughty. Using an email address at your own domain is very important for these reasons.
What happens when you change of ISP?
Inevitably, you will also need to change your email address. Having your primary business email address at your ISP means if you find a great deal on internet access there is a large cost associated with changing the email address over across all sources of advertising.
Owning a domain name and operating email addresses on your domain means your email is independent of your ISP, and you’re free to move as you please.
Strengthen your brand at every opportunity. This includes your email address. By having your own email address shows you’re operating a serious business.
Which is better in your mind?
email@example.com or firstname.lastname@example.org?
Every now and then I come across a fantastic website with a strong concept and spectacular delivery. I strongly recommend business owners to consider spending an hour with a good glass of red and the Flying Solo website.
Essentially Flying Solo is an online community for small business owners with an abundance of articles, tips and advice. The articles are short, punchy and relevant to hectic life in small business.
Their immensely popular weekly eNewsletter, Soapbox, is delivered to 14,000 Australian business owners, and is one of the few eNewsletters I always read as soon as it arrives. Consider signing up to this for your weekly dose of inspiring goodness.
I’d love to know what you think of their website. Please leave me a comment.
It’s very disheartening when businesses have their name tarnished by an ambitious competitor who understands the internet just a little better than they do. So how can you protect your business’ good name online?
Brainstorm for permutations of your domain name. This can be as simple as considering the alternate extention on your current domain. So if you have a .com, consider the .com.au, or expanding into other extentions like .net, or .org.
Next think about different ways in which your business name might be written. For instance, if your business name is The Rock Man, then you might consider both TheRockMan.com.au and RockMan.com.au.
Protecting your name has an unlimited number of possibilities, and can be an expensive exercise. Major companies go even further than the methods outlined here to include typos and less common mispellings of their domain to protect their brand. My best advice is to always purchase your .com and .com.au, and if you’re in a particularly competitve industry, also buy the .net and .net.au.
To seasoned internet users, blogging is a household word. To business it’s a new and blossoming addition to their websites bringing new visitors, customers and clients.
Blogging in business is booming in popularity due to them being easy and simple to use, relatively cheap to have installed on a website and an excellent form of communication to share corporate expertise and connect with existing and potential customers.
A great business blog has a continuous stream of fresh and interesting content and helps establish a relationship with website visitors and build a climate of trust. Blogs offer business a chance to build a real community by making it quick for people to post, comment and update posts – essentially making it easy for everyone to participate.
Most businesses who have ever thought about publishing a newsletter, or an e-newsletter will find a blog a natural addition to their website. Because blogs are centred around frequently updated mini-articles, they’re essentially little news items and any business which has information they want to deliver to potential customers is a good candidate to have a blog.
Here’s a couple of specific examples for business types;
Share your expertise and develop a stronger sense of credibility through your blog.
Consultants and service-based businesses are the most common businesses currently using blogs. People working in these industries spend considerable time displaying their skills within their target market through networking, panel appearances and mentoring. Blogs help to establish consultants as a trustworthy expert and build oneself as an authority or expert in a particular field.
Encourage new custom through in-depth detail on your specialist area.
Businesses which operate in a niche target market or a tight product range are ideal for communicating with their customers through a blog. Use the blog for a knowledgebase of product information or a dynamic frequently asked questions section. Industry specific news and events are
Keep customers updated with new products and their features as they become available.
Many retail businesses evoke natural curiosity and following from their customers. These businesses especially should consider a blog to keep customers up to date with new and interesting products released.
Announce new listings and keep poignant sales information in the buyer’s eye.
In a fast paced and ever changing industry like real estate, blogs are an excellent way to keep potential buyers informed of market trends as well as industry expertise, knowledge and specific suburb data.
Attract more customers through detailed product knowledge and regular news.
Many tourist operators already publish a reef report or regular newsletter which discusses specific topics pertinent to their product but much of this information is only distributed to booking agents. By publishing regular articles in a blog potential customers researching travel product online will be more likely to book through a company they know more about. This is especially true for travel agents whose business is built on experience with product.
Blogs are not necessarily designed to capture the largest audience and widest readership possible, but rather like most forms of internet marketing it is intended to help convert already interested visitors.
Unfortunately many businesses fall into the same trap with blogs as they do with e-newsletters – and abandon them after just a few months. Blog abandonment happens for lots of reasons, but mostly because in business we just get too busy. Here’s a quick list of common blogging mistakes that should be avoided;
Many new bloggers love the feeling that comes with expressing their opinion in a public place. It is especially warming when you receive comments from others that agree with you! A blog is a channel of communication that builds momentum and is ideal for opinionated thought. Many journalists and editors now use blogs through the major media newspaper websites.
Blogs which encourage a genuine exchange of ideas are a great platform to network with other industry leaders and further grow your business. The best minds in business often tell us how to attract the right customers with a strong opinion than the lowest price quote.
As with many internet advertising opportunities, a blog provides inexpensive exposure for your business. Allowing customers to interact with you through a blog encourages repeat business.
Have you checked lately how many people visit your website? For most small businesses it’s a couple hundred people every day. Bloggers post comments at a fiery pace, and you can very quickly gauge the public’s opinion on products, services, events and business ideas. Blogs have most recently been established by political reasons heading into elections for precisely this reason.
When you’re planning a website, you will most likely be asked to write a design brief, or your web developer will write one for you. The process of writing your design brief is a great way to have focus the thoughts of your website project and define the goals you’re trying to achieve. Your design brief will also save you a lot of money in the long run.
Here’s the essential things you consider including in your brief:
Write a couple of paragraphs about your business. Think about your company history, current staffing levels and how your product or services range has evolved. Your web designer will be trying to establish what type of business you are, and what style of website would suit you.
This is an area lots of businesses struggle to define, but it is important as it sets the mood of your website. When deciding on your target market, consider the following demographics:
Websites You Like (and Dislike)
Scour the web for similar businesses in your industry, both locally and abroad. Look for aspects of these sites that capture attention and include them in your design brief.
Be sure to pay attention to anything you don’t like, or anything that captures your attention in a negative way.
It’s important for your web developers to know how you plan to promote your website, as they can help you track the performance of your endeavours. Consider including both online and offline promotional activities.
If you’re a bit stuck for ideas download our Website Design Brief, and just fill in the blanks.
Keeping your website fresh is considered one of the most important features of keeping your customers. Have a look at some of the great websites of the world like Amazon and eBay, and you’ll notice they rarely look the same each time you arrive. The only thing they keep the same is the location of the menu.
For most small businesses though, changing your website every few months is usually adequate. If you’ve invested a lot of your time into developing your website and ‘getting it right‘ the first time, it might be hard to think of some new things to add, or what you can change, so here’s some ideas.
Start a File
Open a new folder on your desktop, and inside create a Ideas Word document. This is a quick and easy place to put anything you find on the internet, or thoughts and ideas you have.
Listen to Customer Feedback
“I looked for information on your widget product, but I couldn’t find anything.“
When a customer says something like this write it into your Ideas document, and consider how you can incorporate this into a new page or section on the website. Sometimes you might just need to ask your web designer to make particular aspects stand out more.
When Things Change…
… think of your website. Many of your prospective customers check your website before contacting you, so make sure if a price changes, or you do not sell particular products lines anymore that they are correctly noted on your site. Customers report one of their biggest frustrations as being out of date websites.