Don’t Drink The “Develop Your Domains” Kool-Aid

April 12, 2008 · Print This Article

The biggest theme in the domainersphere in the last few days has been about development of domains. Many people are saying that this is the way forward for domainers and the best way to profit from domains. Elliot talks about his ideal portfolio. If you look at the direction he is heading in, he is basically reducing the number of domains he holds in order to concentrate on developing a few successful websites. Lord Brar talks about how he makes money from domains – essentially he develops them before reselling. Over and over we hear about how “pure” domaining is dying, and domainers need to hop on the development bandwagon.

All of this is somewhat ironic to me, as I’ve come into domaining from an SEO background. As Peter would say, I’m an SEOmainer. So, I’m moving in the opposite direction that everyone is recommending – I’m doing less developing, and more pure domaining.

I’ve got nothing against development and indeed, I continue to develop websites. However, I think the problem with the recommendations I see is that most domainers underestimate the amount of time, money and energy that goes into developing a successful site. It’s actually quite incredibly large. It’s also important to recognize that developing a site is actually fairly trivial in the scheme of things; what’s difficult about making a website successful is marketing, and marketing is a relentless, demanding, and never ending task.

Given that one of my goals (and goal of many domainers I’ve met) is to develop large streams of passive income, development is not the best way to achieve this. What’s more, given the time and energy commitments that go into building a website, it is hard to scale. Really, you can only run a limited number of successful websites, no matter how good you are at delegating. However, there is no limit to the number of domains you can own and profit from.

So, in short, yes, development is great. A great domain plus expert SEO is a killer combination. If you’ve got a flair for SEO and marketing, and apply this to a category killer domain name, it is likely you will do well. But going down this route is not for everyone. More importantly, I don’t think that development in any way replaces pure domaining – it’s just a nice addition.

Comments

15 Responses to “Don’t Drink The “Develop Your Domains” Kool-Aid”

  1. Troy Duncan on April 12th, 2008 1:23 pm

    I don’t think fipping domains would ever replace domaining. But things are different for those of us who got in after the gold rush. We are trying to mine copper and squeeze a dollar out of it. Developing domains does require a lot of work. But for some of us this is the best route.

  2. Domain Bits: Don’t Drink The “Develop Your Domains” Kool-Aid at Conceptualist.com, By Sahar Sarid on April 12th, 2008 1:31 pm

    […] Source: Domain Bits […]

  3. Lord Brar on April 12th, 2008 1:49 pm

    Hi Jeff — first of all, thanks a lot for mentioning DomainingTips.com in your post. I appreciate it.

    Yes, I agree with you that development takes a bit of effort. But the way to that and to scale-up the strategy is to outsource as much as you can — while making sure that you minimize the costs involved.

    One of the first posts which I have made as a follow-up is 6 Ways Not to Go Broke Developing Domains — Lessons That I Have Learnt the Hard Way.

    As I confessed in the article, I was initially forced into the strategy because of what I had on my plate — too many domains which people were not buying. So what started as a way to cut my losses turned into a nice revenue stream. The ROI was high-enough to keep me going.

    You also have to remember that most premium domains and traffic domains are pretty expensive and out of the reach of a new-domainer who may not have enough funds to support the investment.

    Remember the old saying – “Money Makes Money”? If you don’t have enough money to get into premium domains, this strategy is a good one to boot-strap your way up and get a taste and experience of domaining industry.

    The money that you make from these flips can be reinvested in whatever way you can maximize your revenue — which could be re-investing in other sites that you can flip OR premium and traffic domains.

    It is all about finding what works best for you.

    Keep up the good work on Domain Bits! =)

    All the best.

  4. Domaining Tips » My Response to Jeff and Sahar! on April 12th, 2008 1:59 pm

    […] at DomainBits.com made a post about my domain development strategy and Sahar mentioned it on Conceptualist.com. Here is the […]

  5. Gordon on April 12th, 2008 2:18 pm

    I’m also an SEOmainer, and I disagree with some of this.

    1) I agree that development does take a long time and a lot of smarts. If you don’t know html, seo or how to build a site it will take quite a while to get up to speed. People need to understand they may not see their first $100 month for 6-12 months.

    2) I disagree with your statement that it won’t bring passive income. I have 2 sites I built 6 years ago that enjoy nice google rankings. Because of this, I get monthly checks from advertisers, sometimes without spending 2 hours per month on the site. I spent a ton of time on the sites a while back, but now (knock on wood) as long as google doesn’t turn me upside down I have a steady and significant stream of money coming in. I will say that these sites aren’t sites that need to be updated weekly with new content, and that i don’t need to look for new advertisers very often, so perhaps they are unusual in that sense.

    And with SEO, the time you put in now will pay big dividends down the road….

  6. admin on April 12th, 2008 3:39 pm

    @ Gordon – I partially agree with you re number 2. I think that unless you have a very authoritative website, it’s rankings and income are going to decrease over time unless you work on them. I have sites that I built over two years ago that I haven’t touched since then – but I’m only making about 1/3 of what I did from them two years ago, and this number keeps declining. I don’t know about sites that are 6 years old – maybe the age of your websites and the fact that they’ve ranked so well for so long makes them a sort of self-reinforcing authority.

  7. admin on April 12th, 2008 3:43 pm

    @Lord Brar – thanks for dropping by. I’m always very interested in what you have to say.

  8. admin on April 12th, 2008 3:47 pm

    @Troy – I’m not trying to say one route is better than the other. Development certainly has its place, and I do develop myself. I just don’t think that it’s the panacea that domainers think it is. And I disagree with the “mining copper” statement. While the gold rush may or may not be over, there is still enormous potential to make money.

  9. David J Castello on April 12th, 2008 4:52 pm

    True, developing is a lot of blood,sweat and tears, but pound-for-pound nothing generates more revenue. There is one well know cyber-journalist who owns about 6,000 domain names. He told me that his one developed name generates 10X more than his 5,999 parked names. And some of his parked names are quite good.

    The same goes for me and my brother. The front page alone of PalmSprings.com generates over 60K a month in revenue. We could never generate this much money from parking (unless it was Sex.com!).

  10. Giovanni on April 12th, 2008 10:58 pm

    how does being a SEO expert benefit a parked generic page?

  11. Ed Keay-Smith on April 13th, 2008 1:14 am

    Hi Jeff,

    I must say that I love to develope my domains as they make much more money than just parking them.

    Yes it does take some work, but for about 5 hours invested in building a WordPress website with some original content, the returns are easily 10X what they make as parked pages.

    But I still like my parked pages because I cannot develope all of my domains at once and they may as well make some money parked even if it only washes their face and covers the annual renewal fees.

    It also gives me some metrix as to which domains I can devlope next if they are getting some decent type-in traffic then its possible that they could have potential as a developed website.

    I have just finished uploading my latest Domain Names Podcast with Michael & David Castello and they talk about how they developed some of their great Geo Domains such as http://www.PalmSprings.com & http://www.Nashville.com.

    Your readers can find the podcast here-
    http://www.ozdomainer.com/97/domain-names-podcast-episode-8-with-michael-david-castello/

    Regards

    Ed
    http://www.ozdomainer.com

  12. Holly from mobiEnthusiast.mobi on April 13th, 2008 3:55 pm

    It’s correct that developing a domain takes a lot more time than parking one. However, “regular” people outside of the domaining community are growing weary of parked pages and say so frequently. This is perhaps why the Snowe Bill is of concern to the domainer community. I would prefer to give something of value to people who visit my sites, even though I have a long way to go to get there. When you look at .mobi domains especially, development is pretty much imperative in order to get value from them. Google is getting more savvy by the day, and they are looking for content. Just providing decent content is more SEO than your typical parked page offers.

  13. Domaining on April 13th, 2008 4:08 pm

    Pure domaining is far from dead. However, domainers need to realise that website development is more profitable than simply parking domains. Niche minisites can be set up relatively easily and the increase in revenue compared to parking can be significant. Many keyword rich domains just don’t get significant type-in traffic, but the establishment of minisites on those domains make ownership of these domains profitable. Clearly, the development of ‘authority sites’ on generic domains can really bring in good revenue from advertising, especially if these sites are on topics with high paying keywords. If you have lots of low traffic domains, brandable domains and generic ccTLDs that do not always get much type in traffic, development gives you an opportunity to make good money without selling these domains. Ray

  14. damir on April 13th, 2008 10:45 pm

    Your point makes sense but the decission is up to the domain name owner and the ability to make the most of it’s domain name portfolio in terms of sales and traffic.

  15. Jamie Parks on April 14th, 2008 5:02 pm

    Jeff, I hear what you’re saying but I gotta respectfully respond by saying that developing is getting easier than it’s ever been and the day is coming quick when surfers and search engines will expect a domain to have a certain degree of development on them.

    I vote more transparency, MORE BLOGS and less parked pages to push IT all forward.