(If you are wondering, the image of me above was taken when I used to work at KISSmetrics with Hiten Shah… I used to have hair)
In early January 2017, I purchased the KISSmetrics website for $500,000.
If you go to the site, you’ll notice that it forwards here to NeilPatel.com (which I will get into later in the post).
The $500,000 didn’t get me the company, KISSmetrics, or any of the revenue streams. The parent company, Space Pencil, is continually improving and developing the product.
And on top of that, there are restrictions. I can’t just pop up a competing company or any company on the KISSmetrics site.
So why did they sell me the domain? And why would I pay $500,000 for it?
I can’t fully answer why they sold it, but I do know a lot of their customers came from word of mouth, conferences, paid ads, and other forms of marketing that didn’t include SEO or content marketing.
For that reason, the domain probably wasn’t as valuable to them as it was to me. And of course, who wouldn’t want extra cash?
I’m assuming they are very calculated because they are an analytics company, so they probably ran the numbers on how much revenue the inbound traffic was generating them and came to the conclusion that the $500,000 price tag seemed worth it.
Now, before I get into why I spent $500,000 on the domain, let me first break down my thought process as I am buying out a lot of properties in the marketing space (more to be announced in the future).
Why am I buying sites that aren’t generating revenue?
This wasn’t the first or the last site that I’ll buy in the space.
I recently blogged about how I bought Ubersuggest. And it wasn’t generating a single dollar in revenue.
Well technically, there were ads on the site, but I quickly killed those off.
And eventually, I ported it over to NeilPatel.com.
When I am looking at sites to buy, I am only looking for 1 thing… traffic. And of course, the quality (and relevancy) of that traffic.
See, I already have a revenue stream, which is my ad agency, Neil Patel Digital.
So, my goal is to find as many sites that have a similar traffic profile to NeilPatel.com and leverage them to drive my agency more leads.
How do you know you won’t lose money?
I don’t!
This approach doesn’t guarantee I’ll make more money.
I look at the business as tons of tiny experiments. You don’t build a huge business through one simple marketing strategy or tactic.
You have to combine a lot of little things to get your desired outcome.
And sometimes you’ll make mistakes along the way that will cost you money, which is fine. You have to keep one thing in mind… without testing, you won’t be big.
With my ad agency, we tend to mainly have U.S. clients. Yes, we serve other regions as well… for example, we have an ad agency in Brazil.
But I myself mainly focus on driving traffic to the U.S. ad agency, and the other teams just replicate as I don’t speak Portuguese, German, or any of the required languages for the other regions we are in.
So, when I buy companies, I look for traffic that is ideally in the U.S.
Sure, the ad agency can work with companies in Australia, Canada, and even the United Kingdom, but it’s tough.
There’s a huge difference in currency between Australia and the U.S. and the same goes for Canada.
And with the U.K. there is a 5 to 8-hour time zone difference, which makes it a bit more difficult to communicate with clients.
That’s why when I buy a site, I’m ideally looking for U.S. traffic.
When I bought Ubersuggest it had very little U.S. traffic. Indonesia and India were the two most popular regions.
But I bought it because I knew I could build a much better tool and over time grow the U.S. traffic by doing a few email blasts, getting on Product Hunt, and by creating some press.
And I have…
As you can see from the screenshot above, U.S. is the most popular region followed by India and Brazil.
Over time it shouldn’t be too difficult to 3 or even 4x that number as long as I release more features.
Now, my costs on Ubersuggest have gotten into the 6 figures per month, and I am not generating any income from it.
There is no guarantee that it will generate any revenue, but I have a pretty effective sales funnel, which I will share later in the post. Because of that sales funnel my risk with Ubersuggest is pretty low.
As long as I can grow the traffic enough, I should be able to monetize.
What about KISSmetrics?
As for KISSmetrics, I mainly bought the domain for the blog traffic.
During its peak it was generating 1,260,681 unique visitors per month:
By the time I bought the blog, traffic had dropped to 805,042 unique visitors per month:
That’s a 36% drop in traffic. Ouch!
And then to make matters worse, I decided that I wanted to cut the traffic even more.
There were so many articles on KISSmetrics that were outdated and irrelevant, so I had no choice but to cut them.
For example, there were articles about Vine (which Twitter purchased and killed), Google Website Optimizer (no longer exists), Mob Wars (a Facebook game that no longer exists)… and the list goes on and on.
In addition to that, I knew that I could never monetize irrelevant traffic. Yes, more traffic is good, but only as long as it is relevant.
I instantly cut the KISSmetrics blog in half by “deleting” over 1,024 blog posts. Now, I didn’t just delete them, I made sure I added 301 redirects to the most relevant pages here on NeilPatel.com.
Once I did that, my traffic dropped again. I was now sitting at 585,783 unique visitors a month.
It sucks, but it had to be done. The last thing I wanted to do was spend time and money maintaining old blog posts that would never drive a dollar in revenue.
I knew that if someone was going to come to my blog to research Vine, there was little to no chance that the person would convert into a 6-figure consulting contract.
After I pruned and cropped the KISSmetrics blog, I naturally followed the same path of Ubersuggest and merged it in to NeilPatel.com.
The merge
The KISSmetrics merge was a bit more complicated than Ubersuggest.
With Ubersuggest, I didn’t have a keyword research tool on NeilPatel.com, so all I had to do was slap on a new design, add a feature or two, and port it over.
With KISSmetrics, a lot of the content was similar to NeilPatel.com. For the ones that were similar, I kept the NeilPatel.com version considering this blog generates more traffic than the KISSmetrics one.
As for all of the content that was unique and different, I ended up moving it over and applying 301 redirects.
If I decided to skip the pruning and cropping stage that I described above, the KISSmetrics blog would have had more traffic. And when I merged it in with NeilPatel.com I would have done even better.
But in marketing you can can’t focus on vanity metrics like how many more unique visitors you are getting per month. You need to keep your eye on the prize.
And for me, that’s leads.
The more leads I generate for my ad agency, the more likely I’ll increase my revenue.
Here’s my lead count for the weeks prior to the KISSmetrics merge:
When looking at the table above, keep in mind it shows leads from the U.S. only.
The KISSmetrics blog was merged on the 25th. When you add up all of the numbers from the previous week, there were 469 leads in total, of which 61 were marketing qualified leads.
That means there were 61 leads that the sales reps were able to contact as the vast majority of leads are companies that are too small for us to service.
When you look at the week of the 25th, there were a total of 621 leads. 92 where marketing qualified leads.
Just from that one acquisition, I was able to grow my marketing qualified leads by 50.8%.
source https://neilpatel.com/blog/buying-websites/
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