internet bizz

Copyright © 2007 Joel Comm and InfoMedia, Inc. – All Rights Reserved
Buying And Selling Domain Names For Profit By Joel Comm
www.JoelComm.com
Copyright © 2007 Joel Comm and InfoMedia, Inc. – All Rights Reserved
Table Of Contents
INTRODUCTION — WHAT IS THE DOMAIN TRADE AND WHAT CAN IT DO FOR ME?.............................................................. 3
1. IDENTIFYING, VALUING AND BUYING DOMAIN NAMES ... 4
1.1 “Typos” — Making Money From Mistakes ............................ 5
1.2 “Type Ins” — Giving Users What They Want ....................... 7
1.3 Valuing A Domain Name .................................................. 9
2. PARKING YOUR SITE ...................................................... 12
2.1 What Is Site Parking? .................................................... 13
2.2 Keywording Your Parked Domain..................................... 14
2.3 WhyPark.com — An Alternative To Domain Parking? .......... 15
3. FLIPPING YOUR DOMAIN — HOW TURN AN EMPTY SITE INTO A DESIRABLE PROPERTY ........................................... 17
3.1 The Right Content For A High-Value Domain Name ............ 18
3.2 Traffic — What A Buyer Really Wants To See .................... 20
3.3 Revenues — The Real Value Of Your Domain Name ........... 21
3.4 When Is The Best Time To Sell A Developed Domain? ........ 22
4. MARKETING AND SELLING YOUR DOMAIN NAME ........... 25
4.1 Get The Price You Expect From The People You Know......... 25
4.2 Chatting — And Selling — On Domain Name Forums.......... 26
4.3 Going, Going... Gone! Selling Domain Names Through Auctions............................................................................ 28
Conclusion.......................................................................... 29
Copyright © 2007 Joel Comm and InfoMedia, Inc. – All Rights Reserved
INTRODUCTION — WHAT IS THE DOMAIN TRADE AND WHAT CAN IT DO FOR ME?
There was a time when domain names were like goldmines. You could open a dictionary, pick a word, register it as a dotcom for a few bucks then sell it on to some wide-eyed developer with a sackload of venture capital money for a six- or even a seven-figure sum. If you’re hoping that this report will teach how to do that, then I’m afraid you’re going to be disappointed. You’re several years and one bubble too late. But you shouldn’t be disappointed. In fact, you should be grateful. Back when domain name speculation first took off, prices rose and fell faster than ratings on a new reality show. Lots of people got burned. While some people got rich, far more lost their shirts. Today, the market might be more mature but it’s also a lot more stable. There are techniques that have been tried and tested and will help to increase the chances that you’ll generate a profit — even before you make the sale. In this report, I’m going to explain some of the ways that you can make money buying and selling domain names. I’ll begin by revealing how to choose a domain to buy. That’s obviously going to be the most important decision you make, and with single-word domains now harder to find than a hill full of gold, you’ll need to know how to value a domain as well as how to buy it. I’ll explain how to do both. Once you’ve bought a name, there are two ways to earn revenue from it: by parking it and earning from the ads; and by selling it on and profiting from the difference between the purchase price and the sales price. In Chapter 2, I’ll discuss what you need to know to earn from parked sites. I’ll then move on to selling your domain name. It is possible to buy a name, do absolutely nothing with it then sell it for a profit... but don’t depend on it. If you can find a buyer prepared to pay more than you offered the seller, then that seller should have been able to find him too. You might get lucky and spot a good domain name going for a song, but you’ll usually be much better off renovating your domain before you sell it.
Copyright © 2007 Joel Comm and InfoMedia, Inc. – All Rights Reserved
As an AdSense publisher, you have all the skills necessary to do just that. You’ll be able to turn your site from an empty plot to a piece of highly desirable commercial property. That’s where the real profits come from, and I’ll explain the principles to make it happen. And finally, once you’ve developed your site, you’ll need to find a buyer. I’ll offer some tips to find high-paying customers and persuade them to pay top-dollar prices. Buying and selling domain names isn’t like website publishing. Publishing content and earning from advertising is a business venture. It requires plenty of work but demands very little money. Your investment will usually be time rather than cash. Domain name trading though is a form of investment and like any investment, it requires money and carries a risk: as they say at the end of the ads, prices can fall as well as rise. If you’re only going to earn from parked domains, then everything will come down to your choice of domain name. You’ll have to be able to spot potential high-flyers and pick the right time to sell them in exactly the same way that financial investors evaluate stocks. If you’re going to improve the domain before you try to sell it, then the name you choose will still be important. But the likelihood of profitability is much, much higher. It takes more effort than simply parking a good name and earning from the ads but the risks are a lot lower. Let’s begin though by talking about choosing a name.
1. IDENTIFYING, VALUING AND BUYING DOMAIN NAMES
I’ve pointed out that buying and selling domain names is a type of investment. Like any investment, it requires that you lay out money before you can recoup your profit. That means you have to choose where you put your money very, very carefully.
Copyright © 2007 Joel Comm and InfoMedia, Inc. – All Rights Reserved
You will have plenty of choices to make. Domain names that are bought and sold for profit come in two different types — “typos” and “type-ins.” In this chapter, I’ll discuss each of those options and explain how to make your decision.
1.1 “Typos” — Making Money From Mistakes
Most people are pretty poor at typing. We hit the wrong keys, leave out letters and practically create a completely new language every time we sit at a keyboard. If it wasn’t for autocorrect and spellcheck, I doubt if we would ever understand anything anyone ever wrote in an email or a Word document. But browsers don’t have spellcheckers. Mis-type the name of a domain in your browser, and you’ll be taken to the site you asked your browser asked to show you, not the site you wanted to see. Some of the smarter sites bear that in mind when they register their domains. Type “gogle.com” into your browser, for example, and you’ll be redirected to Google’s website. But type “ggle.com” into your browser and you’ll get something completely different.
Fig. 1.1 Gggle.com prefers to offer nutritional information than make money from advertising. It takes all sorts... Instead of reaching Google, you’ll see a notice from a domain broker saying that the name is for sale. The owner also states that he has several thousand domain names which together pick up over a million unique visitors each month.
Copyright © 2007 Joel Comm and InfoMedia, Inc. – All Rights Reserved
Some of that traffic might come from the blurb at the bottom of the page. Instead of placing ads, Nucom.com, the broker that owns this particular domain, has stuffed the page with quotes from books about nutrition. That probably helps with his search engine results and gives him more traffic but if he’s not monetizing that traffic, the benefit is limited. In any case, this page and others like it will pick up plenty of traffic just from people looking for Google and mis-typing the address. A small collection of carefully-chosen domain names like this, filled with ads, can generate some very useful income without effort even before you sell it on. You could even redirect the traffic to another, AdSense-optimized website on a topic related to the subject of the domain name. But there are a few things you should consider before buying a domain name that depends on people making typing mistakes for much of its traffic. The first is the popularity of the correct domain name. Clearly any domain that’s a variant of a giant site like Google is going to pick up more misdirected traffic than a misspelling of a site with just three visitors a month. That means it’s going to generate more ad clicks and be worth more money. In fact, because only a small percentage of people will mis-type the domain name, and only small percentage of those will click an ad, you will need to choose a mis-spelling of very well-known site to make the figures work. But be aware that the popularity of sites changes. A site that’s doing very well now might have almost no visitors in three months’ time when you’re trying to earn back the money you spent on it. In addition to assessing the popularity of a domain name then, you need to consider whether that popularity is permanent or seasonal. A typo of a baseball team, for example, is likely to receive more visitors during the baseball season than during the off-season. Buy the domain at the end of the baseball season and you’ll have to wait before you see any money. The second thing you’ll need to consider is how close the mis-spelling is to the original word.
Copyright © 2007 Joel Comm and InfoMedia, Inc. – All Rights Reserved
That’s a much tougher call than assessing the popularity of a website. People mis-type words for all sorts of reason. Double-letters often become single letters and fingers hit adjacent keys instead of the ones they want. In general though, the fewer the mistakes in the typo, the more traffic the domain is likely to pick up. Copyright is also going to be an issue. Close mis-spellings of company names might well be protected by the company’s copyright. Try to sell them — or even build on them — and you might be rewarded with a letter from a big law firm telling you to hand over ownership. Whether they’d win a law suit is debatable. But you don’t want to pay a lawyer to find out. And if that wasn’t enough to consider, there’s also the issue of keywords. The subject of the original site will affect the value of the ads that your domain receives and the likelihood that users will click them. Typos of sites about financial products, for example, are likely to earn more advertising dollars than typos of sites about children’s shoes. In general then, if you’re looking for a domain name that contains a typo then those that are similar to popular sites that contain high-paying keywords are likely to be worth more money. Buying sites like these is certainly one way of earning cash with domain names but it’s not certain that you’ll be able to sell them on for a profit. Unless you get lucky and the correctly-spelled domain name suddenly takes off, the value of your domain is unlikely to change — and if it does change, can fall as well as rise. Your profit will be in the amount of money the ads on the parked domain generate. If you’re looking for a more stable way of earning money, with more potential higher revenues, then “type ins” are a much better choice.
1.2 “Type Ins” — Giving Users What They Want
Typos depend on users making mistakes to generate traffic and can earn revenue in three ways: from ads on the parked page; by redirecting traffic to another revenue-generating website; or by selling the domain for a profit.
Copyright © 2007 Joel Comm and InfoMedia, Inc. – All Rights Reserved
Type-ins depend on users looking for specific topics. They can earn revenue in all of the ways that a typo can but with one important addition: by developing the site. That opportunity makes a huge difference. The chances that someone is going to construct a commercial website based on the domain name Morgidge.com, for example, is fairly small. While the domain might get some traffic from people who can’t spell “mortgage,” as a business site, the name alone would make it look unprofessional. The pool of people you can resell the site to is always going to be fairly small and would only include other investors. Mortgage.com, however, because it could be developed into a website with plenty of targeted traffic, might be worth enough to pay for your house. Of course, good quality type-ins are hard to find. Some 97 percent of dictionary words are believed to have been registered. That leaves a number of options. You can choose to use a suffix other than .com. There is a market for domain names that end in geographic suffixes such as .co.uk or .fr, but bear in mind that suffixes that aren’t relevant to the domain name will have a lower value. Beaches.ch, for example, is likely to be worth less than beaches.au; Switzerland is less famous for its beaches than Australia is. Other suffixes such as .biz can be useful but even domain names that end in .net are often worth just 5-10 percent of the .com versions. You can push words together. Single-word domains such as Computers.com might cost a small fortune — if the buyer is willing to sell — but phrases such as EasyComputers.com or YourTownComputers.com might cost much less and could even be available for no more than the cost of registration. Again though, the longer a domain name, the lower its value. Even hyphenating words can reduce the price of a domain name, and adding numbers to make a domain name unique makes it almost worthless.
You can buy from a dealer. This is where things start to get interesting. Put two or three words together to form a domain name and find that that phrase hasn’t been registered, and you’re on to a
Copyright © 2007 Joel Comm and InfoMedia, Inc. – All Rights Reserved
sure thing. Registering the domain name would only cost less than ten bucks, so the risk is tiny. Find that it’s been registered by another investor who’s prepared to sell it for $250 or $1000 or whatever it may be and you’ll have to do some smart figuring to decide whether or not it’s worth the price. That’s always going to be your most important calculation.
1.3 Valuing A Domain Name
I’ve already mentioned some of the things that can affect the value of a domain name: its length; its suffix; whether it contains keywords etc., but none of those things will tell you what exactly a domain name is worth. A domain name — like anything else — is worth exactly what someone is prepared to pay for it. That makes the domain name market more like the property market than the used car market. There’s no Kelly Blue Book for domain names. To know whether a price demanded for a domain name is reasonable, you need to know a little about the market and a little about what you’re buying. A good place to start is at the auctions. Sedo.com, for example, is a site that lets domain name investors buy, sell and park their domains. It also runs domain name auctions that let you see the current state of bids.
Fig. 2. Sedo.com’s auctions show you the state of the market.
Copyright © 2007 Joel Comm and InfoMedia, Inc. – All Rights Reserved
What you’ll get by watching these auctions though is fairly limited. You might come to understand that most domain names sold on auction sell for low three-figure sums rather than high five-figure amounts. And you will get a general feel for the sort of prices being tossed around. But unless someone sells a domain name very similar to yours — which is unlikely — you won’t get a close idea of how much your domain is worth or how much you should pay for a domain that’s already been registered. So starting by browsing auctions is a good idea just to get a feel for the market but when it comes to actually setting a value, you have to do some calculations. The numbers you look at will depend on what you plan to do with the site. If you plan to park the domain and earn from the ads until you can find someone prepared to pay more for the domain than you paid, then it’s all fairly straightforward. You’ll want to know exactly the same sort of information that you’d look at on an AdSense page: the number of visitors over a set period time (at least three months); the number of clickthroughs, the cost-per-click and the revenues. Most buyers of parked domains will be willing to supply that data, and if you’re buying from a seller at a reputable forum such as NamePros.com, DNForum.com or DomainState.com, you should be able to trust the information you receive. That just leaves you the question of how many multiples of monthly income you’re prepared to pay. Or to put it another way, how long do you want to wait before you start making a profit? Yes, you’ll be hoping that the sales price alone will give you a profit — but you can’t guarantee that will happen. You might end up selling for exactly the same price you paid. If you know that your parked domain will give you some income each month, then you know how long it will take before you get your money back. At that point, any sales price will be a profit. There’s no one answer to how many multiples of monthly income you should pay, but what’s clear is that the easiest way to make money out of parked domains is to buy from sellers who want to sell fast and are prepared to accept low multiples.
Copyright © 2007 Joel Comm and InfoMedia, Inc. – All Rights Reserved
If you’re planning to buy a domain that will be developed though, the calculations are much harder, especially when you’re just starting out. If you’ve built a site with a similar domain name, you might have an idea of the amount of revenue the domain can bring in each month. And if you’ve seen a similar domain name sold at auction, you’ll have a good idea of the amount that buyers are prepared to pay. But if you don’t have either experience, you’ll be dealing in the dark and that’s never a good thing. One way of getting a clearer picture is to ask people. NamePros.com lets domain dealers ask members to appraise their domain names through the forum. Often though the response is nothing more than a general “low, “middle” or “high.” And sometimes you might prefer not to alert other dealers that a particular domain name is available. An alternative is to have a domain professionally appraised. That’s often a good idea, especially if a seller is asking for a lot of money. Both Sedo.com and Moniker.com offer this service and the price ranges from $24 to $29 per domain. Obviously, if a seller is only asking $100, it might not be worth spending $30 to be told the domain should sell for $80. But once the price starts to get higher, a professional appraisal can be a good insurance policy against overpaying — and tell you how much you can expect to resell the domain for too. And that’s really the point. You don’t want to buy a domain name at the market rate and sell it at the market rate. You want to buy it at below market rate and sell it at above market rate. That’s why the best way to know how much a domain name is truly worth is to know how much another buyer is prepared to pay for it — and pay less than them. Of course, that’s easier said than done, but it is possible — and it should be your goal.
Copyright © 2007 Joel Comm and InfoMedia, Inc. – All Rights Reserved
If you know that a domain name has three potential buyers before you pay for it, and you know roughly what their budgets are, you can guarantee that you’ll make a profit on the resale. You’re not going to have those sorts of connections straight away but you can develop them over time. When you make your first sale, ask the buyer if he or she is looking for other similar domains. Often you’ll find that they are, either to develop a range of sites in the same fields or to block competitors. If you can then find a source of similar domains — either by dreaming up unregistered domains or by browsing auction sites and forums — you can become a kind of domain name agent for website publishers. You’ll know how much your market is prepared to pay for a domain and therefore how much you can afford to pay for it. As I mentioned, it takes time to build up this sort of expertise. And it’s easier to do if you choose to specialize in a niche, whether that’s domains related to computer games or sites connected to home improvement. (Although there’s also nothing wrong with developing expertise in the domain markets of a number of niches and spreading your risk.) When you know exactly who you can sell a domain to, and where you can find it, you’ll know you can run a domain-selling business.
2. PARKING YOUR SITE
In the previous chapter, I mentioned parking your site. I’m not a great fan of this practice. The revenues are usually fairly small and if you’re going to earn from advertising, then frankly you’ll do much better building an AdSense-optimized website. But it can be an important part of the process of buying and selling domain names — and as we’ve seen, it can even make the difference between a deal that breaks even and a deal that makes money. In this chapter, I’m going to take a quick look at site parking, discuss the limitations, and mention some alternatives.
Copyright © 2007 Joel Comm and InfoMedia, Inc. – All Rights Reserved
2.1 What Is Site Parking?
Imagine you’ve just bought a plot of land. You believe that property prices in the area are going to go up and you’re hoping that in six months’ or a years’ time, you’ll be able to sell that plot and make a handsome profit. Along comes a local restaurant owner and suggests that instead of leaving the plot empty until you sell it, he’ll put up a big billboard advertising his business and pay you a fee. You were assuming you’d get nothing for that plot until you made your sale. Now you’re getting a regular income as well as the sale price you hope to pick up at the end. On the Internet you can use a similar system by parking your domain with one of the many companies such as Moniker.com, Sedo.com or Parked.com that offer this service. You’ll get a choice of templates, they’ll supply the ads and you’ll both share the revenue.
Fig. 3 A domain parked with Sedo.com. You choose the layout and the keywords... and hope that users choose your domain. What could possibly be wrong with that? In the world of real estate, nothing at all. In the world of domain name investing, very little.
The difference is that the owner of a plot of land with an advertising billboard on it would get paid whether anyone sees it or not. The owner of a parked domain only gets paid if someone clicks on the
Copyright © 2007 Joel Comm and InfoMedia, Inc. – All Rights Reserved
ads. And while the road an empty plot lies on would appear on maps, parked domains tend not to be indexed by Google. If that’s not bad enough, here’s the zinger: you can’t advertise parked domains to bring in traffic or create new links. Parked domains can only rely on the traffic sources the site had before they were parked. So a domain name that’s never been registered, has never been built on and is unlikely to be typed into the browser directly is unlikely to generate much, if any, parked revenue. That means that typos of popular sites are good for parking as are expired domains that already have plenty of backlinks. In general though, to make money out of parked domains, you’ll need a large portfolio that consists of a mixture of typos and expired domains with plenty of pre-existing links. You’ll also need to know which keywords to use because that’s going to be very important too.
2.2 Keywording Your Parked Domain
Put an AdSense unit on a page of content, and Google will examine the page, decide what it’s about and serve up relevant ads. A parked domain though has no content. It might have some fancy pictures and a nice template but it’s not going to have any of the sort of articles that bring in users and generate targeted ads. If you want the ads on your parked domain to be relevant to the topic of the domain — which, of course, is the best way to get high clickthroughs — then you’ll need to tell your parking service provider which keywords its ads should match. Often, you can leave it to the service provider to decide for you, but that’s rarely a good idea. Only by providing relevant keywords can you expect your parked domain to serve ads that visitors will want to click.
The easiest way of doing that is to look at where your users are coming from. Because you’re going to have limited sources, that shouldn’t be too difficult at all. When users arrive through a search engine, the terms they use will appear in your stats. And when they arrive from a pre-existing link, you’ll be able to see the meta-
Copyright © 2007 Joel Comm and InfoMedia, Inc. – All Rights Reserved
keywords the source site has used. If that source site is about a similar topic to your domain, those keywords should work fine on your site too. But like any form of online advertising, it pays to test and track. Try entering different keywords, following the results and keeping a record of which terms bring the highest revenues.
2.3 WhyPark.com — An Alternative To Domain Parking?
Parking has a couple of major flaws: you can’t add new links, so you’re dependent on pre-existing traffic; and you can’t add content, so you’re not likely to get a high ranking search engines or hold on to users. There is now an alternative option though. WhyPark.com places relevant content on your parked domain. You enter the keywords, the company supplies syndicated press releases and articles, and you earn by pasting your AdSense code onto the page. That’s right, because you have content, you can now get the sort of targeted ads that you’d receive on a conventional AdSense site. You even get to keep all of the advertising revenue and WhyPark pays an affiliate commission of over $45 for referrals. So what’s the catch? The catch is that it costs $99.95 for each block of 100 domain names. If you already have 100 domain names lying around earning next to nothing on a parked site then, you’d only need each site to earn $1 to make your money back. If you’re building that portfolio now though, you do need to consider the math. Each unregistered domain costs around $9 to buy new. If you were to buy 100 then, you’d be laying out about $900, plus $100 to put them on WhyPark. That’s a $1,000 investment, a sizeable amount for someone just starting out.
Of course, you could buy fewer domains. Start with ten, for example, and your initial investment would be just $90 plus $100 for WhyPark. Each domain would have to bring in $19 in ad revenue
Copyright © 2007 Joel Comm and InfoMedia, Inc. – All Rights Reserved
to break even but that’s certainly doable. As each domain went into profit, you could add new ones, increasing your portfolio and lowering the amount each new site needs to bring in to break even. No one says you have to do everything in one day. WhyPark is certainly a big improvement over traditional parked domains. You could even think of it as an easy way to build AdSense sites. But there is a downside. Earning real money from AdSense means coming up with good quality content. It’s not brain surgery: Good Content + AdSense Optimization = Fat Google Checks The content that WhyPark supplies isn’t good. It’s okay. It will bring in users from search engines and generate targeted ads. But it’s unlikely to bring in repeat visitors. It’s a good option if you don’t have the time or the inclination to develop the domain yourself. But turning a domain into a revenue-generating site is always the best way to get more out of domain investing. That’s what I’m going to discuss in the next chapter.
Fig. 3 WhyPark puts content on domains. You add the AdSense units and collect the revenues.
Copyright © 2007 Joel Comm and InfoMedia, Inc. – All Rights Reserved
3. FLIPPING YOUR DOMAIN — HOW TURN AN EMPTY SITE INTO A DESIRABLE PROPERTY
One of the big differences between the offline property market and online real estate is that domain name investors believe that they can generate profits by buying domains in one place and selling them for a profit somewhere else. They can do that. But it’s not easy. You have to know where to find bargains, who’s going to buy them and understand when to sell. And be prepared to do it often because the profits from those sorts of deals are rarely huge. Although you might hit the big time with a particularly high value domain name, most sellers buy in bulk and keep giant portfolios. The small profits generated by each sale together are enough to keep decent revenues flowing in. Offline though, few property developers would think of buying an empty plot, doing nothing with it and selling it on. Sure, they might make a little extra money on rising property prices but that’s nothing compared to what they would make if they built a shopping mall on the site or a condominium. Sure, the risks are higher. They have to persuade lenders to give them the cash to do it. And it requires a lot of work. But the returns can be massive. That’s the way I think that AdSense publishers should be thinking of domain name selling: a chance to buy a empty domain, turn it into a revenue-generating piece of property and sell it for much, much more than they paid for it. Anything else gives up your unique advantage: your knowledge of AdSense optimization. (Okay, anyone can learn AdSense optimization — it’s not difficult — but if you’ve been building AdSense sites, you already know how to do it. That gives you a very valuable development tool and one that it would be a shame to waste.)
Copyright © 2007 Joel Comm and InfoMedia, Inc. – All Rights Reserved
There are three things that make a difference between an empty domain name and a valuable, high-priced website:
● Content;
● Traffic;
● And revenue.
In this chapter, I’m going to explain how each of those elements can make a huge difference to the amount you charge for your domain names.
3.1 The Right Content For A High-Value Domain Name
Putting content on a domain name is the easiest change you can make. It’s also the most important... but the one most overlooked by buyers. Buyers can afford to ignore the value of content. (Although they’ll still be paying for it). You can’t afford to ignore it. The content you put on a site you’re planning to sell should be different to the sort of content you might put on a blog. It still has to be high quality. It still has to interest users. But it can’t be dependent on you. It would be very difficult to sell a personal blog. Unless the buyer is prepared to pay you to continue writing content while pocketing the advertising revenue, the blog won’t be able to exist without you. The content that goes on a site you want to sell has to consist of articles that aren’t connected to your personal experience. So the sort of easy topics you might usually write about — like how you built a drywall last Sunday or the techniques you use to train your kid’s soccer team — just aren’t going to cut it. They have to be topics that can stand alone and be written by anyone with the right knowledge. And that’s not as easy as it sounds when the articles could be on topics you know absolutely nothing about.
Copyright © 2007 Joel Comm and InfoMedia, Inc. – All Rights Reserved
You might get lucky and find lots of unregistered domain names in a field you understand. Or you could be willing to fork out some serious investment money on a good domain that you plan to develop. If you have the cash available, there’s no reason why that shouldn’t be a very good bet. But if you are short of start-up funds, it’s more likely that you’ll toss names into sites like GoDaddy.com until you find some good domains that aren’t registered. That could leave you with topics ranging from cars to computer games to operas. You can go ahead, do a bit of research and write the articles yourself. That’s not too hard. Just because you’re not an expert on drywalling or whatever your domain might be about doesn’t mean you can’t become one. Or rather, gather enough knowledge about the topic to write a few pages of content about it. Alternatively, you could hire a writer to create those pages for you. You’d have to factor in the cost of writing services when you negotiate a price for the site but choose a good, professional writer and the quality of the content should make the investment worthwhile. You should start with at least five pages of content and build from there. The best sorts of articles to produce for a site you’re going to sell are helpful, practical pieces. These are the articles that people continue to find useful long after you’ve first posted them, bringing you a steady stream of traffic and giving you more revenue for each article. So if on a blog, you would have discussed what you did to build a drywall, on a site you plan to sell, you would simply offer useful tips to creating a drywall. There would be less personal experience and more practical advice. Or if you would normally blog about the children’s soccer team you coach every week, you could write articles with titles like “5 Ways To Turn Your Child’s Soccer Team Into Winners.” Those sorts of articles never go stale. As long as they keep turning up on search results and the information in them doesn’t go out of date, they’ll keep generating traffic... and ad clicks.
Copyright © 2007 Joel Comm and InfoMedia, Inc. – All Rights Reserved
Adding content to a domain — turning it into a site — should be fun. And the best thing about it is that it’s entirely down to you. Create it, upload it, it’s there. Generating traffic to see it is a lot tougher...
3.2 Traffic — What A Buyer Really Wants To See
When it comes to earning from AdSense, nothing is more important than content. Get the content right, and you’ll soon find yourself developing a community, bringing in readers and generating income. Your ads will be worth more, your marketing will be easier and the whole publishing experience will be a lot more fun. To someone thinking of buying a domain name though, traffic is more important. In part, that’s because a buyer is probably thinking of adding his own content. What’s already on the site might be interesting as a guide to what users currently like to see but the buyer is likely to have his own ideas about what the site should contain. He’s unlikely to have his own ideas about who should be seeing that content or where they should be coming from. He won’t care as long as the traffic continues coming in and keeps clicking the ads. And he’ll certainly appreciate not having to build that part of the business for himself. There are all sorts of ways to bring traffic into a website — too many to discuss in detail here. But you will need good content first. You’ll need that content to have good search engine optimization, and you’ll need to have links from other high-traffic sites leading back to yours. It’s also worth thinking twice about using pay-per-click ads to generate traffic to a site you’re planning to sell. A buyer wants to see profits not just revenues. No buyer is going to be impressed that your site is earning $1,000 a month but that you’re spending $995 each month to earn it.
Copyright © 2007 Joel Comm and InfoMedia, Inc. – All Rights Reserved
Natural traffic that flows through links and searches is always going to be worth a lot more when you’re planning to sell a site, even if you’re an expert at AdSense arbitrage. Building that traffic takes time. But during that time, your site should still be earning from AdSense ads, letting you make a profit even before you make your sale.
3.3 Revenues — The Real Value Of Your Domain Name
Earlier in this report, I discussed the difficulty of placing a value on a domain name. I pointed out that the amount you pay for a domain might simply be a multiple of the amount a parked site earns. Set the maximum number of months you want to wait before you get your money back, multiply it by the domain’s monthly earnings and that’s the maximum you should pay. Simple. So if you see that a site is earning $50 a month in parked revenues (and most parked domains earn less than that) and you want to make sure that you’ve got that money back within six months, then the most you’ll pay is $300. Exactly the same is true of sites you’ve developed. The only difference is that the numbers are going to be bigger. You’re not dependent solely on pre-existing traffic or type-ins or anything else that isn’t under your control. You can generate traffic, test ad placements and use all the strategies you know to squeeze every last cent out of your site. That means that when you come to sell your site, you’ll be able to provide the buyer with exactly the sort of information he’ll want to know:
● The number of impressions your site generates;
● Your clickthrough rate;
● And the monthly revenues.
That last figure isn’t going to be an estimate or wishful thinking. It’s not going to reflect what you think the site could earn or what other sites on similar topics are earning. It represents what your site is actually earning.
Copyright © 2007 Joel Comm and InfoMedia, Inc. – All Rights Reserved
When you come to open negotiations then, you’ll have just two decisions to make. The first will be familiar: how many multiples of monthly income you want the buyer to pay. So if you’ve created a site that generates $500 a month in AdSense (and other) income and you wanted six months of income in return for your domain, then you’d be looking to sell it for $3,000. That’s a big improvement and it’s not a bad return at all on a domain that cost you less than $10 and from which you’ve already been earning while you developed it. The other decision though is a bit tougher. You also have to decide when to sell.
3.4 When Is The Best Time To Sell A Developed Domain?
When you sell an undeveloped domain name, the price you demand will be dependent on two things: parked income; or the potential popularity of a site you’ve built on that domain. If you’ve bought a domain called iPhone[something or other].com, for example, and the iPhone takes off, your domain will increase in value. As soon as you think interest is at its peak, you could put the domain on the market and profit from the topic’s rising popularity. But that leaves you at the mercy of the market. The iPhone could have turned out to be a damp squib. In that case, your domain wouldn’t grow in value and any money you spent buying it would have been wasted. When you develop a domain into a site though, the value of the domain isn’t dependent on things beyond your control. Increase your traffic and your domain will rise in value. Improve the optimization of your AdSense units and your domain will rise in value. Boost your monthly earnings and your domain will rise in value. One ideal time to sell that domain then is when you think you can’t do anything more to increase its value.
Copyright © 2007 Joel Comm and InfoMedia, Inc. – All Rights Reserved
If you’ve been playing with traffic sources for the last three months, trying to get new links and using all sorts of other strategies to improve your earnings, and little is happening, then it might be time to think about cashing in. But it only “might” be time. After all, that site is still going to be earning revenue. You might want to continue producing content and continue taking the cash even if you struggle to increase your income. And besides, there are always ways that you can increase your income. There are so many different ways of monetizing a website that it’s hard to imagine how your income could plateau. If your revenues have flattened out, you could always try different affiliate products, for example, or change the goal of the articles to increase traffic and generate better ads. That’s why the best time to sell your ads isn’t when you’re struggling to squeeze more money out of it; there’s always the possibility that you could earn more. In that case, you’d be selling your domain for less than its true value. The best time to sell your domain is when you’ve had enough of it. That’s much easier to judge than your domain’s potential maximum income. There might well come a time — and this is particularly true of sites you’re creating with a view to selling them — when creating the content feels more like a chore than fun. That’s the time to sell it. Sure, you might not have reached the domain’s maximum income. The traffic levels might still be growing and you might have some ideas for new products that you could promote on your content pages. But if you’re bored writing it, you can be sure that it won’t be long before your users are bored reading it. Being genuinely interested in the content you’re producing is one of the requirements of getting the most out of your site.
Copyright © 2007 Joel Comm and InfoMedia, Inc. – All Rights Reserved
If you’ve reached a point when you have to wrack your brain to think of something to add to your site or you’d prefer to do the washing up than write another article, you should start looking for buyers. One approach to selling domains then is to develop then until you get bored, then sell up and start again. There is an alternative though. You could set yourself a deadline. Tell yourself that whatever state your site is in when you reach that deadline, you’re going to put it on the market. For example, you could buy three domain names and tell yourself that you’re going to sell them all in three months’ time. In addition, you could buy three new domains each month and develop them at the same time. Once you’ve passed your first three months, you’ll have the income from the domains you’re selling each month as well as the advertising revenue from the sites you’re developing. So if you demanded a multiple of five months’ income for each domain, your revenues each month would be made up of two different streams:
● The ad incomes of the nine sites you’re developing;
● Plus fifteen months’ of projected income from the three domains you’re selling.
That could be a lot of work... but it could also be a very nice business too. Turning an empty domain into a piece of desirable and valuable online property is the best way to buy and sell domain names. It’s not easy. It’s not a get-rich-quick scheme. You’ll have to put in time and effort. But once you’ve developed a routine, you should find that you know exactly what to do each month after buying a new domain until the time comes to sell it. And it’s selling it that I’m going to talk about in the next chapter.
Copyright © 2007 Joel Comm and InfoMedia, Inc. – All Rights Reserved
4. MARKETING AND SELLING YOUR DOMAIN NAME
Whenever you decide to sell your domain name, you have to let people know it’s out there. More than that, you have to let the people who are prepared to pay top-dollar know it’s out there. There are four ways of doing that:
● Selling to contacts;
● Listing on forums;
● Selling through auctions;
● And marketing at conferences.
4.1 Get The Price You Expect From The People You Know
The best way to market your domain names is to sell them directly to people you know would be interested in buying them. So if you know, for example, that someone would like to own a network of sites about football, you could buy a football-related domain name, build it into a revenue-generator and offer him the property. You wouldn’t have to give away a bargain, of course. Your contact would still have to pay the market rate you demand. But by offering it to him first — and by telling him that you’re offering it to him first — you keep a steady customer for the future. You also save yourself the minor headache of pitching the domain elsewhere and hoping that you’ll come up with someone prepared to pay more. As I said earlier, developing these sorts of contacts can take time. I’m going to talk in more detail about conferences at the end of this chapter, but getting out and actually meeting other publishers and online entrepreneurs is — without a doubt — the best way of doing that. Once you’ve created that contact and built a working relationship in which both sides profit, you can be confident that your domain-selling will always bring in revenue.
Copyright © 2007 Joel Comm and InfoMedia, Inc. – All Rights Reserved
4.2 Chatting — And Selling — On Domain Name Forums
While conferences are a great way to actually get to know the people you’ll be selling to — and maybe even buying from too — forums can also be good places to track down customers. DNForum, for example, offers a huge range of different streams for all kinds of domains at all sorts of different prices. Other sites include NamePros.com and DomainState.com.
Fig. 4 Just some of the places you can pitch your domain at DNForum.com. The advantage of using forums to sell your domains is that you can spread them around. Put your domain on an auction site and you’ll have to sell it to the highest bidder who meets your reserve — the minimum price you’re willing to accept. Make your reserve unreasonably high and by the time you’ve found that you can’t reach that price, the highest bidder may no longer be interested. Put your domain name on multiple forums though and you get to market it to a wider group of people than you can find at just one site — and, hopefully, pick up a higher price.
But selling on forums require some marketing skill. Fortunately, because so few people on these forums seem to have any
Copyright © 2007 Joel Comm and InfoMedia, Inc. – All Rights Reserved
marketing skills at all you don’t need to be an award-winning copywriter to stand out from the crowd. The most important part of your forum ad is always going to be the title. You don’t need to be too creative here. The title should include the domain name you’re selling. And only sell one domain at a time, otherwise you look like a bargain basket. It should include a figure — one that either makes your offer look like a bargain or which shows how profitable your site is. And it should have a deadline to encourage people to act fast. Sound like Copywriting 101? Like I said, you don’t need to be the world’s greatest marketer to get people to look at your forum ad. Here are three quick examples. Feel free to adapt them for your own forum ad: [Town]Chiropractor.com - $257 monthly ad revenue -- must sell now! BestDomainInTheWorld.com - 20% off recommended market price! -- offers wanted today! Own DevelopedSite.net today and enjoy over $200 in monthly revenue! See how easy that is? Just make sure that everything you say in the title is true. Tell a small fib to get people to click and no one will ever click on your ads again. The ad itself should contain some basic stats. Again, the most important piece of information is going to be your monthly revenues but potential buyers will also want to see your impressions and clickthroughs, etc. You could also toss in some comparable sites if you know the prices they’ve reached.(Auction sites can help there.) That might prevent you from making a surprisingly large amount of money on the sale, but it should help to cut out timewasters and people pitching ridiculously low prices.
Copyright © 2007 Joel Comm and InfoMedia, Inc. – All Rights Reserved
That’s all very simple, and you should certainly expect to see a fair number of messages from people interested in buying — and making reasonable offers.
4.3 Going, Going... Gone! Selling Domain Names Through Auctions
Place your domain on a forum and you can expect a number of people to get in touch. That’s especially true if you’ve written an eye-catching ad. But there’s no guarantee you’ll get a sale. If no one offers you the sort of price you’re prepared to sell your domain for, then you’re under no obligation to hand it over. You won’t have made any money but you won’t have lost anything either. You might even have learned a little about the value of your domain. But only “a little” because you would only have assessed offers from a small slice of the domain-buying public. And some of those people might have pitched deliberately low in the hope of landing a bargain. When you’re really looking to make a sale — and when you want to be certain that the price you receive is the right market price at the time — there’s no better place to go to than an auction. There are no marketing tricks that can boost your bid prices here. All buyers see is a list of domain names. Domains that receive traffic also show the page views to give buyers an idea of what they’re buying. (Although sites like Sedo also offer a site-selling service rather than a domain-service where publishers can sell properties that already make money.) But that’s it. The amount you receive will be true value of your domain — for better or worse. And that’s where the danger lies too. You can’t use an auction as a place to test the market. Once an offer has been made that meets your reserve, you’ll usually find that the offer is binding. You have to sell. You’ll be left with money in your pocket but you might also be left wondering whether you couldn’t have earned more waiting a week.
Copyright © 2007 Joel Comm and InfoMedia, Inc. – All Rights Reserved
But that’s always going to be the case whenever you sell anything. Buyers might suffer from remorse but sellers can too. If you’re going to buy and sell domain names, wondering whether you couldn’t have made more money — and looking for ways to do it — comes with the job.
Conclusion
I love being an AdSense publisher. I enjoy writing content and I get a kick out of the interaction I have with my readers. But AdSense isn’t my only source of revenue. It’s my most important source of revenue but it’s not my only one. Your knowledge of Google’s AdSense program and your familiarity with the Internet give you all sorts of revenue-generating opportunities. One of those is buying and selling domain names. In this report, I’ve introduced you to some of the ways that you can do that successfully. It’s a complex topic and I haven’t gone into it in great detail. What I’ve tried to do though is give you enough of an introduction to get your feet wet, discover what it’s about and learn more if you want to. I’ve explained the different kinds of domain names speculators buy and sell, and how you can value them. Clearly, whether you decide to develop a domain or simply sell it on, the amount you pay for it will be vital. I’ve mentioned the pros and cons of parking a domain, and suggested one alternative. I’m not crazy about parking domains, but it can be a useful option for some domain names. Auction sites may also offer a discount on their commissions if domains are parked with them first, so it is something you should know about.
And I talked about how you can develop a domain into a working, revenue-generating site before selling it on. You can do that when you’ve simply had enough of creating content for it or you can do it
Copyright © 2007 Joel Comm and InfoMedia, Inc. – All Rights Reserved
on a regular basis. That would turn you into the online equivalent of a property flipper rather than a property developer. Both are perfectly fine strategies and both make use of your advantage. And finally, I discussed when and how to sell a domain name. That’s the best bit — the moment when you can feel the money in your pocket. Like I said at the beginning of this report, domain name speculation is an investment opportunity as much as a business opportunity. It carries risks as well as rewards. But make a start with a small investment, win a small reward and you should find that in time those rewards get bigger and bigger.
"Discover Why AdSense Smarter is Simply The Best Top Paying Keywords Tool Available & How You Can Profit From It!"
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-By Joel Comm
Do you want to profit from domain names? My AdSense Smarter tool not only helps you increase your AdSense earnings by providing search and bid data for over 8 million keywords, but it also includes a secret weapon...
My secret tool is AdSense Smarter's Top Paying Keywords Domain Finder!
Copyright © 2007 Joel Comm and InfoMedia, Inc. – All Rights Reserved
Let's say you are looking for a site on "central air conditioning." Which website or ad link would you click on: www.somenamesite.com/centralac or www.centralacunit.com? That's a no-brainer in my book, and it will be a no-brainer for your site's potential new traffic, too!
But Joel, Aren't All the Good Domain Names Taken?
If you are searching for available domain names by hand - one at a time - it appears that they are all taken. But AdSense Smarter rips through hundreds of domain name phrases in minutes, and tells you, not only which domains are available for immediate registration, but even the number of estimated Google searches for each domain's keyword phrase. AdSense Smarter's Domain Finder doesn't just find any available domain name, it discovers quality domain names that are still available! This just blows my mind...
How About a Real Example of AdSense Smarter's Domain Tool in Action?
You bet! This next video shows you how AdSense Smarter was able to find available domains for the mortgage financing market. Click here to see the videos and find out more.
Copyright © 2007 Joel Comm and InfoMedia, Inc. – All Rights Reserved
About the Author
Joel Comm is an Internet entrepreneur who has been building successful web sites since 1995. Dedicated to providing a family-friendly Internet experience, Joel’s flagship site, WorldVillage.com, continues to be a popular family-safe portal. Joel is the co-creator of Yahoo! Games and author of the New York Times Bestseller, The AdSense Code. Joel makes frequent appearances at Internet marketing conferences and seminar, conducting workshops and training others in the latest ways to make money on the Internet. He is the host of the world’s first Internet marketing reality show, The Next Internet Millionaire. Joel’s sites include:
JoelComm.com – Joel’s Blog
AskJoelComm.com – Question submission page
AdSenseChat.com – Google AdSense Member Forums
DealofDay.com - a popular bargain-hunting community
FamilyFirst.com – Family-friendly sites reviews More Resources by Joel Comm
Copyright © 2007 Joel Comm and InfoMedia, Inc. – All Rights Reserved
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