NEW YORK, NY – When I started in this industry it was the year 2000. The Internet looked very different than it does today, and people were just starting to get acquainted with Google. Search engine optimization was a lot easier to do with most people not having even heard of the term “SEO”.
Back then, as a website owner, you were able to take advantage of certain techniques which could easily put you ahead of the majority. Compared to today, there was little competition out there. Thanks to Godaddy, Google AdSense, and Search Engine Optimization, I was able to buy domain names and make them into websites, originally using “Website Tonight”, a site builder Godaddy still sells today under its new name, “Website Builder”, a click and build software tool for the novice. With SEO, I was able to get the website found, and was able to make money from people clicking on the ads when they got there with Google AdSense (back then, Google just matched the ads to the content, that was it – there was no search history and re-marketing or user historical interest targeting going on). I had effectively found something to make (the website) valuable (the clicks).
It was an instant business and its success grew with time and all I wanted was more, larger websites, with more and more pages.
This evening I came across a thread on NamesPros.com titled, “there’s no money in domain names.. this industry full of bullsh*t” with many reply’s reflecting disagreement with the poster of the message who is obviously frustrated with his – less then stellar domain sales. The simple answer is that nothing good comes easy and staring at domain sales charts all the time can be misleading and could create somewhat of an ‘illusion’ that I myself have fallen for many times over.
- Where are ‘my’ hundred-thousand dollar domain sales?
- Why aren’t ‘I’ flipping my domains for astronomical profits?
Great domain sales are indeed out there, but they are not always as common as you would like them to be. Sometimes great domain name sales take time, patience and often, great effort. You might even be better off hiring a professional domain broker who specializes in outbound domain sales. Professional domain brokers know how to contact potential end-users who might be interested in certain types of names and they often have lists of buyers. Plus, you’ll get the benefits of their skill at negotiating. Check out some of the hold times in one of my lists of domain sales trends; you will see that sometimes domains are held for 10 years or more to see profits, and sometimes losses. See “Winners and Losers; A Look at “Digital” Domains; Prices Over Last 10 Years”.
Looking back now I’ve actually made very little money with flipping domain names themselves. I personally have limited amounts of stories of profits simply on domain flips. One of my greatest profits in strictly domain name sales was a small sale where I registered a .org domain name for $8.95 and was contacted the very next day from a buyer who quickly purchased it for $1,500.00 (up 16,660% in a single day), extremely rare.
Sounds fantastic, but unfortunately, I do not have many of these stories; it’s the only one that comes to mind at the moment and it was ten years ago.
As far as domains, for the most part, I’ve created a pattern of purchasing many more domain names than I have sold or had the chance to develop; thousands, but in the last few years, I have let hundreds of domains drop and expire. I’ve certainly let more domains expire than I have sold. If I had to survive purely on ‘Domain Flipping’ by itself, I would likely be an utter failure.
But developing domains has been an entirely different story.
Developing websites is where all the money is. It’s just like real estate. You can purchase a piece of land and sell it as-is for a small profit, or you can develop on it and increase your profits exponentially, for years to come. Lease or rent the development, mall or home and make money forever. Same thing with domains. If you are looking to maximize your opportunity, you need to develop your domains into real properties. See “How to Become a ‘Rockstar Domainer’ by Developing Your Own Domain Assets”.
However, as far as selling the domains, I’ve had very little success selling. Even on the actual domain sales platforms. Some challenges on those venues have been extremely frustrating such as Godaddy Auctions, which has probably been the worst of all, for me personally at least (and I am a huge Godaddy fan). See “Just Another ‘Go-Nowhere’ Transaction at GoDaddy’s Aftermarket for Domains; WTF?” to see my experience there.
In the past, the domain forums were the easiest place for me to sell my domains; however, I cannot remember the last time or the last name I sold in the forums. Now, to be fair, I have not had the time I used to have in order to visit the forums as I had in the past, but still, the atmosphere has changed. Which leads me to conclude that, very likely:
If I had to start it all over from scratch today, I don’t think I would make it, and here’s why.
SEO no longer works like it used to making “knowledge” not the commodity it once was. This is because, near-twenty years later, Google is monopolizing search with its advertising program. Now as a public company, they are under growing pressure to EARN and to continually earn more than the last quarter.
This was simply not the case when I began.
Paid search now dominates the results. I’ve even heard (unofficially – don’t ask how, shh, it’s just a rumor), that Google tells its certified agencies that if you’re not doing PPC you’re losing out on a whopping 89% of visitors to your web site, even if your site shows up well organically; 50% even if you have a #1 organic listing. Holy Ouch! This is why websites are receiving less and less traffic.
The #1 organic listing on Google has become #8, behind paid clicks and behind Google’s own directory-like maps listings.
Direct navigation is also down as people are getting more and more acquainted with their browser and address bar search function. Additionally, and yes, there’s more – people are getting accustomed to Google being an even easier navigator to quickly pull up the right sites without having to even remember exact names. Google’s almost always got it right these days, and more and more traffic is going directly to Google as the starting point. To make matters even worse, Google will just answer all of your questions now without you even having to visit a website at all. See “Who Needs Domains and Websites Anyway? Google Say’s “You’re A Loser”.
Hopefully, Google will not figure out how to do away with named addresses completely putting us all out of business.
The second major issue I would struggle with today, that I did not need to deal with in the past, is declining ad revenue and ad blockers. These two things have brought quick and sudden-death to many publishers. It seems that both click and impression revenue is always declining. And if you think it’s pretty bad now, wait till you hear about Google’s new “Brand Safety Initiative” which as far as I know, has not been officially written about yet on any Google website or Google help section, but it’s coming and some publishers are already experiencing it. I’m not getting into all the details but the short version is that it will, potentially, depending on the quality of your content, siphon-off even more revenue as it could cause missing ad impressions. It’s probably also a good time for me to recommend you Declare authorized sellers with ads.txt, another thing you should look into now rather than later to ensure ads continue to serve on your pages.
These are all challenges I did not face when I started in this business nearly twenty years ago. If I just started from scratch today, in this much more commercialized atmosphere, I’m not sure I would have been able to get things off the ground quickly enough to sustain myself being that I began with no startup capital at all.
I wrote a book a few years ago titled, “Mastering Your Website: The Insiders Guide to Search Engine Optimization and Building Your Brand”. It’s a great book packed with do-it-yourself instructions on building and optimizing your own sites. If you’re new at this or just eager to learn you should read it. I planned to write a second book titled, “Mastering AdSense”, but I would like the book to give “realistically obtainable goals” not pipe dreams, so I am unsure if I am writing this book or not. I’m also concerned with revaealing certain specifics which would be required to give the book real-world ‘credibility‘ on the subject matter by example. However, in preparation, I do have the domain, MasteringAdsense.com just in case I do write it. But it is an evil world out there, and sometimes you honestly don’t want to call too much attention to your successes.
They say, listen very closely to those who do not clap, when you win”.
About The Author: John Colascione is Chief Executive Officer of Internet Marketing Services Inc. He specializes in Website Monetization, is a Google AdWords Certified Professional, authored a ‘how to’ book called ”Mastering Your Website‘, and is a key player in several Internet related businesses through his search engine strategy brand Searchen Networks®
R P says
The real winners, just like any industry, typically buy and hold long term. Domains are unique assets and can’t really be commoditized. I started investing in early 1999. Had I not developed some of my domains wouldve never had the capital to buy true premium domains (mostly regged 1996-98) when the market crashed in 2008-2009.
The laymen are catching on as well. Had a guy call me delusional for 15 yrs straight cuz I wouldn’t sell him some domains, and just a few months ago he called to apologize and say I was right. Premium domains are the original and true HODL because each is unique. Crypto is helping elevate true premium domains as the safer digital asset, and prices on a whole are still relatively low compared to the amount of fiat money printed over last 10 yrs.
I’ve been at this since 1995. Never seen it this tough.
You really need 100K to get started in a good way and even then that might not be enough.
I’m watching everyone bid too much in auctions these days. Most of those people will eventually go out of business. Considering the ratio of sales to non-sales per year, and the percentage of buy-in costs versus completed sales is so tight they just won’t make it.
Anyone in this business a long time sees this happening right now to the greenhorns.
Domain Guy says
I loved this post. Realistic like anything.
I was also the one who started late and was looking for those “astronomical sales” in the first few weeks, which never came my way.
Headed my way into NamePros and found this particular thread regarding Completed domain name sales:
Found out about geo-domains from here and my business took off then only.
So yeah, namepros in one sense was important.
Also, I believe anyone starting now can count on geo for early support while they make their way up the ladder.
Brad H says
not with that attitude