© Bob Angus for bobangus.com, 2008. | Permalink | One comment | Add to del.icio.us
Post tags: domain parking, web real estate

© Bob Angus for bobangus.com, 2008. | Permalink | No comment | Add to del.icio.us
Post tags: domain parking, web real estate

Here are 5 tips that I have found invaluable when negotiating with domain name and website buyers.

1. The Low Ball Bid

Most deals start with the seller asking for a high price and the buyer offering an insanely low bid. Do not get offended or put off by a low ball offer. If somebody has made the effort to make a bid, then they are interested in your property.

The key is to identify one or more elements of your domain that the buyer values. For example, do they own a portfolio of other domains in your niche? If so, then you have something in common to build on. You can move forward with the negotiation by demonstrating your value, not just haggling price.

2. Moving Forward Based on Value

When you ask questions or research other properties owned by the buyer, you can identify what is important to them. This approach helps significantly during the negotiation or when you run into a roadblock. You have to ask how/what/why questions to diffuse any roadblocks and turn them around to increase the value to the buyer. This process is what salespeople call objection handling.

DomainerPro.com had a good example in his How to Negotiate Domain Name Prices post.

Countering Bluffs: I would add that you should learn to recognize and counter the most common bluffs that buyers use. If a buyer says, “I can’t go any higher,” don’t give in, and don’t call him a liar either. Instead counter with a reasoned argument like, “I understand what you’re saying, but this domain name will ultimately save you money by bringing you targeted leads. The extra money is worth it.”

3. Always Answer Questions

Potential buyers will always have questions about your domain. You will receive even more questions when you are selling an entire website. It is important that you answer these questions thoroughly and quickly. The buyer is asking for details so that they can better value what they are willing to pay. More likely than not, a detailed response from you will help increase the final selling price.

4. Always Answer Questions Honestly

Do not play games with buyers. If you think that you can maximize your selling price by lying and by sayging that your website is not an auto-generated, blackhat SEO quickie, then you are fooling yourself. Buyers know all the tricks and will bail on a deal if you try to snow them. It is okay to be honest. A quickie, no-effort website will not get top dollar, but then again it shouldn’t.

5. Build Relationships for the Future

If you are interested in making money online through a repeatable domain flipping process, then you need to establish and grow relationships. The more key, trusted connections that you have, the more profitable and repeatable you domaining business will be. Just like any business.

Do not burn bridges by weaseling over $100 or even $1000. A single solid relationship can help your business profit 10 or 20 times that. Keep providing value and sharing with your partners and they will return the favor in spades over the long run.

Do you have any other negotiation insights or stories that others can learn from?

Related posts:

1. 5 steps to maximize domain parking revenue
2. Domain parking is SO easy
3. Would you use domain parking to monetize AtomicWarrior.com?

© Bob Angus for bobangus.com, 2008. | Permalink | 8 comments | Add to del.icio.us
Post tags: domain names, domain parking, results, web real estate

Hot Topic

I have read three poignant posts this week that have led me to write this post.

Devlounge – The Dangers of Buying a Blog: David gets right to the point – expect to lose approximately 33% of the current traffic right away. Unique visitors are not eyeballs, they are readers. You have to value why those readers are visiting the site and if that readership can be maintained.

Portfolio.com – What’s Drudge Worth? – by way of ProBlogger.Net: Duff estimates that The Drudge Report should be valued between $10-20 million based on eyeballs, ad sales, and his mom’s opinion. However, he goes on to say that it is worth zilch if you cannot lock Matt Drudge into a long-term writing contract. I could not agree more.

Dosh Dosh – Building an Online Empire: Of the 16 website types Maki mentions that you can buy/sell, none of them were a pure blog. He lists a product review blog, but that type of site is more dependent on the product than the author.

There are many more helpful articles if you do a Google search. Or I also recommend reading related forum posts on WickedFire, Sitepoint or Digital Point.

The Metrics

Before buying a blog or any website, you need to know the following metrics:

• Unique visits per month
• Page views per month
• Feed subscriptions
• Posts per month
• Monthly Revenue
• Google PageRank
• Alexa rank
• Date established

Of course, you should ask for the trends and seasonality of these metrics. A snapshot in time or peaks can look great, but they can be pumped up and a single number does not tell the whole story.

Beside statistics, you should also have a clear understanding of the intellectual and technical property you are acquiring. You are not buying a domain. You are buying a website and everything that goes with it, including posts, comments, media, databases, customized themes, etc.

Recommendations

There is no cookie-cutter, rule of thumb for valuation, like $10 per post or 10x monthly revenues. Here is a swag bid estimate calculation that I use:

1. Your valuation calculation should start by defining a financial benchmark. Estimate the monthly profit (preferred) or revenue per thousand unique visits or subscriber that you are achieving for your current blog properties.
2. Then use that value and apply it to the same measure for the blog in question… less 50%. Remember David said 33%. I go more conservative when making financial estimations.
3. Finally, my bid would be approximately 12 months of that estimated profit or 6 months of the estimated revenue. That is my personal valuation rule based on my desire to be rolling full speed with a site within a year.

For example, let’s say your current blogs make $2 profit per thousand unique visits per month and the potential purchase has 20k uniques per month. Then I would expect to make $20 per month ($2 x 20 x 50%). My bid would be in the range of $200-250 (or $20 x 12).

In addition to making a good quantitative decision, you should also be prepared with an action plan to minimize readership erosion and to increase your ramp to profitability. Specifically, make sure you line up engaging writers and content to hit the ground running and get your promotional methods implemented.

Now I am off to see if there is anything on Sitepoint or Digital Point that catches my eye!

Related posts:

1. Flipping Website Real Estate for Profit
2. Claiming my blog on Technorati
3. Search Engine Journal – 2006 Search Blog Awards

© Bob Angus for bobangus.com, 2007. | Permalink | No comment | Add to del.icio.us
Post tags: blogging, business models, results, web real estate

Way back in August, Super Affiliate Marketing Blog had a great post on flipping web real estate. Jon details three key redesign elements to turning a low traffic dud into a website worth buying. First, the design…

Is it too crappy to look at? Do you need to change it around? Chances are pretty good that you will need to make some alterations. Whether you should redo the whole thing is again, up to your taste and budget. Remember, you already spent $500 on this, and your goal is $3k, so you don’t want to go overboard with unnecessary beautification operations.

Then, Jon drills down on steps #2 and #3 – usability and monetization. Mixed in with these steps, he gives invaluable guidance that can give you the edge to maximize your ROI. For example, focus on generating statistics like unique impressions, page rank on Google and Alexa, and some basic contextual advertising revenue. Then, provide a mini business plan with current site metrics and future projections in your “for sale” message. Help make it simple for a buyer to pay top dollar.

Also, it is vital that there is an active marketplace to buy and sell web real estate. Of course, the real differentiator that maximizes your overall profits is to understand the potential buyer and don’t burn bridges…

Remember, that even though you are selling a property that doesn’t really interest you much in holding onto, you are selling it to someone who finds it as a good deal or investment, so you must treat it with respect, because this property may be someone’s baby sometime soon…

… put some contextual ads onto it if you like, get the stats program working again, collect as much real data as possible on the current situation of the site, and then make projections of 3, 6, 10 and 12 months. Base those numbers ONLY on the current situation of the site. If you just go off and make numbers up, they won’t buy anything else from you ever again, and you may also sabotage your reputation on your first deal, which can suck.

Here is the link to the full post. The marketplace and profits are there for you. Check out Biz MP for developed websites or The Domain Name Aftermarket by GoDaddy for just domains.

Related posts:

1. Buying a blog is different than buying a website
2. Free Website Launch Checklist and Daily Tracker
3. Domain parking is SO easy

© Bob Angus for bobangus.com, 2007. | Permalink | No comment | Add to del.icio.us
Post tags: business models, results, web design, web real estate

Here are five basic steps to drive your domain name parking revenue:

• Select a high traffic domain name
• Use a .com TLD
• Optimize keywords
• Use multiple landing pages
• Don’t take a flat rate

Select a high traffic domain name
Domain parking revenue is first and foremost about type-in traffic. Therefore, the best way to get any sizable traffic is to choose a domain name based on keywords or phrases that someone is likely to just type in, rather than do a keyword search on a search engine.

What works best? First, think like someone doing a keyword search. You can use common keyword selection tools to come up with ideas, identify common misspells, and estimate the potential success of your domain. Second, single word and short phrase domains get the highest type-in traffic. Based on those two criteria, my ultimatetoilets.com domain is doomed if I stick with domain parking.

Use a .com TLD
The TLD (top level domain) also has a significant impact on traffic. Domains ending in .com receive the most type-in traffic by a wide margin. Someone looking for Bob Angus is significantly more likely to type in bobangus.com than bobangus.net or the “personal” bobangus.name. The only extra consideration would be country-specific TLDs like .co.uk or the new .mobi TLD for mobile sites.

Optimize keywords
Take advantage of your keyword research again by providing a list of relevant keywords to your domain parking service. Put yourself in your customer’s shoes and think about what they may have been looking for when typing in your domain. By presenting information that visitors want upfront, you reduce the number of clicks before clicking on an ad. This leads to greater conversion rates and more revenue.

For services like Domain Sponsor, these keywords define your high-level advertisement categories and help further with the automatic optimization process. Until I put in keywords for ultimatebathroom.com, the automatic category selections displayed were all poker and gambling-related items. What do you think my conversion rate was for that? Zilch.

Use multiple landing pages
Cycling multiple landing pages and even custom ones helps you test what works and feeds the advertisement optimization engine. Some domain parking landing pages are completely lame. Assume that visitors are internet savvy. They recognize a link farm or lame site right away and quickly move on without clicking one of your ads. Similar to keywords, you can use a landing page design that shows you care why the visitor is on your site and that you are trying to add value.

Don’t take a flat rate
Your revenues come from pay-per-click advertisements. Just like Google Adsense, you should get paid more for ads presented based on popular keywords. Mortgage-related ads pay out more than ads for potpourri candles. Don’t accept a flat PPC fee from you domain parking service. Make sure that you are getting paid based on a percentage of the total advertising revenue.

Once you get these basics down, the next step is start buying a ton of domain names. And don’t fall into the “all the good domains are taken” mindset. With a little effort, you can capture some significant income.

Related posts:

1. Domain parking is SO easy
2. Would you use domain parking to monetize AtomicWarrior.com?
3. 5 Tips to Negotiate with Domain Name Buyers for Higher Profits

© Bob Angus for bobangus.com, 2006. | Permalink | 4 comments | Add to del.icio.us
Post tags: domain parking, results, web real estate

Domain Sponsor is by far the best service that I’ve found to help generate some very small revenue rather than posting an under construction page while I am in development mode. There are other good services like Google Adsense for domains. Or every web hosting provider has a partner that provides domain parking for free.

What is domain parking?

Domain parking is simply an advertising program to monetize type-in traffic visiting your site. Your traffic comes entirely by someone typing in your domain – no Google Adwords or search engine traffic allowed. Based on that, you are not going to see a whole lot of folks hitting your site, even if you have a really common domain name.

Visitors are redirected to a page containing relevant advertising listings and keyword links. These ads and links are pushed by the service and are targeted to the predicted interests of the visitor. Over time the domain parking service further optimizes the ads based on the number of clicks and the payout. The domain owner is then paid via a classic pay-per-click model.

How do I make real money?

“So domain parking is incredibly easy, but I can’t see how you can make any real money.” Well, you really can’t make significant “quit your day job” revenue on an individual site basis. Then again, you can at least cover the annual cost of owning your domain for absolutely zero effort.

For me, I’ve made a whole $3.50 over the past 6 months on ultimatebathroom.com and ultimatetoilets.com – not even close to covering my fees with Go Daddy. Then again, those are terrible domain names to get type-in traffic. I am even amazed that I’ve gotten the 15-20 visits a month (about 1/3 are international).

However, there are domain real estate businesses that are playing a numbers game. If you own thousands of domains, you only have to net $10-$20 per year for each domain to grow a pretty easy nest egg. Additionally, these high volume domain owners are typically using domain parking as an enabler. They make some easy money while trying to sell the domains on the aftermarket. Plus, they can identify sites with real potential for building out and launching, or at least sites that should have a higher resale value.

I will share more on how to optimize your results if you are venturing into the domain real estate business, why Domain Sponsor is the best provider, and how I’ve customized my landing pages in future posts.

Related posts:

1. 5 steps to maximize domain parking revenue
2. Would you use domain parking to monetize AtomicWarrior.com?
3. Discover Domain Name Deals using DMOZ

© Bob Angus for bobangus.com, 2006. | Permalink | No comment | Add to del.icio.us
Post tags: business models, domain parking, web real estate