Website flipping encompasses various expertise from digital marketing, niche websites, and mergers & acquisitions. It can be confusing at times to keep tabs on all of the terminology.
Here is the full terms and abbreviation list with explanations to keep you informed.
Due Diligence – The work done by the potential buyer to confirm all the information provided about the website for sale, as well as any other background information like traffic, traffic sources, P&L statements, revenue, or any other information important to the buyer. Read the full due diligence guide here.
P&L – Short for “Profit and Loss.” A P&L statement is a financial statement that includes revenues, expenses, gross and net profits (or losses) for a given time period. A common part of due diligence.
L3M – “Last 3 Months” is the last three months of average earnings from a site. Important to see if a site’s revenue is trending upwards or downwards.
L6M – “Last 6 Months” is the average of the last six months of earnings from a site. This number is the one most commonly used in website deals for determining multiples and final sale price.
L12M – “Last 12 Months” is the last twelve months of average earnings from a site. This is sometimes used for figuring out the number used when figuring out the final price via multiple, especially with a seasonal niche site, it’s also a number many buyers want to spot trends.
TTM – “Trailing Twelve Months,” this is basically another term for L12M, they are interchangeable.
Multiple – The number used to determine the sale price. For website flips, it represents the number of months of average earnings. So a multiple of 20 would be 20x monthly earnings, a site sold with a multiple of 40 would be 40x monthly earnings.
Revenue – Revenue is the total amount of income generated from the website.
EPM – “Earnings Per Thousand” refers to the average income made by the site for every 1,000 visitors.
Profit – The total earnings left over after expenses have been taken out of revenue.
Operating costs (a.k.a. Operational expenditures) – the costs for day-to-day operations of a website. This can include hosting fees, content costs to upkeep, VA costs, dues & subscriptions, etc.
Growth costs (a.k.a. capital expenditures) – the upfront costs to revamp and set up the site for growth. This can be bulk costs for content, backlinks, website development, etc.
Affiliate Marketing – A common way of monetizing websites where the affiliate creates links pointing to a product or service someone else offers. When someone buys via that link the affiliate gets a cut of the sale. Common examples: Amazon Associates, Clickbank
Display Advertising – Common way of monetizing websites through text and picture ads. Common examples include AdSense, Ezoic, and MediaVine.
Lead Generation – Getting paid by businesses to provide potential customers interested in their service. Examples include payment per phone call, per email, or per contact form filled out.
Digital Products – Digital products for sale include anything digital as opposed to physical products and can include video games, custom software, website themes, premium plugins, special database access, online courses, and more.
E-book – Digital version of a book, will often include graphics, illustrations, links, and other information necessary to cover a topic.
Sponsored/Guest Posts – Writing a post for another website in return for one or more backlinks in that article pointing back to your own website.
Niche Edits – Contacting a website owner to get a link on an existing post to your site, often via replacing a broken link, pitching a better-related resource, or even payment.
PBNs – Private Blog Networks. Series of blogs built specifically to create websites that farm out links to people who pay for them. Against Google’s stated terms of service.
Unique Visitors – Number of distinct individuals who have visited a site in the past month. A person counts as one unique visitor no matter how often they visit the site or how many pages.
Pageviews – Total number of pages visited by unique visitors during a set time period.
Pages Per Visitor – Average number of separate pages/posts each unique visitor checks out on a website.
Time on Page – The amount of time the average visitor spends on a particular page of the website.
Bounce Rate – The percentage of visitors who land on a page and then backspace or jump to another site after seeing just one single page.
Social Traffic – This is traffic from social media sites like Facebook, Pinterest, Twitter, Quora, etc. This traffic can be valuable though it’s not considered as valuable as direct organic traffic from the search engines.
Organic Traffic – Traffic that comes from searches made directly on search engines like Google, Yahoo, Bing, or DuckDuckGo. The most valuable type of traffic.
Direct Traffic – Traffic that comes from people typing in the website URL directly. Can be a sign of a good brand, but can also be the sign of inflated traffic from owner visits.
Referral Traffic – Traffic that comes to your site from another source like a link from an email, another website, or other source.
Paid Traffic – This is traffic that was paid for via ads whether on an individual site or via ad network like Google AdWords. This is not traffic you want to see on a site being considered for sale.
Search Engine Optimization (SEO)
Backlinks – When another website links back to your site. Backlinks are a huge part of getting a website to rank and therefore a core focus of SEO.
On-page SEO – Actions taken on a website to improve rankings in Google – the factors that a webmaster can directly control on the site itself.
Off-page SEO – Actions to improve a website’s rankings off the actual site like building backlinks.
Link Diversification – The use of a wide variety of types, styles, and anchor text for backlinks from sites at many different authority levels. Important for keeping built links looking natural and to avoid Google penalties.
Anchor Text – The words that are linked to your site. Direct keyword anchor text is known for being the best for improving rankings for a term, but too much of this is obvious manipulation and penalized by Google.
Referring Domains – Websites that deliver traffic to your site.
Domain Rating – A general measurement used to estimate the overall strength of a domain in the eyes of search engines like Google.