Adding Domaining to your business model
August 17th, 2007 | by ScottIt appears that you're new here, if you like what you read, please subscribe to the news feed or sign up for the Leap eTips news and updates email list. Thank you for visiting :)
By and large I’m against the business of domaining. I understand it and appreciate the profits available, however I see it as too unregulated and open for abuse by some, and that just doesn’t fit the image I want for my business.
Still, there are some lessons and revenues to be had from Domainers, those who buy domain names on speculation in the hopes of later reselling them in the after market for big profits.
For example, this past May I purchased a domain name simply because of the name. It wasn’t keyword specific, but it was short, memorable and highly brandable to a certain industry that I know is strong and growing.
I didn’t just buy the domain to resell it, but I did purchase it speculating that I’d be able to develop a mini-site with it to capitalize on the industry and earn money.
The industry I’m speaking of is related to a popular online technology, so I decided to build a site on the domain that would act as a resource site for this technology. The best thing was, because the technology is so popular, I was able to actually use affiliate products for about 80% of the resources I placed on the site.
How’s that for cool? Create a resource site around a popular niche so that people will seek your site out, and have almost all of your site earning you revenue from those visitors.
Like all of my mini-sites, I created a half-dozen articles about the topic and submitted them to article directories, then left the site alone and moved on to my next project.
Now, fast forward to early August. Just 3 months later and that site had earned me over $200 in affiliate commissions already, just from the limited traffic it was picking up so far. Not too bad at all.
Then a wonderful thing happened. Someone involved in this popular industry approached me about purchasing the domain name. We negotiated and eventually struck a deal in the low $X,XXX range.
There was a NDA (non-disclosure agreement) on the purchase, which is why I haven’t listed the domain name and actual selling price here, but I thought the story was worth sharing so that readers of my blog could see that there’s more ways to open up revenue for themselves than just the obvious with mini-sites.
Let’s recap:
- I purchased a domain for $10 that I thought could be branded to a popular niche
- I created a mini-site on it that earned over $200 in profits in the first 90 days from minimal traffic (because the niche is so popular)
- I sold the domain name for $X,XXX
In all I spent about 8 hours creating the initial mini-site and article content, so that’s a nice payoff for a day’s worth of work and $10 investment.
I’ve had similar successes with selling domains after purchasing them for mini-sites like this in the past, though none were quite as fast. The point to all this though, is that if you’re lucky enough to find a good domain that fits a popular niche–and let me warn you that if the niche is popular you won’t find keyword domains available for it, you’ll have to be creative–you can not only capitalize on the popularity of the niche to earn revenues from your mini-sites, but you may also be able to build the domain up a little and then capitalize on its value by selling it to someone else involved in that niche.
That’s the biggest difference between what I’ve done and what most Domainers do. They purchase names on speculation and then place them on a domain parking service, or just toss some crap advertising on them until they can sell.
I created an actual site of value, even though 80% of it was affiliate products, they were still the products that visitors were seeking, so the site was a valuable resource to the visitors.
If it sounds like I’m judging Domainers, I’m really not. Honestly, I think many of them are missing the boat with the way they handle domains while in holding. If they put a little time into creating a small site of value to visitors on their domains, or even paid someone from rentacoder.com or elance.com a few dollars to develop the domains into sites with affiliate products rather than just parking them I believe they’d earn more money from the domains and increase the brand value with visitors even more, which increases the selling value for the name when a buyer comes along.
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