Saturday Musings - In a World Gripped By Fear

Saturday Musings - In a World Gripped By Fear

Sadly, when I look at the world today I see that it’s largely been caught up in the hysteria of fear. It’s questions like the following that seem to be plaguing everyones mind as the media pumps out an endless litany of terror.

Who will win the presidential race? Does that person walking down the street carry a gun? What are the implications of Brexit? Will I keep my job? Will my kids love me when they’re older?

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Like the USA, Australia is in the middle of a federal election campaign. The two major parties here have finally devolved into, you guessed it, fear campaigns. You can almost feel fear's icy tentacles grip the nation as the attack commercials are shown time and time again on the television. It’s really quite sad.

Being bound by fear of the future and what may happen can be debilitating. One of my favourite science fiction books is Dune by Frank Herbert. In the book there is the following quote:

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Aslan Avdi
- and Dune is a classic.
25 June 2016
Michael Gilmour
One of my favourite books!
26 June 2016
Michael Gilmour
I completely agree with you on this. I think that in many respects the Central Banks have completely lost control of their economi... Read More
26 June 2016
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What Brexit Means For Domain Investors

What Brexit Means For Domain Investors

Well, the news is out! Britain has just exited the European Union and the global financial shockwaves are only rumbling through the markets. It’s only been hours since the announcement but what does this mean for Domain Investors?

For a start, the forex interest in the event has been so enormous that popular website XE.COM crashed. I spent the last ten minutes trying to get any sort of activity and finally gave up. My guess is that it’s experiencing the impact of a very real DDOS (Distributed Denial Of Service) attack from genuine requests rather than a large botnet.

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After flipping across to Yahoo Finance I was able to see that as of this article the Pound has dropped over 12.65% against the USD. Likewise, the Euro has fallen by 3.6% and this will mean a possible boom ride for European domain investors.

The majority of the online advertising market is still in the United States and so any advertising dollars earned will need to be converted to Euros or Pounds. If a UK based domainer earns $US1 they will effectively get an additional 12.65% free of charge.

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Aslan Avdi
Thanks for an interesting take on it Michael ... Read More
24 June 2016
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Using Analytics to Price Domains - Part 4

Using Analytics to Price Domains - Part 4

In the last article in this series I began to unpack the importance of the demand curve for accurately pricing domain names. My experience with domain sellers is that most of them price their domains more by gut then attempting to apply a process. In this article I want to move my line of thinking forward to help sellers more accurately price their domains and buyers know if their getting a fair deal.

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I should say out the outset that I’m going to keep everything as simple as possible by minimising the number of input data points and mathematics…..but hold onto your shirt as it can still get a little tricky! Remember the goal is to see if we can create a demand curve for a market vertical and then attribute pricing to this curve. So where to start?

We can use the google keyword tool (remember there are a LOT more other data points) to provide us with both quantity and price for an individual keyword. It just so happens that the price is more often than not a reflection of the demand for that keyword due to the Google auction system amongst advertisers. Google also provides a competitive index which is really interesting and bears a lot more thought…..I won’t be applying the index for this analysis.

So I entered a whole lot of “gaming” keywords into the keyword tool and out popped the data that I was after. After a bit of manipulation, I was able to produce the following chart (price is the vertical axis and quantity the horizontal). I really haven’t added a huge number of data points but it provides a reasonable picture of demand for the gaming market vertical.

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Michael Gilmour
Hi Jeff, Many thanks for your thoughts. I think what I was attempting to do with by using the Google data was to get a picture of ... Read More
21 June 2016
Michael Gilmour
Hi Adam, yes,,,,maths can be a pain at times. The methodology of pricing domains can be used for both buying and selling.
22 June 2016
Michael Gilmour
Hi Jeff, Couldn't agree with you more....and that is why we founded ParkLogic for traffic monetisation. It basically back fills wi... Read More
22 June 2016
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Saturday Musings - What Terrorists Need To Learn From the LGBT Community

Saturday Musings - What Terrorists Need To Learn From the LGBT Community

I turned on my television this week to be faced with yet another massacre being perpetrated across the screen. Innocent lives snuffed out in an instant by an unbridled rage empowered by a maniac with twenty-first century weapons. All of this in the name of an ideology that has a complete disdain for life and liberty.

The biggest problem with terrorism is not that it appears insane, because it’s not. The biggest problem with terrorism is that its carefully orchestrated to play to the ferocious western media appetite. Just think about it, one attack and the terrorists get a couple of week’s media play in prime time that would have cost millions of dollars to purchase.

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So what we are looking at is not the mad outworking of a deranged individual but an entirely different kind of warfare that the massed military might of western nations is struggling to come to grips with. So if this is a new type of war then what’s the objectives of the terrorism?

I wish that I could come up with an instant answer to this question but sadly that’s not going to be the case. What I do know is that the middle-east is a seething hotbed of dictators, warlords and extremists all trying to enforce their will on an oppressed people. Each of the groups are also armed with weapons that come from either the east or the west…

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Kan
Last week's event's are very sad indeed.. but if you look at the middle east. Most of it's ills are nothing but Western imperial... Read More
19 June 2016
Michael Gilmour
Hi Kan, yes, there are definitely problems in the middle east.. The point of my article was the to highlight the power of expressi... Read More
20 June 2016
Jeff Schneider
Hello Michael, " I will continue to pray for the gay community that lost so many loved ones this week and for the perpetrator t... Read More
19 June 2016
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Demand Based Domain Pricing Strategy - Part 3

Demand Based Domain Pricing Strategy - Part 3

In the previous articles in the series I discussed how much a domain is really worth and some of the potential traps that some domain investors fall into in selling stock-item domains (ie. multiple keyword domains). In this article I plan on tackling both the pricing and portfolio models from the perspective of supply and demand.

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What we do know about the supply/demand curve is that once a domain is acquired the cost of supply is constant for .com domains. Each year there is the same renewal fees (assuming no increase) and the renewal fees are identical to each domain whether it’s google.com or fredspizzashop.com. This line is represented in the blue colour in the below chart.

Standard Supply and Demand Chart

The shape of the demand curve is much more difficult to plot but for now let’s assume that it’s linear and represented by the red line. The industry essentially works under the assumption that optimum price for stock-item domains is around $1,000. What this suggests is that the total volume of dollars sold, Area 1 (yellow), is at a maximum at this price point. In other words, the quantity of domains sold multiplied by $1,000 is the best amount the industry can possibly do for these types of domains. I don't believe this is correct.

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Richard Filing
Michael, this series of posts has been invaluable - thank you. Richard Canberra.
17 June 2016
Michael Gilmour
Richard, not a problem. I'm still doing a lot of thinking about pricing and how domain investors can earn more from their sales...... Read More
17 June 2016
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