Closing an end user sale is the only way to make serious money in this business. Yes it’s lovely when they approach you and make a fabulous offer, but this is rarely the case. So instead of waiting around for what is probably never going to happen, a small amount of domainers take the initiative and contact the end users themselves.

And it’s here that the fun begins. Now as far as I’m aware there is no right way to contact a potential buyer of your name. Yes there are certain things you can do to smooth the way, a polite e-mail, a professional sales call, etc…

But there are some things you definitely shouldn’t be doing and that’s what I’m going to focus on today:

1)      Don’t send your offer from a free e-mail address. Not only is it very unprofessional it also lacks credibility, trust and has a reek of spam to it.

2)      Do not send a one size fits all e-mail. You must tailor each mail to each company/individual you plan to sell the name to.

3)      Always send the mail to a specific person. Do not address it Dear Sir/Madam or just plain old Hi. (If you have to call to get the correct persons details then do so.)

4)      At the bottom of your mail you must have your telephone number, and preferably a website you have (this just helps to add a bit of credibility.)

5)      Do not have a spammy title to your e-mail. Make it professional and intriguing so it doesn’t end up in the trash or spam folder.

6)      If you are calling, make sure your sales pitch is perfect. Have all the reasons listed as to why this name is such a great fit for their company and what the domain can do for them.

7)      It’s a good idea to put an actual price in the email. Just having, make me an offer is unlikely to get you very far. I actually tried the same letter with make offer and a price and only got one reply on the make offer mail and four on the mails where I had a price listed.

      Be realistic with your price. You may think it’s a $100,000 name, but why would a company pay that for it. How many offers in that region have you received over the last year?

9)      Take time crafting your letter. It is your one chance to make an impression so don’t send out an unprofessional pitch. Obviously you won’t have it perfect first time round but hone it after each response you get. (The perfect letter is a moving goalpost and you will need to constantly revise yours.)

10)   If possible try to follow up with a phone call.

11)  Don’t give up too soon. It’s basically a numbers game. You could send out 100 mails and get nothing (although this is unlikely – you will at least have some response) and then the next 10 you send could yield the buyer.

Take a look at the below thread on Namepros as it has some excellent tips on crafting a letter to send out to end users.

http://www.namepros.com/domain-name-discussion/68798-how-to-find-potential-end-users.html

Next week I will be showing you a couple of letters I have sent out in the past, one successful and one not.

I’ll be interested to hear and see any comments from readers as to other mistakes that they have made or seen others make.

James

Of course there is lots of advice thrown around (quite a lot of it is very good), “LLL.com’s are cheap now, only invest in one word premiums, .Net is the way to go.”

But if I’m going to be honest I’d say now isn’t the time to load up on names. Whilst the economic barbarians are at the gates I’d spend the next two months learning everything I could about this industry. Read the forums, read Namecake.com, and look at the blogs of people who have actually made a success in this business. Then once you have a good understanding of the different categories and pitfalls to make your strike.

Still, these troubling times have unearthed quite a few gems, and if one of these does come your way then certainly snap it up. It may be a good idea to think of yourself as a sniper, who picks off select prey. Sure it may take a lot longer to build up your portfolio, but at the end of the day you will have a much stronger group of names and the potential for greater profit.

I do think there will be better buying opportunities around June next year, but if you have to start buying there are some areas I think safer than others:

Hand Registrations – Avoid. If you have to do this, do a maximum of twenty in upcoming industries, trends, new technology, TV shows (these are your long term punts – don’t expect them to come off, but you never know!)

But DO NOT go and register hundreds of names, as this will bleed you dry and it’s unlikely it will make you a penny.

Generic dot coms (one, two, three word) – at the present time these names still are pretty expensive. I’ve been looking for bargains, but the few I’ve seen have been snapped up by more hawk eyed individuals than me. Still if you can find something then this is a good place to start.

LLLL.com’s – I’ve got mixed views here. Letters that are brandable or have meaning: Tine.com, Wodo.com, Joof.com, in my eyes are good solid investments. But at the other end of the scale you have the speculative combinations that were registered during the landrush: hjdy, jsrf, xwqs, etc…. I can’t see names like these being worth anything at any time so avoid anything but quality.

LLL.com’s – I think the saying, “never try and catch a falling knife” applies here.

Values have been falling through the floor and although I think we’re nearing a bottom I wouldn’t like to start buying just yet.

Hyphenateds – Well I’ve always been a fan of hyphenated names. They’re cheap in comparison to their non hyphenated brethren, but if you are to buy only buy quality: Solar-Energy.com, Teddy-Bears.com, etc…

Geographicals – I would avoid. I really think these are going to run into some trouble. I don’t mean the Premiums like: NewYork.com, London.com, ParisVacations.com, etc… But one of lesser quality focusing on a certain niche in a region, such as: ChicagoPlumbersDirectory.com, DenverAttorney.com, etc…

.Net, .Org, .Info, .Biz – Premium names here will still continue to pay. Most domainers are obsessed with the dot coms, but I’ve made some very good money in these areas and I think there will be a lot of opportunity in this area during the flight to quality (.com). So this is where I’m going to have my eyes peeled.

Anyway, I realise there are quite a few other categories, but I think this pretty much covers where I stand on the opportunities out there.

Remember, before you buy anything, make sure you do ample research. How much research would you do before buying a stock? You look at the industry, sector and regional fundamentals. Then you look at the companies balance sheet, their management and a host of other factors before making your decision. Buying a domain should also involve the same level of due diligence.

If you disagree with anything I’ve said or have any other views I’d very much like to hear them.

James

I recently interviewed Craig Rowe from Whypark on their phase 2 development program and how they plan to help all Domainers transform their parked pages into unique and attractive sites. As most of you are probably aware the domain community has been crying out for a cost effective way to develop their domains into income producing websites. I recently had the opportunity to look at the beta version for Whypark’s new platform and all I can say is that I am amazed at what they have done. I am not exaggerating when I say this will revolutionize the domain parking and monetization business and confidently make the statement that once people have had a chance to see what is on offer the traditional parking companies will be lonely places to be.

Just as a bit of background, WhyPark.com is an alternative to traditional domain parking where a domain name’s theme is matched with relevant, full-text content that helps attract, engage and retain visitors.  With a wide variety of customization options, unique content development options and other tools built around the needs of domain holders, WhyPark gives momentum to a domain name that would otherwise see no traffic or activity through parking.

Can you talk a little bit about the evolution of Whypark. How it started and some of your goals for the future?

WhyPark was originally built out as a way for me to manage and develop around 100 domains.  I didn’t really have the time to do anything with them and they were purchased for future development.  What’s ironic is that I didn’t have the time to build these sites, but somehow built a business out of the same concept.  As I released it to others to use, we quickly went through some growing pains with scalability issues, so I brought on a developer to make everything more efficient.  That was in 2006.  Throughout 2007 and 2008, we’ve been growing quickly managing around 25,000 domains in January 2008 and now over 125,000 domains in November 2008.  In April 2008, we picked up a round of angel investment from a customer who was seeing great results from the platform.  Since then, we’ve been developing our new platform which is just about ready to finally launch in beta.  It’s been a massive undertaking and is really a complete overhaul bringing again further enhancements in terms of scalability and a host of new features to keep visitors and bring them back for long-term monetization.  The goal is to show domainers that there’s life outside of parking.  While that passive income has been tough to beat over the years, a larger portion of domain portfolios are non-performers.  So, we’re bringing large scale development opportunities through an affordable platform to turn those domains into performers.

What’s your background and how did you get involved in this business?

I’ve been developing and selling sites since late 1997.  In the late 90’s, it was a small group of niche directories.  After that sold to some investors, I developed an online billing application to help web hosts manage and automate their billing processes.  That was also recently sold to allow me to concentrate 100% on WhyPark.  I’ve always been on the development side of things and haven’t ever really been strictly a domainer.  I think that’s been helpful though.  Looking from the outside in with a group of non-performing domains, it was easy to see that I’d get little value with my domains through parking.  When there seemed to be no options, that’s when I built one.

Why would I want to use Whypark and what do I get for my $99?

If you have domains that simply aren’t performing through PPC, whether that means no revenue, no traffic, etc, then WhyPark is a great fit.  Certainly, if you have traffic and are looking to take the next step toward development, it’s great as well.  Parking is great for monetizing existing traffic, but does nothing to help build traffic.  WhyPark is there for helping you build new traffic.  For $99, you can bring over 100 domains on our platform, which includes our application for matching licensed content with your domains, the ability to customize your sites, and host them with us.  It’s a one-time setup fee.  In the new platform, we have a number of upgraded options as well that will be billed on a per-use basis including unique content development, link building, custom templates; and also a monthly basis for enhanced features like RSS publishing to bring users back and build links, image hosting, newsletter management and a wider range of content and templates.

Could you go into some detail about the new platform and what it will offer us that the current version of Whypark doesn’t?

While our main content matching platform is still the bread and butter of the platform, we’ve enhanced a lot behind the scenes to distribute content differently, reduce duplicate content and help with SEO efforts.  Our interface has been built to allow for bulk changes and setup in a more efficient manner with some nice AJAX/drag and drop features as well.  We’re now including image hosting, which has been asked for frequently.  RSS feeds can be integrated and also published, alerting visitors that new relevant content is available on your sites and to come back to check it out.  Newsletters do the same through a double opt-in process where visitors can signup and get monthly alerts with new content that’s been added to your site.  These are some ways to retain visitors and keep them engaged in your sites.  We’ve also brought some social networking and bookmarking into the mix to again drive new traffic.  A major piece of this new rollout is the managed and promotional services we’re offering, such as managed setup for those looking to have us setup their domains; custom design and implementation, unique content development, domain research, rss feed submission, content syndication for backlinks, directory submission, blog placement and more.  It’s been a serious undertaking, but we’ve been listening to what our customers want and what domainers are looking for to get the most from their domains.

It’s no exaggeration to say that the launch of the new platform will be the start of a revolution in the domain parking arena. I’m wondering if you have the infrastructure to deal with the increase in demand for your service?

That’s been a huge part of this overhaul.  We’ve changed the development language from ColdFusion to .NET and are doing a lot of caching and behind-the-scenes processes to ensure that sites are as a quick and stable as can be.  We’ve also migrated to a new datacenter with the ability to quickly scale.  The rapid growth over the past year has made all of this very necessary.  We’ll be able to scale quickly based on this new infrastructure.

Whyparks main site can be reached by clicking here

What sort of support will you be able to offer users, Forum, Whypark guide for dummies, Phone, e-mail support?

For all users, we’ll have the blog, forum and knowledgebase which are more of a moderated/self-serve form of support.  We also have email support and will be ramping up phone support and live chat.  A lot of people have asked for a WhyPark guide, which we will put together after the launch.  I’m also looking to start periodic webinars at no cost to show some ways that you can use WhyPark that maybe you haven’t thought of, or just didn’t know existed. 

A problem with the majority of minisites and Parking templates is that they all look the same. How many templates will you be offering users?

Initially, I believe we’ll have close to 100 or so with the new launch.  There’s always a tough trade-off between mass scale and customization.  We always provide the starting point of available templates and will be adding more, but you can also customize every aspect of any layout with complete HTML and CSS control.  We’ll also be offering custom templates as a service for those looking for something custom, but preferring to not deal with it on their own. 

I see that you are also building a domain marketplace to work in conjunction with the development service. How will you be marketing this? Will you be targeting the domain community or attempting to reach the wider business community?

Exactly.  We’ve always had simple contact forms for sites, but are now adding a marketplace as well.  This will only be for those domains using WhyPark and not a general aftermarket.  We’ll be showing depth in stats with the ability to search very specifically.  So, if you want to buy a domain that has organic search traffic with $x per month in revenue, x number of visitors and x% from the US, you’ll be able to find it.  I think initially it will be more domainers buying based on traffic, but as we start to scale out the offering, I’d like to reach end-users more.  One benefit of getting your domains built out and into search engines is that you do open your domains to a wider audience including small businesses and end-users.

I see that you are also offering a managed service for the large portfolio holders. Can you expand on this?

Someone that wants to move say 1,000 domains over to WhyPark may not want to handle the setup, so we can offer that as a managed service.  We’ve been doing this for some customers for awhile now, but even someone with 50 domains may prefer to offload that responsibility.  While we did build the platform to manage sites in bulk easily, it’s still important to really analyze and optimize individual domains and build them out accordingly. 

I personally am interested in your custom design service, how does this work and what does it cost?

 It will be a one-time fee of $199 for each custom design, which you can then use across any of your domains.  You’ll basically order the service through our interface, and we’ll design and publish the layout to your domain(s).  There is a job tracking board for managing the process as well, so we’re sure you’re happy.

Other parking providers don’t reveal the ad split which is a cause of some controversy in the business . Can you shed any light on what the revenue split will be.

By default, customers get a 60% share of the revenue.  However, all traffic isn’t necessarily treated the same, so like any parking company, there are some variables.  The split may always be the same, but based on the source of the traffic, user behaviour, etc, the pricing certainly changes.  For larger portfolios though, and those using our enhanced tiers of service, we provide larger splits to the domainer.

There had been a scare in the past with Google banning accounts because of duplicate content from the article databases. What is your response to this?

We’ve put a lot of effort in the new platform to reduce duplicate content, add new content and offer unique content services.  We always recommend customization and adding something unique to each domain and have the tools in the platform to make that as easy as possible.

How many sites does Whypark host at present?

Just about 125,000 right now.

Alongside the wider economy, the domain market is experiencing quite a slowdown. Where do you see the market going in future and which areas do you feel offer good opportunities?

I feel like the domain industry has been in a bubble for awhile now, with a lot of trading and sales amongst us rather than working with the wider economy and larger companies.  That’s also provided some short-term shelter, but it’s not sustainable.  Clearly PPC has seen a decline and that’s been very noticeable in our industry.  Obviously I’ve banked on development as being the future.  I think without some sort of development, we’re going to start to see a lot of drops and low-price sales because domainers won’t be able to maintain a large speculation percentage in their portfolios.  If those non-performing domains are not being subsidized through high PPC returns elsewhere in their portfolios, then sales will be forced, and selling at the wrong time won’t yield the best return.  I think for anyone with a strong cash position, it’s going to be a huge buying opportunity. 

Your platform will eventually host hundreds of thousands of sites. Have you thought about creating an open directory similar to DMOZ, but more geared to connecting advertisers and sites within their niche?

We’ve been looking closely at direct sales with advertisers.  I think the industry as a whole needs that; advertisers who are educated and understand the strength of our industry and the results it can deliver.  There is no lack of ad networks out there already, so I’d really see it as someone in this space buying existing technology with a good advertiser base already to start with some traction and build from there.

Are you worried about Minisite developers pinning your picture up on dartboards?

Not really.  There will be more entrants into the development field, but that’s a good thing for our industry.  Right now, there’s no lack of domains to develop.  In some cases, unique mini-sites will be the answer, commerce partnerships for others and mass development for yet other domains.  We’re all looking to make something from nothing.

I appreciate the interview and opportunity to showcase what WhyPark has been up to.

Thanks Craig for your time and that fantastic insight into Whypark. I’ve been steadily moving my names back there and slowly started customizing the sites.

I really do recommend you visit Whyparks main site and see how they can help you transform your portfolio of parked names into popular income producing websites.

Whyparks main site can be reached by clicking here

James

I get quite a few e-mails from visitors to my site on a daily basis. Most of these are people trying to sell me their names or services I have no need for. But over the last three weeks I’ve had four mails from people new to this business asking me which sites I’d recommend to someone who is just starting out or who wants to get on top and stay on top of developments in the domaining industry.

So I had a look over my history for the last week and it appears that I visit a vast number of domain relates sites. But there are some I visit more that others and usually on a daily basis. Please see below:

Namepros.com – Probably the most popular forum online related to domain names. I always look at the domain discussion thread

DnForum.com – Another very popular forum, that has paid membership (it’s well worth the small fee if you are serious about this business.)

AcornDomains.co.uk – A forum geared towards UK domainers.

With the above forums, it’s essential you look around. Don’t just look at the domain discussion threads. Look at the domain appraisals, check out the for sale threads, see what’s selling and what’s not. Look in monetization, development and design. Read old posts, see where the Market has come from and see where it’s going.

These forums contain the wisdom of almost everyone in this business, so the answers and knowledge you require are in here somewhere.

Also people are always willing to help, so ask ask ask if you’re not sure about something.

But don’t expect to become an expert in a couple of weeks, it takes time to understand any industry and domaining is no exception.

Other sites I visit are:

Elliotsblog.com

Domaining.com

Namecake.com

Dnjournal.com

Domainnews.com

Estibot.com (not for the valuations, but the domain stats they provide.)

There are obviously others, but these are more than enough to get you started for now.

I’d like to mention that after I sent the mails out, one of them came back to me saying he required more specific information. He wanted to know which threads and posts to read, so as not to “waste his time.”

After deleting this scoundrel’s mail I had a think about what he had said and pulled it out of the trash and sent him a reply he didn’t deserve, basically saying that none of the threads are a waste of time as there is something to learn in all of them and that there is no shortcut to success in this business. I haven’t heard back from him yet, but I expect I’ll soon receive a $60 offer from him on one of my LLL.com’s

I’d be interested in hearing which sites you also visit if they’re not on my list.

James

Alltop.com is the best one I have come across so far.

The site is simple in its setup, incredibly easy to use and whatever topic interests you will be covered there by experts in that particular industry or niche.

If you want to learn about SEM or SEO then there are about 60 of the top blogs listed there with their latest entries.

Maybe you need some information on  Sports, Gaming, Finance, Branding, Shopping, etc.. No matter what it is you’re searching for there will be something here for you. And best of all they have a new section devoted to Domain Names: http://domains.alltop.com/

So pay Alltop.com a visit. I can guarantee you will be impressed with the vast array of topics and just how much “quality” information you’ll find at your fingertips.

James

P.S. I have the domain Pily.com currently on auction at Sedo. The price is a very low - $1500. If you are interested in this lovely brandable name please click on the following link: Pily.com Sedo auction

The current bid is $1500 and is an absolute steal at this level.

Pily is a superb brandable LLLL.com
It is a very popular phrase on Google, with over 4,850,000 listings.
PPC Ads # 1
Max PPC Bid $0.53
Overture/mo 152
Wordtracker/day 3

Click on the following link to go to the Auction:  Pily.com Sedo Auction

I think all you really need to know about this can be answered by Christian Kallad, who is the director of brokerage for Sedo North America. Christian said, “If you ask 10 different experts, they are sure to tell you 10 different things (about a domain’s value)."

Not exactly a great advertisement for their domain appraisal service but I think it’s spot on. As giving an accurate value to a domain is pretty much impossible. The main problem facing the industry is that there are no standards. An appraiser merely tells you what they think the name is worth and different appraisers will have different opinions. All you need to do is take a look at the appraisal sections on the forums and you’ll see how vast the differences are between some of the values quoted.

Still, I think with a bit of experience and some research, used in conjunction with the appraisals you receive on the forums you can get a pretty good idea what the reseller value of your name is. But as far as I’m aware there isn’t any formula or service that can appraise or give any indication what an end user would be willing to pay for a domain. So don’t fork out for any of these paid appraisal services you see the Sedo’s, Afternics and GoDaddy’s offering you.

At the end of the day a domain is worth whatever anyone is willing to pay for it.

What I believe is more important than the appraisal is how you negotiate when approached by an interested party. If you paid $500 for the domain are you happy to sell it for $2000? Sure you may feel it’s a $5000 name, but how many offers have you received over the last year and were any of them in this ballpark?

Before you get back to the interested party, be sure to do some research. See what’s happening in the industry the name relates to. Look to see if there are there similar sales on Namebio or DNjournal.

Your research alone will tell you what the name is worth.

So next time you’re thinking about getting that appraisal. Don’t, do a bit of research, ask on the forums and I’m sure you’ll get a much more accurate idea of what your name is worth.

Now everything I’ve said above can be taken with a pinch of salt when a whale comes along and offers you $$$,$$$ for your name. But that’s as likely as winning the lottery. So try and be scientific and if you apply this to your buying and selling I’m sure you’ll come out at the end of the game with a nice stack of cash to make your next purchase.

James

As I said in a prior post, when I first started out in this business I hand registered a couple of hundred names, sat back and waited for the wealth to pour in.

This never happened so I started buying names I knew had value as this seemed like a more sensible approach to succeeding in this business.

But does this mean to say that there isn’t any money in hand regging names?

It sure as hell doesn’t!

Fortunes are being made by savvy domainers who register names that capture trends, or that take advantage of the changes we see in New technology, Medicine, the internet, TV shows, sports, politics and up and coming events.

The world is constantly changing and it’s these changes that offer those who keep their eyes open the potential for big rewards.

One of my names that has seen some good enquiries (well it was) was a hand registered .net. I’ve received three good offers for the name to date and foolishly I turned them down (if only I could turn back the clock.)

The name is ScrapMetalPrices.net and although it’s not going to make me my fortune a mid $xxxx payday on a $7 investment is a pretty good ROI in my eyes.

I haven’t registered names for quite some time now, but I just picked up BlogPrince.com, which I think is a very brandable nice sounding name.

So going forwards I may register a few more names, but I certainly won’t be getting carried away like I did in the old days. These names will have to pay their way and I’ll need to be confident there will be demand for them.

Of course the next big thing can come from anywhere, so keep your eyes peeled and you never know, maybe you could get lucky and get to the top of DNJournal’s charts with your hand reg.

Still if you’re not sold by what I’ve said maybe you should listen to mark Ostrofsky, the President of Internet REIT:

"Another example of this is the word ‘ringtones.’ It is worth millions right now, but five years ago, it wasn’t worth 50 bucks. If you see a trend or something that you see coming out that the next guy doesn’t–spend ten bucks and buy up that name."

Or how about Rick Latona in his recent interview on DNkitchen.com

"95% of all the domains I get are hand registered."

I’d be interested in seeing which hand registered names you have that you feel have the most potential.

James

I’ve just read a very disturbing post on CircleID.com about how Verisign and other existing gTLD operators are almost being invited to ask for their contracts to be amended, and in effect get the same treatment as the new gTLD’s in regards the elimination of pricing caps. Which could result in premium name renewal fees being in the thousands or millions – or whatever verisign decides.

If you haven’t already read the post and you are a domain owner i advise you to click on the below link to find out more.

http://www.circleid.com/posts/20081024_verisign_tiered_domain_pricing_soon/

Amongst all of the end of the world predictions and cries that our Industry is falling apart there has been some positive news of late.

The latest DNJournal sales report shows some fantastic figures with four six figure sales totalling over $1 million. What’s also good to see is that there some very nice sales in extensions other than the mighty.com, with Pisos.net going for $187,500, Voyance.net sold for $31,250 and Recontre.org netted $31,250.

These are not the sales of a market that is falling apart.

But it’s not only the domain market that has had a nice week the Dow closed up over 500 points yesterday and the European markets have some good momentum going today.

Whether they have broken out of their bearish trend is another matter, but it’s good to see nonetheless.

There were also good figures for the videogames sector and according to Reuters: US sales of videogame hardware rose 18 percent in October from a year earlier, after falling 7 percent in November. They are also very bullish on the prospects for the holiday season. (Maybe Bernanke & Brown are right – we can spend our way out of this recession)

I think that will be the tale of this downturn – some areas will suffer, some get by and others prosper – There will not be a destruction of value across the board, and because of this I feel domainers will be in a good position to weather the storm. Still it would be nice to see things pick up between now and Christmas.

James