Advice From the Most Successful Domain Owners of All Time – Part 4
This is part four of a series of five with one piece of advice from some of the most successful domain investors, domain developers, domain monetizers, and others involved in the domain industry. I asked them for one piece of advice they would give to a part-time domain investor looking to build his business. I believe there are quite a few people who are part time domain investors, and I also believe just about anyone involved in the industry can apply some of this advice to their own business models.
I really appreciate all of the contributions from the industry leaders who contributed, and I hope the advice contained within is helpful to you now – or will be helpful to the growth of your business in the future. As an FYI, I intentionally did not put these posts in any particular order.
Warren Royal, Bobbleheads.com:
DEVELOPING? PICK THE RIGHT DOMAIN NAME
I developed my first website in 1994 and have developed many since then. I am a big proponent of developing domains, and I think this is the best way to create revenue. If you have a business, or are looking to create one, buying a great domain name is one of the best investments that you can make. But make sure to get the right one, at the right price. The key is to pick the right name. Here’s a checklist that I use when considering investment opportunities for a project:
1) Is it .COM?
Stick with .COM if you can afford it. If you develop a domain in any other extension, your target audience will confuse your site with the .COM version. For example, I developed Trivia.net over 10 years ago, and developed significant unique content for it, but many of my customers will still confuse it with the .COM version, and will mistakenly visit that site instead of mine.
2) Do I have a clear plan?
Have a crystal-clear development plan in mind. If you have to strain to come up with a plan that “kinda/sorta” fits the name, you probably should move on to a better candidate. For example, the domain names Bobbleheads.com and NorthGeorgia.com are perfect matches for the websites they represent – but I have many others that I have really struggled with to come up with the right development plan.
3) Does it pass a reality check?
Ask some friends (who AREN’T in the domain industry) these questions: “What would you expect to see at the website _________.com? What would you be looking for, if you go there? Would you ever go there?” If their responses match your answer to #1, and they would go there, that’s good. If their response is “Gosh, I don’t know – what does __________ mean?”, then you should move on.
4) Does it have type-in traffic?
If the name passes the test in #3, then it is probably a name that people would type-in hoping to find the product or service that you’re planning to provide. If that’s the case, then the traffic numbers should confirm that this is the case, and it also makes it much easier to obtain sales. In the case of Bobbleheads.com, it was getting several hundred type-in visitors each day, even though there was no site present. That made it very easy for me to start getting sales, as I had visitors – and customers – from day one.
5) Can I confirm the value?
Ask some trustworthy friends (who ARE in the domain industry) what they think about the price. They will have less emotional investment in the name, and should help you to determine if the price is in line or not.
6) Can I really afford it?
If you buy the name, and then the development effort doesn’t work out, can you afford to lose half or all of your investment, or keep the domain for many years without selling it? Or, if you build the site, but your sales never materialize, can you afford to continue to operate it? It’s possible that you may be able to resell the domain, but it’s also possible that you can’t. You should only buy domains that you can afford, whether they are a “good deal” or not.
7) Do I have the right resources to develop it?
If you have the right plan, and the perfect name, but don’t have the technical ability or contacts to actually implement the concept, that’s a problem. I have purchased names with a crystal-clear plan in mind, but then found that I don’t have the right technologies, development resources, or time to get the job done. That’s a problem.
If you can answer all these questions affirmatively, then you’re on the right track for success, and you should move ahead. Otherwise, you should probably look for another opportunity.
To a part-time domain investor I say this: Read, research, and then read again. Education is important in all things and domaining is no exception. You are not going to register a few domain names and make a killing. You will make a killing through important timing and from investments that are carefully thought out. Don’t go overboard and spend money just because you have it. Spend money because it will make you money. And before you spend your money on domains, spend your time reading about domains.
Stephen Douglas, SuccessClick.com:
Buy an ebook on domain investing to learn the basics. There are about five good ones out there. Domain Graduate is a good start.
Do NOT go on a domain buying spree because you think you found a niche nobody else has discovered. Buy one or two, then ask around for help on the domain forums without revealing your domains.
Don’t buy domains with hyphens or numbers, unless the numbers are common sequentials such as “365”, “123”, “247” “360” and maybe “4”.
Don’t use a registrar that charges you more than $10 per domain for a new registration.
Read ElliotsBlog.com for great tips on getting started. Make sure you address Elliot by his proper title, “El Silver!”
Eric Rice, DomainsForMedia.com
No matter what else you do strive to end up with at least one great domain like we have with www.snowboards.com which you can build a long term, stable business on no matter what happens. In most cases my advice would be a domain that you can run ecommerce on.
Pete Lamson, NameMedia:
Treat all purchase inquiries – no matter how low – seriously and with your complete respect given to the buyer.
I can’t even begin to tell you how many seemingly unqualified $10 offers BuyDomains has converted into solid 4 figure (or higher) domain sales.
Low ball purchase offers generally occur for one of three reasons:
1. The buyer is unfamiliar with the domain industry, especially the aftermarket
a. This often occurs with SMB “end users” who are professionals within their own industry – but not the domain industry
b. If the buyer has the budget to acquire your name, but needs a domain industry overview to justify the purchase, take the time to do so. The 15 minutes you spend educating the buyer will be well worth your time
2. The buyer is low balling the seller in search of a favorable price, and is perhaps doing do anonymously
a. In most cases buyers of this type are willing to negotiate to a higher price point
b. Remain professional – but also firm. Negotiate to a common ground that will allow both of you to “win” the negotiation
3. The buyer’s initial low offer may be all they can afford
a. We’ve all received these. High school kids, rock bands, etc. People with no ability or intention to increase their initial low ball offer. Once you know this to be the case, politely decline their offer and move on (and yes, remain professional and polite even if they flame you with profanity laced emails).
The key is to determine into which of these three groupings your purchase inquiry falls. This usually cannot be done with beginning a dialogue with the prospective buyer. Phone is always the best method as speaking with the buyer allows you to build a relationship and pick up on nuances that are often missed through email.
Remember, your prospective buyer may only have interest in one of the names you have registered, but he/she likely has many other options available to them.
If you do not respond to an inquiry – or respond unprofessionally – you run the risk of missing out on profitable sales from buyers who may be in one the first two groups described above.
Respond to all offers – and watch the $$ roll in.
Dan Pulcrano, Boulevards
Pick a domain and use it to build a brand that offers value.
Alan Macomber, Girls Coats:
Don’t spread yourself thin, pick a niche and stay focused.
Focus on a niche and begin to acquire the generic .com domain names related to the niche. In many cases the names are owned by non-domainers and are available at a reasonable price if you approach the owner as a person. Remember these are names that are owned by non battle hardened domainers where manners and respect go a long way.
You’d be amazed at what you can buy for $250, $500 or $1,000. Learn how to pick up a super generic .com for $250 directly from the original owner and you’ll slowly build your domain empire. Over a period of months you’ll know who owns each and every generic .com in your niche and you’ll be prepared to acquire them if they become available.
Lastly, in a private sale never ever disclose your triumphant purchases. You are going to feel like telling the world you picked up a particular name for $500 and get a bunch of pats on the back from your fellow domainers. Fight the urge, you’re the only one that needs to know lest you want domainer competitors in your niche.
Andrew Allemann, Domain Name Wire:
If I were to give one piece of advice to a part-time domain investor, it would be to invest in what you know and like.
I often times see people start development projects or start registering/buying a particular type of domain name because they think it’s where the money is. But if you don’t understand that particular niche, or aren’t enthusiastic about it on a personal level, you are less likely to succeed.
This is particularly true with development. If you develop a web site on a topic you like, you’ll enjoy yourself and end up making money. If you develop a site because you think there’s a lot of money in the niche, you’ll hate the process and make less money in the end.
Tim Chen, Thought Convergence:
Unless you are very lucky, the real value of your domain transactions will be created when you build out a website and/or sell the domain, not when you buy it. So be very careful and very honest in assessing just how much value you will commit to add. Everybody I know has bought a domain with the intent to develop it, and sold it later on untouched. Or bought one thinking they could ‘strategically sell it to end users’ and then sold it at auction when they failed to lift a finger to do so. Some of those people lost money because they overvalued what they brought to the table.
Richard Douglas, TooManySecrets.com:
1. For beginners, the best bang for the buck today is to buy/register keyword rich cctld’s such as .co.uk, .com.au, .co.nz, etc. Sign up for drop lists, look around, there are plenty of deals out there, you just need to spend the time to look for them.
2. Don’t be lazy.
3. After you get some keyword rich cctld’s in profitable niches, build 100 pages of unique content and launch the site. Then, add a page of new content each week. I’d use WordPress with a clean permalink structure and no duplicate content problems.
4. Don’t be lazy.
5. Build two back links per day using a well researched keyword matrix. Remember that a link is a link. That means no-follow, blog comments, images, twitter, bookmarking sites and article sites all count as links.
6. Don’t be lazy.
7. After 6 months you’ll have traffic and rank in the cctld search engines with keyword rich domains in profitable niches that have unique content and back links. You’ll have to decide to monetize or sell the domains.
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