I know it’s a holiday weekend, but I think everyone needs to take a few minutes to read Ron Jackson’s interview of Rick Schwartz. In the domain space, Rick has been something like a soothsayer, and when he speaks, I listen. While we don’t all own the same quality domain names as Rick, the things he is saying does affect all domain investors.
If or when Google decides to pull the plug and PPC as we know it drastically changes, there is going to be a lot of tumult in the industry. While quickly and efficiently monetizing domain names will be difficult and domain values will be impacted, domain owners need to keep the following things in mind:
- Businesses who want to be online need a domain name
- Advertisers will still want to advertise on relevant domain names
- People will continue typing-in domain names looking for products or services
- Easy to remember and relevant domain names are the most desired
- Consumers typically have certain web browsing patterns, and many type in their keyword and .com as a starting point
The point is that while making easy money from domain names won’t be possible, there are still going to be plenty of opportunities in the domain space. Some people will have to sell more than they have in the past in order to maintain the same revenue levels, so some deals may be had. I recommend buying domain names that would make sense to be developed. Just because a domain name did well parked, doesn’t mean that it would be good to develop.
I still believe the greatest ongoing revenue generating opportunity is selling advertising space directly to advertisers on developed websites. I believe websites are the newspapers of decades ago. Websites get the eyeballs that newspapers once received, and advertisers want to reach them. Motivated consumers are untapped leads that businesses would like to acquire.
I also believe that as companies continue to migrate their business online, more will get it, and more will want (or even need) the domain name that describes their business or industry. Generic and category defining domain names are rare, and they hold considerable value. Selling domain names to end users that get it will be the driving force behind the future growth of domain values.
Changing times call for changing strategies. Those who adapt and adopt will survive, and those who sit back will not. Who knows when all of this will happen, but I think it’s important to be prepared for the worst. Read Rick’s interview and judge for yourself.
I think if Google pulls the plug, then CPA networks will take the place of PPC. Maybe G will just replace PPC with CPA. That would make more sense instead of just walking away from all our traffic. Maybe our good traffic would even pay more than previously, and the poor domains from domainers would go by the wayside. It could be a blessing in disguise really.
When you look at what you make in PPC don’t you always think that it is worth at least two to three times what they are paying you, even in the PPC model? Hence, the spread we are losing by not dealing directly with the advertisers, which is basically what you are saying.
We need a domainer’s exchange run by domainers where the traffic is easily sold on the marketplace. And, one more open than Sendori …… which wants like a million uniques a month to deal with you. Most domainers don’t have that kind of traffic…… just a handfull of domainers and some registrars do.
Parking Fail = Mini-Site boost
I mean it really is as simple as that. So until a company comes along and offers what we want on a mini-site in a parking company, it will take some effort. The days of the lazy domainer are coming to a close and its time to evolve. The next generation of domainers are going to step in at this point and set the boat off the docks soon, so don’t miss it!
Opportunities are on the horizon! Get on the BOAT!
Domains are only really worth the revenue they generate – for many mini-sites there are no alternatives to PPC so they wil be worthless if it disappears. But sites like tropicalbirds.com have a different revenue generating potential beyond PPC – a pet shop can use its for branding/lead gen. Not so a site like tropical-birds-online.com which could get 50% of the PPC of tropicalbirds.com, but has no resale if PPC dies. Any thoughts anyone – am i talking nonsense?
Thanks for this important post which inspired my email message tomorrow. Its point was that a truly GREAT domain is not a place on which to run ads, IT IS an ad.
Thankfully Rick has the balls to say what needed to be said. Not because anyone will listen, but because a simple link to that post will help everyone understand how and why they self-destructed.
Rick has done this before. As in predicting the dotCOM bust in 2000 12 months earlier by reasoning that a business model formulated as eyeballs=ads=success is really a business model that should be restated as eyeballs=ads=death.
Even most mini-sites are just history repeating itself with this same flawed formula and a co-dependancy on a revenue stream you don’t own and can’t control. Just like PPC.
Maybe the third time around, some will get it right. Those with the one part of the equation that was right (eyeballs aka. type-ins/traffic) already have a great head start.
As for the industry waiting for corporate to discover it, the chance is blown for all but a select few.
Because every time a corporation finds a typo, tm infringement, email scam with their spoofed domain, article about someone monetizing tragedy, or has to spend millions litigating or trying to bid on name assets they would be the best use of- to no profitable conclusion, it’s like swatting a fly that keeps coming back.
Eventually they move on. So while we’ve been waiting for them, they’ve gone 10 steps ahead of us.
A case in point is cowboys.com. Dallas Cowboys didn’t see value in the name cowboys.com but did find already proven value in adding a Demand Media/Pluck social community to DallasCowboys.com.
In being competition, we created competition. And now there are case studies like cowboys to make prospects evaluate whether adding a generic name to their marketing strength, delivers more ROI then adding value to the one they already own.
Now corporations are getting traffic and a whole lot more from blogs, Twitter, YouTube and more. Once they personally see this, touch this, feel this and benefit from this, it weakens the domain value proposition that once stood alone.
For an industry built on the premise of “what’s in a name” we can’t be proud of the name we’ve made for ourselves.
Domains will still be king. Take a look at CBS, they paid 1.8Billion USD for CNet and investing in domain names.