“Online Success Need Not Be Measured in Enemies” plus 2 more

Online Success Need Not Be Measured in Enemies
Boost Your Blog #9: Create a Resources Page
What’s Your Blog Worth? How to Value Web Properties

Online Success Need Not Be Measured in Enemies

Posted: 06 Sep 2011 01:00 PM PDT

This guest post is by Margie Clayman of margieclayman.com.

One of my favorite Elvis Costello choruses goes like this:

"What's so funny 'bout peace, love, and understanding?"

I have always liked that song, but I never really thought I would live in a time where that question would resonate. I always thought, "Well, that was written when peace and love seemed hokey, perhaps, or maybe impossible. It was more than a rhetorical question when Elvis first sang it."

And yet, as I sit here in the year 2011, I have to ask the same question. What is so funny 'bout peace, love, and understanding? It sure seems like all three concepts are running into a PR crisis in the online world.

“You're nice. That's so boring.”

I have gotten picked on a bit over my year in the world of social media. Why? Because I'm nice. I'm lovey dovey. People have told me that it's really boring listening to someone like me because I never ruffle any feathers.

To put it kindly, I think that's a totally ridiculous sentiment.

Sure, you get a powerful response if you call someone out, bash someone, hurl insults, or say that someone is really stupid. There's no question that ruffling feathers tends to be great for attention-grabbing and traffic spikes. So what?

If you want to entice people to read your blog posts, what about the concept of writing really good content? Really thought-provoking content? What about writing about something people aren't writing a lot about? Like, I don't know … like being nice, maybe? Why does excitement in the online world, or interest, have to be synonymous with cruelty or malicious intent? I'd rather be boring and nice than enjoy a modicum of success at the expense of others.

"If you don't have haters, you're doing something wrong."

This is another phrase I've seen a lot in the online world over my year navigating the wild Internet waters, and I also think it's utter nonsense. Why are we measuring success by how many people hate us? There is no other realm that I can think of in the human world where we measure success that way.

"Congratulations, Daisy. Everyone in your department hates you so we're going to promote you now!" That just doesn't happen. So why do we need to pull out haters instead of a yardstick when we talk about measuring online success? What is this need to have people attack us all about?

How do I measure my online success? I look at how many people say they enjoy my posts. I look at the solid relationships I have built. It's not exactly a revolutionary concept, folks.

"Women can't be successful because they can't be narcissistic morons."

My friend Sean McGinnis ran into a post that made this claim: that women may not find as much success in the world because women just can't be egotistical or selfish enough.

First of all, let me tell you about some of the women I've encountered in my life. If you want to know about knife stabbing, in-it-for-herself, ruthless, downright cruel women, I could spin ya a yarn, sonny jim. That's not an issue.

Second of all, what?!? Are we really saying that success rests on how much you make people want to throw up when they see you? I mean, that doesn't sound like success to me. That sounds kind of like, I don't know … crazy-sauce?

The glorification of “Ick!”

Next to the glorification of failure, I find the glorification of crassness or cruelty to be the most nauseating thing I've encountered on the Web. You should not be applauded for breaking your Censor button. You should not gain accolades because every other post has an f-bomb in it. Surely there is more to online success than being someone who invites comparisons to male and female genitalia? I mean, really. Can we aim a little higher?

Then again, maybe I'm just a boring nice person.

You tell me what this is all about.

Margie Clayman represents the third generation at her family’s marketing firm. She is the resident librarian at the Blog Library and is the resident blogger at www.margieclayman.com.

Originally at: Blog Tips at ProBlogger

Online Success Need Not Be Measured in Enemies

Boost Your Blog #9: Create a Resources Page

Posted: 06 Sep 2011 10:07 AM PDT

Continuing our discussion of things you should be doing right now to improve your blog, today’s tip is:

9. Create a Resources page

One page on ProBlogger that has worked well for me is a Blogging Resources page (it is actually a page I need to update further).

The page serves as a starting point for bloggers when creating blogs, and includes a mix of free and paid resources (some of which are affiliate links to paid options). This page is linked to from numerous places on my blog. I’ve been thanked for it by readers, and it’s a page that has made me money over the years, too.

Hat tip to Dr Mani for the suggestion.

Do you have a Resources page on your blog? Can you build one today?

Originally at: Blog Tips at ProBlogger

Boost Your Blog #9: Create a Resources Page

What’s Your Blog Worth? How to Value Web Properties

Posted: 06 Sep 2011 07:01 AM PDT

This guest post is by Sunil of Extra Money Blog.

I have sold an ecommerce website for $250,000 and several other niche websites for a five-figure price tag. I want to share with you one valuation method you can use to put a price on your web property today.

Whether a website owner or a blogger starts with the initial goal of selling their site one day, it is my belief that every successful blog owner has at some point thought about the potential of selling their web property. At least they will have wondered how much their web property is worth—especially when it begins to generate a decent amount of money.

In fact, I think almost no one thinks about a sale as an exit strategy when they first start. It’s usually a passion, hobby, or something other than a potential sale that motivates a person to get started making money online—unless of course they run an online business, such as an ecommerce website, from day one.

When a website becomes profitable, it has the potential to become saleable. You may deliberately be contemplating selling either because of boredom, because you’ve found a better alternative use of your time, because of a potential use of the financial proceeds, or any of several other reasons.

If so, do you know what your website is worth?

When a web property starts to generate profits, it becomes an income-producing asset, much like a rental property or a small business. Just like property and businesses are valued and sold in the open market, a website or blog can be too. Therefore, valuing a web property is not much different from valuing any other income-producing asset.

The quantitative aspect of web property valuation

The quantitative aspect of valuation is not rocket science, in my opinion. You take a site's current earnings and expenses, figure out what the net cash flows are, and then project a value based on an earnings multiplier.

The net earnings, or cash flows, is commonly referred to as EBITDA in the business world. That means: earnings before interest, taxes, depreciation, and amortization. The multiplier is applied to this number to come up with a value, or price, for the property.

Earnings and expenses are what they are: they are not subjective by any means. But where do you get an earnings multiplier from? Evaluate recent sales of websites that are similar to yours to get an idea of what kind of multiplier was paid for each one. This number will be larger in stronger economic times, and smaller in weaker economic times like those we’re in today.

There is no standard multiplier, however. Similar to real estate, if figures are available from recent blog sales, great. But if not, your website's value is only as much as someone else is willing to bid for it. Obviously you have the option not to sell for what you might feel is a low-ball offer.

One more thing to consider is whether the website is as monetized as it can be today. Is there opportunity to add more private ads to the sidebar, and generate more profits on a residual basis, for example? A buyer would definitely evaluate this monetization potential and factor it into their purchase decision.

The qualitative aspect of web property valuation

Here is where the subjectivity in blog valuation comes into play. An active business sold at an earnings multiplier of two may not be comparable with a same-size passive business, because a passive business requires a lot less effort to manage and sustain. Consider how much cost and effort the owner of the web property will have to invest in the passive business to generate a dollar in profits. Then ask how this compares with an active business.

Factors such as effort, operating cost structure, sustainability, long-term relevancy, and prospects all play an important part in determining what the reasonable value of a particular web property should be. At the end of the day, none of this is exact science, but these are some ways to arrive at a justifiable or rational price.

For example, no one knew the long-term scalability of Google or LinkedIn. In fact, no one knows today. The market had a certain estimate (multiplier) set at the time each company went public, and has a different one today. It will likely have another one by the time you are done reading and commenting on this post. Expect the multiplier to evolve, especially in an ever-changing and dynamic industry like this one.

A practical example

When I was initially solicited by an Ebay power seller to potentially sell my ecommerce business, the business was generating roughly $60,000 annually in profits. After weeks of discussion back and forth, we settled at a sale price of just under $250,000, or roughly four times the annual earnings of $60,000.

The quantitative piece of the deal was straightforward. The qualitative piece is what dragged out the negotiation. The power seller had previously purchased a similar ecommerce business at an earnings multiple of three. They had paid $90,000 for a business that was generating $30,000 in annual profits. However, I was not willing to accept a price of $180,000, which was three times the annual earnings of my site. Further, my business showed a consistent rising trend in terms of web traffic, customer acquisition, sales, and profits. These qualitative measures needed to be "baked" in to the deal for it to be viable for me. I was able to persuade the buyer of that, and we sealed the deal at four times the annual earnings.

The key lesson here is that although acquisitions based strictly on earnings multiples sound good in theory, they rarely work out practically, whether at my level or at the Fortune 500 level. Our repeated attempts to narrow the nature of deal making to a pure science have never worked, and likely won’t in future. Valuations, although driven mostly by the underlying financials, rely heavily on qualitative aspects that are subjective and unique to each buyer and seller.

What do you think of this valuation method? Do you have any alternatives to share? Is this a fair way to value your web property? I’d love to hear your thoughts in the comments.

If you want to be brave and bold and open your kimono to me and fellow readers: what do you believe your web property worth is today in the open market, if you use this valuation method?

Sunil owns over a dozen profitable niche websites and is the author of How to Go from $0 to $1,000 a month in Passive and Residual Income in Under 180 Days All in Your Spare Time, a FREE report you can download instantly from his Extra Money Blog, where he discusses how to create multiple streams of passive and residual income, entrepreneurship, internet marketing, blogging and personal finance.

Originally at: Blog Tips at ProBlogger

What’s Your Blog Worth? How to Value Web Properties