Website Worth Calculator Algorithm Explanation

In this section, we will try to explain how we calculate the website worth of the site of your interest.

Please kindly note that we will be using website worth and site price interchangeably from here onwards as they are the synonyms.

How does our site price calculator work?

We found that most of the times, users have the following questions in mind when they try to look at the results of our estimation:

  • "What all information did you use to calculate my website worth?"
  • "How did you calculate the website worth? What metrics did you use?"
  • "How did your website worth calculator estimate the daily pageviews and traffic information like pageviews per user, average time on site and bounce rate?"
  • "How did you calculate daily, monthly and yearly advertisement revenue? How confident are your on this estimation?"

In the following sections, we will try to answer all the above questions one by one. First we will explain how we came up with site price of the website.

Site Price Calculator Algorithm

Input

The algorithm takes the following information as input:

  • Daily Page Views
  • Monthly Page Views
  • Yearly Page Views
  • Traffic Demography: The distribution of the website traffic from various countries/continents
  • Traffic Source: Search, Referral, None, Paid
  • Daily Time on Website
  • Bounce Rate
  • Average Pageviews per User

All the information we use is from freely available public sources and some proprietary information like Alexa data

Revenue of a website

We come up with daily advertising revenue, monthly advertising revenue and yearly advertising revenue of a website based on the algorithm results.

The websites with traffic from developed countries have a higher CPC and RPM in general and their traffic can earn a higher ad revenue. We have found the average CPM and RPM rates for websites and we will describe the same in the next section.

Note on Accuracy of our calculator

We understand that all websites are unique. Not every website income stream can be accurately estimated. Some websites sell stuff online, some provide reviews of products and earn revenue from the affiliate links, some provide services and charge for them. So it is very difficult to find the exact revenue a website can generate. So we try to only estimate the revenue considering advertising as the only revenue source for the website.

We understand that this way of estimating website worth if flawed, so we request the users to consider this only for educational purpose. Users should do their due diligence before taking any further actions.

Page Views Information

Page Views can be described as an instance of an internet user visiting a particular page on a website. Users can browse through multiple pages at a time and all the pages are counted as pageviews.

The average number of pageviews per user can significantly affect the rate of RPM. As users browse through the website, the advertising partners can better learn the behaviour of the user and they will be able to display ads with higher RPM.

So tip to the readers: Try to make sure that users can views as many pages as possible in a single visit.

Traffic Demography

In this section we will try to answer the question of "does the page PRM for users vary across countries/demographics?"

Yes, the page RPM for users varies for different countries and demographics. We can understand this from the following points:

  • The page PRM is dependent on the advertisers trying to build for the ad slots on your websites.
  • The average expenditure of advertisers differs from country to country. This is mainly due to the country economic status and the average cost of living.
  • The developed countries income level is very high compared to developing and undeveloped countries population. So their spending will also be higher.
  • So PRM for the websites can change depending up on the demography.

So, if you want to have a very high PRM and CPC, try to build websites in the neche where there will be very high traffic from developed countries like US and European Union.

Traffic Sources

In this section, we will to discuss about the role of Traffic Sources in the Website Earnings?

The main point to note is that page RPM or website earnings will be higher if there are a lot of advertisers ready to bid for the ad slots in your pages. In order for the advertisers to understand that the website is of relevance to them, they need to have context of your websites. This is traffic source medium comes into picture.

Let's go through the different traffic sources:

  • Search Traffic : From Google, Bing and Other Search Engines
  • Referral Traffic : This can be from other referral sites or social media
  • Direct Traffic : This will be the case if the user directly types in the website URL into the browser and enters the site.