Some domain names are that desirable you can guarantee an individual or company will come knocking. There are times when there is no alternative for a business and they must acquire the domain you own for branding purposes or to target a particular keyword phrase for their website. But some domains need a further display of potential, and the additional assets of a developed property with great content, diverse backlinks, and if possible, monetization, will attract a wider buying market. Previously I posted about the ethicalness of link baiting for clicks on parked domains. Well developing domains provides an alternative to that practice. Why bother sprinkling links for small ad click revenue when you can spend time increasing the value of your domain, and make money through Adsense of partner products until a buyer comes along.

Okay, so this is a different strategy to traditional domaining, and development may mean you need to list the site in different places for sale than you would a stand-alone domain. However, this won’t stop a domainer coming along, buying the domain, wiping the installation and parking it again. But it is worth remembering that you aren’t in the game to sell to domainers, quite simply because you will never maximize the price potential of a domain selling to another domainer – like you they are in it for the maximum profit margin.

Development means missing out on parking revenue, but where you lose the potential for money is actually greater. Some people aren’t tech savvy, and the thought of having a blank canvas isn’t hugely appealing. A desirable domain name with a decent design, content and decent rankings in the SERPs is a huge leg up the ladder for a person who wants a readymade package. Even if a person wants to change the design, Google will have already ranked the site and any backlinks you have acquired will remain. And without doubt this adds value to a web property.

Of course I wouldn’t want to develop all my domains, and some I know for a fact are better off parked. But there are a number for which I have an itching feeling development will bring a more lucrative sale. Recently I have been working on www.muaythai.net. It isn’t fully developed yet but it is progressing, and I already recieved one inquiry. Muay Thai is a massive industry, not to mention that the “Muay Thai” has an exact match search volume of 300,000. The domain itself is worth a nice amount on its own, and with the added content there it sparks ideas in the minds of potential buyers as to where they can take the site going forward. I had an affiliate sale on an associated product too, which is a great selling point, because even with a small amount of traffic money can be made. The domain is for sale if you know anyone who may be interested.

But price isn’t the only thing that puts me off registering domains with GoDaddy. Like many onliners, I am not exactly a fan, and believe me I am not the first to say negative things about GD. For such a successful company, you will find a multitude of gripes from dissatisfied customers on forums and websites. In my experience the hosting is reliable, but the service rather annoying for four key reasons.

Complicated Hosting Panel

The GD hosting panel is a nightmare to navigate. Even for an experienced online guy it is a chore every time you login to change settings. I just can’t understand why they haven’t invested in simplifying the entire process. For example, Hostgator’s Cpanel is a walk in the park compared with the NASA qualification required to get around GoDaddy.

Unethical Owner

Secondly, the boss, Bob Parsons, likes hunting innocent animals, and then photographing himself alongside his kill. Do a quick Google for Bob Parsons elephant and you will see the evidence. If that isn’t enough to put you off, the whole cheap “Go Daddy Girls” campaign that clutters the already overly cluttered page might well do so.

Restricted Customer Service 

Thirdly, although you can get through to customer services very easily, and the guys there are very helpful, no matter how technical the problem, they don’t have the ability to go into your account and fix things. They read off the GoDaddy help sheets, which are readily available online, and insist on guiding you to do everything for yourself. For newbies/technophobes this must be an excruciating experience, one that will take forever and a day.

Overbearing Upselling

Lastly, every time you call up, whether for simple enquiry or technical direction, you can guarantee the call will end with a lead in to the selling of some service you don’t need. Occasionally it might benefit you, such as locking in domain or hosting renewals at a better price – but eve then you will find a more affordable and more efficient service elsewhere. More often than not though, it will be some amateur SEO/traffic add on or similar. Okay some things might be useful to some people, but I don’t want an overly friendly customer service rep pretending to be my friend but really trying to sell me something extra every time I call up with and enquiry.

So, in short, I couldn’t care less about this week’s GoDaddy domain sale…

As a “long-time in the game” domainer you would have thought I’d tried naughty techniques like this before, but in truth I have always focused on the bigger goal of selling domain names for big profit margins. I simply don’t have the time to trawl the web leaving URLs everywhere. That said, in this era of high domain renewal prices, any extra revenue from parked domains is greatly appreciated, so maybe this practice is escalating. Moreover, I tend to steer clear of anything that is borderline unethical or illegal.

During my research, I began reading about other techniques like YouTube baiting, whereby the owner of a parked domain will post an adult natured YouTube video and encourage watchers to click thru to the domain. Once they click thru the parked domain will show adult related ads and the user will usually click one, providing the domain owner with a small profit.  I actually think this technique is more ethical than simply sprinkling a link in unrelated forum posts; at least the YouTube video and the ads the user sees are related.

One serial link baiter I found on a forum advised others not to leave live links but to simply type the URL as text and let users copy and paste into a browser. This apparently avoids getting banned by parking companies and also stops forum masters penalizing you for posting links.

The main problem I see with using such techniques to drive up parking revenue is that if a domain with relatively low traffic suddenly starts getting lots of traffic and lots of clicks, the site will flag a warning light for the host. If a domain goes from earning 0.25$ a day to $5 a day overnight, it will look mighty suspicious. I wouldn’t fancy getting banned from SEDO and risking not being able to sell my domains. I am interested though in hearing from others who do use such techniques. It would be interesting to know the legalities behind this practice and whether there are people making a full time online career like this.

Before I reveal some of my latest domain sales, I will just briefly document how I conduct selling domains.

There are 3 ways in which I make sales; SEDO, Escrow, and PayPal. Primarily I use SEDO for listing domains and currently have about 1000 on there. It’s a pretty simple process; a buyer contacts me, we discuss the price, agree, and then let SEDO handle the rest. SEDO charge a 15% fee, which in my opinion is a rather high. However, I usually ask the seller to agree a split on this fee, although I am prepared to pick this up if need be.

If I receive an offer directly by email, I will conduct the sale and transfer through Escrow.com. Again I will try to negotiate a fee split. Escrow has two services, Standard and Premier. Using the standard service, a $1000 domain will incur a $32.50 transaction fee (3.25%).

For domains under the $1000 mark I prefer to use PayPal because it is hassle free, although it does carry a slight risk of fraud. I won’t transfer a domain though until I have secured and verified the money. I wouldn’t advise anyone to avoid the SEDO or Escrow fees on domains over $1000. The fees you pay are for security that protects your property. If you hand over registration of a domain and don’t get paid you will have a very tough time getting it back.

Sales For The Period Oct 2011 – Jan 2012

It has been a lucrative little period with a few domains I have been holding a fair while suddenly sparking interest. Selling domains is a sporadic industry, and it is near on impossible to predict the high and low periods. For this reason, building a diverse portfolio of domains is important maintaining some buyer interest throughout the year.

Sales Via Sedo:

1. Cardplus.com – 10000
2. Playsoft.com – 5000
3. Hotvpn.com – 1490
4. Hobbyfinder.com -1500
5. Filmark.com  - 1490
6. Tafels.net – 1000
7. Feing.com – 410
8. Adventurestars.com – 750

Sales Via Escrow.com

1. Monodox.com – 6000
2. Gmeals.com – 2000
3. Cosgraves.com – 1950
4. Genering.com – 1500
5. Sitespecific.org – 1100
6. Cottonlinks.com – 1000

Here’s looking forward to plenty more in 2012!

On average, visitors to a site’s typo domains total 0.7% of visits to the genuine site, which is why I am partial to buying a typo domain myself. Typo domains can receive a lot of traffic, of course mostly unintentional. People surf in having intended to type in the genuine site name, but instead type a common misspelling of the domain name. Once the traffic arrives the idea is to hook interest by providing information or interaction that the traffic finds engaging. This drives up the value of the typo domain. So, domainers like me buy up common typos linked to high volume search phrases and then sell them to brands and services looking to protect their business and traffic flow against typo sites, or to Internet Marketers looking to exploit the typo traffic and lure it away from popular brands and services.

Now wait, before you go out and register hundreds of typo domains, do your research first. Try using this tool to find commonly misspelt domains, and use the Google Keyword tool for exact match searches on typo domains. Like cybersquatting, typo domains are seen as a little unethical, but then who decides the rules in cyberspace?  That said, my advice is not to annoy the big players. Recently the National Arbitration Forum transferred youtbe.com, youtub.com, youtue.com, youube.com, and yutube.com to the real Youtube after these typo sites were stealing personal details through fraudulent surveys.

Remember, when you register typo domains there is some law you should be aware of:

ICANN the group in charge of Internet domains and regulations, has a policy where domains can be transferred to the genuine domain as long as three elements are satisfied. Those are:

1) the domain name registered by Respondent is identical or confusingly similar to a trademark or service mark in which Complainant has rights; and
2) Respondent has no rights or legitimate interests in respect of the domain name; and
3) the domain name has been registered and is being used in bad faith

In light of this try not to play ball with big brands you think will come at you. But then again, some do and get away with it; it’s your call.

Sales:

In total, there were 39,951 domains sold across Sedo’s Domain Marketplace in 2011, with the majority of sales in the first half of the year. The total sales volume was $84,431,965, although 80% of sales revenue consisted of confidential sales. When taking into account that the world’s highest-value domain sale—sex.com at $13 million—took place in 2010, the market has stayed relatively stable in 2011

TLDs:

At 44%, .com domains were the most frequently traded in 2011, with .de names a strong second at 18%. 2011 saw 150 different TLDs being traded on the marketplace, and for the first time, previous top ten candidates such as .fr and .es dropped down the list to be replaced by .co and .me.

Sales Method:

Buy Now accounted for 30% of all sales in 2011 as compared to 25% of all sales in  2010. During Q4 2011, the actual percentage of sales at Buy Now prices was closer to 40%, indicating that Buy Now may edge out the competition during 2012 and become the most popular sales method.

Sales Prices:

A massive 47% of traded domain names during 2011 were sold at prices at or under $500. Domains in this category typically consist of at least two keywords, though the keyword language does not always match the associated TLD.

Highest Sales:

In general, Sedo’s highest sales in 2011 were for domains that offered the most generic, or most brand-specific keywords in combination with the highest-value TLDs. For example, the sale of republic.com for $200,000, or dudu.com for $1 million.

Domain Name Length:

The most popular length for any name traded on Sedo’s marketplace is 8 characters. The highest value sale in 2011, gambling.com, was one domain that fell into this category

Most Popular Category:

Business was the top 2011 category, with domain sales such as selfemployed.com and 3dprinting.com. The second category, Shopping, included sales such as niceprice.com and happyshop.com. In third place, Computers included sales like datastore.com and networkdefender.com.

The full report is well worth reading. You can find it here.

When people register businesses they tend to look for short, snappy names, easily brandable and memorable at a first glance. When people register businesses they tend to forget to check if the exact match domain is available first, and that’s where we (the domainers) come in. So it’s a no-brainer really; if people register short snappy business names then domainers should look for short, snappy, memorable domain names.

Where possible, domain names should consist of no more than two words domains. Of course, having a domain like photograph.com or trainers.com is awesome, but you need a big budget to get hold of those babies, so instead try your luck at two-word domains with a medium budget.

When I say memorable, I mean more than just easy to remember. The order of words is just as important, and coupled with this is “relevance”. For example, Barnail.com is easy to remember, but for someone looking to set up a nail bar it is pretty worthless because it doesn’t ring a bell with the target audience. Nailbar.com on the other hand is a home run all the way.

Search engine friendly is another attribute of a valuable domain name. Many people register domains on the basis of search volume. For example, the term “running shoes” has 135,00 exact monthly searches, so it is no surprise Runningshoes.com is worth a fortune. Using the Google Keyword tool  (on exact match setting) you can determine how popular particular search phrases are. This is a great resource for researching potentially hot domains. You can also utilize Google Trends for spotting new trends and trends on the downturn becoming less popular. If you find an available exact match domain with high search volume and a rising trend line, you are on the money trail.

So, if you’re struggling for a place to start when it comes to buying new domains, you wont go far wrong with the concept short, memorable and search engine friendly.

Some people think sharing the pie means less profit, but in fact it often means more. Having a partner not only means halving the risk but also having a second brain available to source great domains and come up with ideas for new ones. This means buying domains you wouldn’t otherwise have bought. You will also be able to invest in higher priced domains outside of your own budget, meaning bigger returns, albeit halved.

The impact of losing money isn’t as great in a partnership, and a good partner will assist you in the decision making process when you are caught in two minds. This assistance can be the defining factor in avoiding backing out of buying a winner or buying a loser. You see, a partner is for more than creating a bigger budget; a partner is for motivation, confidence building, reassurance, risk management and quality control.

Although I have since ventured out domaining on my own, I still maintain that starting out with a partner is a wise move. Of course, it goes without saying that your partner needs to be someone with a solid knowledge of the web and a broad understanding of how domain names are an integral part of cyber business, and of course someone you trust and get along with.

Recently I have been busy locking in my domains before the price rise that in case you didn’t know happened on as January 15th, 2012. The price of .com domains rose by 7% and .net domains by 10%.

7% across thousands of domains is a lot of money, and these year-on-year rises are making domainers think twice about holding onto domains that aren’t returning enough in parking or aren’t receiving buying offers. The agreement between ICAAN and Verisign states that they can increase the cost of .com and .net domains in any 4yrs of the 6-year agreement they signed. Here are the finer details of that agreement:

(ii) for each calendar year beginning with 1 January 2007, the smaller of the preceding year’s Maximum Price or the highest price charged during the preceding year, multiplied by 1.07; provided, however, that such increases shall only be permitted in four years of any six year term of the Agreement.”

Unfortunately, this doesn’t help the plight of domainers at a time when there is an economic squeeze on; it seems most goods and services are coming down in value, except domain names! It isn’t like they need to encourage the registration of domains by lowering prices though; the internet is still growing at a steady rate and people need domain names and domainers need domains to sell those in need.

I think these price increases might put people off getting into the industry, or at least stop domainers speculating on so many domains. This might be a good thing, though. It will stop domainers registering everything and anything, leaving at least some names for the average Joe to register without hindrance, and on the other hand make domainers more selective, conducting better research and making more informed purchases, which will ultimately lead to more profitability (I hope).

I do fear a time when domain name renewal fee will be sky high, $30 plus, meaning a huge cull for most domainers. This would be a smart move on behalf the web community/police – whoever they are- when you think about it. Stopping domainers registering domains means less cybersquatting, endless parking and hoarding domains. But until then, the show will go on….

Another big seller was BoatLoans.com on January 16, which sold for $50,000 to $100,000. Nothing is coming close yet to some of the big boys of 2011, like RunningShoes.com which sold for a whopping $700,000, but we are only in January so there is a long way to go.

Analyzing these two domains it is easy to see why they are in high demand. The pet industry is huge, and PetZone.com oozes branding potential, something we have discussed before as a prerequisite for domain buying. Boats, boating, buying boats and anything to do with boats is generally associated with the rich, and therefore BoatLoans.com no doubt has huge potential for the buyer, who I’m guessing is already in the industry in some way.

Notice that these two domains are both .coms, and while other extensions are getting love here and there at Sedo and DNS, I still favor dot coms and dot nets for scooping the big cash on a regular basis, and that’s where I will continue to focus my attention in 2012.

While I usually use http://www.estibot.com to appraise the value of my domain names, DNS is awesome because you can view the entire sales process from inquiries and quotes through to the final sale. This marketplace provides a great place for newbie domainers to learn about the sales process and get a feel for the type of domains that fetch big money. I have a feeling 2012 is going to be massive for the domaining industry…but then isn’t every year?