When I was at AIG, one of the most frequent questions, aside from “what’s the projected ROI on that program?” was “can you scale the program?” If we could do a small test that was successful, it would only be great if we could scale up and have the same success on a greater level. It just wasn’t worth the time and effort doing a particular program if the potential revenue was limited.
I’ve asked the same question about my domain investments, and that is why I have chosen to focus on development. While domain sales is still fairly lucrative, I don’t think it is still considerably scalable to a degree where it will drive constant growing revenue at a multiple of what it is now. I still believe I can do what I do to generate revenue for the foreseeable future, but I don’t think it’s feasible to greatly scale this business model at this point in time.
With domain development, I believe I can scale. On Burbank.com, Lowell.com and Newburyport.com, I can either keep them as tourism-heavy websites with information about the city, or I can follow Shaun Pilfold’s model on Kelowna.com and become the source of information for my respective cities. Yes, it costs money to scale and I am not ready to make the financial and time commitment yet with my sites, but it is possible to scale in that manner.
Likewise, my mini site building strategy is also scalable. Perhaps it’s not easily scalable if I continue to build them on my own because of the time constraints, but there are great development companies that focus on mini site-type websites like AEIOU.com, WannaDevelop.com, and MiniSites.com that offer a variety of services. Building mini sites is scalable, and the more you build, the better the deals you can make with all of the mini site and development companies.
A couple of dollars a day per mini site doesn’t generate a lot of revenue if I were to look at each site individually, but if I have 100 mini sites that make $2.00 a day, that’s over $50k per year, with very little maintenance. Some websites will make less than $2.00 and some will make significantly more, but you get the picture. If you build websites on strong keyword domain names, you are generally going to drive revenue while adding value to your domain names.
The point of this is that you need to determine if what you are doing is scalable and sustainable. Experiment with different things like I am doing and make sure you can scale if it works.