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.

Escrow.com

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 Zero Click Matters

I received an email the other day inviting me to spend some time on a panel at a conference discussing the impact that Zero Click has had on the domain monetisation industry. It should be said that I like data…..touchy feely stuff is all well and good but getting a return from your domain investments is all about getting dirty in the numbers.

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First of all….what is zero-click? Zero-click advertising networks bid in real-time to get access to traffic. In the case of ParkLogic, there may be a dozen or more companies bidding for each piece of traffic every hundred milliseconds or so. The winning bid must outbid every other bidder AND also the best traditional parking solution to receive the traffic. This is all good news for domain investors.

So after receiving the email about the conference I decided to do a dumpster dive into the data and out popped the following chart about the impact Zero Click advertising networks have had on domain monetisation. The data goes from 1 November 2017 to 25 July 2018. I should say that we deal with many traditional parking solutions and zero-click companies and the numbers are aggregate of all of these.

Zero click

 
The chart comprises of three lines with two trend lines on the orange and grey series. The orange line represents the percentage of revenue that is now going to zero click companies and uses the right-hand axis. The trend is clear….it’s headed upwards.

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Wolftalker
..as always.
01 August 2018
mgilmour
I agree that there has definitely been problems of this nature in the past. We have seen that many of the zero-click networks have... Read More
03 August 2018
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Getting Into the Numbers...

I had a discussion with a domain investor today that went like this….."Michael, ParkLogic isn’t performing for my portfolio so I’m going to stop the test.” I replied, “Let’s take a look at the numbers and understand what they are saying.”

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We have a standard report that compares a baseline for domain names versus the most recent data. It only took a few minutes to identify the problem….it just so happened that out of over one hundred domains there were five that were pulling down the results for the portfolio.

Without the five domains there was an overall 63% performance increase. Our recommendation was to move the five domains that were pulling down the results and re-baseline them to see if it just so happens an advertising has gone missing during the USA summer period. If the domains popped back up then it was a great win for the client.

Getting into the numbers is key to assessing the performance of a domain portfolio and yet, so many domain investors don’t understand how to do this. The question that I constantly ask is “Why?”. Why are the domain not performing? Why are the domains performing? Why is company X winning the traffic? Why is the traffic going down? Why is the traffic going up? Why are/are not direct advertisers bidding on a domains traffic?

It’s asking the “Why” which leads to a fuller understanding of the overall portfolio performance. For example, without those five badly performing domains there was an overall revenue increase of 75% for domains that had at least 80% of the traffic compared to the baseline. Anyone would have to agree this was a great result!

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Domain Traffic Monetisation Continues to Grow

For those of you that listen to the naysayers and believe that monetising your domain traffic is dead then think again. The reason why domain traffic continues to be valuable is because advertisers want to reach potential customers.

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This demand for quality traffic has continued to increase while the volume of high value traffic has decreased as domains were dropped. Since the supply is diminishing and the demand increasing then the price paid for the traffic has gone UP over the last few years.

The question has to be asked, “If the price being paid by advertisers is going up then why are most domain investors experiencing a decline in their traffic based revenues?”

The answer is really simple. The advertising aggregators (of which Google is the largest) is taking a bigger slice of the pie. Ask yourself a really simple question, “How much of your earnings are exposed to Google?”

If the answer is “a lot” then don’t be surprised by the decline in your earnings. Albert Einstein said the definition of insanity is doing the same thing and expecting a different result. Are you doing the same thing as you’ve always done?

So how do you get an improvement in your results? I like to think about this in a similar manner to the gold rush. Many years ago, a farmer stubbed their toe on a rock, only to discover the rock was a nugget of gold. This was like the first domain investors monetising their domain traffic. It was an awesome time of easy money!

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mgilmour
That is true. What Google does have is a breadth of advertisers. I think this competitive advantage will be eroded over time but i... Read More
30 May 2018
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NamesCon 2017 - Not Long Too Go!

Vegas will come alive with NamesCon in just over a week! People will be flying from all over the world to get further educated about domains, conduct business and make new friends. I will be arriving on Friday 20th and I’m really looking forward to the swathe of meetings and sessions that I already have lined up.

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The first of my sessions is for registrars and registries and I will be sharing about some new technology that we’ve developed that will enable these two types of organisations earn additional revenue. It's going to a practical session that will unpack a number of great opportunities.

Date: Monday 23rd, 11am
Room: WP Engine Room

If you represent either a registrar or registry then it would be great to see you there as I’m sure it will well worth your time. If you have a clash in your schedule then please reach out to me either here or via the NamesCon app so we can meet one-on-one.

The second session I’m participating on is a panel that will be discussing “Monetisation”. There’s a number of other highly experienced individuals on the panel and I know that we will be all digging into how to get the most from your domain traffic.

Date: Wednesday 25th,12pm
Room: Uniregistry Keynote Hall

I should mention that I will also be accompanied by Laci Nagy from ParkLogic and I know that he’s really looking forward to catching up with clients and partners. Joe Politzer, who works with ParkLogic out of San Diego won’t be able to make it to NamesCon due to the recent birth of his daughter….congrats Joe!

I've been using the NamesCon app to reach out to a number of people and I must admit that it's a fantastic tool for coordinating meetings etc. If you haven't downloaded the app then please do so....it's really good! Click here to download the app.

My wife and two daughters will also be joining me at NamesCon. Sarah (my eldest daughter) will be attending many of the meetings and sessions with me as she is wanting to broaden her experience of the domain industry before her studies this year in social marketing. Please make her feel welcome as she soaks everything up in her effort to learn more about our industry.

So while I’m earning the money through the many business deals Roselyn and Elise will be out spending it up at the discount factory outlets……so if you ever want to do a deal with me then now will be the time. Somehow I’ve got to earn enough to pay for all their shopping! :-)

I’m looking forward to catching up with everyone at NamesCon and making a lot of new friends along the way.

See you there!

Greenberg & Lieberman

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