2008: Year of Uncertainty in Domain Industry
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.
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