This is the third in the series on running a traffic test. The first two articles in the series can be viewed at:
Part 1 – Traffic Test – Baseline Data
Part 2 – Traffic Test – Focusing on Performance

As we discussed in Part 2, what’s vital in running a traffic test is understanding the performance, both positive and negative. The data is the data but interpreting what it’s telling you is far more important if you are wanting to develop long-term value from your domain traffic.

So how is the real live test portfolio progressing so far? The following two charts show the overall trend lines are all heading in the right direction. Despite the time of year and the typical overall decline in advertising spend over the northern hemisphere summer, revenue is continuing to trend upwards.

The second chart clearly shows the reason for this is due to the normalised RPM (or plRPM as we call it at ParkLogic) is also trending upwards as the optimisation algorithms continue their work. For those of you that are unaware, RPM stands for Revenue Per Thousand - more of per thousand what shortly. It’s at this point that I’m going to take a little detour to explain a few things about plRPM and how it differs from RPM.

This is the second in the series on running a traffic test. The first may be viewed by clicking on the link below:

Part 1 – Traffic Test – Baseline Data

One of the challenges of running a traffic test is to determine which metrics should be used for comparison purposes. I’ve had so many people tell me that all that matters is revenue…..I beg to disagree.

Although revenue is a very important metric it is not the only metric that should be paid attention to. For example, let’s imagine the baseline data for an education related domain is from May and the traffic test started mid-June.

Many education advertisers wind down during June and therefore the pay-out rates per click will typically be less for this type of traffic. In addition, depending upon the type of education domain the traffic is likely to be less as well.

What we need to do is to interpret what the data is telling us and not just look at it and say, “The revenue is down, I’m pulling the test.”

One of the challenges in running a traffic test is using views as a comparison metric. Because every provider counts views differently then using this metric can end up becoming quite subjective....that being said, sometimes it's all that is provided in the baseline data so it's better than nothing.

Many years ago, I was sitting in a meeting with a person that controlled a very large domain portfolio. They were running a traffic test with us and we were taking them through our typical analysis and discussing what was happening at the individual domain level. This surprised the prospective client as they said they’d never done that before.

Getting your hands around the data is paramount when it comes to working with domain traffic monetisation. I’ve had a number of readers ask me to write further about how ParkLogic conducts a traffic test and whether it really is worth all the hassle.

The first thing we ask for is baseline data from where the domains were previously being monetised. Some people get suspicious with asking for this information and take the approach that we should just perform as “good as we can” so I thought it would be good to unpack why we ask for this data.

There are three primary reasons:
1.    Focus
2.    Accountability
3.    Trust

By having data prior to starting the test helps us immediately focus immediately on where the effort will have the most impact. Without baseline data we end up spinning our wheels for the first part of the test and this is not worthwhile for either ourselves or the potential partner.

Accountability is crucial in any transparent relationship. We take managing domains very seriously and we believe we need to be held accountable against the baseline data at the very least. Let’s face it, the revenue from these domains goes to paying mortgages and putting food on the table for many domain investors.

The last reason is trust and, in many respects, this is the most important reason out of the three. ParkLogic has a stance that we do not have people who use our service, but partners and these relationships are built upon a solid foundation of mutual trust.

I recently conducted an in-depth analysis of a statistically sound sample of a several hundred thousand domains. There was nothing special or selective about the sample and yet the results showed that contrary to many peoples believe, domain monetisation is alive and well.

I attend a lot of conferences around the world and I must admit that I get a little flummoxed when I hear over and over again claims that domain monetisation is dead. The reason for this is that my company, ParkLogic, sees the actual data from right across the industry and from our perspective nothing could be further from the truth.

When I say we see data for the industry I really mean that. Any domain traffic on the ParkLogic platform is evaluated every hundred milliseconds to see which company will pay the most for it. There’s no guessing or “gut instinct” involved, it’s all about the numbers.

I have two questions to ask the monetisation naysayers:

1. Do you have a statistically sound sample of domains that allows you to speak with any authority?
2. What have you done differently with your domains in the last 6 months?

The first questions strikes at the heart of credibility. If you don’t personally have the data or access to the data, then on what basis are you making claims that can potentially be damaging to the industry.

A few year ago, I was publicly ridiculed in a domain forum by an individual and told in no uncertain terms that I know nothing about domain monetisation. I took the condemnation on the chin and in a private message I asked my accuser how much revenue per month they were doing. The answer was $5.

Over the last few years the domain monetization industry has gone through a silent seismic shift that many investors are completely oblivious about. For the last decade it’s been assumed that with the demise of Yahoo that Google was the only alternative to monetise domain traffic…..boy has that changed!

I went trawling back through the many presentations that I have conducted at various conferences around the world and a slide from May 2016 leapt out at me. It showed the relative difference between revenues generated from traditional domain parking versus direct advertisers.

What you will notice is that around 8% of the total revenue generated from domain names came from traditional parking solutions that are underpinned by Google. The numbers came from ParkLogic and given that we run a truly competitive marketplace for the traffic it means that about 92% of the time Google paid more than direct advertisers.