Invest in Niche Websites

 

What are Niche Websites?

Niche websites target very narrow searches on Google in order to generate traffic.  They then monetize this traffic through advertising (such as Google Adsense, Ezoic, or MediaVine) and affiliate programs (such as Amazon’s Associates Programs).

They attempt to take advantage of situations where there a particular search term does not have a lot of high quality website results; the goal is to be on the first page of the Google search results.  Being on the first page would be very difficult, if not impossible, when competing against high traffic websites like CNN.com, ESPN.com, NYTimes, etc. but is a possibility when competing against homemade blogs and low traffic websites.  This process is called keyword research.

Niche website developers spend a substantial amount of time before they ever launch their websites in order to find a niche that has an adequate amount of traffic and relatively few competitors.  Many of them keep their websites secret in order to prevent competitors from entering the niche, but they are easy to come across if you start searching for random terms or for different things you might buy on Amazon.

A few examples include SecurityGuardTrainingHQ.com, KnifeFellas.com, PickMyShaver.com, BestBasketballHoops.org, and Shiniest.org.  All of these websites are very focused on one particular niche and its related search term.

The first site is primarily monetized with Google Adsense (Google shares its advertising revenue it generates from the Adsense ads sprinkled throughout the site), while the next four are primarily monetized through Amazon’s Associates Program (Amazon pays a commission of 4% for any website visitor that clicks through and then purchases the advertised product or any other product on Amazon within 24 hours).  Some niche websites are monetized by lead generation and selling to the leads.

Lists of Niche Websites for Sale

Developing a niche website from scratch is somewhat difficult.  While the tools required for keyword research and WordPress blog design and publishing are not expensive, they do require a lot of time; time is money.

Each niche websites usually has at least 40 to 100 blog posts or pages, and these need to be written by the developer himself or herself, or else outsourced for a fee to a highly competent English writer.

Besides great content, successful niche websites often require many hours of link building (convincing other websites to link to the niche website in order to generate link popularity and improve Google search results).

It can take months for Google to index the site and for any real traffic to develop; many newly launched websites never gain traction.  Because of this, many people choose to purchase an existing niche website from another developer.  It is not unlike buying a a completed home or other real estate rather than developing a house or building completely from scratch.

The major websites that list niche websites for sale include: Flippa, Empire Flippers, Latona’s, FE International, BuySellWebsite, and Website Broker.

Flippa is probably has the most niche websites for sale, but it is truly the Wild West.  You could buy a website that is legitimate and you could buy one whose traffic and revenues are complete crap and fizzle out shortly after you purchase the site.

Empire Flippers is on the other end of the spectrum; they scrutinize the traffic on Google Analytics, Adsense, and Amazon’s Associates Program, and turn away websites that have flawed numbers or do not look legitimate.  You do end up paying a higher multiple for the site due to this added level of screening.

Most niche websites sell in the range of about 30 times monthly income to 40 times monthly income (compare this with offline real estate where even a property selling at a buyer-favorable “10 cap” sells for 120 times monthly income.

Authority Websites vs. Niche Websites

Niche websites focus on a very narrow search term and generally should not require a substantial amount of day-to-day updating or frequent new posts.  They are fairly passive and definitely are at the whims of Google’s search algorithm.

This is why they generally sell at a low multiple and why people generally own multiple niche websites.  The trend in recent years due to Google’s aggressive algorithm updates (Panda, Penguin, etc.) has been for many developers to move away from niche websites and to focus instead on authority websites.

Authority websites are focused on a broader field (like college education or investing in the stock market) rather than being hyper focused on something like the “best survival knife.”  This site UnusualInvestments.com would be an example of an authority site.

Rather than being focused on something very specific (like New Jersey property tax liens), the website covers over 50 different niches from across the investing spectrum.  Because they are competing against much tougher competition, authority websites need to be run more like a business with frequent posting and in depth posts.

The goal for an authority website is to develop a loyal following of readers and become less reliant on Google search results; niche websites on the other hand are just trying to take advantage of gaps in Google’s search results.