10 Year Blogging Anniversary

10 Year Blogging Anniversary

Well, I can't believe it that today is the day of my 10 year blogging anniversary. I would like to thank all those readers that have been so encouraging across the last decade. You have inspired me to keep on writing.

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To say thank you to the entire industry I'm giving away a free downloadable copy of my book science fiction book, Battleframe, on Amazon. Click here to download your copy. Due to Amazon constraints, this giveaway is only available on the 8th and 9th April. I should mention that I wrote this book while travelling to many domain conferences and not surprisingly the central characters name is Whizzbang.

I've also recorded the above video where I share about some of  whizzbangsblog's history and why I decided to start writing. I hope you enjoy watching it and don't mind the enthusiasm I continue to have for our industry.

As a part of the 10 Year Celebrations I plan on releasing quite a number of new videos across this month that will cover a wide range of topics. So tuned tuned!

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Part 1 - How to Price Your Domains for any Market

Part 1 - How to Price Your Domains for any Market

As I’ve stated in a previous article, pricing domains can be a difficult task. Many domain owners firmly believe that the price completely depends upon the buyer. The problem with this position is that it runs contrary to the fact that priced domains are more likely to sell. In this article, I’m going to attempt to put some mathematics behind pricing domains in ANY market vertical.

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I made my first attempt at pricing domains in an article last year. At the end of the article I suggest that a lot more thinking needed to go into the model…..so here goes!

I’m a firm believer in economic theory and the rules of supply and demand. High prices are the result of a combination of high demand and low supply while low prices are a function of both large amount of supply and low demand. You can see the rules of supply and demand all over the business world; from oil and iron ore right through to dog food.

Supply and demand lead me to attempt to build a demand curve for a set of keywords in a market vertical. I entered mortgage, loans and finance into Google’s keyword tool and out popped 703 keywords with both the estimated volume of traffic, recommended price point and demand (ie. competition) for that keyword.

After a little bit of Excel magic I was able to produce the below demand chart for the financial category. I will be the first to indicate that you can actually get a more accurate curve with greater numbers of data points but the essence of the demand curve will remain intact. The interesting thing is you can also build the same sort of curve for any group of keywords.

Demand Curve

So what are we looking at? This is a pretty good picture of a marketers view of the keyword landscape for their particular market. Remember, this does not provide a picture of what they are spending but how much they value a particular keyword.

The only reason marketers will consistently pay more for certain keywords is because the traffic from that keyword provides a return on their investment. This is the why each keyword has a different price point. This means the demand curve is a mirror of the conversion rate for each keyword.

We do know that the average keyword domain sells for around $AU2000 ($US1,500). It could be then said that keywords around the “weighted mean” (ie. the point at which the areas to the left and right of the chart are equal) of $21 will attract the $2K price tag. Domains down the curve will sell for less than $2K and those above this point will sell for more than $2K.

For example, “second mortgage rates” has a bid price of $12.60 which slides it about 25% down the curve from the weighted mean which would suggest this domain is worth around $1,500. On the other hand “second mortgage loans” (a more targeted keyword) is selling for $21.33 and places it right about the mean and a price tag of $2,000. “Second mortgage” is a shorter keyword and has a price tag of $22.86 which pushes up the demand curve by 5% which suggests the domain is worth around $2200.

These prices are guesstimate and I will attempt to do a more accurate pricing later in the article. What’s interesting is keywords such as “refinance second mortgage” is 45% higher on the demand curve than the mean and are deemed more valuable than the shorter keyword versions. So why is this the case?

Remember the demand curve will only keep in place if the underpinning metrics of a sale are met. It’s not just about traffic volume or “brandability”. Ultimately, it’s all about sales! This suggests that people that click on the keyword “refinance second mortgage” are more likely to purchase a second mortgage compared to individuals that click on “second mortgage”.  In fact, we can calculate the number as being nearly 40% more often.

This flies-in-the-face of the assumption that a short domain is a good domain. Sometimes shorter keyword domains provide more traffic but they bring a lot of tire kickers who don’t purchase products or services. The simple act of typing in more letters can be one of the more interesting qualifiers of whether a consumer will purchase or not.

For instance, everyone would assume that “best loans” is a great domain….and yet, the marketers don’t like that keyword and push it down the demand curve. What they love is “home refinance” and are prepared to pay top dollar for traffic from that keyword.

Here’s the problem with this analysis. The amount of $2,000 for the weighted mean is an assumption for this market vertical. I believe that every market vertical will have an average value that domains are sold for…..the majority of this type of information is held by the incumbent marketplaces.

What I’m saying is that for the finance sector rather than $2,000 it could actually be $10,000 or even less for the weighted mean. In my next article I’ll continue to dig and pull out more on the mid-point number.

Battleframe

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Saturday Musings - Whizzbangsblog's Upcoming Anniversary

Saturday Musings - Whizzbangsblog's Upcoming Anniversary

Last night we invited a couple of friends around for a barbeque. It’s a quintessentially Australian thing to do and no, we didn’t have a shrimp on the barbie (besides, we’d have prawns). I find there’s nothing quite as relaxing as sitting outside watching the sun set while you feel the cool refreshing breeze on your face.

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It was then that it hit me….I’ve been blogging for nearly ten years! After checking the whois on whizzbangsblog.com I found the actual ten year anniversary date is the 7th April! Time flies when you’re having fun!

One of the things I most cherish is hearing from you, the readers of whizzbangsblog. Each comment spurs me on to keep writing and digging into all the possibilities that business and domains represent.

I don’t think I’ve ever asked it before but I would love to hear from you about whether you find the articles helpful, challenging, funny or something else altogether. Also, it would be great if you could let me know which articles you have enjoyed reading the most.

I'm planning on compiling a lot of the comments (assuming I get any) to be part of the anniversary celebrations....so don't be a stranger and let me know what you really think!

Many thanks for being a reader here….

Have a great weekend,

Michael

Battleframe

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Being Focused

Being Focused

One of the biggest challenges many businesses face is deciding which opportunities they should focus on and which they should leave for another day. It’s so easy to become seduced by one opportunity after another, only to find that none of them are concluded and their value isn’t realised.

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Over the years, I’ve watched a number of businesses go bankrupt by mismanaging opportunities and becoming confused over what they should be working on. The owners didn’t make the difficult decisions to shelve a great idea, not do some development or say no to a fantastic potential partnership.

If you find yourself surrounded by opportunities and wondering which one you should pursue then there are a number of questions that you may wish to ask yourself. By addressing these questions then you’re very likely to gain a clarity to your thinking that will help you make wiser decisions.

Why am I in business?

This may seem obvious but it really gets down to the bedrock of why you’re doing what you’re doing. Some people get into business because they want to make money, others for the lifestyle and yet other individuals just want to create something. There are innumerable reasons for starting a business and the great majority of them are very personal.

Let’s imagine you enjoy the lifestyle provided by your business, then selecting opportunities that will take up all of your time is probably not a good option. Everyone assumes that all businesses need to grow….this is not always true and asking this question will help you come to grips with what you really want.

What does the business do?

Working out what you are good at and where you add value for clients is critical to understanding where your focus should be. Believe or not, your business can’t do everything.

I’ve walked away from a lot of deals because they would be a distraction to our primary business of monetising domain name traffic. I’ve had untold numbers of people approach me about partnering with them to develop an awesome domain but in the end, I inevitably way no. Developing websites just aren’t our thing right now….they may be in the future but not now.

So many domain owners believe they are domain managers, traffic monetisers, stock item salespersons and are awesome at selling their premium domains. Their time is soaked up with a multitude of tasks and although they are busy they really aren’t focused on what they are good at. To be quite honest with you, each of those tasks require specialised skills and to expect yourself to do all of them well is nigh impossible.

Where’s your business going?

Sounds pretty obvious but thinking about where you would like to be in the future is an important consideration that will have a direct impact on the opportunities you pursue. If you plan on becoming a domain monetisation specialist then you really have to ask yourself why you’re brokering domains.

Having a clear picture of what your business will look like in the future is the only way I know that will allow me to build towards that future. By not having a vision for your business would be like building a house without a set of plans.

Of course, there is only one thing worse then a lot of opportunities…..and that’s no opportunities. If this is your case then you have a very different kind of problem to solve and my guess is you’ll need to address it very quickly or you’ll end up burning a lot of cash.

So this past couple of weeks I’ve been working like mad expanding one of our product lines. It fits in with the three questions but even still my business partner wisely insisted that we do a check against the third question. This has brought crystal clear clarity to the project that would have otherwise not been evident.

These questions have really helped me stay focused on what we do at ParkLogic and I hope they can help you in your own decision making. I look forward to catching up with you all at NamesCon in Vegas.

Greenberg and Lieberman

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Saturday Musings – You’re not going to believe what happened…

Saturday Musings – You’re not going to believe what happened…

Just over a week ago I’d published an article, went to bed and enjoyed the peace that only comes when everything seems to be good. The next morning I awoke to discover that two things had happened in a perfect storm.

The first was that my personal server had been hacked and with laser precision all of my websites, backups, configuration files and system had been eradicated. Trust me when I say that I had a LOT of protections in place but seriously, this was like a guided missile.

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The second thing that happened was that the primary hard drive in my server began to fail. I say began to because sometimes it was there and sometimes it wasn’t. I have a second physical hard disk in my server that I keep all my backups on and that was working just fine except this was hit by the hackers.

Some people have asked me about offsite backups and I answer this in two ways. It’s a personal server….and have you ever had to restore a 500 Gig backup over the wire from your home? It will take about 3 weeks just to transmit the data. Needless to say, I’m exploring “other options”.

So what was the end result of all of this? I lost everything on my blog from about February onwards. I would like to apologise to all of you that have signed up and have to do so again…..sorry about that. I would like to appeal to anyone that has any of the articles on either the “Domain Association” OR “Selling high value domains” as I would love to get them back up as I think that they were really ground breaking.

So what else have I done? I’ve reworked the site, updated the look and feel and I’m in the process of adding a lot more features. Despite the amount of work involved I’ve had a lot of fun rebuilding Whizzbang’s blog from scratch. I’ve also enjoyed learning about security, setting mail servers, database integrity, apache and PHP configurations. There’s nothing like getting your hands back on the tools. :-)

So thank-you to everyone that has been patient with me over the past ten days. If you notice anything not working then please let me know. In particular I would like to thank all of the sponsors. Each of you have been outstanding in your support.

Right now, I think that I’m going to take a rest and get back to finishing my science fiction novel…..it’s up to the fifth rewrite!

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