Domain Articles

In depth articles on domains, the domain industry and how investors can get the most from their assets.

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Successfully Outsourcing Your Domain Management

I was speaking with a client that had been with ParkLogic for many years and they asked me to conduct a complete review of their portfolio. Without giving away too much about who the client is I thought that I would share some of the history and the results of the analysis.

The client initially had a team of people managing their domain portfolio for them. When they moved their domains over they ended up letting these people go or reassigning them to other projects as they were no longer required to manage the domains.

Escrow.com

I want to be right up front and say that I'm one of the founders of ParkLogic. Despite this, I found the results that we achieved for the client incredibly revealing about how a properly managed domain portfolio can produce huge rewards for investors. They completely outsourced the entire management of the portfolio to ParkLogic and this is what was acheived for a 4 years period.

 

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Tagged in: outsource parklogic
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Posted by on in Personal Musings
What a CATastrophe!

The other evening my wife Roselyn and I went out for a bike ride. We left the door to the garage open and upon returning I made sure that I closed it so that it didn’t bang with the wind in the middle of the night.

Around lunch time the next day I asked Roselyn if she’d seen Pepper, our cat. She’s a wonderful cat that often curls into a ball in some hideaway in the house so it’s not unusual if we haven’t seen her for a while. She always comes when we call her name as she hopes to get some tasty morsel or two from us…..strangely this time when we called her name there was no sign of her.

After hunting around it suddenly dawned on me that maybe I’d inadvertently locked Pepper in the garage. Sure enough, after opening the garage door there was our cat staring with accusing eyes back at me. I apologised to her with a can of tuna and all was good.

So let’s unpack this story a little as there’s so much to learn from it.

escrow.com

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Tagged in: apology pepper
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Recent Comments - Show all comments
  • Melissa Dafni
    Melissa Dafni says #
    Too often our need to be right, or appear to be right takes precedence over everything else. Just like saying thank you, an apolog
  • Michael Gilmour
    Michael Gilmour says #
    Melissa, you bring up another important point.....saying thank you. When I think about it, there is the almost lost art of being p
  • Michael Gilmour
    Michael Gilmour says #
    My grade 5/6 teacher used to say, birds of a feather flock together.....
  • Kan
    Kan says #
    I'm a regular visitor to your blog.. but never commented on anything.. But This time I'm commenting... I would like to say that S
  • Michael Gilmour
    Michael Gilmour says #
    Kan, it's great to see you here and comment on this article. It means a lot.
  • Michael Gilmour
    Michael Gilmour says #
    Thank you Kassey!
Buying and Selling a Traffic Portfolio - Part 5

Like any industry where buying and selling is involved there is a potential arbitrage gap between what the seller is generating and what the buyer can potentially earn once a transaction is complete. This can dramatically change the return on the investment.

A simple example would be if a seller has all of their domains parked at Company A and they received a 75% payout. As the buyer, you know that at the same company you receive 85%. That’s a 13.3% greater payout. This means that if you paid 24 months revenue for a portfolio you should get the payback within 20.8 months.

Escrow.com

If a seller has all of the domains at a single parking solution then there are a considerable number of additional ways that you can increase the revenue. Over the years at my company ParkLogic I’ve found that the maximum any parking company typically wins in a portfolio is 20% of the traffic.

This means that if you are acquiring a portfolio that has been parked at a single parking company then you can at least improve it 80% of the time. That’s a great outcome! At ParkLogic we also have a real-time bidding system in front of the traffic that sends the traffic direct to advertisers to provide additional revenue uplift (enough of the sales pitch!).

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Posted by on in Personal Musings
Stop Biting the Hand That Feeds You!

I’ve been in the domain industry for more years that I care to remember and I constantly hear the cry of domain owners claiming that parking companies are defrauding them. So are they defrauding you?

I'm actually Parking Company independent.....at ParkLogic we send our client’s traffic to whoever pays the most at that specific point in time. In the last 8 years I’ve have only found one parking company do something deliberately wrong....and we terminated the relationship with them.

escrow.com

On the whole the major parking companies are run by honourable, good people that are doing their best to earn money just like the rest of us. They don't have a secret bucket of money that they are stashing away and they also don't steal from domain owners. If they did, they would pay out less and we would instantly move the traffic away.

That being said, stuff sometimes goes wrong....it's technology and as we know technology isn't 100% perfect all of the time. When something stuffs up give your account manager the benefit of the doubt that they aren’t trying to screw you out of a few dollars. The typical account manager has no say what goes on with the technology anyway!

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Posted by on in Domain Industry
The Evolution of Domain Parking

Domain parking is dead and should have been buried a long, long time ago. This is what I see written in domain forums over and over again. I’m left with two questions, “Why hasn’t it died?” and “What’s next?”

There are a number of reasons why domain parking hasn’t died and the first being that domain investors continue to support the business model. Let’s face it, all you have to do is change your nameservers and voila! Money starts pouring into your bank account…..that’s the theory anyway.

The reality is that I end up spending a huge amount of my time ensuring that ParkLogic clients have their nameservers set correctly and that the domains are actually still in the right parking accounts. When was the last time you audited all of your domains? Trust me when I say that about 10% of your revenue is being lost by not doing this.

Escrow.com

There is one thing for sure about domain parking is that it’s scalable. There are very few barriers to the number of domains that you can park but there are barriers to managing your domain portfolio. For example, at about 5,000 domains you will probably discover that vlookup in Excel becomes your best friend.....even if your domains are successfully parked.

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Saturday Musings - Relationships Not Things

I’ve had a lot of people asking me why I’m not at TRAFFIC in Miami. I’ve been to every TRAFFIC conference for the past 10 years (other than the very first) and I’ve found them exceptional events for developing business. So why aren’t I attending this time?

It just so happens that my daughter Elise is turning 16 and despite my love for TRAFFIC she trumps it. I wouldn’t miss her birthday for anything. So I am really sorry to all of my great friends at TRAFFIC but you got beat out this time……but I will be there in 2015!

When I think of my decision it’s all about what I regard as important in my life. Do we work to live or live to work? I love my work but the reason why I work is so that I can live a more fulfilled life. It's focusing on people and relationships not things and money that provide a richer better life. In this case it was my relationships with my daughter that won the day.

The order of importance for me is my relationships with God, Roselyn (wife), my kids, work colleagues, friends etc.  I find that if I have these priorities in the right alignment then life is good. Sure, I can break the rules for a time but there’s always a cost.

Tagged in: relationships traffic
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Recent comment in this post - Show all comments
  • Michael Gilmour
    Michael Gilmour says #
    You both are way to kind with your comments. Thank you for your thoughts and I will pass on the "happy birthday's" to Elise!
Buying and Selling a Traffic Portfolio - Part 4

So you’ve done your due diligence on the domain portfolio that you wish to acquire and everything looks like it’s good. All you have to do is part with your hard earned cash and wait for the authorisation codes so that you can transfer the domains into your registrar. So what’s the problem? A lot!

What happens if you send off your money and the seller decides not to transfer the domains. They now have your cash and the domains. What happens if you send your money and the domain statistics have been fabricated? What happens if you transfer your dollars and discover that the stats have been pumped up with purchased traffic? These are all good questions and I’ve heard story after story of people who have been burned by unscrupulous sellers…..so my advice is BEWARE!

Some buyers try and solve this problem with a contract. Personally I find that they are almost worthless. If you have a person that is prepared to steal your money then reneging on a signed contract is probably nothing big for them. So what’s the solution?

In a nutshell I would recommend using an escrow service. With a good quality escrow service both parties (ie. the buyer and seller) can agree to specific terms and a middle-man handles the actual transaction.

For example, you transfer your money to the escrow service and the funds are not sent onto the domain owner until the domains are under your control. This at least stops people from running off with your money and the domains. You can actually specify a variety of conditions that are agreed by both the buyer and the seller that the escrow company can verify before the seller can get their hands on your cash.

Seller financing has become very popular. The escrow company holds the domain in their account while the financial obligations are met. Say $12000 being paid in 12 monthly instalments of $1000. My only caution is can you imagine the headaches involved if the escrow company ceases to operate or becomes insolvent during a transaction of this kind. This wouldn’t be pretty!

There are a number of Escrow companies that domain owners use with Escrow.com being by far the most popular and the longest established. Over the years, they’ve spent a huge sum to ensure that they are in compliance with the various governmental authorities that manage the escrow industry and ensure that it’s clean.

Tagged in: escrow escrow.com
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Buying and Selling Traffic Portfolios - Part 3

In the previous two articles we looked at managing legal risk and also the different types of traffic that often flow through to domains. In this article I will be examining the other influencers on the returns from a traffic portfolio.

The first thing to look at is where the traffic is coming from. For example, is it mainly USA or is it from China? Chinese traffic tends to be paid much less than traffic from the USA.

A number of years ago I did an analysis on the penetration of credit cards in a specific geographic region and how this influenced earnings per click (EPC). Cash based economies like China tended to have a much lower EPC. The reason being that marketers have a much more difficult time tracking spending money online to ultimate sale of the goods if the transaction is constantly being pulled off-line.

I personally believe that over the years ahead many of these burgeoning economies will adopt credit cards and the online cycle will be complete for marketers. So watch this space!

When you buy a traffic portfolio you are always looking for any “free” upside. An example of this would be if you were getting paid 90% from a monetisation provider but the person selling the portfolio is only getting paid 80%.

We’ve had ParkLogic clients purchase portfolios that have been held at a single parking company and then placed on our system. From experience, typically no parking providers wins more than 20% of the traffic on our platform which means that the acquisition would receive more revenue 80% of the time if move to other platforms. This typically provides a 30% uplift in revenue via our algorithms and processes and this dramatically reduces the payback period for the investment.

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Posted by on in Domain Industry
TRAFFIC - Happy 10th Anniversary

I would like to wish the team at TRAFFIC all the best for their 10th anniversary. It's been quite a journey for Rick and Howard and their families for the past 10 years. Sadly, due to my daughters 16th birthday I won't be able to make this one....the first TRAFFIC that I've missed since the very first conference run all those years ago.

If you haven't registered then make sure that you go to targetedtraffic.com.

Please enjoy the video below...

 

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Recent Comments - Show all comments
  • Michael Gilmour
    Michael Gilmour says #
    The only reason why I didn't travel this time was due to my daughters 16th birthday....otherwise I would have been there. This is
  • Michael Gilmour
    Michael Gilmour says #
    Thank you for your kind words.....I must admit that when you travel across the Pacific the number of times that I have it does hav
Buying and Selling Traffic Portfolios – Part 2

This is the second part in a series on buying traffic domain names.

Once you’re comfortable that the legal side of the portfolio has been addressed then you really need to dive into the traffic numbers and do some research into where the traffic comes from.

So let’s get back to basics. You’re about to purchase a traffic portfolio. The first question that you should ask is, “Where does traffic come from?”

Traffic typically comes from the following sources:

1.    Direct type-in

Generic or short domain (eg. Beds.com, gx.com.au)

2.    Typos

Typo of a generic domain (eg. Fruit spelt fruit)

Typo of a weak trademark domain (eg. Joespizashop.com instead of Joespizzashop.com)

Typo of a brand (eg. Verison instead of Verizon)

3.    Link based traffic

4.    Purchased

5.    Hijacked traffic such as tool-bars and NXD traffic.

In the above list of places where traffic comes from I’m making no attempt to try and pontificate on whether they are appropriate traffic sources. I’m only indicating that they are sources of traffic. So please do not get upset at the mention of typo, trademark, purchased traffic etc.

Many years ago I purchased my second domain name and it failed miserably to provide any sort of return. Each and every year I faithfully registered the domain to remind myself to ALWAYS ask the question, “Where does the traffic come from?” In my case, the domain had a lot of Russian bot traffic that didn’t monetise at all. There’s nothing like a $10 annual learning course to remind you of an important lesson.

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