Costs Associated with Niche Sites: The Total Investment Spent on Niche Site Project 4
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I have a small confession to make.
I've started hundreds of blogs (or niche websites) in the past 10 years.
So, how much does it cost to start a website?
The cost can be as low as $10 per year for a domain name. (I recommend NameCheap to register domains). Then an additional cost of $5ish dollars a month for hosting. (I recommend either Bluehost or SiteGround if you are just getting started out…or BigScoots Hosting if your site is a bit more established).
You can install WordPress for free and there are lots of great free WordPress Themes out there to make your site look great. I recommend GeneratePress as a WordPress theme. Although, I do personally spring for the Premium version of GeneratePress.
So, you can technically start a blog or website for peanuts. However, running a successful site could be a different matter.
If you do EVERYTHING yourself, you can still keep your costs extremely low. If you do all the writing, editing, graphics/images, link building, and more…you can get away with just a large time investment and a small amount of money.
However, today I'm going to share exactly how much I've spent on my most recent niche blog for Niche Site Project 4.
You can either do everything yourself and start a blog for under $100 or you can outsource or hire people to do everything for you, like I've done, and the investment is more significant.
Let's dive into what it costs to build a site where you spend very little of your own time.
First a Quick Income Update
I started my Niche Site Project 4 site about 7.5 months ago. The growth at first was extremely slow…as expected. I thought it would take about 6 months for the site to really start getting much traffic from Google and that was the case.
However, over the last month and a half, the site is getting more and more traffic from Google and the earnings continue to grow rapidly. While these earnings are nice, they are only the beginning of what I hope and expect will be a much larger site.
I'm looking 2 years down the road when this site is earning several thousand dollars a month (hopefully!).
Earnings Through April 15th
In the first 15 days of April, my site has earned more than double what it did in March!
Overall, I'm happy with the earnings trend! At this rate, my site could get real close to breaking the $500 mark for the month of April.
I've shared step by step how I've gone about producing these results in all my updates here.
However, seeing the earnings is one thing…what about the costs? What does it take to build a site from scratch that has over 100 articles published and is starting to ramp up its earnings?
The Costs of Building a Niche Website
What I'm about to share with you might make you think I'm crazy…or maybe brilliant. I'll confess that the costs are high and if my site was only making $500 a month for the foreseeable future, it would be crazy.
However, what if I keep these costs and my site down the road is making $5,000 or $10,000 or more each month? Well, then perhaps it would be considered a genius business plan.
Only time will tell which end of the crazy to brilliant spectrum my plan really falls.
Profit and Loss for My Niche Website
I went through all the history of everything I've done on my site and tallied up all the costs. Below is the Profit and Loss statement for everything done on the Niche Site Project 4 Site.
I've done my best to include everything and I believe it's fairly accurate. As mentioned, I am outsourcing almost everything, so I put very little of my own time into this site. Most weeks I only put 1 to 2 hours into the site.
Now I want to take some time and go through each line item and provide a brief explanation.
Amazon Associates
I insert Amazon affiliate links in my posts and make money. I use the following tools to help me insert my links: AAWP, AmalinksPro, and Table Labs. I also use the Amazon sitestripe a little and Amazon Native ads.
Ezoic Ads
Ezoic is a display ad network similar to Google Adsense. (Many of the ads come from the Google ad network).
Hosting
For this site, I'm technically using BigScoots (which I highly recommend). I share the cost of BigScoots across several sites. However, this site could also be hosted on Bluehost or SiteGround for less than $10 a month.
Content Writers/Editor
This is the bulk of the cost of the site as you can see. (This number would be zero if you write all the content for your site). I haven't written any articles on this site. For some of the articles (maybe half?) I've used an editor once the author is done with the article to review and format. Then all I do is basically hit publish. However, my authors are trained so well, that I may not need an editor anymore.
The average cost per article has come out to $80. I like to use hourly writers. I've found a couple of young US based writers that do great work for $10 to $15 an hour. Some of my articles were much more expensive in the beginning – $200+ each. However, I've found cheaper authors with just as good a quality and now my average cost per article has come down.
You also have to consider that some of my articles are only 1,500 words and so might only take 2 or 3 hours ($30 to $45). Other articles are 3,000 to 4,000 words and might cost $80 to $150.
Outreach / Link Building
I've spent about $1,850 total here. These expenses include the time a VA spent doing some blog comments for me, the time an outreach specialist has spent finding, writing, and posting guest posts for me, and finally links from services like The Hoth and Authority Builders.
I will likely keep the budget at somewhere around $500 to $1,000 a month for outreach and link building efforts for the next few months.
Pinterest Management
I use a company to manage Pinterest for me. My Pinterest workflow goes like this:
- As soon as a blog post gets published, my Pinterest VA (a different person than Pinterest management company) creates 2 pins in Canva and then uploads the images to Pinterest and writes the Pinterest description and hashtags.
- The Pinterest Management company then schedules the pins in Tailwind.
- The Pinterest Management company also interacts with Tailwind tribes and shares images there.
Overall, the Pinterest Management company also offers suggestions, notifies me of issues, keeps my board active and increases my Pinterest followers.
Over the past month or so my Pinterest growth has been pretty stagnant while my SEO efforts are really starting to take off. I'm strongly considering just eliminating the Pinterest Management company and the VA and doing it myself. If I can find a couple of hours a week, I think I can replace the work they do and save myself close $400 a month.
Pinterest VA
I explained above what this person does: creates pins and pins to Pinterest including hashtags and descriptions.
Shutterstock
I am using Shutterstock to get all the featured images for my posts, roundup image type posts, and for my Pinterest pins. I technically use this account for one of my other sites, but I am still attributing the $99 cost to this site.
I like using Shutterstock because I don't have to worry about whether I'm allowed to use the image and they have a HUGE database of images.
Tailwind
The Tailwind App is an essential tool if you plan to do well on Pinterest. Tailwind allows you to schedule pins, which is the biggest function. However, you can also grow your account with Tailwind Tribes. In addition, Tailwind provides good stats to help you better understand your Pinterest accounts and Tribe activity.
Opt In Monster
I just started using Opt In Monster on this site a couple months ago (been using Opt In Monster much longer on other sites). I have a pop-up to collect emails.
Email Automation
I put a cost of $10 a month for an email autoresponder. I share a ConvertKit account with several of my sites, so technically I'm not paying anything extra by adding this site. Even though I haven't gotten aggressive with email yet for this site, I'm building the list and plan to start sending more emails soon.
Is This a Good Investment?
Overall, I have spent a total of $14,656 on the site and it's earned a total of $443. I'm down over $14,000!
Sure, that's a big investment, but will it be a good investment? Obviously, if you can only see the present, it doesn't look like a good investment. However, if you can see the future (at least the future I hope for), then it's an incredibly good investment.
In addition, I do expect that some of my costs will actually go down over time on the site. As mentioned, I may just do the Pinterest stuff myself (would have eliminated about $3,000 in costs).
In addition, Jon Dykstra has made a good argument that content costs should not be considered when selling a site and Empire Flippers have agreed. In other words, when I look to sell the site the P&L will look more favorable without the content costs and the Pinterest costs.
I would expect my expenses that would be counted if I were to go sell the site to be around $500 a month going forward. (hosting, tools, a few other minor expenses).
So, revenue of $2,000 a month, should be a net profit of about $1,500 a month when I go to sell (just a rough estimate). This ongoing expenses number could obviously grow if the site really takes off (over $10,000 a month), but I just wanted to give you an idea of my estimates.
How Much Can I Sell it For?
So, judging whether this is a good investment comes down to 2 things:
- how much do I think I can get the monthly revenue to
- how much can I sell the site for.
Obviously, I'm hoping that over time the site will reach a level where it's making $5,000, $10,000, or more each month. I've interviewed people on the Niche Pursuits podcast that are making $20,000 a month, or $40,000 a month, or $100,000 a month with their sites.
The ceiling is pretty high with these types of blogs.
So, let's do some math.
A “white hat” blog or content site is a pretty hot commodity in the marketplace. These types of sites are easy to run and buyers and investors LOVE them. (Especially sites that are hands off like mine that are completely outsourced by the way).
A 3x annual multiple is not out of the question. However, just to play it “safe” let's do our calculations with a 34x MONTHLY multiple.
So, if the site has a net income of $500, it could sell for $500 x 34 = $17,000.
Here's some more numbers for fun to look at:
Potential Sale Price at a 34x Monthly Multiple |
|
| Monthly Income | Sale Price |
| $250 | $8,500 |
| $500 | $17,000 |
| $1,000 | $34,000 |
| $2,000 | $68,000 |
| $3,000 | $102,000 |
| $4,000 | $136,000 |
| $5,000 | $170,000 |
| $7,500 | $255,000 |
| $10,000 | $340,000 |
| $15,000 | $510,000 |
| $20,000 | $680,000 |
| $40,000 | $1,360,000 |
| $50,000 | $1,700,000 |
| $100,000 | $3,400,000 |
So, am I crazy for investing so much money in a “niche site”? Well, if the site never makes more than $1,000 a month I might be. But if the site even gets to $2,000 a month I will have a nice return on my hands.
But if the site gets to $3k, $5k, or $15k+ a month then my plan might be considered genius, right?!
Final Thoughts
Overall, I hope you've enjoyed diving into some of the numbers for my Niche Site Project 4 site. So, how much does it cost to start a blog or content site? Well, that number can vary wildly.
It can cost as little as $5 a month for hosting if you put in all of the work yourself.
Or it can cost $15,000 over 7 months if you outsource pretty much everything (like I've done). And to be honest, some sites spend WAY more to get their business off the ground than I have.
The right answer is that costs all depends on a few factors:
- How much money are you willing to risk?
- How much time and desire do you have to work on your own site?
- How big do you expect your site to grow?
- How long are you willing to wait before you want a return on your money?
I've been in the website building, buying, and selling game for several years now and this is what I'm comfortable investing. If I personally had more time, I would likely invest less money and do more of the day to day work on the site.
Alas, I'm an entrepreneur with lots of sites to operate and new ideas to pursue! So, I'm “forced” to spend a bit more money because I lack the time.
I would love to hear your thoughts in the comments below!
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54 Comments
Conversation
You’ve really spent a good amount on the site Spencer,
And I’m happy for one thing. It shows you’re fully committed to the site, and this will really make it more successful. Most people are usually kinda skeptical about investing such amount on a new site.
You’re obviously on the right path though, and I’m sure the ROI will be massive down the road.
Keep winning brother.
Thanks Theodore!
Very nice article. Is your site’s niche new for you?
I’ve never created a site on the subject before, no.
Making 15k a month off amazon is like selling maybe half a million dollars worth of goods every month (at about an avg 3% commission rate). How is this realistic? Have you seen examples? Couldn’t you monetize that amount of traffic much more efficiently? This is why I think the Amazon associates program only truly benefits them and almost no one else… I have an amazon-oriented niche site myself and it would take 15 years to earn what I’ve earned just today with high-ticket affiliate marketing. I dunno, maybe someone can change my mind..
Spencer mentions a few examples in his blog with links to Podcasts where he has interviewed those people.
Sergio,
Yes, I’ve seen lots of examples. In fact, I linked in this article to 3 podcast interviews I did. One is making $20k/mth, the other was making $40k per month, mostly amazon. If you look at Empire Flipper listings, you will see successfully sold Amazon associates sites making good money all the time.
2 addition points: 1. In this particular niche, I’m not sure the site could be monetized better. In other niches, it absolutely makes sense to do it otherwise. 2. I expect (hope) that half or more of the income on the site will come from display ads (like Google adsense or mediavine) over the long term. Even more examples of sites making way more than $15k/mth through display ads that I know of personally for sure. (And several that I’ve interviewed on NP podcast).
Very nice read, I have been trying to find a niche to start my blog for getting my online business off the ground. I am into the furniture business and had difficulty find a niche in it, so I thought of including the location name, hence arrived at “Sydney Furniture”. Now seeing the number from a pro I believe we can generate enough sales as well as earn from our blog.
Thanks
Absolutely, go for it!
This is great insight and if I think back to when I had just begun, this would have been very helpful.
Please expand more on empire flippers not including content costs in expenses? Is this a new policy in their valuation?
If a site is a content driven site, how can this not be considered an expense? It’s the primary expense of this web business model…thanks for your feedback!
Ricky, go ahead and read the article I linked to from Jon Dykstra, that’s where EF talks about it.
Content creation is a one-time expense, not a required ongoing expense. (The site will continue to rank and perform for all the articles already written). That’s the argument. Again, please read the article I linked to for more depth.
I tried to explain this to them last year when I was selling my website but they still included writing content in expenses. It is good that now they have learned the basics of financial analysis.
Hi spencer,
Thank you for this article!
Where did you find your cheaper young US based content writer?
Upwork
Fantastic article.
Can’t wait to explore these links!
It’s interesting to see your numbers and your take on Pinterest.
I started my site in November 2017 and I used mostly the data I learned from your blog.
I haven’t bought your paid course, therefore it’s been some trial and error. I tried Pinterest and didn’t get anywhere with it, at its best I was getting 2-3 clicks per day.
I am not using Amazon, I am using Thrive Themes affiliate program with a 50 percent commission rate instead. I wrote all my blog posts myself and they are all long-form content.
The blog has made $3,600 so far, last month cashing in $1,100.
The fact is that one single article is responsible for all these earnings.
I don’t have a lot of organic traffic. In fact I am only getting about 1,500 per month. Out of the 70 blog posts I have written, only 10 are getting any sort of traffic. The reason is that I picked long-tail keywords, however these were still too competitive, being in the internet marketing niche.
It’s clear that I need more backlinks…
Thanks for all the information you regularly provide.
Thanks for sharing your journey so far! Good luck with your site!
So if somone is broke they should start a niche site around their hobbies because content outsourcing is expensive…
Yes. Or at least start a site they can write the content for (learn as they go).
Excellent write up and nice to see the honesty about the expenses. It gives people an insight as to how much it actually costs to let others do all the work for you.
It also looks like the site is getting ready to take off this month, so hopefully the costs will start to come down.
It is good reading how the site actually does each month and gives people encouragement.
The only downer at the moment is how difficult it is to keep your amazon account, and the fact they are now renewing if you have not made any sales after 12 months. Not as simple as it used to be, but I suppose it helps Amazon to get rid of all the dead wood out there.
Thanks, glad you enjoyed the writeup!
Love the transparency! Seeing how much you’ve been able to outsource over the years motivated me to start outsourcing a lot of the more “menial” tasks for my sites too (I was getting pretty tired of spending hours adding and formatting content on my affiliate sites).
One thing that stood out to me was the cost of Shutterstock though. I know you mentioned they have a ton of royalty free images, but if you’re ever looking for an alternative option, I use a combination of Canva’s paid plan (you mentioned your VA is already using it for Pins) and Twenty20. Totals out to less than $50/month and covers pretty much any images I need for all my sites. Just a suggestion though. Keep up the awesome work!
Thanks Dominique! That’s a good suggestion for images, I may go ahead and look into that.
Thank you for the transparency and honesty when it comes to costs.
I invested about $7500 in content costs for my latest niche site, and I was worried I was doing something wrong since no one talks about this stuff on the web (most of the articles are you can build a niche site for under $500, etc…), but I see now that it’s pretty normal and expected, so thank you for speaking out.
My site makes about $500-$700 per month by the way, but it’s older, and I also did not invest in Pinterest and did seo myself for lower costs, but that’s the true cost when you’re building a content-rich, high quality site. I also noticed that sites take longer to get out of sandbox and receive google love, i think most people report about 8 months in, instead of the old just 6 months. I remember freaking 4-5 months in with minimal revenue and over $5000 put in.
It’s good to have a clearer picture of what such a project entails.
I am sure your website will perform and you’ll recoup your investment in the future and much more based on your latest stats, best of luck and looking forward to future updates.
Thanks Nick. I was pretty nervous about writing this blog post. But I always figured it’s best to be 100% honest, and that includes these costs involved. I hope your site continues to grow!
Spencer, you definitely deserve credit for being transparent about expenses. As another commenter noted, that’s rare – you see tons of “I make $XX,XXX/month through affiliate marketing” posts, but rarely do the authors clearly state their expenses.
I scaled and sold two sites between 2017-2018, and content was by far the biggest cost. But once your site has traction in the SERPs it’s well worth the expense.
Btw, I’m doing a study of new niche affiliate sites that have rapidly gained organic traffic, and one preliminary finding is that they ALL published a lot of content early on (minimum 100k words of content, and in many cases more than 200k words of content in their initial months).
Thanks Moe! Content is definitely the biggest cost, and I agree that generally speaking, more content is better.
Hi Spencer, thanks for sharing your numbers. It is really interesting to see.
For us just starting it is a bit hard to think of investing 14k over 7 months… I think that the lack of experience would make me think I may or may not get a good ROI. Of course that is not your case, as you have been doing this for years and I’m sure your site will be a success and make the $$ you expect.
Well done!
Any advice for newbies?
Cheers
Mariana
Thanks Mariana! My advice for newbies, ready my niche site projects and do exactly as I’ve explained…but you do the work yourself (writing articles, outreach, pinterest, etc) rather than paying someone else.
Thanks for the update Spencer. Seems like your site’s earning are reading to go exponential!
What were your thoughts on The Hoth. I’m thinking of using their guest post option and was wondering what your feedback on their services was and how it benefited (if there was a benefit) to your site.
When I initially, wrote about the Hoth, they hadn’t delivered my links yet. But now they have delivered 2 out of the 3 links I ordered so far. The links look really good on some high domain authority sites. They are a little slow in delivering all the links (it’s been well over a month now), but since they are legit outreach and guest post links, that’s probably okay.
Thanks for the article. Though it scared me to continue building my site for obvious reasons that financial backing is quite huge.
Very new to this, just wondering if its better to write all the article first then publish in one time or publish it after after you finish writing one?
Just publish one at a time.
Thanks for Sharing the information
Do you use Amazon onelink to get visitors redirected?
On most of my sites yes. But I just haven’t added it to my new site yet.
Thanks for your good article.
I think you are on the right way. Keep going. I am new in content site, I also spent 1000$ from January for my site. Everything is hard to me because I am really zero experience in this area. But I wanna to continue.
Good luck!
I think a big off-putting consideration to many people considering starting such projects is the cost of starting rather than considering the returns when they become successful.
Thanks for your honest post. Do you use upwork Timesheet feature? Or, author adds work time manually?
Upwork timesheet.
Thanks for providing a detail explanation of cost to start new website.
Hi, Spencer.
I enjoy reading your articles from Turkey. I’m studying in medical school. I want to prepare a site about an A Disease I’m an expert. Monthly search volume 50k. Cpc $ 7. There are always news sites on the first page. There is no detailed guide as I will write.
However, the maximum number of articles that can be written about this A Disease is 50. Can I get that Micro niche site?
In addition, how do I prove to be a doctor for the Google medic update.
Don’t lomit yourself to the 50 subtopics you might see now. See them as a start.
Regarding being legit (having medical background fpr Medic update), have akind of CV on you site stating all your medical experiences, studies and University your attend. Also have your articles reviewed by a real medic and also state that publicly on your site.
I am thinking of you having two author-boxes next to each other (under each article). One for you and one fr the reviewing Doc.
Sure, you can create a micro niche site on the subject. Although it might be ideal to create lots of articles on your site with related topics. In your about page just list your credentials and any links to verification that you can provide.
Hi spencer, Yesterday I got your email where you report that your niche site project 4 website crosses $500 mark, I am so happy after seeing your growth from approx $118 to $500 in a single month, can you please explain which backlink building strategy you use in the month of April and whether it helps to grow your traffic or not, or just publishing new in-depth content is enough
I didn’t really do any link building in April honestly. I may have gotten 1 guest post in. Its just site age and overall quality/quantity of my site improving.
Hii Sir,
you case study is amazing, and it is really insprational for me, i had started a blog in Dec 2017 and i started getting 700K Pagevies monthly but don’t know why my site lost all traffic and not it has only 2k visitors daily. should i change hosting?
My guess is that there must be more things going on with your site than just hosting problems.
Despite that Amazon has dropped the commission rate. I think that it’s still good to investigate in the Amazon Nich site. There is still room for us. The only problem now, is how to focus on the “quality” while you scale up the contents.
Great post!!!! Thanks for sharing it will really help me to spent money on blogging.
Hay Spencer,
Thanks for the very informative blog.
helped me alot. i spent around 1K on my site since january.
the part about the potential sale of the site was encouraging.
Thanks
Gracias por las buenas ideas estoy aprendiendo
Que bien Dolly, eso nos alegra 🙂