Journal: The overall theme of T.R.A.F.F.I.C. West 2008
– one that has not been explored before – is transparency.
Tell us why this was chosen as the show’s focus and how you plan
to tackle this hot button issue?
time for domain investors to wake up. They talk about
“X” which is a VC game and they don’t even know it.
But if they are foolish enough to play the “X” game,
then focus on X!!! Let’s stop kidding ourselves. Domainers
are on the short end and it is no secret. Domain
investors are very diversified. So they BUY T.R.A.F.F.I.C.
as well as SELL T.R.A.F.F.I.C.. It is interesting when I
hear that they pay $1 a visitor and by the time the
domain owner gets their “Share,” it is 2 cents!
So if you base your life on “X”, I just pointed out
where “X” can be 50 times what folks are selling
their domain for. If you want to play the “X” game, the
least you owe yourselves and your family is to play it
Sure, this will upset some
folks. But I promised when we started T.R.AF.F.I.C. that I
would never waste folks time. When I ask for their
time what I aim to give back is higher earnings and
higher valuations. That has been the underlying secret
of the success of
T.R.AF.F.I.C. and that is why T.R.AF.F.I.C. will always be a
different type show. So others won’t ask
what happened to the 98 cents. I will and if it takes
all of 2008, this industry deserves to know.
Transparency is the only way and I think there is a ground
swell to find out what the heck is going on.
Transparency is a two
way street. Domainers have to be transparent with their T.R.A.F.F.I.C..
Besides the obvious benefits transparency will give domainers, the
real secret of transparency is bringing in new advertisers
that can better judge their T.R.A.F.F.I.C. buys. As time goes on
this will only become more important. The good news is there is
broad support for this and the challenge is defining how it will be
implemented. I see a time in the not too distant future where T.R.A.F.F.I.C.
will actually be graded like gasoline. That way those that
have the most potent T.R.A.F.F.I.C. will be rewarded and those that
have crappy T.R.A.F.F.I.C. will be penalized. The result will be
that all groups will make significantly more money as
advertisers will gain confidence in their ad buys and that has the
power to transform things in a big way.
Journal: Let's drill down to some of the agenda specifics
starting with keynote speaker Jim
McCann of 1-800-Flowers. T.R.A.F.F.I.C. has a
history of bringing in great keynote speakers, including Forbes
Magazine publisher and former U.S. Presidential candidate Steve
Forbes at your last show. How does Jim fit into the mix and what
kind of insight and inspiration can he bring to domain owners?
Schwartz: First of
all I think it is important to bring business leaders of all
types that are heavily connected and expose them to what
we do as well as listen to things they have learned
traveling down similar paths so that we can avoid the great
pitfalls. When we refer to Jim McCann, we are talking about
somebody who actually invented the path we are on. He
was the first to really recognize the power of a
“Vanity” 800 number and used it to disrupt one of
the oldest consumer industries. The path he has forged is
the path many have been on for 25 years or more. He changed
how folks do business. He is a renegade, a maverick and now
part of the corporate mainstream. So not only did he invent
the path, he can tell us secrets to get further on
that path. I believe a conversation with Mr. McCann could
change the future of our industry.
Interestingly, Howard and I
spoke with Jim McCann at length this afternoon. We started
by explaining our dilemma of how we needed a strong follow
up after Steve Forbes and we
will deliver keynote at T.R.A.F.F.I.C West
believed he was the person
that could pull it off. I think the attendees are going to
be thrilled with his presentation. He is a man who
has worn our shoes and has gone down our path
and has seen it from all sides. I asked him only one
question during the conversation. “What would your
business look like today if you did not own flowers.com?”
I am not sure what the exact answer was, but it came
packaged in a groan. So it was obviously something
that imagining it for only a moment could make the stomach
turn. We are all in for a big treat and I can’t
wait until after his speech when folks come up to Howard and
myself and say something like…We did not believe you could
actually top Steve Forbes, but you did!
Journal: Among the new wrinkles you are introducing is a
pre-show elite auction immediately after the welcoming cocktail
party Monday night (Feb. 18) in which Moniker will
sell a short list of about 50 top notch domains. Tell us
about that idea as well as how the main auction Wednesday
afternoon (Feb. 20) is shaping up? Also, while
we are on the subject, many have wondered how, if at all, Oversee.net’s
acquisition of Moniker (who pioneered the live auction concept
with you at T.R.A.F.F.I.C.) might affect your partnership with Moniker
Monte Cahn and his Moniker
team will be back to run the
T.R.A.F.F.I.C. West live auction
Schwartz: Monte has
assured us that it is all good and we believe in Monte.
I think it best for the industry if in our efforts we learn
to compliment what we all do and dovetail things as
opposed to what went on during the first half of 2007. Monte
has always promoted “Coopetition” and this is his chance
to bridge whatever gaps that may remain. That can only be
good for the industry.
As for the
live auctions…they are popping up all over the place.
T.R.A.F.F.I.C. led the way with the first live auction and
that has changed the landscape of the industry. The way we
set ourselves apart from the others is by focusing on
premium domain names and stop putting embarrassing crap
out there. This will be the first time I actually get to
approve the final list and I can assure folks, I
would rather have a smaller shorter auction with only great
domains as opposed to one where folks fall asleep or walk
out because the domain names are sub-standard. Monte and the
Moniker crew do a great job and each auction we discuss what
we can do better. The best
thing we can do is have
domains that are great and have them at a market
price in which they can actually change hands and help move
the industry along. I sent out a small preview list last
week and I think it is the best by far. In addition, Howard
and I plan to make a big announcement in the next few
days or weeks that will have a significant impact on the
aftermarket and add a great deal of excitement.
Journal: T.R.A.F.F.I.C. always manages to mix a lot of
fun in with a great atmosphere for doing business. A day before
the show officially begins, you have something scheduled on Sunday
(Feb. 17) that should command the city’s attention – and
that is not easy to do in a jaded town like Las Vegas that has seen
it all. Tell us about that.
Schwartz: I had an idea
during the Florida show in October and decided on the spot to
make it happen. Since a lot of folks get to the show a couple days
before it actually begins, we decided to have a “Road Rally”
in Las Vegas. We have hooked up with an exotic car company
that has it all and there will be about 2 dozen cars as we travel
thru the desert, have lunch and then parade our “.Coms” down
the Las Vegas Strip. It will be a parade of domainers in exotic
cars and it should be a blast. It’s just a few hours of FUN that
will be remembered for a lifetime. Lamborghini, Ferrari,
Porsche, Bentley, Maserati, Mercedes, Hummers,
Corvettes and more. Don’t miss it! Anyone that wants to
participate needs to email me directly so we can set things up. They
can just go to the website and go to the “Contact us”
Journal: As the domain industry has grown,
competition has heated in every corner of the business, and
that is certainly true in trade show production and
promotion. As the first mover in the field, and one with a
stellar track record, T.R.A.F.F.I.C. has set the bar high
for others in the sector. In the past your
biggest challenge was topping yourself. Has your job become
a lot tougher now that you have to outshine others as well?
In that same vein, what do you feel distinguishes
T.R.A.F.F.I.C. from other events on an increasingly crowded
T.R.A.F.F.I.C. was not started as a business but it evolved
into one. I saw it as a 3 year plan to bring domain names
from total obscurity into the mainstream. It has been my
focus for a dozen years. The trade show became a better and
quicker vehicle to accelerate the process. The whole thing
has been about accelerating the process. It does none
of us any good for the power of domains to be
Hotel - Las Vegas
Site for T.R.A.F.F.I.C. West 2008
discovered in 75 years as we
will surely be dead. So I saw this as a 3 year project to
achieve that goal and Howard saw what I did.
The first show in 2004
and Yahoo And Google showed up and the dialogue had
begun and we are on the way. Each show was designed to take
advantage of the momentum of the previous show and trail blaze new
territory. Each show also had a theme, a challenge and a goal. Each
one we were able to succeed. The secret is Howard and I just set the
tone and loose agenda, it is the attendees that make it. A
staggering number of REAL decision makers. Deals done right there.
No board meetings, just decisions.
Forbes speaking at T.R.A.F.F.I.C. East
Getting back to the 3 year
plan…..Steve Forbes was the Crown Jewel of the end of the
first phase. That really brings us into the second phase.
Now that domain names are no longer a secret. Now that
domain names are a multi billion dollar industry. Now that
domain names are starting to get the recognition they
deserve. The T.R.A.F.F.I.C. shows in 2008 will be
interesting as we deal with a sensitive subject. A subject
others may talk about but only T.R.A.F.F.I.C. will tackle
with full force. We have brought this subject to light and
once we did others talk about it and I welcome the
discussion. But folks should not forget who brought up the
subject and will focus on it until a real result is
I don’t think we
have to outshine anybody. What we need to do is keep challenging the
status quo. Keep pushing the envelope. Keep ruffling feathers. Keep
pushing the monetization process. This is serious business with
billions at stake. T.R.A.F.F.I.C. has been a very influential
leader in the fight and I think folks are realizing that. The one
promise I will make is I would rather walk away from T.R.A.F.F.I.C.
and close it up before I wasted anyone’s time. The day we can no
longer move the industry forward is the day we will close it up. I
would hope some day that T.R.A.F.F.I.C. will be run and conducted by
people in the industry that only have one focus and that is to move
things forward and keep increasing the value of our assets. My life
dream is not to run a tradeshow. It is to go on as world cruise.
Neu: What started out as a small gathering
of selected people who collected domains in 2004, has
developed an entire industry where no industry previously
existed; the “industry” of domain investment.
T.R.A.F.F.I.C. apart from its flattering imitators is that
we have nothing to sell, no axe to grind, no agenda to push
on the attendees. Our only goal is to further
the industry and we have been very successful in doing just
initially were primarily interested in putting domain
investors and developers together with the monetizers, our
view has broadened considerably. This will mark our
4th visit to Las Vegas and our 10th T.R.A.F.F.I.C. and at
each of the 10 events, we have focused on different aspects
of the industry. At the first Las Vegas show we
focused on Domain Hijacking and pressured registrars to work
together and have a “Sense of urgency” when dealing with
Valley we brought in bankers and VCs, at Las Vegas last year we
focused on developers. In New York we went after Wall
Street and investors and have made a few attempts at attracting Madison
Avenue. At our last event, with Steve Forbes as our
Keynote Speaker, we concentrated on our place in investment history
and the parallels of domains to other investments. We brought
in the SEO factor and will be concentrating on
“transparency” of the monetizers in Las Vegas in 2 weeks.
Our success is in the “industry” realizing that it is indeed an
industry that must be represented and protected by an organization
like the ICA
which we gave a platform to get started and worked with the
organization to get it off the ground.
extraordinary ability to see the trends that will be coming in the
future and create programming to bring these trends to Domainers
attention, we have been in the forefront of every innovative aspect
in the industry. This includes providing a platform again and again
to Sponsors to unveil new products and bring them to the most
influential domain investors and developers. Every large
Parking Company and monetizer has used T.R.A.F.F.I.C. as the
springboard to announce new programs and innovative technology. Each
T.R.A.F.F.I.C. show had a defined mission and a successful result.
Each T.R.A.F.F.I.C. has benefited all who came and that is the
reason they keep coming back.
Fortune Magazine senior writer
answer to your question, no, it has not gotten tougher to
“compete” with rival trade shows as there are no trade
shows that can do what we have done as they are all one
dimensional and will continue to be so as long as they have
a product to sell to their customers.
Journal: The general economy appears to be headed
for or is already in a recession. A lot of people are
wondering how an economic downturn might affect the domain
business this year. After seeing several high value
auction sales earlier this month at DOMAINfest,
several mainstream outlets, including Fortune
Magazine’s Paul Sloan asked
in print if domains might be recession proof.
What is your take on this? Have registration
rates for the upcoming show given you any indication that
people in our industry are becoming cautious?
Schwartz: I think we
are all using the word “Recession” in an irresponsible
way. Me too as you will see in a moment. I don’t think
folks remember the mid
70’s. THAT was a
recession. 21% interest rates. 12%
unemployment, housing at a stand still, Detroit at a
standstill. No gas, just rationing. I could go on and
on. So this is not a recession. This is a crisis in a
sector that has the power to disrupt the economy for
a period of time. I talked to Paul Sloan and I do believe
domains are recession proof to a degree. I wrote this in my blog
last week: “During this slow down or recession, it will be
the DOMAIN INDUSTRY that is the shining light on the
hill. A place where great fortunes can and will be made.
Times like this fuel emerging growth and we are more than
emerging. We are busting out when everyone else is bailing
out. We are positioned very well and this rocky
financial environment we are in will benefit the domain
industry more than any of us could do alone or
Now this does not
mean we are without risk. Another of my blog posts addresses
this issue as well. “Smart business increases their ad budgets
during tough times to keep their numbers as close to level as
possible. Dumb businesses pull back and that is the kiss of
The point is that our destiny
is in the hands of others and it can go either way.
However if they are objective, they will start closing their
B&M stores that are marginal and take those savings to
invest in growing their online presence via online
advertising. Those that don’t and can will be washed away
because their competition will. Their spreadsheets all show
them 25% growth online and low single digit offline.
They are SOOOOO SLOOOOOW to react. Their equation is
upside down. They spend 90% offline in dying
newspapers and magazines with a shrinking subscriber base
while only spending 10% online if that. They got it upside
down and those that expect to survive and thrive thru
this crisis better figure it out before the real world
overhead sinks them.
Slowdowns and recessions are
the single best thing that can happen to emerging
industries and technology. I see this slow down as
Schwartz says a bear market wouldn't
be a bad thing for the domain business
great thing. It can
only benefit us. Just like when the net collapsed
back in 2000-2001. I said then that from the ashes of that
collapse would come the real Internet and that domain names
would be the epicenter as is it will be domain names that
survive. This time around the net won’t collapse however
business will re-evaluate everything they do and when they
do that, domain investors will become the big winners on
Journal: If the domain industry has the good fortune to
outperform the overall economy, there is still a threat on the
horizon - one that is potentially much bigger than a recession -
which is the continuing effort of those who want to take over assets
held by domain owners in any way they can. The Internet
Commerce Association (ICA) was formed to combat this and
will again have a high profile at T.R.A.F.F.I.C. West. Where do you think domain
owners stand (with respect to strength or weakness) in
this battle at the moment?
Schwartz: Stand?? They are MIA
(Missing in Action) It takes money to fight well funded
folks that want to legislate our domains away from us. Please point
the readers to my year end post right here on DN
Journal (Editor's Note:
scroll down to middle of page where Rick's comments begin). If the
readers like their cushy lifestyles, they better pay attention and
support the ICA. I have been on the forefront for a couple years.
Some may dismiss what I say. Fine. But now I am joined with other
voices. Other well known voices and they see the same threat I see.
The seeds of our destruction are being planted today!
They may not sprout for several years. But believe me, those seeds
are being planted and when they sprout it will be way too late.
I hope this year there will be a ground swell of support and
we can avoid what is certain to come if we continue to do nothing.
Journal: Let’s close with an invitation for you
to address any other points about the upcoming show or the
industry in general that you would like to make before we
sign off and start packing our bags for Las Vegas.
Schwartz: What’s to say? If you want to earn
more and get a bigger piece of the pie, show up
at the Las Vegas show and make your voice heard. If you want
to see your earnings continue to shrink, keep getting a
smaller piece of the pie, then stay home. Las Vegas
is the money show. Don’t leave your money on
the table. Howard and I work our asses off to get to this
point because we believe in what we do. Like many
you we have spent an
extraordinary amount of time educating as many sectors as we
can and now it is time to reap some of the sweeter fruit.
As an industry our
day in the sun has only just begun. The domain industry is an
overnight success that has been 12 years in the making. The
opportunities that an economic downturn present are enormous.
Business must ask question and take inventory. That positions the
domain industry in the perfect place. Those that see and
believe this will seize great opportunity in the coming months. The
others will run scared and miss all of it. It’s just another fork
in the road and life is all about making good decisions. Which path
will you choose?
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