Erik’s Blog: Board Shorts and Business Suits

Buying and selling domain names for profit is a rather new mainstream phenomenon. One that has been written about widely ever since the major story in Business 2.0 titled “Master of their Domains”. Although the act of buying and selling domain names for profit has been around. Tons of people, like anything that makes you a quick buck, are jumping in full force.

In this little five part series I have mentioned only one major way you can buy and sell domain names for profit. There are many more ways to monetize a domain name than just parking a name. Although, parking is the least time consuming method to a quick buck. There’s of course building the name with content, playing the SEO game to get your domain and site to the top of the Google Search list. There’s also building a community of readers and contributors, which is rather popular right now with MySpace making all the headlines. There’s also a plethora of ways you can make money on the Internet, buying domains and creating revenue with them, that I haven’t come close to touching on. There’s probably tons that aren’t even thought of (at least I hope so).

Since the bulk of this series is on buying and selling domain names that you park, I’m going to focus on that for right now, and where I think those types of names will go.

In the short-term, 6 months to a year, I think domaining will be strong. Internet users will still type-in names in their browsers, they’ll still mistype some of those names and advertisers will still pay for people to click through on ads placed on these pages. There won’t be an overnight extinction of parked pages.

However, as browsers move forward, these sites, parking pages, which most Internet users not in the parking game have grown to know and hate, will become harder and harder to monetize. One big problem is that browsers might come equipped with fishing, and third-party site announcers. Meaning you’ll be warned that you are being taken to a known third-party site, like a parking site, do you want to proceed. Specifically targeting typo’s

In fact Microsoft has just the service to help you out. Which, being a domainer I hate to promote or even show where they exist, but the service is called Stryder and is written about here.

But that isn’t going to bring the world crashing down on domainers. Of course some of the prices of domains are getting a little out of control. Like any business, if you can’t realize a return from a purchase, ie spending more than you make, you’ll go out of business. The market will take care of itself if it gets out of control. Be it a bubble or just a gradual realization that prices are too high.

The key thing with domain names is how much money do they make and what’s the brandability of the name. If a domain name gets traffic, someone can always find a way to monetize that traffic. If you can show that the traffic, provided by a domain name, brings you money, you’ll be able to put a price on the domain.

I don’t have to send my domain name visitors to a parking page, it’s just the easiest thing to do right now. Eventually, if browsers wise up to the game and people enjoy the popup that asks if you want to proceed to a parked page (I for one would get annoyed and disable the thing), then I’ll find a different way to make money from the traffic.

The last thing that might hurt domainers are laws being passed about trademark cases with typo’s. This could hurt the “big-little” business of typo squatters where the easiest money is. I’m not going to get to far into this one since I don’t know that much about the legalities of trademark infringement on typo’s. It’s a sticky situation with probably more than one right answer.

Overall, I feel the art of buying and selling domain names for profit is here to stay. The Internet isn’t going anywhere, and the only way to navigate the net is from an address. Domain names give you a unique and sometimes brandable address that can make you a small fortune if the game is played right.

Yes Google may be trying to make searching the net without a domain name easier and easier. However, you shouldn’t fear that, they’ll never be able to make it easier than say, typing in Google. There’s too much clutter with all these blogs (guilty) cluttering the search results. Once a users finds a useful resource they’re bound to bookmark it, or type it in again. As long as you buy and sell domain names wisely, you’ll be able to make a few dollars in the business. Who knows, maybe you’ll make a lot more than a few.