Finding the Gold in Domain Traffic

Finding the Gold in Domain Traffic

I’ve had many domain investors ask me what is the difference between domain traffic monetisation now versus five years ago. The best way to understand this is to use a simple mining analogy.

During the gold rush floods of people poured onto the gold fields in search of their dream nugget that would make them rich. They looked everywhere and in a number of cases, individuals found a mother-load of gold. 

Then someone came up with the great idea of using a pan to “pan for gold” in creeks. They worked out that heavier gold nuggets would wash into the deeper parts of the creek and all you had to do was sort out the gold from the other rocks. More miners struck it rich with this innovation and gold fever seemed to be catching!

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This is very similar to the early days of parking domains. Initially, all you had to do was find a domain with traffic and point the DNS to a parking company. Magic happened and you received a cheque each month.....cash was raining into the industry!

Now let’s move on with our gold rush…

As gold became more difficult to find miners moved from the creeks to digging shafts into the sides of mountains. They’d pull out the rocks and use a sluice to wash the muck to pull out the gold. The new sluice technology was incredibly innovative and made previously unprofitable mines viable.

In the domaining world it didn’t take long for individuals to realise that by using a complicated spreadsheet and a heap of “look-up” statements they could point some domains to parking company A while others to parking company B. This would then potentially increase the revenue but it required a lot of manual labour. It's the sluice but not full automation.

So where is the domain industry now compared to the gold rush? Right now, to extract all of the domain-gold we are driving shafts six miles deep into the earth’s crust. The crust is actually mass data and systems that plough through the muck and extract the gold.

So this brings up an interesting point….where are you in the spectrum of the domain gold rush?

Are you still putting all of your domains with one parking company because it’s easier? Are you using a traffic splitting system or are you digging into sophisticated analytics each and every day to extract every penny from the traffic?

If you are still parking all of your domains with one company then please let me know as I’d be reasonably confident that I could find a buyer that would be more than happy to relieve you of your portfolio. They would then take the domains and go up with technology curve to extract more value from the traffic.

Before looking at the following case study I will fully disclose that all of the data comes from ParkLogic of which I have a stake. I will also say that ParkLogic is a company that drives very, very deep shafts into the bedrock to search for domain-gold on behalf of clients.
 

Case Study

At the end of July a new client came to us with a portfolio to see if we could extract any additional value from their domain traffic. Prior to ParkLogic receiving the domains they had been using a commercial rotation company to send the traffic to a number of parking companies. The baseline data from May 2015 was around $145 per day.

The first chart shows both the revenue and trend for the portfolio. It’s obviously a pleasing result for the client with the revenue continuing to increase despite the typical downturn that's expected during the USA summer.

b2ap3_thumbnail_20150902_revenue.gif

The second chart shows the normalised RPM for the portfolio. A normalised RPM is VERY different from an RPM that is typically displayed in a parking company interface.

A normalised RPM is when the revenue is divided by the RAW TRAFFIC for the domain while an RPM is the revenue divided by the VIEWS. Why is this different?

Raw traffic is the unfiltered traffic that a domain receives while views is the raw traffic multiplied by some filter applied by the parking company. Since every parking company has a different filter then you get some very different RPM numbers that are quite often used as a marketing tool.

The fact that the normalised RPM trend is increasing indicates that more money is being earned for each piece of traffic. This is good news!

b2ap3_thumbnail_20150902_plrpm.gif

So what’s the bottom line?

By driving a really deep shaft into the data, so far, we’ve managed to increase the revenue for the portfolio by 27.35%.  I’m reasonably confident that over time the portfolio will settle down to around an overall increase of 40%.

Not surprisingly, these numbers actually hide the true results for the portfolio.

If we were to take all those domains that displayed the same level of traffic as the baseline then the increase for them is actually 84%! For domains that had at least 80% of the traffic the number is a 62% increase. In other words, if there is the same level of traffic for a domain we knocked it out of the ballpark. These numbers can be viewed in the below graph.

Percent

Every domain investor needs to ask a simple question, “Where am I on the technology curve?” If you are still “panning for gold” with all of your domains at a single parking company then the data clearly shows that you are not getting the full value for the traffic. I would recommend to at the very least get stuck into Excel and get the sluice working for you.

I will be attending “DomainFest” in Macau later this week and also “The Domain Conference” in Fort Lauderdale at the end of the month. Feel free to reach out to me if you would like to discuss this further.

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Michael Gilmour has been in business for over 32 years and has both a BSC in Electronics and Computer Science and an MBA. He was the former vice-chairman of the Internet Industry Association in Australia and is in demand as a speaker at Internet conferences the world over. He has also recently published his first science fiction book, Battleframe.

Michael is passionate about working with online entrepreneurs to help them navigate their new ventures around the many pitfalls that all businesses face. Due to demands on his time, Michael may be contacted by clicking here for limited consulting assignments.

 
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Recent Comments
impulse
Great posting. You said we should ask ourselves "where are you in the spectrum of the domain gold rush?". But, the bigger question... Read More
02 September 2015
mgilmour
Thanks for that! I know people that are still building traffic domain portfolios right now. The mining side of the equation is how... Read More
03 September 2015
vanclute
Nothing to see here... move along...
03 September 2015
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DomainFest Asia - not long now!

DomainFest Asia - not long now!

I’m really excited about attending DomainFest in Macau. Once again Jothan Frakes and the team have put together an incredible event that is attracting many domain luminaries as well as individuals that are new to the industry.

For those that don’t know, Macau is an old Portuguese colony about an hours’ boat ride from Hong Kong. It’s known as the Vegas of south-east Asia and includes many of the familiar hotels from that famous city….such as, The Venetian and the Wynn.

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It’s a short 9 hour flight for me to Hong Kong and when the event was announced I couldn’t resist attending. As well as this, I think that it was a stroke of genius to put a conference on only a couple of hours’ time zone change for me! How could I say no?

As soon as I signed-up Jothan tapped me on the shoulder for a few panels which I always enjoy. This industry has given so much to me, that like my blog, it’s one of the ways I like to give back. If you’re attending then be prepared for some sessions of in-depth analysis and insights into the domain industry.

So what do I like most about attending conferences like DomainFest? It’s the attendees that really make the event. The industry fosters an entrepreneurial spirit that can’t help but inspire you forward in your own ventures. I’m certain that the many different conversations will open doors to incredible opportunities.

What’s going to be fantastic is meeting domain investors from all over Asia. From my experience they have a unique and often very different outlook on what it means to be a domainer. Whether you’re from India, Korea, China, Hong Kong or any of the many different countries in the region I would love to speak with you to get your thoughts on where you think the industry is headed.

For those of you that are wondering how to get to Macau the DomainFest.Asia website has a great video created by Simon Cousins. He literally takes you on a tour of exactly what to do to get from Hong Kong airport to the conference….many thanks for putting this together Simon!

DomainFest runs from Sept 4-7th and I believe that it will be an event that will become a regular fixture in the industry’s calendar. I look forward to seeing everyone there!

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Michael Gilmour has been in business for over 32 years and has both a BSC in Electronics and Computer Science and an MBA. He was the former vice-chairman of the Internet Industry Association in Australia and is in demand as a speaker at Internet conferences the world over. He has also recently published his first science fiction book, Battleframe.

Michael is passionate about working with online entrepreneurs to help them navigate their new ventures around the many pitfalls that all businesses face. Due to demands on his time, Michael may be contacted by clicking here for limited consulting assignments.

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Saturday Musings - Thinking Outside the Box

Saturday Musings - Thinking Outside the Box

I hear too many people moan and groan about their job, their family or their life. They often feel disempowered to make positive changes over their life. Let me whisper a little secret in your ear….you can change your circumstances for the better! You just need to think a little differently.

For example, let’s imagine that you love your job but can’t stand your boss. Each day you find yourself in two minds of whether to persevere or quit. Solution! Get your boss’s resume and hand it onto a head-hunter. Your boss will get a better job and with any luck you’ll get promoted! It’s only a matter of thinking a little differently.

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If you run a company then when was the last time you fired a painful customer? I remember I ran an Internet Service Providing business a number of years ago and our help desk was being driven insane but a painful customer. I got on the phone and politely told them that we couldn’t meet their level of service expectation and provided a list of three competitors.

They responded by saying, “You know your competitors don’t help customers the way you do!”

I then said, “Well here are the ground rules….”

We kept the customer, managed them appropriately and the support desk was happy once again.

I was speaking to a domain owner who was complaining that they were being harassed thirty to forty times per day by inbound buyers wanting to buy their domain. They have a super-premium domain and have no intention of selling at any price (well....almost). I suggested that they get a premium dial-in number and put a charge of about $10 per minute on it. Suddenly the hassle became worth it and a good source of revenue.

A couple of decades ago I overheard my sales team complaining that they were getting the run around by a potential customer. No matter how many times they called and left messages they couldn’t get the person to reply. I asked for the phone number that ended in 55 and dialled 54.

While the phone was ringing at the other end one of the sales team pointed out that I had dialled the wrong number. I replied, “I know.”

Sure enough the person who answered the call worked for the company that we were after and after a brief conversation that involved, “whoops, I dialled the wrong number”, I was speaking to the person my team had long sought. It’s just thinking a little out of the box that makes the difference.

So you want a better life? Here’s a few simple suggestions.

Get eight hours sleep….you’ll become more potent during the work day and life will look a lot better. Trust me when I say that I used to work to 3am each morning and I was not nearly as focused during the work day.

Think of someone that you love and do something special for them. There’s nothing like seeing their smile…it ignites something on the inside of yourself and them.

Pay the grocery bills of the person behind you in the check-out line at the local supermarket. I’ve done this quite a lot and I can reassure you that I’ve received more out of doing that then the person receiving my cash. You can also do this at the drive-through takeaway…it’s awesome fun!

Do you want to make your family life better? I wrote about fifty little messages on how I thought my daughter was wonderful for her to find scattered around the house. Learn to drink the beverage that your wife/husband likes. For me, it was tea and coffee. What I didn’t realise was that the activity had nothing to do with the drink and more to do with spending time with my wife.

Do something special just for yourself….and then don’t tell anyone. A few years ago I gained my private pilot’s license and didn’t tell any of my wider family. My dad discovered that I could fly when I had him sitting next to me in the cockpit. It was an incredible experience keeping the secret and then going “taaadaaa!”

Life isn’t a chore it’s more the way we are viewing it. Thinking out of the box is taking a look at the challenges that we all face and trying to view them differently. Sometimes we can be so bogged down in the swamp of problems that we don’t realise that the sun is shining overhead.

Have a great weekend!

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Michael Gilmour has been in business for over 32 years and has both a BSC in Electronics and Computer Science and an MBA. He was the former vice-chairman of the Internet Industry Association in Australia and is in demand as a speaker at Internet conferences the world over. He has also recently published his first science fiction book, Battleframe.

Michael is passionate about working with online entrepreneurs to help them navigate their new ventures around the many pitfalls that all businesses face. Due to demands on his time, Michael may be contacted by clicking here for limited consulting assignments.

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mgilmour
The most important thing that I've found is to be humble when posing the question about the groceries. I've never had anyone get u... Read More
25 August 2015
mgilmour
Thanks for that Daniel!
25 August 2015
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Back on the Tools

Back on the Tools

For the past week I’ve dusted off my programming skills and conducted a dive into esoteric world of javascript, php, style sheets, html and Googlecharts. It’s been a while since I’ve really done some hard core development and I must admit that it’s been a bit of fun!

A number of times this past week I’ve entered what programmers call “the zone”….it’s a state of bliss where all of the functions, classes and methods seem to behave themselves. I used the same concept in my science fiction book for a character that is a sniper recon.

Escrow.com

You can always tell when a programmer is “in the zone” as nothing seems to phase them as they tap away at their keyboard. I’ve experienced this state of euphoria, where times seems to stand still until I notice that I’ve been pulling another all-nighter. Typically, it’s the birds tweeting their morning calls that pull me back to reality and out of a complex embedded if statement burrowed somewhere in the code.

I must admit that there were a number of times where my PC bore the brunt of my anguish as I yelled at yet another error. These tend to be tumultuous times of absolute frustration that end in an “ahhaaa” moment when I realise my own stupidity.

So what have I been coding you may ask? It just so happens that the ParkLogic development team needed a helping hand on the downhill stretch for our new platform. Being a bit of a multi-tasker, I put up my hand to see what I could do to help out the team. I don’t think that it’s very often that one of the founders of a company jumps back into the code but what the heck.

This brings up an important point that I really value and that’s multi-tasking. Almost all of our team can perform operational, developmental or sales related tasks. It allows us to be extremely flexible in sorting out problems for clients as well a much deeper understanding of what it means to route millions of pieces of traffic each day around the world.

For example, there’s been many times where a client required a unique solution that relied upon my colleague in business development having a clear understanding of the technical challenges involved. Without an understanding of the DNS the client would still have been languishing in their problems.

So what am I actually building? It’s a completely revolutionary client interface that will provide unprecedented access to data for our client’s domain portfolios. It’s one to have the information and it’s an entirely different matter to mobilise it in such a way that decisions can be made.

As everyone knows, I love my data. I’ve always wanted to have every bit of it at my fingertips….and the first stage will be ready for “The Domain Conference” at Fort Lauderdale. We’ve literally rebuilt every part of the ParkLogic platform with the knowledge and understanding that comes from eight years of insight into the domain industry.

All I have to do is get back in the zone and hammer out another bug. Cheers!

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Michael Gilmour has been in business for over 32 years and has both a BSC in Electronics and Computer Science and an MBA. He was the former vice-chairman of the Internet Industry Association in Australia and is in demand as a speaker at Internet conferences the world over. He has also recently published his first science fiction book, Battleframe.

Michael is passionate about working with online entrepreneurs to help them navigate their new ventures around the many pitfalls that all businesses face. Due to demands on his time, Michael may be contacted by clicking here for limited consulting assignments.

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The Domain Conference Awards!

The Domain Conference Awards!

I must admit that I'm pretty excited about attending the upcoming "Domain Conference" in Fort Lauderdale. I can't remember how many times I've traveled across the Pacific Ocean to attend a conference convened by Howard and Barbara Neu....and each one of them has been brilliant!

So now to the awards.....if you would like to nomiate a person for an award then you must send in the below form by the 20th August, 2015 to This email address is being protected from spambots. You need JavaScript enabled to view it.. Don't forget to book your ticket as the event will be held on the 26-29th September at the prestigious Hyatt Regency in Fort Lauderdale.

You may nominate only one person in each category”:

The categories are:

DOMAIN DEVELOPER OF THE YEAR

I nominate _____________________________________________

DOMAIN BLOGGER OF THE YEAR

I nominate _____________________________________________

BEST REGISTRY OF THE YEAR

I nominate ______________________________________________

BEST REGISTRAR OF THE YEAR

I nominate _______________________________________________

DOMAIN BROKER OF THE YEAR

I nominate ______________________________________________________

DOMAIN INVESTOR OF THE YEAR

I nominate ______________________________________________________

BEST COMPANY IN THE INDUSTRY FOR 2015

I nominate ______________________________________________________

GOODWILL AMBASSADOR AWARD

I nominate ______________________________________________________

DOMAIN INDUSTRY HALL OF FAME

The following have already been inducted into the DOMAIN INDUSTRY HALL OF FAME: MIKE BERKENS, JOHN BERRYHILL, MONTE CAHN, DAVID CASTILLO, MICHAEL CASTILLO, MICHAEL CYGER, SCOTT DAY, ADAM DICKER, CHAD FOLKENNING, JEFF GABRIEL, RON JACKSON, RICK LATONA, IGAL LICHTMAN (Deceased), MIKE MANN, HOWARD NEU, SAHAR SARlD, FRANK SCHILLING, RICK SCHWARTZ, YUN YI

I nominate ______________________________________________________

I would like to wish everyone all the best in being nominated.

Cheers!

Michael

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