What's going to happen in 2018?

I would like to start by wishing readers a very prosperous 2018. This sounds really good but what does it mean? Where are the opportunities and how will you take advantage of them?

Whenever I think of investment opportunities I’m forced to reflect upon the underlying business models being adapted. Whether it comes to domains, crypto-currencies or anything else it’s the business models which ultimate will or will not produce the results we all dream of at the beginning of the year.

Let’s tackle the domain investment business models:

Development
For the past year and a bit, I’ve been working on a platform for better monetising domain traffic. The key here was to build a platform that more accurately understood the traffic while at the same time building both immediate and residual revenue. I can only say, watch this space…..as my first evolution of this will be launched shortly.

Domain Sales
I was chatting with a domain investor early this week and he mentioned that once he’d accurately priced his domains he suddenly had sales coming through the door. This caused me to reflect upon the term “accurately”.

The domain industry needs to move away from “gut” reaction for pricing domains and apply a more scientific approach. We’ve all been asked, “How much do you think this domain’s worth?” but what methodology did we apply to our response?

What is clear, is that by more accurately pricing domains you will get a greater yield per domain name. The yield is a combination of both the number of sales and the value. In some cases, an increased yield requires dropping the price to gain more sales. The more accurately you can map the yield curve the greater the return on your investment.

That being said…..there is something about just setting a price and sticking to your guns. I sold an old phone the other day. I knew it was worth $400 and despite a number of people trying to talk me down in price I just told them time and time again I wanted $400. Guess what, I sold it for $400.

While talking about yields is great for “stock-item” domains that you just want to move off the shelf. Sticking to your guns is often a good strategy for higher value domains…..maybe this is the art that should be combined with some science?

Traffic
Monetising domain traffic has been the mainstay of the domain industry for well over a decade. During this time not much has changed…..other than, Google taking a bigger chomp of the pie. Investors have seen their returns decrease and the result has been domains dropping….

As an example, just recently, Google enforced the displaying of multiple advertisements on a two click page. For those investors that are totally exposed to Google this has effectively dropped their earnings per click rates by around 40%. Not something nice to wake up to just before Christmas.

The name of the game is really to move as much as your traffic AWAY from a single advertising source as possible. For the past 11 years we’ve been doing just that with ParkLogic and guess what? For portfolios that have direct advertising implemented the recent drop was only a few percent.

I know I sound like a broken record but you can keep on seeing your earnings decline or give me a call…..despite the naysayers, there is still massive revenues being earned in the domain traffic space. Also, see development above....I'm doing a lot in this space.

Crypto-currencies
Since many domain investors are also up to their neck in crypto-currencies I thought I’d take a stab at what’s going to happen in 2018.

The hype around Bitcoin will continue and it will peak at around $50K and then crash back to more sustainable levels. Bitcoin cash will continue to grow in value as they’ve solved many of the scalability problems that Bitcoin is still wrestling with. Those coins that have real business models underpinning their value will continue to gain traction (ETH and XRP being two of them).

The real issue here is to resist the temptation of the crypto-currency casino and really dig into whether a coin has value in itself or whether the value is coming from speculation. It’s the domain market all over again….so apply some of your experience from that and take a deep breath before you plunge in.

So there are a few thoughts about 2018…..I could go on an on about what I believe should happen but what I would like to hear from is you. Where do you think the opportunities will be in 2018?