Discussions and blogs that relate to the monetisation of domain traffic.

ParkLogic Next - Part 1

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It’s not often that I directly highlight what my own company, ParkLogic, has been working on to better monetise domain traffic. This time I’m going to make an exception. We’re really excited to announce that several weeks ago we completed the migration of the last of the ParkLogic clients onto our new Next platform.

Escrow.com

Around 3 years ago, based upon all the knowledge we’d gained monetising domain traffic over the previous 8 years we made the decision to completely redevelop the ParkLogic platform from the ground up. At the time we had huge aspirations about the development being a 12 month project but like many things involving technology it took a little bit longer…..like just over 18 months longer. This was largely the result of an unending stream of awesome ideas!

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Unlocking Value Through BIG Data

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In this article, I’m going to let you into a little secret. You may not have heard of anyone else approaching domains the way I’m about to outline but in my opinion, it’s the future. These ideas are what keep me so entranced by domains.

Escrow.com

If you are wanting to extract the maximum amount of value from your domain names then the answer is in the data. It really doesn’t make a difference whether you are a buyer, seller, developer or traffic monetizer, the key to generating additional revenue always comes back to the numbers.

As I’ve spoken at conferences or written different blogs I’ve been accused of many things but there has been one consistent accusation that I’m actually quite proud. “You’re always banging on about the numbers!” I love my numbers and more than that, I love trying to interpret what they are telling me.

Over the past 10 years, my ParkLogic business partner and I have continued to be fascinated by domain names because the data tells so many different stories. We’ve taken this to the extreme level by tracking around 250 different metrics for every domain on our platform each day. This leads to hundreds of millions of data points that can be algorithmically analyzed and trend curves plotted over time to see where the next seam of gold will come from.

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Wolftalker
Interesting as always Michael. Congratulations on a good piece.
06 July 2017
mgilmour
Thanks for that!
06 July 2017
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Video - Traffic Monetisation

Video - Traffic Monetisation

This is the final video in the 10th Year of Blogging anniversary series and it covers the topic of Traffic Monetisation. In this video I give my thoughts on the domain monetisation industry, where it has come from and where it is going to in the future.

Escrow.com

One thing is clear, if you are doing the same thing now as you always have done then you are leaving money on the table. This is a must watch video if you have experienced a decline in your traffic revenue over the last few years.

Traffic monetisation has become more of an algorithmic process rather than managing your domains via a spreadsheet. I hope you enjoy my thoughts on traffic monetisation and feel free to ask as many questions as you would like.

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What Influences Domain Traffic

What Influences Domain Traffic

I was having a really interesting discussion with a domain investor recently about why domain traffic appears to be reducing for some domains. What we first need to understand is not all domain traffic is equal. In this article, I’m going to attempt to unpack some of the reasons why domains experience losses/gains in traffic.

Escrow.com

For a start, other than arbitrage traffic, there are two main types of traffic:

1.      Link traffic
2.      Direct navigation

Link Traffic

Link traffic is generated from one website linking to another. For instance, I may value a particular article on Domain Name Wire and link to it from here. As an aside, Andrew Allemann (owner of dnw.com) has been doing a fantastic job for many years reporting on domain news and I highly recommend his website (no, he didn’t request this shout-out).

I will continue to link to Domain Name Wire as long as the article remains in place. Let’s imagine that Andrew decides to stop writing news and instead parks his website. At some point in time I’m going to remove my link to his website and any traffic that was flowing from whizzbangsblog to DNW will cease.

The problem with link based traffic is that over time more and more of the links are moved away from pointing to parked domain names. Any domains that are reliant upon a single high traffic domain are very risky investments as that link may be shut off and the traffic suddenly vanishes.

Direct Navigation

Direct navigation was first coined many years ago by Dan Warner of Fabulous and this traffic is when a user types directly into the address bar to reach a domain.

Interestingly, there has been a real assault by the search engine companies, computer manufacturers and operating system developers to try and discourage users from typing directly into the address bar. To date, the will of the users has reigned preeminent and the address bar still stands in the same place it did twenty years ago…..although it is somewhat smarter.

High value domains such as beds.com will always attract users but the vast majority of traffic domains are typos of a root domain. For example, bds.com is likely to get quite a lot of traffic spilling over from beds.com. In addition, some people accidentally link to a typo domain rather than the core root domain the meant to.

Most domain investors are more than aware of both the ups and downs of linked and direct navigation traffic but what else can cause traffic to ebb and flow?

Traffic is really all about people trying to get somewhere. So the question has to be asked, what made them have this desire?

Seasonality

Some domains have traffic that flows with the seasons. For example, I would imagine that sales of surf boards in the northern hemisphere wouldn’t be very high right now in the middle of winter.

There are more than just the seasons to think about with seasonality. It could be national holidays. Thanksgivings domains rise in traffic in November…..but only in North America. Easter is a broader holiday that has a more international appeal while Father’s Day in Australia is celebrated in September.

Some domains also may have a unique seasonality. For example, I had a domain that only spiked on a couple of days a year. It related to the world-wide celebration of the mathematical symbol pi and within those days I made thousands of dollars. Yes, I couldn’t believe such an event existed either.

Advertising Campaigns

If the root domain has an advertising campaign, then more traffic will flow through to it and any typos of that domain. Marketing managers are always after eyeballs and as well as bidding up keyword values they will at times artificially inflate other domains traffic levels.

Since marketers aren’t stupid, a logical reaction to a competitors marketing campaign may to run one yourself. Therefore, there may be a sudden surge in traffic for an entire industry and any domains associated with it.

News Coverage

Never underestimate the power of news coverage to drive traffic to domains. Many domain owners make a good living by paying attention to the news, registering domains and quickly reaping the benefits of the traffic.

It really makes you wonder whether it’s worthwhile trying to generate some news for a group of domains that you may control….maybe issue a press release or two on a root domain you may own and reap the benefit off the typos.

 

A huge number of forces are constantly buffeting domain traffic and that’s what makes it so interesting to analyse. With Christmas almost upon us we can see marketers demanding more and more traffic to help them meet this quarters targets.

So is domain traffic reducing? I would like to answer this with a yes and a no. Not really as much of the decline in traffic from western nations is being replaced by third world countries.

The challenge here is many of these countries are dependent upon cash as a medium of exchange rather than credit cards. Why is this important? With credit cards, online marketers can complete the revenue cycle from buying advertising right through to a purchase on their website. Even still, nearly 50% of Google’s advertising income comes from international sources.

When you look at your own domains traffic rise and fall then consider you may want to dig into why this is occurring. It’s unlikely to have anything to do with a technical fault at a parking provider and more than likely its some other force at work. Rather that trying to dig into the whys and why nots my suggestion is to spend your time finding more domains with traffic.

Greenberg & Lieberman

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Part 3 - The EPC Opportunity

Part 3 - The EPC Opportunity

The formula outlined in the previous two articles on EPC looks a little scary but whether we like it or not it is THE formula upon which a huge amount of the domain investor community swings. Understanding how it can impact your business actually isn’t rocket science but requires a little intuition. Here is the EPC formula in its entirety.

Escrow.com

EPC Forumla

 

The formula now incorporates the advertisement clicks and also the Monetisation company filter in the denominator. What it does clearly show is the closer you can get to an advertiser the higher the payouts.....no surprises there! The goal is to effectively eliminate many of the margins on the top line and potentially remove one of the multipliers in the denominator.

There are two problems with managing direct advertising relationships:

1.      There’s a large hidden downside cost associated with the relationship management.

2.      Most domain owners don’t have the scale to attract the interest of the serious advertisers.

The one great thing about domain parking is that it’s scalable without scaling the direct cost base associated with matching the advertisers. The question is whether there is enough free margin available to offset the costs.

The rise of zero-click solutions is an attempt at getting closer to the advertiser in a unique manner. For those of you that are unaware, zero-click is where domain traffic is routed directly through to an advertiser’s web page and does not require a click. Behind the scenes there is a real-time auction process to determine whether the zero-click advertiser will pay more than a parking solution for the traffic….if they do, then they get the traffic.

Many of the zero click companies have moved away from working directly with domain owners because the domain owners do not have enough traffic to warrant working with them. The cost of doing business is just too high…..therefore domain owners are faced with working with traffic aggregators.

What needs to be appreciated is that as soon as you add zero click to the mix then you are effectively introducing yet another EPC. Remember that EPC is a measurement across a period of time (typically 1 day) while zero-click is an offer at a point in time. In terms of the stock market, this is comparing an average price versus a spot price….the two don’t mix.

Let’s take a look at an example that will hopefully provide further insight into the challenges of zero-click. Remember the example of EPC we used in article two in this series? The EPC was made from six clicks each of $10, $10, $5, $5, $1 and $1. The final average EPC result for the day came to a value of $5.33. You don’t know the individual values that made up the $5.33 you ONLY know the $5.33.

Let’s imagine a zero-click solution offered $6 for the traffic? Since it’s more than $5.33 then it looks great! Wrong! Zero-click solutions are smart and only want the pristine traffic. They can often accept the traffic that you were previously getting paid $10 for and now pay you $6. Your average EPC for the day has now dropped to $4……which is lower than you received previously.

Correctly setting up a zero-click initially solution sounds trivial but it actually isn’t. There must be a dynamic swinging of the real-time auction process to ensure each piece of traffic receives its full value. This can get really complicated really quickly!

I hope this series of articles helps domain investors in their understanding of one of the very much taken for granted metrics that are bandied around. EPC isn’t as simple as can initially be thought about and yet coming to grips with its intricacies can pay significant dividends. If you have any questions then please don’t hesitate to leave a comment below.

Greenberg and Lieberman

Recent Comments
vanclute
and this is why I work with ParkLogic.
25 November 2016
mgilmour
LOL and thank you for your kind comment. :-)
25 November 2016
vanclute
It was made with all sincerity! Trying to manage my own advertiser relationships was an area of absolute disaster for me as a tra... Read More
25 November 2016
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