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The Great Domain Name Boom Ahead

The Great Domain Name Boom Ahead

Email arrives:

""The Domain Distribution Network (DDN), managed by Fabulous.com, has been running aftermarket domains distribution via the registrar channel for a month now.  We are pleased to announce that there has been proof of concept for this new paradigm in domain sales.  The program has had strong sales and is showing promising results.  It is fully expected that aftermarket domain sales via registrars will become a major part of the market, with registrars becoming the natural home for the bulk of aftermarket sales.

Previously, the market was in need of resolving some glaring problems that traditional [sales] portals failed to remedy:

· Slow Transfers – Domains sales could take anywhere from weeks to months to settle and transfer to the new owner – as it primarily remained a manual process.

· Lost Clients – legacy domain sale portals required their clients to be passed away from the registrars to the portal to complete a sale.  This breaks the registrar’s relationship with their client in the process.

· No Prices – The vast majority of domains only had “make offer” pricing without any fixed price options.   Due to this registrars couldn’t process the sale.  They had to pass their relationship on to the portals.

· Poor Quality – Domains that are misspelled, have trademark or brand issues, or were poorly formed were all included for sale.  This left registrars at great risk of brand erosion.

· Unknown Ownership – Domain fraud commonly occurred, and if caught usually only is found at the end of the sales process.

· No Authority – Even if a registrar sold a domain that was listed for sale, the domain owner could always cancel the sale or block transfer.

In comparison the Domain Distribution Network enables:

· Instant Settlement – Once a sale is made the transaction settlement happens in seconds.

· Registrars Maintain Relationships – the registrar maintains the relationship with their clients during the entire sales process, and then have the opportunity to offer additional services like web hosting and privacy protection.  These additional services are the core of every retail registrars business – not the registration.

· Committed Pricing – through fixed and/or negotiable pricing registrars can negotiate and complete the deal without owner contact.  Domain owners set their own pricing, commissions and guidelines, for each domain before the domain is listed.  This allows the registrar to close the transaction in real time – followed by instant transfer. 

· High Quality Control – every domain is subjected to qualitative tests to ensure correct spelling and vetting of brand and trademark issues.

· Validated Ownership – registrars are a natural home for aftermarket domain sales as they are the only entity that can guarantee that the person selling the domain actually owns it.  They are the only entity that can take a binding agreement from the registrant to sell and transfer the domain.

· Pre-authorized Transactions – Registrars that are certified for the Domain Distribution Network effectively guarantees that each domain in the network is owned by the person trying to sell it, that it can be instantly transferred, and the terms by which the owner is selling the domains are valid (owner offer).

Domain Distribution Network Registrar Certification

The Domain Distribution Network enables: offer, acceptance, consideration, and delivery in one instant package.  In order for the market to reach this level of efficiency it requires that only domains from registrars with DDN Certification are distributed.""

_______________________________________________________

Battletank_2Okay,  I do not work for Fabulous.. and could care less who the winner of the "War for control of the sales platform" turns out to be.. but I have privately heard some astounding numbers from these guys down-under, so my bet is on them. There is going to be a huge explosion of domain sales via the Fabulous.com global distribution model with ICANN accredited registrars ("not" traditional sales portals) carrying the lead and controlling the sales process in the future… Power is about to dramatically and irrevocably shift to "registrars" and "name holders". Third party loose-inventory brokers are going to be hearing a huge sucking sound. It turns out the best people to sell premium names are not seperate marketplaces, but the registrar "Brands" themselves.

The registrars control the inventory and they control the shoppers. Registrars are the first and last spot people go to look up who owns a domain name (honorable mention to popular third-party WHOIS providers who are in a similar position and can ‘build’ retail rars).

MinerWhat makes this Fabulous.com system so interesting is the speed with which you can close a sale transaction and the amount of sales traffic it can drive by daisy-chaining all the registrars together..  A registrar who has "priced" names, plugged into the Fab system can enable a secure, rate-limited protocol to allow for names to pass instantly to a gaining (purchasing) registrar..  Payment gets cleared automatically behind the curtain, electronically like a NASDAQ market. Name sales are done without people, at pre-set prices. The deals flow as surely as the sun rises. We are talking about selling names which get whois lookups but which draw no traffic and no clicks from a PPC perspective..  Yes, there is a difference and many of those types of names are still "out there" because traditional "domain tasting", which is based on traffic, has not yet revealed them.

Some big sales/brokerage houses such as Fabulous have presumably done whois tasting where they troll the whois lookups checking for repeats or patterns and then registered the stand-out names. Many undiscovered, longer tail versions must surely lie fallow and there-in lies opportunity for you and I.

As of today the majority of all registrars are plugged in to this new Fabulous.com system.. Registrars are the only ones who can authoritatively say if somebody controls a domain because they have the registrant account and credit card information which matches each name. They can act as a title office permitting sales to pass, confirming good-title and facilitating transfer through Fab’s instant protocol. The Fabulous system allows the registrar conduit that procured the buyer to retain that sales lead and upsell ancilliary services.. and because all registrar’s whois boxes are effectively polling the system, it breathes life into longtail portfolios of traditionally "impaired names" (without traffic) and creates value, shining light where there was dark.

Now you can take 50,000 names which make less than $6.00 a year on PPC, plug them into this system and generate more than $15,000 a day in domain name sales, based purely on whois look-ups ..  This is on names which make no money via traffic!! The registrar who brought the lead continues to control the client for product upsells and there is no freerider bleed-off where potential buyers type the name into the address bar to find the registrant’s parked "for sale" page, offering the name for less money. Fabulous’s system is designed to protect the Registrar who brought the lead.

GoFolks, this is a game-changer. Ask your registrar, if they are opted into this system..  Or better yet,  get your own registrar..  Because based on what I’m seeing here, nothing is going to expire anymore in future and your names are going to become much more valuable  — Heck .. many of your best names are probably still sitting in the available pool right now, unregistered!! Go!

What sells?

Screen names:  ie. matt85.com <<– how many guys named Matt were born in 1985? What are the most popular facebook/myspace style screennames? Do this with every name/year.. but do this smartly.

.Net and Org, .us , info versions:  of strong .coms do better than ‘web’, ‘net’, ‘shop’  add-ons  Go up to 2/3 word phrases with high OV (over 2k)

Two and three word phrases:  hotsaleslead.com, eshoppingguide.com, shoppingbutler.com

Any product or service with cityname: Delawarehomedecoration.com, toledoplasticsurgery.com, fargoplumbers.com, losangelestrashremoval.com (this style of regional name is the hottest seller)

Back_it_upBack up the truck folks ..  this is a moment in time to secure the best of the most obvious long-tails..  In the past the renewals would have crushed you,  but if you do it smartly and scale it briskly, you can create opportunity for yourself. Smart people should be able to comb Google for a list of the 100 biggest US cities and add the most popular yellow-page listings..  get to work and your heirs will thank you. Be cerebral..  think about what ‘you’ would want to run there..  put yourself in the business shoes..  It’s counterintuitive to buying names for media/PPC.  I figure there is about a one year window till the best of the remaining long-tail is mined..  if that. 

If the readers of my blog are as smart as I think they are, this should be my worst ‘pageview’ day ever, because if I was you, I would read this post and leave for a week..  It’s time to work.

Go!

This entry was posted by Frank Schilling on Friday, June 1st, 2007 at 12:01 AM and is filed under Domain Names (Domains). You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.


58 Comments

  1. Dan says:

    Nice post Bob Luther…I hope everyone reads it.

    Peace,
    Dan

  2. John says:

    If,
    “Fabulous has a domain portfolio of roughly 500,000 (probably more) and in their last quarter they raised $333,000 or annualised $1,332,000 from domain sales. Therefore for a portfolio of 50,000 names this would give an annualised amount of $133,200 which is far short of $15,000 per day. ($ are Aus, 1 us$ is about Aus$0.83)”
    is true, doesn’t that equate to about $.26 (that’s 26 cents U.S.) per name? I wonder what percentage of their inventory they sold? Looking at it from the ‘little guy’ point of view… If I were to purchase a couple hundred names today (based on the above excellent information) for say $1400, I’d have to sell at least one $1400 name to break even, within a year. Any of you more experienced domainers out there have some feedback on the odds of that happening based on your previous experience? Or is it that the whole Fabulous DNN scenario changes everything, in which case we’re all guessing?

    ***FS*** i don’t have the exact answer because I only know what those “in the know” are willing to share relating to the equation data that you base the formula on.. but that said I look forward to seeing what becomes public as the weeks and months peel on.

  3. Argo Wibowo says:

    This is really good information. I’d better go get some.

  4. Graham says:

    Frank- I am relatively new to the domain game and I really enjoy your blog…
    Please let me know you think of the following names I just grabbed:
    all .com’s…

    IndianapolisSalons
    IndianapolisEyeDoctors
    LexingtonOrthodontists
    JerseyCityDaycare
    SantaClaritaDaycare
    CincyDaycare
    EvansvilleTheaters
    SaintLouisDrycleaners

    ***FS*** I think the singulars are better because the plural implies that people are going to come to a directory of several each.. which is fine.. but this is about resale not so much traffic .. so the directory-play runs secondary to the authoritative singular for resale to an individual.. Its counterintuitive, I know.

  5. Dave Wrixon says:

    Far East Languages are wonderful in terms of sorting out the Singular/Plural conundrum.

    Plurals don’t exist in a separate form for Chinese, Japanese, nor I believe Korean.

  6. DP says:

    Resurrecting an old post here, but worth a follow up. The names I registered were with zero expectations of traffic, they were local service names aimed at targeting local business owners via the DDN. The names were also names that would nicely fit a “develop once, change a few tags to fit” type local service directories and review sites. They were all regfee.

    Here’s the surprise. People are looking for this stuff. They get traffic, they get clicks, not a lot, not enough to pay for themselves in aggregate, but it’s there. Last four from today:

    ftmyerspools.com $0.71
    bridgeportcabinets.com $0.48
    fremontdayspa.com $0.43
    stpaulbridal.com $0.25

    Don’t shoot me for sharing info Dan, it’s just a very small snippet! :)

  7. Mark says:

    Frank

    do you have a view as to whether ServiceLocation.com or LocationService.com works better for type in traffic?

    e.g.
    LondonHotel.com or
    HotelLondon.com

    I think that LocationService.com sounds better and probably will do better in the retail market (eg DDN). What’s your experience with direct navigation on this?

    Many thanks

    Mark

    ***FS*** The one that most people would naturally say works better for type-in traffic. LondonHotel.com

  8. Lyn Mettler says:

    I think another hot domain type to buy and sell is anything with “video” in it. Online video is such a hot trend online right now that I imagine lots of folks are trying to snatch up such domains to start their own video service/idea.

    According to Peter Bowman, of Avericom, an Internet consulting and development agency, who recently put up for auction 150+ domain names under the VideoLinkAmerica.com and VideoLinkNetwork.com brands, video-centric domain names are selling for $3000 to $5000 per name.

    Even if you don’t want to resell them, buying complete video-related .com brands would be a great opportunity for someone to launch a service. They would have an entire network brand at their disposal.

    For more information about his auction, visit http://www.avericom.com/news/domainauction.htm.