How To Conduct a Domain Traffic Test - Part 1

So many domain owners get incredibly confused by all the different companies that want to monetise their traffic for them. Which one is best? How do I really know if they are better than another? What is the best way to run a test? All of these questions are vital if you wish to get the most out of your domain traffic.

In this article I will unpack the critical success factors of what makes a viable good traffic test so that you will always know that you are monetising your traffic with the right provider.

Escrow.com

For a start, to eliminate any discrepancies in timing, all traffic tests need to be conducted simultaneously. What you don’t want to do is change your DNS to point to parking company A and then a few weeks later change the DNS to parking company B. The two separate periods of time introduce large errors in determining who is the real winner.

Without the proper tools, running a simultaneous test can be difficult but with a good partner this is eminently achievable. As an example, we find that at ParkLogic a number of clients use our services purely for benchmarking one monetisation source versus another. We’re happy to work with anyone on this.

The most important factor in a traffic test is understanding the definition of success. So many people fall into the trap of believing that revenue is the only metric that should be paid attention to. So is that the revenue for December or for September? Is that the revenue where there happened to be a 20% increase in traffic or not? Or how about the revenue when it just so happened that an advertiser paid more for the traffic by a mistake?

As can be seen, revenue, although important, is not the best metric to pay attention to during a traffic test. Many domainers have migrated to RPM (revenue per thousand visitors) in an effort to remove the distortions caused by variations in traffic.

For example, if you make $100 from 1,000 visitors then you have an RPM of 100. Let’s imagine that you did a test and you made $200 from 1,000 visitors from a different monetisation provider. Many people jump to the conclusion that the second monetisation provider is the clear winner with an RPM of 200…..and they would be wrong.

The problem with RPM is that it depends upon the views reported by each of the monetisation providers. Sadly, there aren’t any standards on reporting views therefore each provider has a different set of filters applied to the traffic which can dramatically change the number of views reported and ultimately the RPM.

It wasn’t so long ago that some parking companies used RPM more as a marketing tool to say they had the best in the industry! This was easily achieved by just filtering the traffic more aggressively, reporting less views which meant a higher RPM.

For a proper traffic test what we need is an unassailable metric that can be verified for each monetisation source that we wish to test. The only way to do this is to count the raw unfiltered traffic (ie. URLs) that we send to each monetisation provider for each domain and then see how much revenue that generates. This provides us with a normalised RPM (ie. nRPM) that we can then use for direct comparisons at any point in time.

Let’s take a look at some actual data for a domain (XYZ.com) across a ten day period of time (see below). Day 1 is the latest day’s data and Day 10 is the oldest. There are columns for URLs, nRPM and Revenue for 4 parking companies (1-4). The easiest way to understand what is happening is to read the table from the bottom up so that you can get an idea what is happening as the algorithms seek to move in on the higher paying revenue solutions.

Forensic report

Initially, the domain is only with parking company 4 and on day 7 forced sampling was implemented to expose the traffic to the other parking companies. At Day 6 parking company 4 was being beaten by parking companies 1 and 2. More traffic then flowed to those parking companies and away from two and 4 until parking company 2 began to perform and parking company 4 completely dropped out of the race.

In this example, the traffic flowing between the monetisation providers is very dynamic and moves around quite a lot due to the switching regimes being adopted during the sampling process. There’s a lot of moving parts and reasons why the traffic flows where it does but the whole time the algorithms are focused on increasing the domains revenue.

In the next article in this series I will really unpack how to conduct a structured traffic test and why most domain owners get this wrong.

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Michael Gilmour has been in business for over 32 years and has both a BSC in Electronics and Computer Science and an MBA. He was the former vice-chairman of the Internet Industry Association in Australia and is in demand as a speaker at Internet conferences the world over. He has also recently published his first science fiction book, Battleframe.

Michael is passionate about working with online entrepreneurs to help them navigate their new ventures around the many pitfalls that all businesses face. Due to demands on his time, Michael may be contacted by clicking here for limited consulting assignments.

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whizzbang
Hi Michael thanks for the article. Is there a variation on results if the domain is pointed to the platform via DNS A Record ( as ... Read More
02 February 2016
Guest — Michael Gilmour
Really interesting questions....hopefully I can answer them all: Setting the DNS to your own has a number of downsides. 1. Manage... Read More
02 February 2016
Guest — httpscience
hi Michael, thanks for your kind reply. The architecture that I described, is already up and running. Our cost is cd$180 year ( V... Read More
02 February 2016
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How to do a Domain Traffic Test - Assembling the Data

When I was speaking at NamesCon in January I said that I would like to show the attendees the best computer game I’ve ever played. It has all the aspects of both a tactical and strategic game with a bit of time travel for good measure. Everyone leaned forward with expectation…

I then put Excel up on the big screen in the room. It’s safe to say there was a bit of laughter. Let’s think about it for a second, Excel allows us to answer questions about the performance of our domains like no other application can. We can view the past, compare it to the present and even predict the future.

Right now we are going to mobilise the data that we have arrayed from the previous articles in the series so that we can understand what is happening with our domain traffic. This will be a VERY high level view of our traffic test but I believe that it will help get some answers to our questions.

The first thing we need to do is to ensure that all of the baseline data is in the same currency as the testing monetisation source. Once this is done then we then need to convert everything to daily data. The reason why we need daily data is that it gets rid of the problems associated with 28/30/31 days in a month and also allows us to later compare the data against daily from the new testing source.

Next, create another tab in Excel and call this “Latest Data”. When capturing data make sure that you have multiples of 7 days so that any variability caused by the weekends can be minimised. All of this data needs to be brought back to a daily format so that we can then compare it to the baseline.

Make sure you check the DNS settings of EVERY domain in the test so that domains not pointed correctly can be removed. There’s no point in penalising a test by having domains with baseline data and no data from the testing source.

Now create a tab called “Analysis”. In this tab you need to add you complete list of domains in column A, Column B, C and D are for the baseline views, revenue and RPM. Columns E, F and G are for the new monetisation company’s views, revenue and RPM.

Now that the data is sorted out you are now in a position to conduct some analysis.

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How to do a Domain Traffic Test – What are you measuring?

“What are you measuring” seems like an obvious question when you are conducting a traffic test with a new monetisation company. From experience, most people get the answer to this question completely wrong.

When you are running a traffic test you are NOT seeing if you can earn more money. This may sound strange but it’s the simple truth. What you should be actually measuring is the capabilities of the new company to optimise your traffic for a better result. More money (although important) is merely a by-product of the optimisation activity.

Escrow.com

For example, we recently had a client place their domains with ParkLogic for optimisation and as time went by we just couldn’t beat their numbers. In fact, it seemed that the more effort that we put into the optimisation the worse thing became.

It was at this time that I had an epiphany (ie. a brainwave!). It just so happened that the client provided their baseline data in Euros from back in August and we were being benchmarked against these numbers. Since the ParkLogic system uses $USD we dutifully converted the baseline data from Euros to $USD when we received it.

The below graph tells you the story of the relationship between the Euro and USD during this period of time. The Euro has fallen from $USD1.36, when we did the initial conversion for the baseline data, to $USD1.09 (bank rate). That was a fall of 25%!

Exchange Rate

So the fact that we were providing the client around a 5% uplift wasn’t the real result at all. The real result was 5% + 25% = 30%. To clearly show this we applied today’s exchange rate to the baseline data so that we could clearly measure our optimisation efforts and nullify the impact of the exchange rate.

Another example is we were optimising a domain portfolio and the results were absolutely stellar! In fact, we were beating the baseline data by about 250%. Naturally, the client was really happy with the results but something was annoying me about the numbers….

A quick comparison analysis showed that one domain was getting a number of clicks paying $80+ each. We removed the impact of this domain as we did not believe that it was sustainable and redid our analysis. The uplift was still around 135% but I was more comfortable with this number being sustainable.

In both these examples, only paying attention to the money earned column would cause you to completely miss the actually impact of the optimisation effort. It’s not just the data but interpreting the data that is critical to getting the most out of your domain portfolio.

Another simple example is when you have domains that are seasonal in nature that affect the result. These should be removed from any analysis to determine whether the new company is actually adding value. They have the potential to either inflate or deflate the numbers and cause you to come away with a completely incorrect picture of the new monetisation company.

I live a breath numbers all day every day and I would like to say that I’ve seen everything…..but I know that I haven’t. When measuring the impact of any change you must first of all have a clear baseline and then have a metric that you can actually use to measure the impact of that change. It’s the art combined with the science that produces results….and both are constantly evolving.

In a future article I will begin to unpack what metric is critical for determining whether a new monetisation company is performing or not.

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Michael Gilmour has been in business for over 32 years and has both a BSC in Electronics and Computer Science and an MBA. He was the former vice-chairman of the Internet Industry Association in Australia and is in demand as a speaker at Internet conferences the world over. Michael is passionate about working with online entrepreneurs to help them navigate their new ventures around the many pitfalls that all businesses face.

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How to do a Domain Traffic Test – Baseline Data

Doing properly structured domain traffic tests are absolutely critical to extracting the complete value from your domain traffic. What it also means that you need to get down and dirty into the numbers to really understand what’s going on. I’m going to unpack what I mean by this and how we typicaly conduct traffic tests at ParkLogic.

First of all, let me say that doing a properly constructed traffic test is not for the faint hearted and is NEVER as simple as changing a nameserver.

Escrow.com

I was speaking with a domain owner that has been in the industry for many years and still believes that changing the nameservers for their domains is how you start a traffic test. It’s one step in a larger plan and is rarely done straight away.

The first stage in any test is to establish what you are measuring against. For example if all of the domains are currently parked at Company A then the least you need to do is download the last months data to benchmark the success or failure of the test. This set of data is known as the baseline.

There is no point in messing with the baseline data and scaling it up to make the new company “work harder”. I’ve seen data multiplied by a factor and then sent through as “baseline” data. I've even been provided as a baseline the best the domains have ever performed in their history!

Let’s think about this for a second. Let’s imagine the test beats this manipulated data. This is good news because it means the new monetisation company is awesome! The question of what do you do if the test fails is much harder to answer. You either look like an idiot because you leave the domains with the new test….which means the new company knows that you messed with the data or you move the domains away and take a monetary hit. This is even more stupid. So please don’t mess with the baseline data.

Next, hold the baseline data very loosely. Baseline data by its nature is a snap shot at a particular point in time. You need to not only look at the numbers but understand what they mean. This will involve doing an analysis at the domain level and understanding why there are wins and losses.

For example, there is no point in holding the new monetisation company to account for education domains if the test is being conducted in July and the baseline data is from May. Of course education domains will perform better then! In your own thinking you need to remove these types of domains from any test.

All baseline data needs to be reduced to daily numbers. This helps average out the traffic and revenue data across an extended period of time and allows the new company to snapshot a week of data, turn it into daily data and compare it to the baseline.

In many instances you should also screen capture all the high value domain names at the current monetisation company. I would normally recommend leaving this up to the new company. These screen captures can be used to help unravel why some domains may be performing worse than others during the test.

The absolute minimum requirements for baseline data is views and revenue. If you don’t have either of these then you really shouldn’t run any test at all…..it’s just a waste of time.

What we have often done is told the client to leave their domains exactly where they are. We then ask them for access to their current monetisation company account and change the nameservers to ParkLogic. We then route 100% of the traffic back to the existing monetisation company.

This allows us to establish URLs (raw traffic), Views, clicks and revenue. From this we can establish a normalised RPM (revenue per thousand URLs). This number is the ONLY number that will clearly display who is winning in any future test.

After a week of running traffic to establish a normalised baseline we then test a percentage of the traffic elsewhere….but more on this later. By creating a baseline in this method you have a completely accurate measurement of success or failure.

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Michael Gilmour has been in business for over 32 years and has both a BSC in Electronics and Computer Science and an MBA. He was the former vice-chairman of the Internet Industry Association in Australia and is in demand as a speaker at Internet conferences the world over. Michael is passionate about working with online entrepreneurs to help them navigate their new ventures around the many pitfalls that all businesses face.

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