Pricing a website based on traffic

Hi all,

I would like to know what variables and formulas to use when pricing out a website based on traffic as opposed to revenue? i know the usual asking price for rev is X10-12 mths. How can I price out a website based on traffic? Does it also depend on the niche?

For example, what would be the "approximate" value of the below monthly stats coming from 100% organic search and no advertising:

Unique visitors: 6687
Number of visits: 11998
Pages: 24985
Hits: 128964

Thanks

 

It would really depend on what the terms you are getting traffic for. If it was some information related search with very little advertising or further commercial value, then even 50,000 per month wouldn't be worth a whole lot. If it is traffic related to popular commercial terms then it could have a decent value. It really just depends on how commercial the traffic is. 7,000 visitors isn't worth a whole lot if it is un-targeted, non-commercial traffic. The real value here is going to be in finding a buyer that occupies the space that your website is in, as the additional exposure could be worth much more than the just the perceived value of the site or the traffic it gets. Organic rankings and overall niche exposure could also greatly increase the value of the site.

 

$1 per 100 unique visits per month.

 

If you need more information check out sitepoint. You'll find a lot of good info there.

 

That not a lot of traffic.
The price is not only depend on traffic but a lot more factor such as PR and backlink.
If you have PR0 then the price will be around $50 for your site.

 

This website (domaintops dot com) uses formulas to appraise your domain. I think it uses keywords, PR, alexa rank, etc to calculate the value of your domain and traffic.

But I don't know if it's correct...

 

or Estibot.com

 

You need to figure out both the short term and long term value of your customers.

If you are selling a product (Or even selling clicks with Adsense or other forms of advertising) and your conversion rate is at say 1% and your product sells for $100 then your customer value is $1.00 each

That is a simplified formula on short term traffic

Log term traffic:

Estimate how many existing customers will continue to buy, a percentage - known as the Retention Rate – then after adjusting for price inflation, this will give you all the data you need to calculate long term traffic/customer values.

In simple estimates you figure that each customer is has an infinite economic life. Unless retention rates are extremely high say as high as 80% most formulas figure that a customer is about 90% ‘used up' at around 10 years.

Using a more complex scenario, you can assign very specific economic life to a customer, then set multiple retention rates for different years, and look at the value of a customer for a company that maybe offers multiple products. Then you need to separate your profitability of each customer on an annual basis as well an on a per product basis.

I hope that doesn’t sound too confusing?...

I was a market evaluation geek in my former life…