Once again I find myself in the Melbourne, Australia Qantas club about to board QF93 to LA and DomainFest. It's getting to be a bit of a strange feeling as I greet some of my now good friends at the reception desk and they say comments like, "It's good to see you again Michael". Hmmmmm......maybe I've been flying a little too much!

Despite the familiar feel of the airport and the inconvenience of the security checks this flight will be totally different. This time my son Timothy is joining Laci (head of ParkLogic operations) and I on the journey so that he can experience what it means to be a domainer as well as help out on the ParkLogic booth. BTW - drop in a say hello to us all as I'm always up for a chat about domains and getting the most from them.

So Tim and I are sitting next to each other on the 16 hour flight so we'll be having a little bit of father-son bonding time enforced by the proximity of economy seats. Nothing like being squeezed into a sardine can that flies.

The flights just been called so I'd better sign-off and get going. See you all in LA!

Michael Cyger recently interviewed me for his fantastic videoblog site domainsherpa.com. During the interview I discuss what it means to optimise domains, my thoughts on the industry and how domain owners can improve their revenue line.

I would like to thank Michael at DomainSherpa for the interview and wish him all the best in helping educate new and more established domain owners in the art of domaining. Keep up the work Michael!

Click here to go to the interview.

Earlier today I was interviewed by Michael Cryger for Domainsherpa.com and he asked a number of questions that caused me to reflect on my domaining journey and in particular what it means to extract the maximum amount of revenue from your own domains.

The first thing that I would like to say about Domain revenue optimisation is that if you leave all your domains at a single parking company then you will be losing revenue. Yes, I know that it’s difficult to manage domains by changing nameservers, tracking results and then updating the nameservers yet again but if done correctly there are huge dividends.

Over the years I’ve found that each parking company has developed an expertise to monetise different types of domain names and if you leave them all with one player then you aren’t taking advantage of their core competences.

The complexity of managing domains across multiple parking companies involves some pretty complex stuff:
1.    Comparing one monetisation solution against another isn’t easy.
2.    Dynamically moving traffic is a tough job.
3.    There’s just only so much that an Excel spreadsheet can do!

Comparing one parking company against another is not trivial and anyone that thinks believes it’s easy is just kidding themselves. A common misconception is that RPM (revenue per thousand visitors) is a universal metric for comparing parking companies against each other. Let me say categorically that you can’t compare RPM from one parking company against another because each company counts visitors differently. For example the traffic filters in place at Domain Sponsor are completely different than those at Sedo.

Let’s take a look at this with a fictitious example. Let’s imagine that both Domain Sponsor and Sedo generate $10 in a day for a domain name. Due to their different traffic filters and reporting systems Domain Sponsor indicates that there are 10 visitors in that day and Sedo 5 visitors. The RPM’s for the two companies would then be:
Domain Sponsor: $10 / 10 *1000 = 1000
Sedo: $10 / 5 * 1000 = 2000

Some people would then say that Sedo is performing twice as well as Domain Sponsor! Wrong, wrong, wrong! It’s the same revenue just different reporting. The lesson to learn is whatever you do don’t compare RPMs – you’ll get the optimisation wrong every time.

Other people have spoken to me and said, “All that matters is daily revenue.” While there is an element of truth to that statement let me ask my questions. “Is the revenue that you’re trying to compare for the same levels of traffic? Are you comparing revenue in December versus revenue in June?”

For example, let’s imagine that domain name xyz.com was earning $10 per day from 10 visitors one day at Smartname and then $15 per day from 100 visitors at Hotkeys. If you just look at the revenue line then you’d be jumping up and down for joy because of the extra $5. The reality is that it took 100 times the number of visitors to earn only half as much. This is where we need to move onto a metric called a normalised RPM.

Normalisation is the process where you can actually dynamically compare one RPM against another at any given point of time. Internally at ParkLogic we call this the PL RPM so that it’s different from a parking companies RPM figure.

Creating a normalised RPM involves counting ALL of the traffic coming into a server (no filtering and no different reporting rules) and then as simultaneously as possible sending the traffic onto the various parking companies. For example we might have 10 pieces of traffic coming into xyz.com and send 8 to Sedo to generate $8 and 2 to Domain Sponsor which earned $0.50. The normalised RPM for each company would then be:
Domain Sponsor:  $0.80 / 2 * 1000 = 400
Sedo:  $3 / 8 * 1000 = 375

It’s clear from this example that Domain Sponsor is currently the better company to send this domain’s traffic to at this point in time. Never forget that these figures vary widely over time and true revenue optimisation involves tracking all this information.

Let me say right up front that I’m one of the founders of ParkLogic and we have built huge systems that constantly make comparisons based upon normalised RPM values. Don’t try and do it yourself….it’s very hard work and we’ve been doing it for a long time now. Whether it’s ParkLogic or any other company that optimises domain traffic I would recommend that every domainer move their domains to these type of platforms to get the most from their traffic.

In my next articles I begin to break-out some more of what it means to optimise traffic and how to get the best results from your domains. Please let me know if you find these articles useful for your business.

I was sitting at my desk today and for some reason turned on Facebook and read a tremendously inspiring message and a marriage that went wrong then tragically right. It caused me to reflect on what my own marriage is all about and why is it that my wife is my best friend as well as my lover.

I remember a number of years ago I went down to the local store and purchased some salt and vinegar chips for my wife and I to munch on while we watched a movie that night. I came back home and Roselyn said to me, “Don’t you know that I don’t like that flavour?”

By this stage we’d been married a number of years and her casual statement hit me like a sledgehammer. I’d been so self-absorbed that I hadn’t considered even the simplest needs and desires of my wife. From that moment onwards I made a decision to pay attention to the little things.

Twenty-four years later I’m more in love now then I was when we were first married. I’d like to say that I got it right all the time but being human we both stumbled along through the years but with a growing deeper love that is far beyond the young love associated with our honeymoon.

So what was the decision that I really made? I’d decided that my joy was going to come out of serving my wife and paying attention to her needs and not demanding my own needs be met. What happened was amazing! I discovered that Roselyn did the same thing and rather than desperately wanting to have our individual needs met and complaining when they weren’t we both found that there was far more enjoyment and fulfilment from serving each other.

I take this same attitude into business. Serve customers, especially when no one can find out what you’re doing. This is why ParkLogic tries to be transparent in all things. It’s tough to do this in the domain industry but I’d rather be open and honest then have to remember what lie I’d told each person that I’d met. Like the years of my marriage we sometimes miss a step but the desire and intention is to always be open and honest.

As an aside, one of the things I’ve learnt to look at in business is the way people treat those that they say they love most dearly. For example, if they treat their wife or husband badly then how are they going to deal with a business partner. Something to think about…..

Cheers!

While at TRAFFIC I talked to a lot of domain owners and was amazed at the number that either:
1.    Have given up on traffic revenues for their domains.
2.    Manage their domains via spreadsheet.

Over the last couple of years the pay per click market has declined rapidly and all during this time I’ve been developing monetisation solutions for my own portfolio to help ensure that the decline didn’t impact my bottom line. At each of the conferences that I’ve spoken at, like a broken record I kept on saying the following:

1.    Build a business around one domain that you are passionate about. Not three hundred…..just one. Make sure that the business is profitable before you move on to the next domain that you love.
2.    Ensure that all the domains that have little to no traffic but have tremendous brandable value are listed in all the aftermarkets.
3.    Hand the traffic domains over to a company such as ParkLogic (my own company) that have developed specialised skills in extracting every bit of value from your domains.

Think about what this strategy means….you know longer have to try and manage your domains via massive vlook-ups in Excel and move them around from one monetistation solution to another. It’s all done for you that free you up to work on your business and selling domains (or even buying a few).

I’m never ceased to be amazed at the number of domain owners that value their time at $0 and do an incredible amount of work for their passive incomes. Outsource the traffic, answer the inbound offers and build a business with a real business plan. Pretty straight forward really.

I often speak to the same people conference after conference that lament the problems with their portfolios and then do nothing about it. They flick domains around in almost a haphazard fashion with no underlying strategy and then attend the next conference to complain over a beer about the woes of the industry. The industry is fine and from ParkLogic’s perspective it’s thriving and healthy.

Remember the old saying, “If you keep on doing the same thing year after and expect a different result then you’re insane.” I do apologise if this is a little blunt but do something different and reap the rewards…..after all when you’re at the bottom of the pit there’s nothing to lose.

Many people that I’ve spoken with at the recent TRAFFIC conference have suggested that Yahoo is dead and on its way to being buried. I’m a numbers guy and the numbers tell me that this is a long way from the truth.
In my opinion the problems at Yahoo are twofold:

1.    Yahoo is not able to make decisions.
2.    Yahoo is badly pricing their traffic.

Over the years I’ve experienced Yahoo’s inability to make decisions with layer after layer of management trying to protect either their own turf or backside. This has inevitably led to a culture that drives out innovation and resists change. This is surprising considering the industry that they operate in is all about innovation and change.

For example, I just don’t understand why Yahoo keeps on trying to compete against Google where Google is strongest. You’ve only got to look at the recent decline in the number of Yahoo parking companies and direct feeds to large portfolio owners to realise that they can’t compete against Google in the same manner that they have in the past. That battle has been lost so Yahoo should cut its losses and move on.

I remember speaking to the then head of the Yahoo domain channel over 3 years ago explaining that they needed to change the game that they were playing with Google. What’s the point in playing chess against a grandmaster? You’ll lose! What they needed to do was play checkers. Do you think that Yahoo was able to do this? History has shown that they have fundamentally been unable to change.

So what game should Yahoo play? In my opinion they should be attacking Google where Google is weakest. Attack them with transparency. If domain owners could show potential investors exactly what they get paid and why they are paid it from advertisers, through the supply chain (ie. via Yahoo) to themselves then the value of their domains will increase.

Professional investors need numbers and transparency to properly value a portfolio. A higher valuation would then mean that Yahoo has moved the game from one of revenue to capital value. How’s that for an idea? To take this direction would mean a philosophical shift and a level a transparency that Google would not be able to duplicate.

At ParkLogic we recently conducted some analysis on 39,801 random domains over a 2 week period that received 50.3 million views. What we found was astonishing! Yahoo was paying well over double Google for the first 7.2 million views and then lost 43.1 million views to Google. What a crazy strategy!

We then worked out that Yahoo could have won an additional 38 million views if they had just repriced in such a way that they just won each piece of traffic. Why win by huge amounts of so little when you can win a total of 45.2 million views merely by tweaking the pricing by which you win. It just doesn’t make any sense and proves a flawed strategy.

To put this in perspective Yahoo is currently winning 23.55% of the domains and Google largely the balance. By repricing what they payout (ie. not costing them a dime more) they can change this to winning 88.53% of the number of domains.

It’s even more dramatic when we examined traffic changes. Yahoo currently wins 15.18% of the traffic but if they repriced their traffic then this would swing around to 89.49%. You just have to ask yourself what the heck are they doing at Yahoo!

Many domain owners forget that despite being much smaller than Google and lost in the wilderness of lack of direction Yahoo is still a multi-billion dollar company. I just wished that someone would stand up, risk their job, stick their neck out and make some decisions that change the malaise that seems to have gripped the company. How many more contracts do they have to lose in the domain space before they either exit or completely give up?

It appears that the last vestiges of creative talent at Yahoo are ducking for cover in the hope of reaching their long-service leave or have been squashed by a bureaucracy that requires 25 signatures before you are allowed to sneeze. Come on Yahoo, get off the mat!

Sure you have fallen a long way and it’s been a humbling experience but why don’t you smell the numbers and realise that all is not lost? Change the rules and unlike Google turn up to a domain conference full of your potential clients (your absence at TRAFFIC was noted) and be ready to eat some humble pie while seizing the market advantage. Don’t you realise that the entire domain industry is hoping and wanting you to get your act together!

After a 33 hour plus journey I managed to arrive home from TRAFFIC! Hooray! If you’ve never suffered from jetlag then I’m jealous. I love my home in Australia but I just wished it was a little closer to the rest of the world. Jetlag was compounded by our flights being delayed in Miami and LAX then we were routed via Sydney due to bad weather in Mebourne. You’ve just got to love international travel. Enough of that….what did I think of TRAFFIC?

TRAFFIC was absolutely brilliant! Any event can be better but I measure brilliance on a fundamental measurement……Return On Investment. On this metric I had so many great meetings that it’s taken a full day of debriefing with the ParkLogic team to sort through everything.

I said to Howard Neu (TRAFFIC founder), “If you don’t do a lot of business at TRAFFIC then you’re and idiot.” I’m not trying to insult anyone in particular with this comment but more stating it as an observation that each person I spoke with was energised, excited and ready to do business at TRAFFIC. What more could you ask for?

I must admit that I chuckled when I read Owen Frager’s report on TRAFFIC indicating that TRAFFIC really wasn’t worth it and there wasn’t anything innovative at the show. Sorry Owen, I’ve been on many panels with you in the past and have a great respect for your marketing prowess but it’s clear you didn’t have a chat with the team at ParkLogic. We’re all about innovation and breaking new ground! Give me a call if you’d like a demonstration of what we’re up to. :-)

When you talk to either Rick or Howard from TRAFFIC they’re willing to trying anything new that will help inspire the industry. They are more than aware that sometimes they hit a home run and other times they strike out….but at least they’re trying. For instance, I missed the sit down meals but loved the way the exhibitors weren’t pushed away in another room.

I’m of the view that it’s always better to pitch in and help then it is to criticise so that’s what the three of us at ParkLogic did at TRAFFIC. We did whatever we could to help out which included stuffing bags, lifting boxes and anything else that the organisers thought needed doing. It’s easy to sit back and complain about different aspects of an event like TRAFFIC but for the sake of the industry I want it to be successful so pitch in and help we did. Besides that in my opinion the TRAFFIC team did an outstanding job!

I found that at TRAFFIC everyone has made a serious investment to attend which more than likely immediately qualified them as a serious industry player. This also means that you typically are talking with professional domain owners who are really interested in discussing a business deal rather than just picking your brains for ideas (nothing wrong with this BTW).

What I love about TRAFFIC the most is what is actually intangible. It’s the family atmosphere. It’s Rick, Alina, Howard, Barbara, Ray and Kim working in the back and up front to make the conference the best they can. It’s Danny and Chris on the tech side and also the other friends such as the Harnett’s, Berkens and Jackson’s that seem to bring a sense of fun, maturity and wisdom wherever they go. Getting alongside the calibre of people like this is what makes TRAFFIC what it is today.

I’ve attended every TRAFFIC conference that the founding team has put on and I haven’t regretted any of them. My company, ParkLogic sent three people to TRAFFIC and it cost a bundle with all of the international air fares etc but it was definitely worth it. I know that we’ll be back…..I just hope that there is one in Las Vegas in May!