Why is Domain Traffic Still So Valuable?

Domain Traffic is like gold.

For many years people have been making proclamations that the domain monetisation industry is dead and yet….it’s still with us. There is a really simple reason why a number of individuals have been so successful in the domain monetisation industry. Domain traffic is valuable because it converts like no other source of traffic available to advertisers.

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Yes, it’s that simple. Quality direct navigation is like 24 caret gold for advertisers that care to investigate what traffic sources are actually generating their profits.

When you think about it, it’s pretty obvious. If a person goes to beds.com guess what? They want to buy a bed! This gold standard of traffic is what also contributes to driving up the price of high end premium domains.

Many years ago, I read a report released by Google that outlined how domain traffic converted better than search traffic. Not surprisingly, the report quickly vanished…. Everything comes back to advertisers…..and guess what, they want this traffic and they want it bad!

Given domain traffic is so valuable, why is it that many domain investors have been experiencing a decline in their traffic revenues? Once again the answer is simple…..if you depend 100% upon Google to provide you with your revenue then don’t be surprised if they reduce payouts.

I’ve seen domain investors get all upset about their revenue declining but do nothing about it. Go figure? The domain traffic IS valuable but someone else is just taking your lion’s share. What’s the point in getting angry with Google and then doing nothing?

The Google domain management team is doing EXACTLY what they should be doing….maximising Google’s profits. They are not interested in maximising your profits. In fact, if any of them weren’t putting Google first then they would be fired…..

So the question I would like to leave you with is also simple, “Given domain traffic is so valuable shouldn’t you take charge of your own profit line?”

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Why Big Deals Suck!

I’m going to say something pretty controversial, you can’t build a business off big deals. Don’t get me wrong, I love a big deal but to build a business off them is next to impossible.

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I’ve talked to so many entrepreneurs that espouse the next big deal that’s just about to land. In fact, just the other day I was speaking to a person not in the domain industry that told me they had a million dollar deal they were about to get commission on. The problem was they’d been working on the deal for the past two years….

Whenever I hear someone talk to me about a big deal I immediately give it about a 1% chance coming off. Big deals are like that. They take a huge amount of time and resources and have a slim to no chance of actually coming through.

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Defining Traffic Quality

In a number of past articles, I’ve spoken about the fact that traffic quality is entirely dependent upon the advertiser. If the traffic works for them then it’s high quality, otherwise it’s low. This has always seemed to make sense to me until I began digging a little further…..and now I think I could have been wrong...

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Over the last couple of years ParkLogic has been experimenting with how to best define traffic quality. We’ve tried quite a number of third party services that are used by advertisers and what we’ve found is there seems to be a lot of smoke and mirrors bundled with some hefty fees.

The problem is that many advertisers rely upon these services to determine whether traffic they are purchasing is of a high quality or not. It’s the very sophisticated e-commerce website that attributes a traffic source id to a click and then tracks it right through to a purchase.

For those advertisers that wave the flag of Google Analytics then think again. If you think about it, Google is essentially in conflict with itself by wanting search traffic to provide awesome results so that the advertiser will purchase more traffic.

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joezepy
Looking forward to seeing more about this. I think you are on to something that we all have known for years here but has been obs... Read More
25 August 2018
mgilmour
Thanks for that. I believe domain traffic is incredibly valuable and we have been tossing it towards large advertising networks as... Read More
25 August 2018
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Domain Sales Needs a Revolution

Out of all of the different domain investment business models I find myself still a little stumped by some of the actions who invest for domain sales. I understand traffic monetisation and development makes sense but sales is one where I scratch my head…..

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I know there are people that make money from domain sales, but it almost seems like a lottery where a domain name is the ticket. The only way to win is to keep on increasing the number of tickets you have in the draw. Inevitably the law of diminishing returns comes into play and a pile of domains are dropped as they were obviously the wrong tickets…..sigh.

Being a numbers guy, I wanted to dig into what was going on in this part of the industry so the first thing I did was make some back of the envelope calculations in Excel. I’ve often commented that Excel is the best computer game on the market….it allows you to model just about anything and then time travel into what would happen in the future. Awesome!

I should say at the outset that I’m looking at the domains that fall into the stock-turn category. So those of you that have the premium top of the line domains should block their eyes at about now….actually, keep them open them for the next couple of paragraphs.

Premium domains….are an interesting concept. You speak to most domain investors and they’ll tell you about their awesome list of domains and like a guy selling you watches down a dark alley they’ll ask you if you want to buy one.

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mgilmour
My apologies.....forgot that figure! Since they are stock item domains they sales prices is between $1600-$2000. BTW - love to hav... Read More
22 August 2018
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Saturday Musings - Your First Taste of Freedom

This past week I’ve had the pleasure of watching as one of my daughters achieved a milestone that she will never forget. She’d been working incredibly hard in multiple jobs and had managed to save up enough money to buy her first car.

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There’s something really special about your first car. Yes, in your late teens it represents the single biggest purchase you may have made in your life up until that date, but your first car is a lot more than just an asset. It represents a sense of new found freedom and that you’re beginning to cut the parental strings.

“What time will you be home?” is answered somewhat like, “When the car brings me.”

I remember my first car, it was a Mazda 1200. Sounds really sporty until you realise the 1200 stands for the size of the engine in millilitres. For those of you that aren’t enlightened about the wonders of the metric system and how everything ends in zero then this is about 2.536 pints. A simpler way of understanding the engine size is to imagine a reasonable sized motorbike engine and then say to yourself, “That looks about right.”

My first car cost me $200 and came with air conditioning. Well, sort of anyway. The floor was so rusted out that you would get a beautiful rush of air that tickled your toes as you drove down the road. This was great in summer but in winter it was miserable until I squashed a few coke cans down to cover the holes.

The driver seat was bent way back and so being an enterprising young man I built it up with some blankets so that I didn’t feel like I was in a recliner lounge as I drove down the road.

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mgilmour
Now I am green with envy! A Cessna 172!!!
12 August 2018
Rawgi
I would just love to have an old FJ40 about now. We didn't get any of those cars like you had in Australia. Interesting how we w... Read More
12 August 2018
Rawgi
I have had over 80+ cars and trucks , and motorcycles over the years, but my first was a 1954 Chevrolet 2 dr hardtop. Leaked oil... Read More
11 August 2018
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