Ask anyone of the panelists and they will tell you domains are hot right now. There is a lot of interest in this sector for many obvious reasons. At one point you will probably need a domain to establish a presence online or if you dare squat on someone else’s presence. So it makes sense that at search conference highlighting some of the issues in this market is a good idea. This particular session is new for New York and one I have covered before last year. It is an information packed session dealing with all things domains and more specifically how to monetize them, type in traffic, buying and selling, and the current state of the domain private market.
Chris Sherman is moderating this session.
Monte Cahn the CEO from Moniker.com is up first to present. He stats by asking how many domains people have, 10, 100, 10,000? There are a quite a few hands still raised when he asked about who has 10,000 domains. He talks about the basics of domaining. ICANN regulates the domain industry. The original revenue sources for monetizing domains were not developed early on and it is something that has evolved tremendously. There is a 850 million in annual revenue and domains sales. Its predicted to reach $2 billion by 2010. He talks about several companies that own quite a few domain names. These large scale owners have been rising. Since last year, domains have growth 30%. A record 112 million domain names are now registered, a 30% increase in the past year. 9.4 million new domains were registered during Q3 of 2006, the third highest number of registrations ever in a single quarter. At least 100 domain sold twice between 2004 and 2006 for double their value.
So what maybe a good domain. Natural generic brands, there is a lot of search volume. They need to be easy to remember, clear concise and descriptive. Sometimes they can be commercially oriented. It also matters what industry segment is hot or cold at the moment. Are the domains visually pleasing? Is there any existing type in traffic, or backlinks. Mistypes are all popular.
So how do domains generate revenue? Domain traffic (direct navigation) is ad revenue from CPC, CPA, CPM, selling traffic directly to companies or advertisers. Domain development individually or in partnership domain owners add content, diversify advertising and build networks. You can also vertical dominance to monopolize groups of domain names in category verticals. Domainance means more power and revenue. Domains for the first time are not leveraged value for financing/loans, charitable donations/tax deductions. He next goes into a lot of stats. He says that 70 percent of internet surfers use direct navigation, up 53% from four years ago. The rest use search engines. Direct navigation is a $1 billion business by 2007, on track to surpass 1.2 billion.
He next puts up a landing page from Fabulous.com and describes the type of landing page for one click landing. He also shows an example of 2 click landing pages. He says there is a correlation between search volume and type in traffic. He says that a lot of people are typing domain names into search engines with the extension. This is a reverse of a direct type in. Monte goes into examples what people are paying for domains.
There are many ways to get a domain portfolio started. The barrier of entry is low. It does take moderate capital, intelligence, patience and time. There are a lot of aftermarket websites, whois, search databases, and trademark exclusion tools. He says it’s a little late in the game but definitely not dead.
Jon Lisbin from PointIt, Inc is up second. They are a search engine marketing company and wants to give a different perspective about domain parking. He asks if there is anyone that doesn’t have parking sites. Hey says that traffic from many parking is bad. There is a problem with cheats who arrange for people to click on there ads. There is also cypersquatters and domain kiting. Registers abuse the ICANN 5 day holding period to test domains. He explains that traffic from sources like Sedoparking the CPA is really high. He mentions that you can not opt out of Sedoparking and Oingo sites in Google Adwords search network. This is different in the content network which you can opt out, but not in the search network. The domain parking traffic is bundled together with the search network.
He next gives an example of how a parking page that has no real content buy sending a lot of traffic to his clients site. Jon gives an example of the parking page and says there is no reason anyone would want to go to this site. There was 0 conversions from these sites. His examples are pretty funny because they are clearly obvious the traffic is bad. He says that Yahoo is doing work to clean up their network. When will that happen completely, who knows. He asks why Yahoo doesn’t go after they guys who cheat the system.
Andrew Beckman is up from SearchAdnetwork and going to give a positive look at domain driven traffic. He says that you need a web analytics and or bid management system to track the traffic. He puts up an example of kids.com and what they parking page looks like. He says you can use the Google site exclusion tool to prevent your site from getting traffic from those sources. He says parked domains need to be developed a lot more such as a search box and keyword drill down need to be fine tuned. There should be content developed around these domain names.