Hi Steve,

I really like your videos and blogs as they are very informative. My question is: I have an opportunity to purchase an existing website that is currently offline. This website is a pet supply store and uses two drop shippers.

I am talking with the broker about it. He is not sure of the reason for the sale but he did say the drop shippers have a good reputation and usually keep the items in stock. He said one of them had been in business for 50 years and the other for about 5.

The price of the website is $2,000 although he said it is negotiable. I am putting the information below and would really appreciate it if you would tell me what you think. Thank you.

In addition to the website, the vendor has also mentioned that this store has a customer email list that contains about 2000 contacts. Here’s a screenshot of the website below. Should Randy purchase this site for $2000?

What Do Dropshipping Websites Typically Sell For?

While the selling price of a dropshipped ecommerce store varies from shop to shop, the general rule of thumb is anywhere from 1-2 years of income or between 8-12X monthly profits. In addition to the numbers, it also depends on whether the income is sustainable or not in the long run and whether there’s room to grow in the current niche.

In Randy’s case, he didn’t get a chance to ask the owner of the website for any numbers just yet before he emailed me for my opinion. But fortunately, I didn’t need to see any numbers at all in order to give him my answer.

After doing some very basic research, I determined that this site probably isn’t making any money at all and that Randy should probably stay away. Here’s how I broke things down.

How Much Is The Website Design Worth?

Many people want to jumpstart their online businesses by purchasing a ready made site. Randy’s first question was whether the website design in itself was worth the $2000.

As soon as I saw the website, I instantly knew that the site was based on the popular open source shopping cart Open Cart. How did I know right away? Even though the designer tried really hard to hide all traces of the open source shopping cart, anyone who has seen or used Open Cart would be able to tell right away.

Related: How To Install An Open Source Shopping Cart Without Any Technical Knowledge In Under 5 Minutes

In addition, the template that is being used is very close to the vanilla out of the box template. Therefore, the cost of creating a website design similar to this pet supply shop would be next to nothing or $50 at most. Because Open Cart is open source, the source code for the website is completely free.

There’s nothing particularly special about the look and feel of the website either. The logo is just ok and the images and product descriptions seem to be taken straight from the dropship vendors. Therefore, I would place very little value on the website itself.

What About The Value Of The Dropship Vendors?

Under normal circumstances, there is value in having an established relationship with vendors that supply an online store with goods to sell. In this case however, I doubt that this store has made very many if any sales at all (more on this later). Therefore, I can probably assume that there hasn’t been any long term relationship established with the vendor at this point.

In addition, if you take a look at any of the products for sale, it becomes immediately obvious who the 2 dropship vendors are. See the example below.



So if you really wanted to create an identical replica of this store complete with the same vendors, all you would have to do is install Open Cart and contact the vendors circled in the picture above. It would be as simple as that.

How Does The Store Rank in Search?

The next question is whether this store already gets any traffic organically through search and whether it ranks for any keyword terms. Thanks to tools like www.spyfu.com and SEMRush, this is relatively easy to do.

By bringing up this online store in SpyFu below, it becomes immediately obvious that this site probably doesn’t make many sales or garners much traffic at all.

First off, the owner of this site has not used any PPC marketing services at all to generate any traffic. Second, this shop has zero keyword terms on the front page of the search engines.

Third, this shop doesn’t even show up in various traffic ranking sites like Compete, Quantcast etc… You put the three things together and that probably means the site gets very little traffic and makes very little sales. In other words, the site probably doesn’t make any money.

What Does The Backlink Profile Look Like?

But just for good measure, let’s take a closer look at this Pet Supply shop’s backlink profile using Open Site Explorer. If look you look closely, this website is very weak and the only backlinks to the site are from some crappy website directories. No wonder this site is not ranking in search!

Breaking Down The Value

So I’ve already established that the site is definitely not worth $2000 but how much would it cost a normal person to make an exact replica of the site? Here’s the breakdown of costs. As you can see, the total cost of creating a similar website would only be about $70.

• Create an account at BlueHost for $4.95
• Follow the directions in this video to install Open Cart for free
• Follow the directions in this video and install an SSL certificate and credit card processing. Approximate cost for an SSL certificate is about $13.
• Follow the directions in this video and install a shopping cart template. Approximate cost $20-$50
• Contact the two vendors mentioned above and establish dropshipping accounts with them.
• Using the vendor’s spreadsheet and photos, upload the products and product descriptions onto your website

Thank You

To sum it all up, I just wanted to thank Randy for submitting this question to the blog. Remember, I’m going to start featuring questions like Randy’s on a regular basis now so please send me whatever problems you may be facing. But please be specific.

If your question is too broad or too open ended, you will most likely not get an answer. Thank you and I look forward to hearing from you.

First Impressions

I’ve been to Carla’s store several times in the past already so this isn’t exactly a first impression for me per se. But having undergone a few major website redesigns these past few years, her site has changed significantly since the last time I was there.

The current iteration of her storefront is extremely clean and pleasing to the eyes. Her product photos look nice and her website comes across as professionally done. So why aren’t customers purchasing her products?

One thing that I’ve noticed just from doing a few web searches is that the bath and body products niche is extremely competitive. Not only is Carla going up against a bunch of smaller players but there are also a few juggernauts like Bath And Body Works, The Body Shop, and Crabtree Evelyn as well. For someone like me who knows very little about skin care products, all of her products seem to blend together with everyone elses.

When I browse her skin care products, they all seem generic to me especially since I don’t recognize any of the brands. Sure, everything is organic but what’s the benefit of using organic skin products? Why should I buy from GreenAndChic.com over some of the more established players like Bath and Body Works? Why are organic products important for my skin?

Right now, her site doesn’t effectively convey the benefits of the products she carries and why they are special. Although Carla has a beautiful website, her products don’t particularly stand out.

Search Engine Optimization

Since Carla’s niche is fairly crowded, her work is cut out for her in the SEO department. Fortunately however, a lot of her smaller competitors aren’t fully optimized for the search engines either so Carla really has a chance to dominate the rankings for some of her more specific organic products. Here are her top ranking keywords at the moment.

8 Lotus Blossom Tote-BCM
9 organic baby powder
10 sage organic
13 organic baby massage oil
13 vegan leather
16 organic clary sage
16 soap for sensitive skin
16 talc free baby powder
20 vegan purses
22 cherry berry

As you can see, very few if any of these keywords even crack the front page so it’s no surprise that GreenAndChic.com is not getting much organic traffic at the moment.

This is a minor issue but I also noticed that Carla has two domains that point to the same place. Currently, www.greenandchic.com and greenandchic.com are being recognized as two different domains which is diluting her link juice by 50%.

Action Items

For GreenAndChic.com, I would definitely focus on conversions right now over everything else and work on giving her products some personality. Here’s a list of action items for Carla.

• Right now, I would pick a handful of my best selling products, slap them on the front page and promote the heck out of them. What do I mean exactly? Tell me why I should buy these products over every other bath and body store. Let me know that these products are made using a rare oil only found in scarce amounts in Antarctica and that no other chemical has the same skin softening properties (I made that last part up btw).
  
  Whatever Carla decides to do, she needs to give her products a chance to be sold. Make them stand out by telling me a story. Describe the process by which they are made. Tell me the benefits of organic vs the junk that is sold in other stores. Plaster this information on the front page instead of letting me figure it out through reading product descriptions! Within 10 seconds, it should be obvious to me why I absolutely need to have these skin care products.
• Don’t just list your products. Categorize them by benefit. For example, if I have a dry flaky skin problem, do me a favor and point me to your products that specifically address my issue. Don’t just categorize your products by type because that doesn’t tell me anything. Focus on the benefits!
  
  When my wife was pregnant, she was paranoid about getting stretch marks and I know for a fact that many women worry about the same thing. This is just an example, but I would dedicate a full content page addressing this exact need and point customers to your pregnancy oils. Be known as the store that carries the best anti-stretch mark cream. People have skin problems and worries. Solve them! Let them know you have the cure.
• Focus on no more than 2 or 3 product categories or keywords that you would like to rank on in the search engines and start writing content. I noticed that you have a blog but it is not focused. Instead of doing product promotions, I would talk about interesting topics relating to organic products. Specifically, I would write content about the products categories I want to rank on in the search engines. Write all of your blog posts as if you are an authority in your field.
• Fix your SEO multiple domains problem by choosing whether you want to be greenandchic.com or www.greenandchic.com and issue a 301 redirect from one to the other. This should provide some immediate benefit once your site is re-indexed.

Conclusion

With some minor changes and an emphasis on the benefits of her products, Carla will be in pretty good shape. After all, her store already looks better than a lot of her competitors. She just needs to focus on why a customer should buy from her and no one else. She needs to stop selling the product and start selling the cure.

Carla, as you change your product copy and shuffle things around, I would use Adwords with very specific keyword phrases to test the conversion rate for your main revenue generators. Once conversion is nailed down, I would then focus on content to improve organic traffic. You can do it Carla! I have faith in you!

First Impressions

Overall, RJ’s site looks good. On the front page, he states his value proposition very clearly and gives a brief bio about who he is and why he runs his store. As soon as I enter his website, I immediately know what RJ’s store specializes in and why I should buy from him.

The store design also looks professional and there are various security badges displayed around the site that makes RJ’s site look legit. In addition, he offers a live chat service as well. Overall, I don’t see any glaring problems with his overall store design. If I were looking for sanding belts or sand paper, I would have no reservations about making a purchase here. I especially like how it says that RJ, the CEO will personally respond to emails and questions. Makes me feel like I’m dealing with a small shop that cares.

Honestly, I don’t think getting conversions should be a problem for RJ (though I didn’t compare prices). Looking at compete.com and other traffic estimation sources however, RJ’s main problem is that he doesn’t get as much foot traffic as he would like.

SEO

R has done a decent job with SEO already as he ranks on the front page of Google for the following searches.
4 3×24
4 sanding products
4 sanding supplies
4 white hook
5 pads dust free
5 sand belt
5 white hook
6 sand belt
6 sanding belts
7 belt sander belts

Sanding belts and belt sander belts are his primary products so cracking the front page with these keywords is certainly a good thing. The majority of RJ’s backlinks seem to come from a forum called woodsweb.com. Looking at some of his competitors, it doesn’t look like it would be that difficult to crack the number one spot which would improve organic traffic tremendously.

One problem I did notice was that some of RJ’s category and product pages have little or no meta descriptions which might be a reason why his category pages don’t get much love from the search engines. For example, the category page “Abranet Discs” has a meta description that simply says “Abranet Discs (2sand.com)”. This needs to be changed.

Action Items

One thing that was going through the back of mind as I was browsing RJ’s site was why I would go online for sanding belts when I could just take a short trek over to the local Home Depot and pick some up there?

I’m probably not the target customer but what would compel me to purchase a sanding belt online as opposed to a brick and mortar store? One, I would go online if I needed to make a bulk purchase. Two, I might search online if I needed sanding belt advice or if I was looking for a specific belt that wasn’t sold in stores. Addressing these 2 factors is where I think RJ can help with his web traffic the most. So here’s what I would do.

• I would add a lot more educational content to the store. What is different about the different brands of sanding belts? Why would I use an Abralon disc as opposed to an Abranet disc? It would be very helpful to have recommendations on what to buy depending on the project that I’m working on. Reading the product descriptions, all of the products seem very similar to an uneducated sander. Adding more verbiage will also help with search engine traffic as well. Honestly, I think RJ is in great shape here. His website looks better than most of his competitors. With extra content, uneducated customers will arrive at his store looking for recommendations and will purchase based on his expert opinion.
• RJ is an expert in his field and needs to leverage his expertise. I noticed that he had a video in his tips and resources section. He should definitely expand on this section with more how-to advice. How do I use the tools that he sells? What is the proper technique with which to use a belt sander? If his content is good, people will naturally link to his site and be more likely to buy
• RJ should get his name out there and establish himself as an authority. I would look around at the various DIY websites out there and write some guest posts. I think RJ would be able to offer some great woodworking advice. Then, he can go back to 2sand.com and say that his store was mentioned on “diy.com” or a similar site.
• Offer bulk discount incentives for those looking for quantity or wholesale pricing.
• RJ needs to be fix the SEO issues with his website. Fortunately, this isn’t a big deal. He simply needs to add unique meta descriptions to his product and category pages.
• Add more shipping options. What if I want my products the next day. Right now, there are only 2 shipping options and they are both slow.

Conclusion

Overall, 2sand.com is in pretty good shape and RJ’s focus should be mainly on marketing. The basic strategy is to attract visitors through product recommendations, advice or how-to articles and then pitch them the right products to use as an expert. RJ needs to establish himself as an authority on sanding and woodworking. It doesn’t really matter where he starts. Whether it be on the forums or on various DIY blogs or websites, RJ needs to get his name and his store out there. In this respect, it might be helpful to add a woodworking blog of his own to his store.

Adding content takes time, but if RJ gets into the habit of just adding 1 or 2 articles a week to his store or blog, he’ll have an enormous library of content over time. Good luck RJ! I have no doubt your store will be successful.

I just wanted to let you know that your blog has been a tremendous resource for me. I just began my online business selling indie womens clothing at www.scarfu.com. The site has only been live for about 2 months but a few more months have gone into the preparation before we launched.

Much like your online store, my store is run by my boyfriend and I and we both hold full time jobs while working on the website at night. It’s been very time consuming and frustrating, especially when sales are very slow at the moment.

I want to thank you for your blog because I find a lot of useful and relevant information and as you are probably guessing, am feeling lots of frustration at things like site design, traffic, taking 1 month for a sale to come in etc. Your blog is on my RSS feed and your experience has definitely helped me with every part of the business.

Since opening my store about 3 months ago, we’ve had about 13 sales or so, but that is much slower than what we we would wish. There’s a blog post on your site about if you want $100,000 a year, you just have to make 3 sales a day. There are many days we have no sales at all so I’m kind of worried. So far, I’ve advertised on a couple of blogs for design and hosted a giveaway that was quite successful (couple of sales came from there) but we are not getting the organic growth we would like and have quite a hard time getting followers/fans on social media.

I just wanted to ask how you got your site to start taking off. What kinds of advertising did you use and is what I’m going through with my indie clothing store similar to your experience in the 1st 6 months?

Other Background Information

After our initial correspondence, I asked P a series of follow up questions regarding how she markets her store and her answers are summarized below..

• She uses various social media to interact with customers which include Facebook and Twitter. She tweets and posts on the wall regularly.
• She uses monthly paid advertising on specialized blogs
• She uses pay per click advertising on Facebook
• She hosts gift voucher giveaways on other blogs
• She has a testimonials page and an RSS feed for new products

In a nutshell, she’s having a hard time gaining fans and followers organically and getting organic growth.

SEO Problems

The first thing I always do when evaluating any website is I type in a few keywords to see where the site stands in the search engines and to get an idea of the competitive landscape. Sure enough, scarfu.com is nowhere to be found for indie clothing. In fact, scarfu.com doesn’t match at all for indie clothing period. Typing in “scarfu” into Google yields the following result. As you can tell below, the search result reveals absolutely nothing about what P sells. This is what customers are seeing…

Scarfu.com
… Tops · Bottoms · Outerwear · Sale · Newest. Mailing List. Copyright 2009-2010 Scarfu, LLC. All Rights Reserved. about contact faq facebook twitter.
www.scarfu.com/

Turns out, P has some serious SEO problems with her website. The title tags are not descriptive and the meta descriptions don’t even exist for most pages. As a result, P’s site will never get indexed for any of her products in the search engines.

First Impressions

The other impression that my wife had was that P sells really nice clothing in her store, but her store design and pictures don’t do them justice. I’m not an expert on aesthetics, but perhaps she could make her products stand out more by using real human models or using more contrasting colors or borders surrounding her photos, especially on the splash page. She should look at competing websites like modcloth.com to get an idea of what a successful indie clothing store looks like and what she’s missing. Overall though, there’s nothing wrong with P’s offerings as she sells attractive and unique products which is a big plus.

That being said, when I think of an indie developer of clothing, I have this mental picture of a person who bucks the trend. Someone who is tired of the mainstream. Someone creative and daring. She sells Brooklyn clothing but I see no sense of Brooklyn anywhere on the site. On first impression, I receive very little personality from P’s website. Even her ‘about’ page offers very little information about her and why she sells the clothes that she does. What inspires her? Why should I buy her clothes? If I want to buy indie clothing, I want to know who the designer is and why they are special.

Action Items

Most of P’s questions had to do with marketing so I will address them below. Most of P’s marketing efforts thus far have been through blog ads and social media as far as I can tell. Looks like she ran a few promotions on modishblog.com and designformankind.com which are both small-medium sized fashion blogs. Not a bad strategy, but most of these efforts have been one off events. P needs both a short term and a long term strategy. Here’s my take on what she should do.

• She needs to fix all of her SEO problems ASAP. Unique title and meta descriptions are a must for every single page of her site. I wrote an article in the past entitled SEO:10 ways to optimize your online store for the search engines. that she should definitely check out. Without these changes, she will never experience organic growth through search.
• As a designer of clothing, she especially needs to show off her personality. Perhaps she should run a personal design blog on her website, something that allows customers to get to know her better and why she sells ‘indie’ clothing. If the content is interesting enough, she can then go on to promote these articles on social media or start a newsletter of loyal followers. Clothing is just clothing until there’s a brand or personality attached to it. In addition, people might want to know what indie clothing is all about before they buy.
• I noticed that Adwords was missing from her list of marketing choices. Adwords is probably the most effective way to get visitors to her store because people are actively searching for something to buy. As a result, the conversion rate is much higher than other advertising mediums. P’s store is a bit tricky however since there are a million places that sell dresses. However if she can describe something very distinguishing about her clothing, she could probably run an effective adwords campaign. Who knows? Find a free $100 Adwords credit voucher and give it shot
• To improve long term organic traffic, P will need to add written content to her site. In addition, she might want to try doing some guests posts or interviews on fashion blogs or give article marketing a shot. A great example is what the owner of fashionscarvesandshawls.com does with her store. The store ranks in the top 5 in the search engines for scarves which is a pretty competitive keyword. And she did it through a combination of writing for ezinearticles.com and being featured on various publications
• A few other things P is missing on her site is a phone number, a privacy policy, security badges or a mention of SSL and encryption, and a shipping and returns page. Adding these pages are required to improve conversion rate.

Wrapping It Up

While it’s difficult to address everything in a short review, P’s store is still relatively new so traffic is always going to be slow in the beginning. The key is to constantly add more written content and to obtain backlinks from various sources, either through article marketing or guest posting on fashion blogs. But none of this is any good if her SEO issues are not addressed.

I also think that the site needs some more attention grabbing oomph. P should try to emulate her competitors to a certain extent and then add her own flair and personality to her site.

Dear Steve,

I’ve been following your blog for almost a year now and I really enjoy reading your blog posts. The resources that you have on this site are tremendously helpful – thank you very much for sharing them with us.

The reason that I’m writing to you is because I need feedback from an experienced and successful e-commerce store owner, such as yourself, on my online store — FineBuddhaStatues.com

I mainly rely on PPC advertising to drive traffic to my website and I get about 500 – 600 visitors a month on average. However, I only get 1 sale a month, which equates to 0.2% conversion rate.

I understand that you are a very busy person, but I would be extremely grateful if you can spare 10 minutes to look at my website and tell me what you think is missing.

Looking forward to hear from you.
E

Other Background Information

After E’s initial question, I immediately asked a few follow up questions and here’s the gist of our email conversation.

• Besides Adwords, he’s also doing a little On-page SEO. However, off-page SEO has been largely ignored.
• His main concern is increasing conversion as it is abysmally low (0.2%) and would like to increase this to 1% range or higher. He’s not sure whether his site design that is the problem, or whether his (Unique Selling Proposition) is not strong enough.
• He’s averaging a 7% CTR with Adwords with only $0.10 average CPC, which makes it still profitable even after only getting 1 sale a month.
• He’s attracting 250 visitors a month via PPC advertising, which makes up 50% of the total incoming traffic.
• He currently removes keywords which result in high bounce rates (> 80%) or keywords with low number of clicks.

My Initial Observations

Since most of E’s traffic is coming from Adwords, the source of the problem can be several things. Either the Adwords Ads are not very well targeted, his Adwords keywords are too broad, or there’s a problem with his store design.

First off, E sells buddha statues so I first wanted to get an idea of what his Adwords ads looked like so I typed in a few of his keywords (Don’t worry E, I didn’t actually click on your ads). This is what came up.

Padmasambhava Statue
Extremely fine sculpture of
Guru Rinpoche. View Now!
www.FineBuddhaStatues.com

I immediately see a few problems here. For one thing, the call to action is to “view” the statue. It’s not obvious whether he is selling statues or he just has pretty pictures of statues for people to see. The other problem is that he uses “statue” as a singular in his ad. Does he only carry one statue?

I don’t know anything about buddha statues, but I might want to restructure the Adwords ad to something like the following.

Padmasambhava Statues
High End Gold, Silver And Copper Sculptures
Shop Now And Save On Popular Styles

Take the above example with a grain of salt since I don’t know anything about buddha statues. But from browsing his competitors’ stores, it appears as though E focuses on gold or silver statues which could be considered higher end. In any case, he needs to make his Adwords ads a bit more specific and emphasize that he sells buddha statues with a strong call to action. This will weed out some of the potential non-customers immediately.

My other advice is read my article on how to create a Google Analytics Filter For Your Adwords Ads. You also might want to check out Xurxo’s article on Adwords Reports That Can Increase Your Conversions. By default, Analytics does not display the exact search terms your customers are using to click on your Adwords Ads. E needs to go through all of his search terms and use negative keywords to weed out products he doesn’t actually carry. Just because a particular keyword has a high bounce rate or low conversion rate doesn’t necessarily mean it’s a bad keyword. In fact, he could be losing out on many potential customers by eliminating keywords based on bounce rates alone.

Conversion Rate

Even though E has some Adwords issues, I believe most of his conversion rate problems have to do with his store. To illustrate, let’s take a look at one of his prime competitors, www.buddhagroove.com. While Buddha Groove isn’t the best store that I’ve ever seen, they are doing several things right.

When I first enter buddhagroove.com, the look and feel of the store is very clean. Across the top and bottom of the page, they offer a lot of extra information on Buddha, the culture and the teachings. In addition, they also run a pretty decent blog about Buddhism.

All of this extra information leads me to believe that the owners of buddhagroove.com are very passionate about their products and their store. As a result if I were in the market for a Buddha Statue, I’d be inclined to make a purchase from them.

The main problem I see with E’s store is that the website is just a listing of buddha statues for sale. Upon entering the page, I don’t really see a compelling reason to buy a statue from finebuddhastatues.com over their competitors. What benefits does E’s store have to offer? What is his value proposition?

Action Items

Based on this feedback, I propose the following action items

• E offers an ebook on his site that is free with purchase. Instead of offering the ebook as an incentive, I would suggest either giving it away for free or taking the content and making it freely available on the site. Of these two options, I would recommend putting the information on the site for free. For one thing, the verbiage will get indexed in Google which should boost page relevance. Second of all, it will help educate the customer and might influence their purchasing decision.
• Since E has several competitors, I would pick 2 or 3 differentiating factors and plaster them right on the center of the front page by the large buddha pictures. What sets E’s products from his competitors? Is it quality? Price? As soon as the customer walks in the door, they need to know why his store is special. From my limited research, he seems to specialize in metal statues. He needs to pick a unique aspect to emphasize.
• E should also focus on writing more content. The site needs more personality, more passion. The content can be in the form of video or text but preferably it should demonstrate some amount of expertise on his products. He needs to show customers that he knows what he’s talking about and that he carries quality products. As Seth Godin would say “He needs to tell a story”.

The good news is that his competitors aren’t incredible. With some hard work, I believe that he can overtake his competition.

Readers: If you have any advice for E, feel free to post your comments below.