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.

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!

Eventually, all the gold was found in the field as more and more investors entered the market and monetised the traffic from their domains. Finally, an innovative company came along and developed the gold pan to get all the gold from the rivers near the farmers field. This created a bit of a frenzy as more and more prospectors entered the market to search for the elusive digital gold.

Once again, all the gold was mined but then another new technology was developed, the sluice. This allowed the processing of mass quantities of dirt and the extraction of every flake of gold from the rivers. This is similar to designing better landing pages to entice users to click on advertising.

I like to think that what my own company, ParkLogic, does is dig a hole three miles deep into the earth’s crust to extract every speck of gold from domain traffic. But we don’t stop there. We are constantly working and improving systems for extracting every cent from domain traffic…..in fact, we never stop. What we are all experiencing is a technological race for extracting the gold from domain traffic.

Now let’s imagine you’ve done nothing with your domain traffic for many years. This would be like trying to compete with a gold pan against someone using a bulldozer and dynamite. You may still find some gold in the domain traffic but the person using new technology will have a massive competitive advantage over you.

To bring this a little back to reality….. processing your domain data with spreadsheets is like using a gold pan. To provide some insight into what ParkLogic does, we track and process around two hundred different metrics for every domain every day…..it’s all about BIG data.

Our current systems make decisions every 100 milliseconds about who will pay the most for each piece of traffic passing through. Similar to the gold rush, each technological evolution has resulted in more gold being extracted from the domain traffic.

Developing technological innovations is not easy. To be quite open with you, it’s been an 11-year journey of continuously developing algorithms to better monetise domain traffic. Right now, around 50% of our revenue is from the large advertising aggregators and the balance through direct advertising and affiliate networks.

Around six weeks ago I wrote an article where a client moved from a single parking solution to ParkLogic and we provided a 39% uplift in revenue. I recently spoke with the client and the latest analysis now shows an increase of 47% above the baseline they provided from Internet Traffic. In fact, digging deeper into the analysis revealed an uplift of 69% for domains that had at least 80% of the traffic of the baseline.

The reason for the uplifts are really simple. Only 49.5% of the revenue being generated is from traditional parking solutions while the balance is from direct advertising networks. The direct advertisers are wanting the traffic and are prepared to pay for it.

What’s really interesting is that on a traffic basis the direct advertising networks earn as much as Google on just 3.8% of the traffic. The trick is to provide each network with the traffic they pay very highly on. When you back out all the numbers the direct advertising networks are paying 28.3 times more than Google for the traffic!

Does this mean traditional domain parking is dead? Heck no! What we have found is that each domain parking company has developed a unique IP to better monetise certain types of traffic compared to their competitors. At ParkLogic, we have had over a decade long relationship with many of the parking solutions and we see this continuing into the future.

As can be seen, ParkLogic is NOT a traditional parking solution. Think of us more as a meta-monetisation solution that makes decisions on who will pay the most for your traffic.

The point I’m raising is not to brag about my own company but rather I found that that most domain investors are leaving a HUGE amount of money on the table. I’m not sure why anyone would do this but maybe Einstein was right……we are all a little insane…..