Web Names- Just Like Real Estate
Lately I have been engaged in
Internet Domain
Investing and some of my friends have enquired
about it so I am writing this note.
We all know the old joke about
"Tastes Just Like
Chicken." Well domain name investing is just like
"Just Like Real Estate."
Your goal is
to Buy Low and Sell High
and if possible, make some rent
money in between.
Many people go out and buy up names that they think
others will want to have and then sit on them until that
someone comes along with a bag full of money to offer. This
is known as
"CyberSquatting."
Unfortunately it doesn't usually
work out because most of the best domains were
taken years ago. So while it is cheap to buy these original
domains ($8-10), the owners usually let them expire because
no one comes along to buy them.
I prefer to find distressed
properties on the internet (to continue with our
real estate analogy) and spruce
them up. Every day people allow perfectly good
domains to expire. Why? Maybe they die, or maybe they no
longer want the website and haven't updated it in a while,
or maybe they lose track of its expiration date. Whatever
the case, on the Google PageRank toolbar of zero to ten,
there are many websites that go as high as a six that can be
bought when they expire.
Keep in mind that just because
someone else no longer wants the domain doesn't mean that it
has no value. One of my first domain name
investments was for Phonetique.com which was kind of
a competitor
site to my
BoldOldPhones.com. I noticed on SnapNames.com that it
was expiring so I placed a bid on it. While the phones that
were originally sold on Phonetique.com were from an earlier
Art Deco era than my phones, I figured that I could put a
link there to my site and sell Phonetique back to the
original owner if he requested it.
The bidding got intense on
Snapnames and I paid about $500 for Phonetique
because it had a Google PageRank 6 and when I typed
"phonetique.com" (including quotation marks) into Google I
found hundreds of website that linked back to it (called
"backlinks").
When the original owner made no effort to reach me within
a year, I changed the site a little to sell both my
telephones and replicas from the Art Deco era. Today it
still has a pagerank of 5 and I have sold thousands of
dollars of my phones thru it. So far I haven't sold any of
the replicas but I also installed the Google
Adsense advertising links program on it and generate
additional revenue thru that. Sooner or later I will figure
out the formula to sell the replicas and generate money that
way.
Just like in real
estate, if you find the
right buyer, the domain
can be worth a lot of money. For me, owning
Phonetique was an easy way to boost sales in a business that
I already owned so I was willing to pay top dollar.
Other times I have bought web
names and have been offered money by the original owners to
repurchase them. Unfortunately these people
usually don't understand the value of what they created on
the web. I bought one name that was the website for a garage
band in Great Britain. It was a PageRank 5 because a lot of
music sites linked to it. They asked to buy it back within a
week after I paid $60 for it so I quoted them a price of
$250. More than fair I thought... there are some real
pirates out there who will slap a porn site on an expired
domain and then charge you a few thousand to get your domain
back since they know the damage the porn site on your former
domain will do to your reputation. However, these guys
decided not to pay and just start a new website for $10.
Stupid decision!...now the earlier CD's they sell thru
Amazon.com have my web domain on the covers! I tried to
explain it to them but they wouldn't
listen. I haven't yet made $250 in
Pay-Per-Click advertising so we both lost out on the
deal.
Spruce them Up: I try
to stick to fields that I know-- military, politics, and
telephones are my current favorites (Macintosh used to be).
That way I can write original articles on them so that they
will draw attention on the web and be worth more money in
the long run. Alongside those articles I install the Google
Adsense program to generate a little revenue from
Pay-Per-Click ads. While everyone wants to achieve a high
PageRank in Google, it may be easier to do that if you can
use Search
Engine Optimization tricks to boost your site in Yahoo and
MSN first.
In the short run I have
started"parking" these
domains at Parked.com which has an
automatic system for attracting
advertising traffic. It is based on Yahoo's
Pay-Per-Click system and it works pretty well but
occasionally I have to give it a new prompt since it will
sometimes automatically point at a subject area that is not
even close to what the site was previously used for. You can
check what the site was originally used for by checking the
Google Backlinks or by actually
looking at old screenshots of it at the Web
Archive's Wayback Machine.
Beware of Trademark
issues. When choosing a domain name you cannot
choose variations of trademarked websites. For instance the
letter L at the end of a domain can generate a lot of
traffic because it is above the period on the keyboard and
so people mistype it into their browser. But if you buy
AmazonL.com then you can have your domain taken away from
you and given to Amazon.com because you are infringing on
their trademark. This also applies
to actual names of people-- you cannot buy
JohnKerry.com and expect to keep it if your name isn't John
Kerry. As an example of how murky this can be: for the
Presidential campaign in 2004, a citizen named Kerry Edwards
( bail bondsman ) owned KerryEdwards.com so the Kerry for
President campaign paid him six figures to use it in the
campaign. You can however buy KerryforPresident.com without
running into these trademark issues (as of this
writing).
The path I am following is to:
- Buy Low (distressed
domains)
- Spruce them Up (parked.com
and then an original site with original
content), and
- Sell High (find the right
buyer)
- The Pay-Per-Click ads are
the rent you collect while waiting and
hopefully it will cover your original cost and the cost
of renewing the domains.
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The path I am following is to:
- Buy Low (distressed
domains)
- Spruce them Up (parked.com
and then an original site with original
content), and
- Sell High (find the right
buyer)
The Pay-Per-Click ads are
the rent you collect while waiting and hopefully
it will cover your original cost and the cost of renewing
the domains.
The mechanics of it:
A. Load
the Google Toolbar onto your browser.
B. Decide what areas you are an expert in and then
stick to buying domains in those areas.
C. Continuously scan the Snapnames
list of expiring domains.
D. Check the expiring domain name in the Google
Toolbar to see how many backlinks it has (for an example,
type into Google "SpencerGarrett.com" including quotation
marks) and check what it's PageRank is (by
clicking on http://www.SpencerGarrett.com).
E. You can also check Alexa.com
to see if it has a history of traffic and the Web
Archive's Wayback Machine to see what the site has
looked like in the past.
E. If you decide the name is worth owning, then place
a bid for it in Snapnames ($60 minimum). Decide what you
are willing to pay for it maximum and stick to your
budget.
F. If you win the domain name in the Snapnames three
day auction then you should immediately point its
Nameservers to ns1.Parked.com and ns2.Parked.com and load
it into your Parked.com
account's domain portfolio. Be sure to leave a For Sale
sign hanging at Parked.com if you are willing to consider
offers.
G. Start planning the future for the site. Is it going
to be articles that you write (one of the reasons for
limiting yourself to domains in your fields of expertise)
with advertising from Google or Yahoo imbedded (like
Phonetique.com)?
Is it going to be a web magazine/portal that links to
other websites (like MilitaryHops.com)?
Or are you going to leave it as a placeholder at
Parked.com and wait for someone else to come buy it?
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