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SEO is War, War is Progress, and Progress is Expensive

TropicalSEO says domainers are in a slump, having profited hugely from generic domain appreciation while not developing beyond page parking. After 3 days at DomainRoundtable, I have to disagree with a few things. I wanted to say it in comments on the blog, but TropicalSEO requires registration so I’ll post here.

First, I sat through the auction action and there were a number of domains sold at very decent prices. There were 450 domains listed, and many (in my humble opinion) were sub-par as undeveloped domains go. I sat with experienced domainers, most with bidding paddles, and every name was subject to live whisper valuations among us. As I listened, I learned that the experienced domainers basically agreed on most domains. Most were deemed to be not worthy as listed. In addition, it seemed many sellers really didn’t want to sell. The reserves were too high to initiate bidding interest, despite talk about how they worked to get reserves lowered. Domains not selling at overvalued prices doesn’t indicate a slump – it indicates that the domainers didn’t want to sell – the reserves were too high for things like for $3000.

But how about at $20k? You must be kidding. Command language for “now!” or “today” for the Latin American markets. Supremely brandable. That’s a powerful domain name, and it was bid up to $31k or so where I still think it was undervalued. Sitting in a corporate meeting room with a marketing team looking at domains for a media project, something like that would be worthy of top consideration at a multiple of that price. The domainer that bought it made a wise investment. for $100k? Looks like someone isn’t really interested in selling at a domainer’s auction. That reserve is too high for consideration.

I spoke with several people who had pulled their domains from the auction before the start. They had second thoughts, and didn’t want to sell. After speaking on SEO in two sessions, I met over a dozen domainers looking to discuss several aspects of SEO. It was all business development. Not always site development, but business development. Slump? Nah. Not for these guys. Maybe the smaller portfolio domainers are unclear of how to proceed, but then it seems pretty clear to me many of the smaller SEOs are unclear about that today, too. Most of the domainers I spoke with were strong businesses working serious projects, in addition to their domain holdings. They all had visions well outside of domaining. Of course they are looking to utilize more of their domain portfolios, but I think that has much more to do with Googles complete control of the PPC market and the fragility of the parked page monetization model than anything about domaining. As one large domainer told me, buying select domains at the auction was not spending money. Buying them was like putting money in the bank.

Andy can poo-poo the parked page model, but with tens of thousands of parked domains in your portfolio you’ll find yourself solo managing a “business” with millions in revenue before you have time to consider various “more advanced” aspects of monetization. I met guys with several hundred thousand domains. They’re busy being successful, building up war chests for the next recession (to buy more domains) and finding people they can trust for business development – not an easy task. They’ve made millions in a few years focusing tightly on domain acquisition. What’s the point of highlighting that they haven’t gotten into development yet? When they do, they will do it with the passion that led them to become so successful at domaining. Big surprise? No. And now that the domain name drop has been squeezed by registrars, and Google is squeezing page parking monetization, yesterday was the time to shift some attention to that business development. From what I have seen, these guys are ahead of the curve.

If you really think about it, what is in all of these portfolios? There aren’t that many generic domains. Obviously there are strategies in play.
We SEOs and domainers are in the same business. We publi$h on the web. To do that we need domain names, content, and traffic. The SEO community chose to focus on traffic, while the content people evolved content management systems and blogs, and the domainers optimized the domain acquisition and portfolio maintenance arenas. We each encountered similar forces of aggregation and control, and change. SEO now suffers under a Google monopoly, and domain acquisition has been stymied by registrars and a shortage of easy domains. With Google and Google’s “partners” controlling the monetization of domain portfolios, it’s time for innovation. From what I have seen this past week, that innovation is not only happening, but it is being very well funded.

What good is a war chest until there is a battle? Why do nations go to war? Who needs SEO? Good questions, and I think they are very relevant to the current domainer and SEO fields.


  1. Neil wrote:

    Quick question John, which registrar do the big domainers use? Or does it not really matter? I’m guessing NOT godaddy?

    John replies: The registrar is an important topic, but maybe for different reasons than you usually consider. Domainers have been “catching” dropped domains for years. It was the best way to pick up a good domain. Domain “tasting” is also popular, as it allows you to test a domain for traffic for 5 days before committing your reg fee. You pay a few cents (a nickel, a dime) to taste a domain on the drop list, and you release it if it doesn’t have traffic. So to a big domainer, the registrar should have a “tasting” program (moniker, enom, not GoDaddy) and a decent fee schedule for tasting. Lately some registrars are keeping the released domains themselves, so they never make it onto the drop list. Obviously that is hostile to the big domainers, and as the drop list “dries up” with regards to value, whether or not a registrar has a good/low-fee tasting system becomes less relevant.

    Sooo… some registrars are moving into the “park and sell” domain business, where they need to court the big domainers. Enter GoDaddy – trying hard to promote a positive reputation in the domainer space. According to the conversations I had with domainers, GoDaddy has been much less aggressive than some others when it comes to stripping the drop list of value. They are the largest registrar, and they did assumed the RegisterFly problem, which was helpful to many domain holders. I think we can expect GoDaddy to move into the domain parking and selling market in a very big way.

    Did that answer your “quick” question?

    Friday, August 17, 2007 at 5:28 am | Permalink
  2. Neil wrote:

    > Did that answer your “quick” question?

    Yes it did, thanks for the info.

    Saturday, August 18, 2007 at 8:21 am | Permalink

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  1. on Friday, August 17, 2007 at 8:02 am

    SEO is War, War is Progress, and Progress is Expensive…

    TropicalSEO says domainers are in a slump, having profited hugely from generic domain appreciation while not developing beyond page parking….