Can any one company turn a domain into a business?

[dn-101]

You're either a domainer or a web entrepreneur. Can't be both.

Jose is obviously joking. He's probably one of the best developers on the Continent (that's Europe to you!)
BY the way, IDN.bz is his baby.

 

[dejanlesi]

Well i must say that is what me and my designer are doing.. One way or the other i look at every site as a business of its own. Our business model is pretty straight forward. We get very good domain names and build them out. They start out as mini sites and then they can move up to full fledged drop shipping store which can generate a great amount..

Since we do all the SEO by ourselves it takes a lot of times, but i have time and we have a lot of nice results showing already so i think we will stick to this

As for the topic title question. Yes if you give the one who will make the business for you enough motivation to go out and do this.. This is my longterm plan for sure. Get a real category killer and build out a business. SInce im already good at drop shipping i think this will be the route i will follow.

If you dominate a niche with a lot of keywords to rank for then that, time and will is all that you need if you have the knowledge already..

 

[simon johnson]

If you had a high end domain to develop, who would you turn to do build out the property?

We develop our own portfolio with in house developers. It keeps our standards very high and we know what we get. A little insight into our business ;-)

Can anyone in this industry really build out a business and not just a website?

Unless you are an entrepreneur the answer is a clear NO. Here are a few scenarios to think about:

1. Web Developer gets into domaining to boost SEO. Has no idea about building a real-world web business, but can get you great links.
2. Internet Marketer gets into domaining to make a quick buck, and later realises that its hard work.
3. Dodgy used car salesman / pawn broker stumbles across domaining and is "technically challenged".

If you don't have the vision and the ability to execute on it (whether it be finding the right people or overcoming technical challenges) then you will fail - which is where we are now with respect some "development firms".

 

[ngconcepts]

We develop our own portfolio with in house developers. It keeps our standards very high and we know what we get. A little insight into our business ;-)

Unless you are an entrepreneur the answer is a clear NO. Here are a few scenarios to think about:

1. Web Developer gets into domaining to boost SEO. Has no idea about building a real-world web business, but can get you great links.
2. Internet Marketer gets into domaining to make a quick buck, and later realises that its hard work.
3. Dodgy used car salesman / pawn broker stumbles across domaining and is "technically challenged".

If you don't have the vision and the ability to execute on it (whether it be finding the right people or overcoming technical challenges) then you will fail - which is where we are now with respect some "development firms".

I partly agree with you. No one is born an entrepreneur, they have to get their feet wet. I am a developer by trade and I decided to get into domaining for that same purpose. I can pick up good domains and I don't have to hire anybody from the outside to create the site. I have also developed good SEO skills that I can apply. The business know how is something you just pick up along the way. You don't need an MBA to do this stuff (unless you are going the venture capital route). You make mistakes and learn from them and keep going. Eventually all the pieces of the puzzle fits and you start getting successful in implementing your ideas into a business.. in my case, ecommerce sites. My portfolio has a balance of sites that are purely traffic generating sites based on keywords that generate good CPC as well as sites that are niche with specific products for sale. I also keep an eye out for future niches as well and develop them over time.

---------- Post added at 07:18 PM ---------- Previous post was at 07:06 PM ----------

I'm curious how many domainers out there are web developers by trade? I think it is a huge advantage in being a developer/domainer/marketing hybrid because you can utilize all skill sets and knowledge to save you money as well as time in developing your business. You may need to reach out to an experienced "mentor" to guide you in the business side of things but there is no reason why one can't pick that up. It is just like opening up a brick & mortar franchise business such as a Subway. The owner doesn't know anything going in but they get few weeks of training and jump in with both feet and learn on the job. We are lucky that we don't have to drop $200K in a franchise business just to start. We can start on a shoestring budget and gauge our progress and invest when we need to. This is how I do it.

 

[AMERICAR]

3. "Dodgy used car salesman" / pawn broker stumbles across domaining and is "technically challenged".

I could take some offence at that statement but i wont as it seems to go with the territory ... maybe you were/are a lawyer or a realestate salesman, banking/loans same territory ..

How to make a business out of a domain name ... you have to know more than a little about the business that the domain name refers to .. back up the thread away someone refered to the logo.com purchase of $500K as being a way over the top price to pay fact is you cannot buy a decent business of any kind for $500K .. The City of London Olympic committee logo .. The logo cost £400000 (U.S.$800000) and took a year to develop .. where would a major organization start to look if a logo was required for such a project .. would it not be fair to say that Logo.com might just be top of the shopping list ... Logo.com has every chance of being a force to be reckoned with if built into a business by the new owners ..

The easy domain names to build a business off are the ones like Hotels, Travel, etc as booking or comparison sites .. you dont need much development as most of the larger hotel providers will suppy a white label affiliate website ...

To build a real stand alone money making website from a domain name you need to know the business that you are getting into backwards .. you need to be selling something or providing a pay for service that people want .. no developer company can do that for you unless you are a common affiliate for some one else ..

 

[Attila]

Wow, $800k for a logo...I would of just dropped a project on 99Designs website (with a $2k pot) and let a few hundred designers go at it.

Whether a domain can be turned into a business. All I know is the several domains I acquired were because I had a vision what that site would look like and how it would make its money. I then determine how much potential that business can make and then make a portion of that amount the max price to buy the domain.

For instance, I just bought Moulds.com for $12k - while some might say thats expensive, I look at it this way (what domainers call, an end users perspective). If I build out the website in different mould categories (plastic, silicone, die casting, aluminum, more) and rank these highly in the engines. I can either do lead generating which can make me 5-10% commission off the gross order amount (which can sometimes be in the low $xxx to mid $x,xxx) . I can do that OR make a customized software which represents a B2B network, market place, premium advertising and charge $20-50 a year to have companies listed. With over 100,000 mould factories just in China alone (not including India, usa, uk, all over world), I believe finding 1000 of them to pay $20-50 a year should be cakewalk.

Development isn't easy. Making 5-10 pages loaded with filler articles and ton of ads is not development in my book. But more or less squatting keywords for Search Engine rankings and making a profit off a click. There are different types of sites which are considered businesses; eCommerce sites (products or service) and User Interaction sites (social media sites, media sites, game sites). Whether you choose either, a business plan has to be created on how it will make money. From that point on, is how you design or develop your site.

A business is anything that makes money, either off a consumer or another company through advertisements on your site. So if you just made 5 cents off that click, then congrats, your business just made a nickel. At the end of the month, compile your gross income/expenses and you will see if your business is in the black or red. Though if you think its a hobby, its probably because one doesn't take too serious whether it makes money or not. To be or make success of your domain or website, you have to be ambitious, make plans, be persistent and always stay on top of things. After all, you wouldn't tweak that website if you didn't think it'd make you more money, right?

 

[Tia Wood]

Great responses in this thread.

 

[AMERICAR]

Here is an Australian company that may be of interest those who are interested in this thread ..

This Company started with a crappy name and they still have that name ...

"it took 3 to 4 months to come up with a good business model despite the lack of start-up capital in terms of launching."

"From business point of view, some of the things that wasn’t done:"

Didn’t have a business plan written out
The prototype that Graeme Wood put up had no documentation
No documented strategic plan
No exit strategy until the business was worth a lot of money
No market research of consumers
Started with about two people but never hired people from the hospitality/accommodation industry. They talked to a few but found them so aligned to traditional point of view and instead hired new talent to “get people along who know nothing about it”. Graeme knew nothing about the hospitality industry as his background is technology.
Never secured intellectual property ie they had to change their name after launch
But what was done from the start was to keep it simple. Simplicity was the key and ensuring that the user understands at glance.

Now values at 1.6 billion dollars.

http://creative3.com.au/graeme-wood-every-business-startswithasimpleide

And the $64000 question is what would he have paid to obtain Whatif.com .. he talks about that in his presentation

Graeme Wood was a guest speaker at http://www.Trafficdownunder.com Nov 2008 .. Day 2 video

 

[Bill Roy]

Great thread with many great replies and perspectives.

 

[A D]

"From business point of view, some of the things that wasn’t done:"

Didn’t have a business plan written out
The prototype that Graeme Wood put up had no documentation
No documented strategic plan
No exit strategy until the business was worth a lot of money
No market research of consumers
Started with about two people but never hired people from the hospitality/accommodation industry. They talked to a few but found them so aligned to traditional point of view and instead hired new talent to “get people along who know nothing about it”. Graeme knew nothing about the hospitality industry as his background is technology.
Never secured intellectual property ie they had to change their name after launch
But what was done from the start was to keep it simple. Simplicity was the key and ensuring that the user understands at glance.

Now values at 1.6 billion dollars.

http://creative3.com.au/graeme-wood-...withasimpleide

So it seems we as domainers have over valuated the value of domains to a websites success.

So was the logo purchase for 500k worth it or should that have picked another name and spent that money on marketing?

-=DCG=-

 

[Tia Wood]

So it seems we as domainers have over valuated the value of domains to a websites success.

So was the logo purchase for 500k worth it or should that have picked another name and spent that money on marketing?

-=DCG=-

Not necessarily. More along the lines of domainers undervaluing what it takes to get something like that going when you are speaking in terms of development on a partnership basis. Sometimes it can take months for a site to take off. Sometimes not at all. There is a lot of risk involved for any developer in this position. Of course it is a reasonable concern that a developer would want to know that the domainer is a true partner (in a business mindset) and not just someone looking to eliminate his/her risk by using someone for free development. I have only accepted (1) "development by partnership" after many requests over a period of ten years for this reason. And this was after a lot of back and forth and a fair, written contract. Most of the others either did not have their ducks in a row or were simply looking to eliminate risks.

 

[AMERICAR]

So was the logo purchase for 500k worth it or should that have picked another name and spent that money on marketing?

Logo.com was worth it simply because the purchaser had the money to buy it they have a massive head start they may also have more money on hand to market the Logo.com site .. if you dont have the start up money for such a name then you have to go the long way round and work your way up .. the Wotif scenario is one of those ideas that just worked out for the owner not many could replicate that again .. doesn't mean that one shouldn't keep on trying .. some will win some will not but they may have moderate success which ever way it goes they will learn from it win or lose ..

 

[AMERICAR]

Logo.com .. one for domainers

http://techcrunch.com/2010/11/02/logo-com/

//Logo.com, LLC this morning announced that they have bought the domain name Logo.com for $500,000 through domain marketplace Sedo. The company was – obviously – formed in order to act as the parent corporation of what the site will become, and to facilitate the domain purchase.

The company, which will provide logo design and related services to small businesses, was founded by veteran domain investors and ecommerce developers Adam Strong and Alan Townsend.//

 

[adonivideo]

we do it all the time

the key is putting quality content on page one google for high value cpc terms

then you can easily find businesses buying your pages on that domain

so some high value terms are gold mines for seo development

you stick page 1 with a term, that businesses PAY high cpc for, why won't they give you a nice monthly for the use of your work?

so you an turn any nice domain into a money maker with

a. proper seo
b. high response content
c. market for the term

all that adsense and type in traffic was the tip of the iceberg

the reason high value cpc terms like insurance.com sold for 36+M to a net company is

they know how to turn the asset into a revenue maker

now, if you got businesses paying monthly use fees to be on high cpc terms

that's the new 'business model' for domain assets

 

[strongvis]

I've been a domain investor for a while now and also developed some popular sites which are growing quickly. This has led me to believe that the domain is important - but not that important.
There is no way on earth i would pay $500k+ for Logo.com - when i could get LogoShark.com, GreatLogos.com, etc... for a fraction of the price and spend under $100k building widgets, content and other link development strategies which will more than overcome the natural advantage Logo.com has - it just doesn't make sense.
I think the companies are now understanding this - that they don't need to shell out millions for a domain name - sure some "Category Killers" do go on to become very successful sites - but i'm certain the entrepreneur in that case could have done it with a less premium name.

When KBToys.com folded which domain sold for $5m KBToys.com or Toys.com ?

This is why it's very difficult to find a developer and proven entrepreneur - who will put all of the sweat into a project for only a % of the equity. If the idea is that good they will do it with a lesser name. A good hustler/businessman, just doesn't need the premium domain - This is my opinion and i'm sure you'll disagree, but i know a lot of successful web entrepreneurs and none are too fussed about owning the Premium name in their space - they can work around it and for much less $$$ than the name would cost.

My partner in Logo.com has a developed a successful business on a generic domain by himself, as well as heading the a large ecommerce operation.

I've seen a swing in the opposite direction you are talking, with more entrepreneurs looking for good domains and paying premiums. Just my little corner of the world though

 

[AMERICAR]

Congrats Adam .. Logo.com is sure to be a great success ..

 

[hugegrowth]

If you look at the truly successful people who made big money with websites, they did it with just one - eBay, Facebook, Paypal, Zappos, Amazon, AmericanFlags, and scores of others. Most entrepreneurs you read about in magazines are working ONE business, online or offline. Those that become rich can then invest in many businesses and become more of a VC or advisor to many businesses, but usually they just start out with one.

I think domainers (including myself) up to now have focused more on collecting domains that can be the virtual real estate of a good business, but just try to monetize with PPC, ads, and maybe leads or affiliate programs.

I am getting ready to roll up my sleeves and start 1, 2, 3 websites that actually will sell a product that I'll ship. If nothing else I'll gain from the experience, and learn if a good descriptive domain can help with it.

As a domainer, if you have a really great domain with a lot of quality traffic looking for a product or products, you could also team up with a business that sells those products and work out some deal where you provide the domain and they do the grunt work. But I think it would have to be a quality domain that really gets the traffic to make them want to do it.

---------- Post added at 10:08 AM ---------- Previous post was at 09:56 AM ----------

I think if there was one company that could do it all, they would just buy good domains and do the businesses themselves.

Anyone who can successfully come up with a business plan and build a profitable website for that business will just do it for themselves, why do the whole thing for someone else?

A good or great domain can really help a business, but there are countless examples of great website businesses with average or made up names - the key is the people putting in the work.

Anybody with a decent budget can buy a good domain, but it's much harder to find a person or team that can build a successful online or offline business.

---------- Post added at 10:19 AM ---------- Previous post was at 10:08 AM ----------

If they sell mortgages and I have mortgages.com surely it will benefit them to get my leads.
-=DCG=-

It will, but there are many mortgage companies that exist out there without having the benefit of mortgages.com. Same as for companies that do loans, cellphones, books and so on, having the .com of their main product would be a boost, but not critical.

Domains are important but only up to a point.

 

[A D]

Domains are important but only up to a point.

The theory is good and probably quite accurate, the message of this thread should be:

Focus on one domain and build a business.

Once that business is successful build another if time permits.

Owning multiple domains is good for resale or will have to be shelved until the time is there to build them out into businesses.

Bulding out multiple businesses at once will make them all suffer from lack of proper attention.

With PPC almost dead, now is the time for domainers to take their best property and TRY to turn it into a viable business.

-=DCG=-

 

[AhmedF]

I've been a domain investor for a while now and also developed some popular sites which are growing quickly. This has led me to believe that the domain is important - but not that important.
There is no way on earth i would pay $500k+ for Logo.com - when i could get LogoShark.com, GreatLogos.com, etc... for a fraction of the price and spend under $100k building widgets, content and other link development strategies which will more than overcome the natural advantage Logo.com has - it just doesn't make sense.
I think the companies are now understanding this - that they don't need to shell out millions for a domain name - sure some "Category Killers" do go on to become very successful sites - but i'm certain the entrepreneur in that case could have done it with a less premium name.

The problem with your thinking is you don't see the domain as part of the budget.

If your entire budget is $550k, then spending $500k on a domain can definitely be construed as a bad idea (even factoring in all the press they got). On the flip side, if their entire budget is $1000k, then spending $500k on Logo.com was a wise move.

That really is the problem with 'generic domains' - far too many people think that purchasing the domain is the end goal, when really it just gets you a leg up. You still need to spend developing and advertising the site.

 

[ngconcepts]

I might be in the minority here but every single domain name that I registered since 1999 up until recently has been based on a business idea I had. I never had the intention of being a domainer and recently I became one because I felt like I needed to diversify my portfolio. Having a portfolio of just "business ideas" wont hack it until you get your feet wet. My problem was which one to get into. I admit my very first ecommerce business started out on fire but then crashed and burned because I wasn't organized enough and got frustrated with chargebacks. This was back in 2002 where there not many tools available to your average joe ecommerce site.

Now its a different story. You have off the shelf ecommerce packages which handle everything from inventory, customer management, returns, accounting & tracking of shipping. Back in 2002, I developed the whole shopping cart myself(although there were some expensive carts available) and I focused more on being a perfectionist web designer/developer than on the business itself.. which also was my downfall. I learned my lesson with that and made mental notes of what not to do again and that has helped me tremendously with starting more ecommerce sites. My vision was, and still is, is to have about 10 ecommerce sites being run out of one warehouse where I keep my inventory. I hire a bunch of minimum wage employees to handle the shipment, maybe one other person to handle the paperwork, sign up a customer service company to handle all customer inquiries & issues and I spend all my time developing more ecommerce sites and focus on tweaking the ones I have. Of course all this has to scale well when business increases.

If you have that type of business model, you don't need to spend $500K on a domain name but spend a part of that money to buy a decent one and a LOT OF TIME looking for niche markets where you can take hold of page 1 spot on G$$gle. That is the difference between a small business ecommerce owner and the big hot shot VC backed ones that throw $500K at a logo.

Thats my 2 cents...