Getting Serious About Domain Name Development

Domain investors must change the perception that there is easy money to be made simply by investing in domain names. While many early speculators and adopters were able to do quite well, there is a perception that everyone in the domain industry is getting rich fast. Because of this perception, our domain names are a target. I don’t think there has been a time when our domain names have been put in such a perilous position by people who want to take them from us.
As most people are aware, the recently proposed Anti-Phishing Consumer Protection Act seems to be a vehicle intended to allow large corporations to claim that generic domain names infringe on their brands. This cleverly written bill sounds like it is intended to protect consumers, but the heart of it seems to be about stripping Internet entrepreneurs of their rightful domain names. Large corporations will be the beneficiaries of this bill, as they could use its vague language to take a privately owned domain name. Most of us aren’t viewed as Internet entrepreneurs, but rather people who got lucky and rich by making a wise speculation.
This perception also causes much internal strife, as some people who try to break into the industry do so without a strong ethical footing. Every day, hundreds of new domain names are registered intentionally containing the trademarks of well known brands, something that can be seen by reviewing the growing number of UDRP disputes. Some people also try to capitalize on catastrophes by registering related domain names immediately after a terrible event, and listing them for sale shortly thereafter. Most of the time, I would bet that this is done by people who aren’t having success on the straight track, so they feel the need to take shortcuts. This gives the domain industry a black eye, and it gives outsiders more motivation to try to penalize us by taking our domain names.
Folks, I hate to say this, but there isn’t easy money to be made in the domain industry.
With very little exception, parking revenues are down throughout the industry. This can be attributed to factors far too numerous to list, but the bottom line is that parked domain names aren’t going to make you rich – unless you spend millions of dollars to acquire them – in which case you probably won’t be parking them. Parking is still a good option for domain names that are waiting to be developed, but the key is that they need to be developed.
I believe we are at a serious crossroads in our business. While many people in the industry successfully brought us to the place where we are now, we need to reevaluate who we look at as the “industry leaders.” Whether we like it or not, the domain industry is changing. Gone are the days when people could make a ton of money parking or using arbitrage. Development is the key to long term success, and we should look up to people who are developing or have already developed some of their domain properties into successful businesses.
Development isn’t easy. There are so many spinning wheels with a development project, it is no wonder many people opted to park their domain names. Well, it’s time we take the bull by the horns and learn about what needs to be done to develop our domain names into websites. The transition won’t be easy, but I know we are all up for the task. While many early adopters spent 18 hours a day attempting to secure the best domain names several years ago, it is time to take the same initiative with a focus on developing our names. Just like a real estate developer doesn’t need to be a professional architect, domain owners don’t need to become professional programmers. We need to learn the basics and work with the experts.
In several years when we look back at 2008, I think we will note it as the year the industry changed its focus. The people who develop their domain names will be on top of the industry, and those who don’t may suffer. It is time that we do what we can to protect our domain names, and I think development is the best solution. In the coming weeks, I will do my best to speak with developers to give as much advice as i can. There are plenty of resources out there, and it’s about time we look into them and move forward. Web 2.0 is here, and it’s time we catch up and make the most of our domain assets.

Elliot Silver
Elliot Silver
About The Author: Elliot Silver is an Internet entrepreneur and publisher of Elliot is also the founder and President of Top Notch Domains, LLC, a company that has closed eight figures in deals. Please read the Terms of Use page for additional information about the publisher, website comment policy, disclosures, and conflicts of interest. Reach out to Elliot: Twitter | Facebook | LinkedIn
  1. Great Post Elliot. I do Agree with you. With as much competition as exists its very difficult to secure a domain name under wholesale prices and be able to flip it for a profit. I too am slowly on working to develop my parked domains, giving them what I hope will be a new lease on life.

  2. “Gone are the days when people could make a ton of money parking or using arbitrage.” Big agree…up to now it was a land grab and the shear numbers were the driving force…is 1000, 10,000, 100,000 names enough? In the near future, as parking income disappears, it will be better to own 100 great names than 10,000 so so names…imo

  3. The bill will pass. Most domains won’t fetch the registration fees and some prosecuted will see jail time and banishment from ever being on the net.
    Yahoo too will be gone, leaving just about every parking company who put their eggs in one basket having the first REAL domain auction- when the liquidators come. And that’s when mainstream will come too.
    Then the dust will settle, the noise will clear. And we can make the movie. It’s really quite a story– the dreamsellers… the most profitable and efficient business on the net, for now, until lottery tickets are legal.

  4. I agree 100% percent with you Eliott. I have been saying the same thing in the past couple of weeks. Domain Parking is coming to an end and while some people made a fortune with that, web visitors are looking for something more. I also feel it is a great exercise for domain owners to go through the exercise of developing a site, and see what it takes to put one together.
    In the long run, developed sites will be more valuable than a parked site, not only will you be selling a great name, but you will be selling a brand, with visitors who know that your site is a valuable resource for what they are looking for. Without going into great detail, but one great example of a site that just recently sold is, which got $20mil. not because it is a great domain name but because it has such a huge web presence.
    Again this is just IMO.

  5. “Large corporations will be the beneficiaries of this bill, as they could use its vague language to take a privately owned domain name.”
    i’d be willing to bet, at least for geo names, that it’ll be
    cities, chambers, and llc’s formed betweens cities and
    chambers that’ll try to grab geos…
    they’ve already tried and failed with current methods.
    now they’ll have this looser avenue to take what they want.

  6. Owen – I agree that the bill will pass (nobody in their right mind would vote against a bill with that name), but do you think there is a real chance to get any of the language changed?

    The more opposition to this bill, the less likely it is to make it through to a vote. We need to write to our representatives to ask them to change the language.

  7. Though it plays only a very small part in my own domain business and would have no material effect on my company even if it disappeared entirely tomorrow, PPC for domains isn’t going away…ever.
    Sure; the income will continue to fluctuate, including being down for many over these last few months. And yes, some of the marginal-income “worth-little-or-nothing-without-their $7/yr income”) names will be let go by some (not all, and probably not even most) owner/registrants.
    But–make no mistake here; this traffic is too targeted (the high CTR rates prove this over and over again), too profitable, and too valuable to too many, including Google and Yahoo (whether they remain a stand alone company or not) to just walk away from.
    Because they so very often provide them with just what they’re looking for, Internet users will continue to click on such ads.
    Today. Tomorrow. Forever.
    And even if the “give with one hand while taking with the other” Snowejob bill passes in its current form (and I of course hope it doesn’t), the most likely result will be that–because they have the most–and most valuable–targets (domains) and therefore the most to lose–the domain “big boys” (the Oversees, Name Medias, Marchexs, Fabulous’, Demand Medias, and large individual owners of the world) will do battle in court (no mamsy-pamsy WIPO/UDRP for this/these important battles) against those immoral interlopers who would take that which is not theirs…
    And they will win.
    If necessary: Again and again and again.
    None of these big players will lose their domains.
    We’ll see no domainers on TV wearing handcuffs.
    No one’s going to jail.
    The grounds not shaking, the sky’s not falling, and the domain world’s not about to end.
    There will always–-always–-be nice, fat profits to be earned in our industry by astute, hard-working, forward-thinking individuals and companies; by developing…by flipping…and yes, even by PPC monetizing our domains.

  8. This is a 100% correct and well said Elliot.
    I’ve had to adjust my strategies a bit and have found some success setting up small niche sites. Now a majority of my income that funds domain purchases comes from affiliate marketing.

  9. Doom and gloom all over the place in the post and comments. Elliot are you calling 2008 the year the domainer died ? Development is 100% not domaining so if development is the evolution, the domainer must die no ? Oh oh…and don’t forget to buy the Domain Graduate ebook 😉 ! Seriously now

    I’m just callimg it as I see it. From my perspective, sales are generally down, PPC is generally down, and we are all facing tough legal times ahead. I love the industry, but I think people need to proceed with caution. Most of the mainstream press is good, but it’s not as easy as just buying and selling – especially now, and I think people need to know that getting into the domain business isn’t easy money, as some people think.
    If you disagree, I would love to hear some good news.

  10. I’ve sold 300k in domains so far this year. If sales are down it sure as hell doesn’t feel like it to me.


    Personally, I’ve been doing well and have no complaints. I just don’t feel that it’s the same for the market in general. I talk to a fair amount of people who indicate that they are either spending less on new acquisitions or are selling less than they have in the past.

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