I was reading an article on TheDomains.com about domain traffic monetisation and the comment list ended up being filled with doom and gloom. I found the comments tended to spring from domainers harkening back to the “good old days” when raking in money from their traffic was easy. Many of them also showed a complete lack of understanding about how monetisation has moved on from the “good old days”.

I will once again say upfront that I’m one of the founders of ParkLogic and we monetise domain traffic but in a very different manner from ANY other provider. We work with almost all of the traditional parking companies and many of the global advertising networks. This gives us a unique perspective on the industry, and I believe provides us with some authority to speak on the subject of monetisation.

I would first like to tackle the common misconception that parking providers are thieves. Contrary to popular belief, we find the parking providers are not fraudulent and stealing your money. They are often as in the dark as you are as to why a domain’s earnings have fallen apart or why a clawback was applied to your account. Google is pulling all of strings and they don’t share squat with their partners.

Before you go accusing your account manager of theft think twice. They are actually your best friend who represent you to their larger organisation. I’ve heard of some account managers being treated despicably and it’s about time some bad domainers act a little more professionally. Thank goodness most domain investors ARE professional in their approach.

That all being said, have some parking providers attempted nefarious behaviours in the past? Absolutely! In fact, on the whole these companies are no longer in business. They’ve either been caught out by their customers or partners for doing the wrong thing and have now been expunged from the industry. This means the companies that have survived are generally pretty good.

Now let me comment on the state of play of domain monetisation. Is it dead? Nope. Is it dead for some people? Yes. The major reason why domain investors believe that domain monetisation is dead is because they keep on doing the same thing they always have. Go figure?

Let’s think about this for a bit. Many domain investors complain about declining revenues and then do nothing about it. They may change parking providers but that’s just like changing which cabin you’re going to sleep in on the Titanic.

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.

In this blog I’m going to be a little like Rick Schwartz and have a rant. Many domain investors make the mistake of assuming that domain parking is dead and the only real business model is available to them is domains sales. Is domain parking dead? No, it’s not dead but for a growing number of investors it’s morphed into something a lot more sophisticated.

One of the strengths and weaknesses of traditional domain parking is that behind all the smoke and mirrors lies Google. Google buys a lot of the domain traffic because they have a huge breadth of advertisers. If you have a website that is about "Norwegian Knitting" then it’s likely Google can put relevant advertisements on the page.

The weakness of traditional domain parking is that Google has manoeuvred itself into an unassailable position and has then exploited this position by continually reducing pay-outs. Domain investors shouldn’t be surprised by this behaviour as it’s economically rational in a world that is driven by quarterly earnings calls….so stop complaining and just get over it.

Notice what I said earlier…..Google buys a lot of the traffic. Just because Google is wanting to buy your traffic doesn’t mean you have to sell everything to them. It would be far more sensible to only sell to Google what Google is paying fairly for and then sell to other people what they want to pay more for.

What I've found is the majority of domainers are like a person selling a bucket full of oranges. The buyer (ie. Google) asks if you can throw in your car with the deal and with a grateful smile you say “yes”. In fact, it’s a bit worse than that. Domain investors are selling oranges and Google takes the car without asking because they believe they deserve it. Remember they still only paid orange prices for your car.

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!

We recently had a new client that does a significant amount of domain traffic revenue come across to ParkLogic (I'm a co-founder) for a test. They were previously with a single parking solution and I thought it would be interesting to share with you the results as a case study in why domain traffic optimisation works.

After 6 days the overall results a 20% uplift in revenue…..which is quite a good given the short time frame. It's still early days for the optimisation process to kick in and effectively route the low traffic domains to the highest paying monetisation solution.

When you begin to unpack the data a little further an even better outcome is just on the horizon. For instance, for all those domains that have exhibited at least the same traffic levels as the previous month’s baseline the uplift in revenue has been 39%.

If we hand back to the client, the bottom 10 worst performing domains out of nearly 4,000 in the test then the results completely change. Overall, the performance is a 41.2% revenue uplift with a 75% increase in revenue for domains that had at least the same traffic as the baseline. This is a HUGE result where the revenue line has nearly doubled!

I wouldn't be surprised if the revenue line continues to increase over the next 6 weeks as the optimisation process hones in on the best performing solution. From that point onwards, optimisation will continue every second of every day.