How to calculate website revenue posibilities?

[Nico]

How do you know which sites have economic future and which ones doens't. How do you know which sites you need to keep working hard on, because you see the posibilities, and which one's you can remove or pay less attention?

As an example: the site on my signature is pretty new (a few months). It's getting very low traffic, but that's expected for the amount of work im putting on it (3000 unique visits/month). With that little traffic im getting $xx with text based ads....in the very low end of the 2 figures.

I know the site will get more traffic...but is there a way of knowing if it'll make good money?
If i think i can have 30000 unique visits/month, just by multiplying the money im making now by 10 would do the trick?

Any tips?

[Chris]

A harder thing is calculating traffic potential. You can't always assume more traffic is to be had, eventually you can reach the ceiling for your niche.

[Nico]

Exactly. But is there a way to calculate that? Im guessing it's just the experience you have online + some research on similar niches that will tell you what's your traffic ceiling.

In my case, i can pretty much assure that the traffic will increase a lot. I mean, i have x amount of traffic when im #10 in Google, it's fair to assume that at least i'll have 10 times more if i get to #1 in Google. Sounds right? Would it be fair to assume that i'll make 10 times more also?

[Chris]

Oh certainly, moreso even.

[Nico]

Thanks Chris. I'll keep working then.

[Cutter]

I like to get rough ideas rather than make a solid calculation.

The two important variables are profitability of traffic and volume potential.

A general rule of thumb, that the more niche specific the traffic the less of it there is. This is not always right. Some niches do ont have the advertising base to support strong revenue. Just the same, general traffic sites can make a ton of money too.

At a base level you want to make not less than 2 cents per unique visitor unless you are dealing with a lot of international traffic. This number can go up to over $1 depending what you are doing.

Estimating traffic is tough. If a site may get a lot of referral or non-SE traffic it can be just about impossible. I usually look at overture, and rather than calculate based on the exact number, I look at how the numbers compare to other sites I have.

Another trick is to watch for similar sites on Marketplace's like Sitepoint. This can really clue you in to revenue potential.

[Nico]

Thanks for the tips Cutter.