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Why Parking Companies Want YOUR Portfolio and What DomainSponsor.com Is Doing To Try to Get It

By Ron Jackson
Editor/Publisher



The domain industry is experiencing a new boom and paradoxically the most active sector in the business is the one with the most passive name – parking. Elsewhere it’s a word people associate with turning off the engine, locking the door and walking away. In the domain world it’s just the opposite. Parking is what you do when you are ready to flip the ignition switch and begin a race that can lead to real wealth. 


Advertisers have discovered that when it comes to reaching a targeted audience nothing beats the Internet. To get their message to people who are most likely to act on it, those advertisers are paying increasingly large sums of money to owners of domains that attract surfers who are already looking for the kinds of products and services they offer. Those surfers might be drawn to a domain by a keyword or term matching their interest or the visitors might represent residual traffic from a domain’s previous life as a live website. No matter why they come, those people are a liquid asset that you can cash in on.



Parking companies exist to make it easier for you to do that. They line up the advertisers, produce the pages visitors will land on to see the advertiser links, track the traffic statistics for you and best of all, cut the monthly checks you receive for parking your domains with them. All you have to do is pick a company, sign up for a free account and change your name servers (or redirect your site) to the address your partner provides you.

 

Sounds easy enough, right? Well, it used to be! Until recently, only a handful of companies understood and operated in this space. However, as advertisers have poured resources into this medium, new companies have taken notice and followed the money, triggering a stampede into the parking sector. It is still easy enough to set up an account and start making money, the hard part is deciding among the myriad of parking options available today. 

 

Some split advertiser revenue with you in the standard 50/50 arrangement, others offer a higher cut (normally for a limited time) to entice you to join them. Companies also vary on how attractive their landing pages are (or the degree to which you can customize them), how well they are optimized, the quality of statistical reporting and ease-of-use in their domain management interface.

 
You can make a decision by trying out a lot of different services to see which one pays best for the kind of domains you have (and are most user friendly) or you can rely on a recommendation from someone already in the business or from a website that evaluates the different companies. One of those is Howard Hoffman’s PPCIncome.com. He currently has DomainSponsor.com at the top of his list. On his site Hoffman says their Premier program (currently offered only to larger domain owners with at least 1000 unique impressions/day) provided the highest RPM (revenue per thousand impressions) he has seen and adds “ even their standard program beats most of the competition.”

Howard Hoffman
PPCIncome.com


If what Hoffman says about their Premier program being #1 is true, then the best may be about to get better. DomainSponsor will be announcing an all-new program they are dubbing Domain Sponsor 2.0 at the T.R.A.F.F.I.C. 2004 conference in Delray Beach, Florida Oct. 20-23 (they are the lead sponsor for that new trade show). DomainSponsor is already a familiar name to anyone who has been in the domain business for more than a few weeks – so familiar it is hard to believe they are less than two years old. 


DomainSponsor’s parent company, Oversee.net, is only a bit older having been created in May 2000 by Lawrence Ng and Fred Hsu. The two friends had been working in the SEO (Search Engine Optimzation) and online advertising fields when they decided to set up their own internet advertising shop in Los Angeles. Lawrence took on President and CEO duties while Fred became the CTO (Chief Technical Officer). Their new company included an online ad network at Revenue.net and the Information.com search engine. In the fall of 2002 they added DomainSponsor.com to the mix. 

It's just about impossible to get the busy DomainSponsor.com team in one place at one time but here is about half of the DS crew at their Los Angeles HQ!

President/CEO Lawrence Ng is in front row 3rd person from left (black shirt).
CTO Fred Hsu is standing at back immediately right of the Oversee logo.
Director of Business Development Ron Sheridan is in front row at far left (green shirt).


Ron Sheridan
joined the team as the Director of Business Development for DomainSponsor and Revenue.net and he is the guy most domain owners work with when they sign on with the company. Sheridan told us “DomainSponsor was created to address what we perceived at the time to be a need for a new revenue program designed specifically for parked domain traffic.  At the time Oversee was focused on our paid search program TargetWords.com (Editor’s note: a company that allows owners of developed sites to place advertising related to the content on their pages). We were talking to an increasing number of publishers who owned portfolios of parked domains and were interested in earning more revenue from the traffic their (undeveloped) domains were receiving.”


Sheridan said they looked at what the competition was offering at the time and decided they could do better. He believes the success DomainSponsor has had since then has proven they were right. “Since the launch of DomainSponsor.com just under 2 years ago, Oversee has grown from 4 employees to 52, and more are scheduled to join the company in the comings months.  Our current offices encompass just over 8,000 square feet and we recently secured an additional 16,000 square feet in an adjacent office. It is presently being renovated and we expect to begin moving in by December.”


There's Plenty of room to grow at DomainSponsor.com headquarters 
in Los Angeles. Entrance to 818 W. 7th St. (left) and Main Lobby (right)
.

Of course what you will want to know are the specifics that might make DomainSponsor the best choice for you. Sheridan said “Our primary objectives from the beginning were greater monetization through better optimization, combined with the highest level of customer service in the space.  Our proprietary optimization technology is unrivaled in the industry and has consistently outperformed the competition in converting visitors to domain landing pages into searches, and searches into clicks.” 

PPCIncome’s Hoffman backs up Sheridan on that point. “DomainSponsor's auto-optimization is an example of superior technology that really pays dividends for the domain owner, and the new improved optimization is what I always hoped they could accomplish,” Hoffman said.  He is equally impressed by the company’s reporting features. “I have learned so much from my stats at DomainSponsor.  It is great to be able to submit (via copy and paste) a custom list of domains (such as those that are expiring within a month) and get back a report on traffic and income over any period of time I want (last 30 days, last 6 months, or whatever).  The stats are very fast and very easy. I also like the fact that they keep improving their service and the pages that are generated,” Hoffman said. 

Hoffman also agrees that DomainSponsor’s customer support people are top notch however he said the company’s rapid growth can make it tougher to reach them. “DomainSponsor is partly a victim of their own success.  DS has been adding new tech support staff and this should help reduce the wait that prospective users sometimes encounter.  The tech support people they have are incredibly good, it is just that they have frequently been overloaded.”

One thing very few DomainSponsor customers complain about is how quickly their checks arrive each month. “From the beginning we wanted to be known for the fastest payouts in the space, and we are to this day,” Sheridan said. "Our payment terms are Net 15 and we consistently exceed those terms by getting payments out to our publishers early.”  Having placed a part of my own portfolio with DomainSponsor (on Hoffman's recommendation) that is a point I can personally attest to. I typically receive payments an average of just 7-8  days after the month ends. 

As good as DomainSponsor is, they fully understand that there is no shortage of able competitors that would love to eat their lunch. Many new parking companies have entered the fray in just the past few months. That has come as no surprise to Sheridan who says DomainSponsor is ready for the challenge. “The migration of various entrants into this space is easily predictable when a market such as ours reaches this level of maturation.  New entrants try to come in at the peak.  After time a number of the new entrants and some of the longer term players die away, while the stronger players survive. You saw the same thing in the PPC space, SEO etc.” Sheridan said. 

He added “the way we deal with it is to work 24/7, 365 days a year to always look for ways to improve our optimization and drive increasing payouts to our publishers. We never stop trying to improve and we don’t get comfortable or complacent. Yes we are paranoid, and for good reason. There are some strong competitors in this space.”


Fortunately the entire space is growing rapidly, so a company doesn’t necessarily have to dominate all others to do well. Advertiser payouts have increased considerably this year and Sheridan said the upward trend is likely to continue for some time to come. “According to Bambi Francisco of CBS.MarketWatch.com “paid search, virtually non-existent several years ago, now accounts for 40 percent of online advertising revenue. Advertising revenue linked to keywords is expected to grow 63 percent this year.” That much of an influx into the marketplace will certainly drive up revenues for parked domains,” Sheridan said.

That’s not all. “There are still large numbers of mid sized and small companies that have yet to develop solid strategies for doing online direct response advertising,” Sheridan said. “PPC and search are still the surest way for them to drive buyers to their web properties and generate online revenues. Google has over 180,000 advertisers at last count and that number is still growing.  As it does the bid values associated with the most valuable keywords will climb.  Traffic is not finite but quality search traffic is.”

 

While DomainSponsor produces solid revenues there are always people who would like to try to squeeze out more. The company’s system is largely automatic – you just point you domains at them and they take care of the rest. However, some domain owners think that if they handle some of the optimization themselves they can get their pages into the search engines and increase traffic to them. Sheridan says his company has looked at that but is unconvinced. “We are involved in on-going testing to explore what potential increases really are possible from the search engines. At this point, we are unsure as to what it’s really worth. With respect to those in the space that we have observed that are doing it, we don’t see them out competing DomainSponsor. There are always exceptions but as a rule the SEs can easily spot this pattern of activity and easily remove thousands of links from their indexes,” Sheridan said.

 

With any parking company you have to understand that your results will only be as good as your domains. Most that produce steady traffic will be .coms. Some .nets and .orgs draw nice numbers too, but new extensions like .info, .biz and .us aren’t yet known well enough to generate much traffic revenue. “Every market shift needs a driving force and the alternate TLDs seem to lack that at present,” Sheridan said. “Over time we expect that to change but we do not see a trend on the horizon that portends a significant shift in web user behavior. The web users do not need new TLDs at present to find what they are looking for on the web. The demand from the domain owner marketplace has already been demonstrated but has yet to translate into a marketplace transition.  Definitely a space to watch though.”

So, as with all parking companies, to get the most out of the DomainSponsor revenue machine, you’ll need to put high quality fuel in the tank. Sheridan said “ DomainSponsor is geared towards domain portfolios that generate type-in traffic. So for us, traffic is the focus.  We are expert at converting traffic into cash. And besides, Ron’s rule of internet marketing is “He who controls the traffic, makes the rules!"  That puts DomainSponsor publishers squarely in the drivers seat.”

For newcomers who remain bewildered by the choices available today, Sheridan offered this advice, “When selecting a company to park with a publisher should be clear on what their goals and objectives are. They should make sure they earn the most money possible for their traffic and get paid promptly for it. Flexibility with respect to options available for redirection is important as well as not being forced to enter into contracts or agreements that limit their options and make it more difficult for them to control their own destiny.” 

Sheridan added “We think it is important to pick a company that is well established with plans to be around for a long time. Quality, responsive customer service is also a critical element, especially when many companies have chosen to locate offshore or in far-flung time zones." 

"At DomainSponsor, we focus on traffic quality as well as traffic monetization. We feel to really last in this industry, you cannot focus on one or the other, but you need to focus on both," Sheridan said. Our technology is designed to produce both high conversions for both sides (publishers and advertisers) through targeting and relevancy. That translates into a stable business model that helps to ensure long term viability.” 

As advertisers come and go and competing companies tweak their systems, results may fluctuate. While the bottom line always takes top priority, Sheridan said there are other factors that will keep DomainSponsor running at the front of the pack. “The loyalty demonstrated by publishers to Domainsponsor is one of the things what we feel makes us different or special. We believe our publishers are with us because they want to be. They have many options and yet they choose to stay with us month after month. Of course the fact they earn more with us is a major factor.  But we’re about more than just making money for our publishers (which is always our main focus)...we're are also about building relationships with them. In a space and industry where most communication is achieved through instant message and email, most companies forget the human element so we make an extra effort to build solid relationships.”

A primary way DomainSponsor does that is by taking time to actually meet many of their partners face to face. That is one of the main reasons they are making the trip to Florida this month (in addition to debuting DomainSponsor 2.0). Sheridan said “We regularly travel all over the US and Canada to meet with our publishers. Sam Tseng, one of our account managers, will be traveling to Hong Kong later this month to meet with our top DomainSponsor publishers there. And of course we have always had an open invitation for publishers to stop by our offices when they're in town. The meals and the drinks are on us if you can make it!”  Don Corleone couldn’t have said it better himself. That really is an offer you can’t refuse!


 
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Editor’s Note: For those who would like to comment on this story, we invite you to make use of our Letters to the Editor feature (write to editor@dnjournal.com).


If you missed our previous Cover Story click on the headline below: 

Underachiever to Overlord: Go Daddy's Bob Parsons Started Slow Then Built Two Business Empires

All other previous Cover Stories are available in our Archive

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Domain Name Journal
A Division of
Internet Edge, Inc.

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