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Wednesday, July 29, 2009

What is a Blog Worth

Many of my readers also read Blogger Unleashed and probably already know that Vic has kicked up a firestorm over the recent purchase of One Man's Goal by a beginner blogger for the price of $10,500. I won't rehash that story here but for those who aren't familiar with the controversy you can catch up by following the link trail below - I want to talk about another Blog for sale - John Cow dot Com.

Read Vic's post and watch the Video here; Blogger Unleashed

Read One Man's Goal comments and Video here; One Man's Goal

Read Don's post at Making Sales Making Money

And Justin's post at Blogging Zombie

I found this interesting as I was planning on writing about this subject a couple of days ago when I found out that John Cow was up for sale. You can see the Cow's post here; Cow for Sale and the prequel post done prior to the announcement here; How Much is our Blog Worth

To summarize the fellow behind the "Cow" persona is moving to Oz from Europe and won't be able to continue the Blog. He figures it's worth $25,000 - $50,000 and lists his reasons why in the latter article.

Do I have a beef with this blog? Nope. It was a clever parody of John Chow that gave the owner some quick fame in the MMO niche. Is it really a MMO blog. Nope. It is much like the rest of the blogs that claim to be "make money online" blogs - it is a social blog that makes money selling ads and promoting affiliate sign ups and basically has a readership base but no organic traffic. It doesn't teach others how to "make money" which is what I call a "real" make money online blog. It makes money for the owner and not for the reader. In other words a typical "John Chow" spin off site but with a talented writer behind it for a change.

Where I do have a problem is that someone will likely pay $25,000 or more for this blog and it is not worth a fraction of that price. This isn't a slam against the owner, just an objective look at the numbers.

First off - the blog is a social site with 1658 readers who subscribe based on one thing - an affinity for the owner. Basically the readers like the guy and enjoy his writing. They will not necessarily like the new buyer and will likely never return upon the sale. Remember Cash Quests? This blog sold a while back after rising quickly in the social arena based on the talents of it's creator - Kumiko? I forget. Like the Cow it was good at link baiting and getting attention. Cash Quests sold for $15,000 and then promptly nosedived as the new owners (a blog network) proceeded to post the most useless keyword stuffed generic rehashed crap imaginable.

Look at Cash Quests Alexa Ranking below.

Click on all images to enlarge



That shows what happened to the RSS subscribers - they jumped ship. As for search engine traffic it has none. It's keywords don't rank anywhere in the serp's front pages. The site has no visitors now and if you doubt me - check the comments out. There are no comments. Is it worth $15,000? It will never make that investment back under it's current operator.

The Cow lists a number of "assets" that he believes makes his site a valuable commodity. This includes things like;


He Claims to make $2,500 per month. How this is made is not specified but if true it must be from selling ad space and flogging affiliate sign ups to things like TLA. There is no Adsense income.

He Claims 30,000 uniques a month for traffic. He believes that this equates to having to spend $144,000 a year on Adwords to get the equivalent amount of traffic.

He boasts of having a 5th spot Google ranking for the term "Making Money Online" and a #1 ranking for the term "John Chow". He mentions that it would be hard to put a sum on this but you would have to pay a lot for a text link campaign to get these rankings.

He mentions that the blog has 382 posts and content like that would cost almost 6k if paying someone $15 per post to write it. There are 2,830 pages indexed by Google.

He has 1659 RSS sbscribers and mentions that Mark at 45n5 estimates that each RSS subscriber is worth $30. This makes his blog worth $49,770.

He also mentions that he has a professional theme and header worth another $2500.

He will introduce the new owner to John Chow.

In the end he mentions that the blog could be worth up to $344,000 but realistically notes that no one would pay that amount. His point is that the blog s likely worth more than the 10-12 times monthly earnings which puts it in the $25k or more category.

Now for some critical thinking.

The current earnings if true are based on the RSS feed numbers. He sells ads and promotes stuff to his readers. If the new owner loses those subscribers then the advertising sales stop as well as the affiliate signups. What do you think is likely to happen? People don't learn how to make money online on the site - they are there to be entertained by the Cow. Unless the new owner has the same ability then say good bye to the readers. (If such a person was out there they probably already have a popular site - who knows maybe it's worth the money to someone already established and known but the chance of an unknown keeping the readers is slim.)

Take away the RSS readers and the income stops. Without the income the blog is worthless.

He has almost no organic traffic - yes he has 2800 pages indexed but they aren't on page 1 for anything. No search traffic.

The two terms he ranks for; "Making Money Online" and "John Chow".

What are these terms worth?

As it happens there are only two people in the world that knows as much as me regarding "Making Money Online."

The Cow actually ranks 4th on Google not 5th and guess who ranks 3rd for that term?



Would you like to know how much traffic that term generates?

Not as much as you might think.

Here are the last 80 keywords people used to find my blog. Take a look and notice how many times "Making Money Online" shows up in comparison to the other make money online keywords.









I had 4 searches out of 80 and I'm in 3rd spot. I used to be in 4th spot. I get 4 times as many hits now as I did in 4th spot. I have mentioned not to put too much stock in the actual numbers given out by keyword tools. The list below is keyword Elites list of the most searched keywords related to "Make Money Online". The term "making money online" appears to be the 3rd most searched term.



But is it? Here is my Statcounter stats showing the percentage of what keywords people use to find my blog for the same period as the screenshots above.



This is not very scientific and only gives a brief shot in time compared to my entire days stats but the ratios don't change that much over a 24 hour period. The fact is the term "making money online" is my second highest ranking "main" MMO keyword and yet my 4th ranking term "How to make money" pulls in a lot more visitors everyday than it does. Yet the keyword tools don't show many searches for the term at all.

John Cow won't get more than 20 visitors a day for his 4th place ranking.

As for the term "John Chow" I see keyword elite shows 179 searches for that term last month. Again it may be incorrect in actual numbers but there won't be much traffic gained because the Cow ranks number 1 for it. Maybe 2-3 visitors a day.



Btw - the Cow mentioned that it would cost a hefty sum to get this kind of ranking using Text Link Ads. It probably would although it didn't cost me diddly to get a better ranking. Of course I don't use Text Link Ads nor recommend anyone else using them. Then again I only dominate all the MMO keywords in the rankings but what do I know - I don't have 1600 RSS subscribers.

SEO doesn't have to cost a lot if you know what you are doing.

As for Mark's evaluation that RSS subscribers are worth $30 each I guess this is what this post is really all about. I have nothing against John Cow - I'm just trying to stop the insanity that has spread through the blogging world. RSS subscribers aren't worth shit - really. It's false hype and here is why. The top A-list subscribers are worth a lot because the A-List can make money from them. They get paid to promote crap to their readers because they have huge numbers. No one will pay you to promote anything to your 100 or 1000 subscribers. By the time you start promoting TLA with an affiliate link the market has been saturated by the A-list. TLA has already paid John Chow to sign you up and 10,000 others like you. Who are you going to sign up? Your readers have already joined. There is nothing that you can sell that your readers haven't already seen and done. Your RSS subscribers aren't worth a dime unless you can actually come up with something new and if you do you will just pay John Chow to flog it anyway.

This post isn't aimed at people trying to sell their blog - it's aimed at the people thinking of buying one.

There is only one stat that can make a site valuable. Search traffic. Why? Because it is independent of the former owners personality and you can see concrete proof of earnings that won't change the minute you purchase the site.

For example. If I was to sell this blog I could guarantee two things; my readers won't likely be back and tomorrow you will make $100 with Adsense. And the day after... and next week and so on.

Oh you won't have to post everyday or every week either. Your income will not be derived from keeping readers happy and returning. Remember to keep advertisers paying you have to keep readers coming in daily. I can keep my serp rankings for months without ever posting an article.

If you ever decide to buy a blog ask to look at the search stats and the Adsense revenue. If they have no Adsense revenue then they have no serp rankings for any decent keywords. If they have no serp rankings for decent keywords then the blog isn't worth a dime - yes this includes the A-List because a new owner will lose the readers and be left with nothing.

If the Cow is worth $25,000 based on 1600 readers and $2500 in ad revenue a month what would my little blog network be worth...



And that's just Adsense.

Think about what would make a better return on your investment. Which would you rather buy? Oh that's right - some people want to be famous rather than make money - silly me.

The thing you should really think about is this - if anyone is really making decent money for the time invested in their blog they won't be selling. Why would I ever sell? I post when I want. I write about what I want. None of it effects my income in the slightest. My traffic comes in everyday whether I am here or not. Yes some of my readers get on me about writing another post but they don't have any effect on my income. They just make all this fun.

The Cow says moving to Oz is the reason for selling. Maybe. I travel a lot and have no problem logging in and maintaining my sites though. I'm not saying he is being dishonest but I have noticed a trend happening lately. The A-List and A-list clone sites aren't doing so well in the stats lately.

Check these Alexa rankings out - could people be getting tired of all the crap these sites have been spewing? Could the fact that a certain blogger, who has shown up recently calling all the A-listers out, be having an effect on how people are beginning to view the MMO niche. Just thinking out loud...

John Cow Traffic



John Chow Traffic



Darren Rowse (Problogger) Traffic



Shoemoney Traffic



Is it a coincidence that all these sites are heading south at the same time as the following site showed up on the radar?



Just speculating. Bloggers never had a choice of opinions or methods prior to Vic. It was the same old same old. Maybe the winds of change are coming and probably not a bad time for some of the old guard to start selling when the selling is good. Just don't be one of the buyers...

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