A Website report is an essential part of Due Diligence to establish company value.
If you are buying or investing in a company you need to understand exactly what its website contributes to the value. Company valuations depend on many factors and often have a subjective element. Similarly, how much a website contributes is not just about sales.
Some factors to consider are:
- How many visitors does the website get?
- How many convert to customers?
- What is the customer profile?
- How well does the website perform compared to sector competitors?
- How much room is there to improve?
Making the decision to purchase or invest in a company is often made with insufficient consideration of its website.
What should be included in a Website report as part of the Due Diligence?
History and Overview
This should include a general summary of the website’s role, objectives and history. When was it established, what technology does it use (is this good or bad?), is it mobile friendly? The website background can often be very different to the company background.
Current Online Marketing Activity
What is the current digital strategy and how is it being implemented. Is it being carried out in-house or by a third party? How is it being measured, how much does it cost and what is the return?
How many followers, friends or likes does the website have? Is it active on social media or pay per click?
Search Engine and Website Performance
Which ‘keywords’ does the site ‘rank for’ at the moment? Are these relevant to the company objectives and is the SEO strategy performing efficiently? How is the website performance monitored, are all the basics in place or is there room for improvement?
Visitor numbers and conversion (sales or enquiries)
How many people visit the website and from which source. How many of these convert to paying customers.
What types of customers are buying from the website. For example, do they only purchase once, or regularly. What is the split between returning and new customers? Which marketing activity is driving the most number of visits?
Does the company (via the website) have a good reputation? How many positive reviews are found on either social media or the site itself? How many negative? What is the general online perception of the website / company? Online reviews need to be managed and responded to, how is this completed?
Who are the main competitors and how does their website perform in comparison? Include an overview and commentary about the positives and negatives of their sites.
What is the overall operating cost of the website and supporting function? From hosting costs, to security, payment processing and customer service.
Opportunites / Threats
Include a list of the opportunities and potential threats to the website performance.
Based in the North West, an estate agent contacted us in order to review their website. Our contact had purchased a business and reached out to discover how he could improve its website performance.
In summary, our client’s new website just loaded 3rd party content. Consequently, in Google terms, their website didn’t exist!
On the positive side, our client had bought a company that had a website with a great deal of opportunity!
Another client had looked to make an investment in a mail order company. Their website was clunky but was taking orders. Understand the customer data behind the orders. Highlight opportunity that the website could realise. Outline the effect this would have on the bottom line.
Before Making an Investment, Carry out Website Due Diligence
It almost doesn’t matter which industry or sector you are looking to invest in. Even (especially) for companies that have no online presence, getting a view of the online landscape will offer insight and opportunity.
Contact us for more information about our website due diligence service.