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August 27, 2012

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T.R.A.F.F.I.C. Conference Ready to Take the Domain Story to Madison Avenue This Month in Manhattan
By Ron Jackson 

The most important T.R.A.F.F.I.C. domain conference to date is coming up June 19-22 at the Grand Hyatt Hotel in New York City. This key event will put domains front and center in the media capital of the world and is likely to have a major impact on the future course of the entire industry. To get the inside story on what is about to go down in the Big Apple, we hooked up with T.R.A.F.F.I.C. co-founder Rick Schwartz for the exclusive interview below.

DN Journal:  The time has finally come. After seven highly influential conferences in Florida, Las Vegas and Silicon Valley, T.R.A.F.F.I.C. is about to invade Manhattan. I’d like to hear how you view the significance of this event for both individual domain owners and the industry at large. 

Rick Schwartz: I could probably sit here and write the answer to this question all day long. But in this case I am going to be short and to the point. The New York City T.R.A.F.F.I.C. show will be a watershed moment. It’s going to change the face of the industry. 

The Grand Hyatt Hotel (with Grand Central Station in the foreground and the Chrysler Building in the background) - Site of the T.R.A.F.F.I.C New York Conference June 19-22

New York is the toughest market in the world...it is also the fairest. Our job is to just be who we are, present our story, stick to facts and stats, and destiny will take care of everything else. Our job is not to sell, it is to present. Present the facts about domain names; equating them to property addresses on Broadway and 42nd Street; some developed into high rises and some used as parking lots; but all domain names in the form of targeted traffic. 

We will emphasize the prestige that a generic dotcom address has when you are battling your competition tooth and nail; the disruptive ability so intense that a single domain can change an industry. Hotels.com is the perfect example. We will show how so many domains are priceless. Just ask Bank of America how much they will sell Loans.com for? The answer is that you most likely would have to acquire the entire company to get that domain name. The same situation occurs with Baby.com and Johnson and Johnson.  








Rick Schwartz and Howard Neu (seated) 
T.R.A.F.F.I.C. Conference Co-Founders 

New York is a chance to walk away with the biggest prize ever. It is nothing Howard and I can do alone. It is something only the industry can do.  For the effort; for the investment in coming to New York, its reward will be an increase in domain values across the board. Actually, I believe that we will see a dramatic rise in value as domains become understood for the investment that they are, the collectable value they have and the potential value to world commerce just to mention a few. What does it do to the value of domains when folks realize there has been no stock or any other investment in history that has gone up more in value in a faster rate of time? I have repeated this question often, yet few understand the dimension of the answer.

DN Journal: How have you tailored the New York show’s schedule to take advantage of this opportunity to interact with the unique audience that will be on hand in the Big Apple? 

Rick Schwartz: For one thing, the night before the show even starts (Monday night June 18th), we are going to have a special cocktail party just for local New York ad agencies, PR firms and Wall Street execs. It is not open to domain owners or sponsors unless accompanied by a qualified member of one of these communities and arranged in advance. There is no charge to attend but you absolutely must be qualified and invited. 

Additionally, our primary focus will be on investing. Domain owners are investors. When you look at the ballroom at T.R.A.F.F.I.C. and see who is sitting there, we anticipate that the persons in that room handle investments in the billions of dollars. If they can’t recognize the value of domain names, then I have confidence that they will recognize a room filled with investors totaling many billions of dollars. Greed will set them free! 

Also Moniker is focusing on names that would be attractive to the corporate world and investors as they assemble the list of domains for the auction. They have sifted through at least 75,000 names and the quality of the domains just keeps getting better. The last 2 auctions have seen $5 million in sales each. I will tell you that it is our goal to break the $10 million mark in this auction alone. That is an achievable goal, but won’t be easy. But I sure would like to see the headline that would bring. 

Auctioneer Joel Langbaum and Moniker.com CEO Monte Cahn (right) at the last 
Moniker/T.R.A.F.F.I.C. domain auction in Las Vegas in March

For those that have not looked or kept track, the T.R.A.F.F.I.C./Moniker and Internext auctions are responsible for and have accounted for 6 of the top 10 reported sales of 2007; 11 of the top 20 sales; 21 of the top 50 and 39 of the top 100. That does not even include the ones that Moniker has done via their own channel. So when folks are serious about buying and selling the top premium domains, we have proved that T.R.A.F.F.I.C. is the place to be and Moniker has put together great domains event after event. And the story gets more impressive. On DN Journal's “Global Contenders” chart, our auctions are responsible for 32 of the top 100 sales.  All I can say is wait until after New York!!  

DN Journal: The current issue of Business 2.0 magazine features a widely discussed cover story about Kevin Ham who has made tens of millions of dollars with domain names. That magazine will still be on newsstands when T.R.A.F.F.I.C. rolls into Manhattan. People are debating whether the article will be good or bad for the industry in the long run but, now that the media spotlight is clearly on domains, there may never again be so many eyeballs glued to an industry conference as this one in New York. Could this be a once-in-a-lifetime opportunity to get the word out on why generic domains are such a great investment?  

Rick Schwartz: Let's face it. This story cuts every way but Sunday. It is bad, it is good and it is everything in between. Some of the reactions are interesting. I will say there is no question that this has opened a hornet’s nest. I think it will be months before we see the total effect this has on the industry. The TM issue is very hot. There are a lot of ramifications. But I believe the focus should be on the sponsors that are paying for this traffic. Take the profit out and the problem will greatly improve. Short of that we will be whining about the same thing in 10 years. Just because something makes money does not mean you are compelled to do it. The TM line is far from clear and there have been abuses on all sides. That is my own personal opinion on the subject. I think we all need to conduct ourselves responsibly. But it’s not for me to judge how others run their businesses. We have a court system and other outlets to decide those things. 

That aside, black holes are intriguing, especially $300 million black holes that are growing by the day. So when folks see that they scratch their heads and wonder if there are other untapped gushers just waiting to be discovered.  So maybe we can be called “Opportunists.” The good news is that we are going to the “Opportunist” Capital of the world in New York City. They love little black holes there. The mindset there is different. I don’t know what the industry will look like on the morning of June 22nd when this show wraps up and I fly home. I know it will be different than today. We might refer to the industry as “Pre New York” and “Post New York.” I don’t know. What I do know is that things are in place, the stars are aligned and we have an opportunity to break through! You just don’t get that many opportunities like this in life. 

The greatest gift most of us posses is the gift of recognizing opportunity when it passes. So the answer is yes. This is a once-in-a-lifetime opportunity to get the word out on why generic domains are such a great investment! It’s what makes T.R.A.F.F.I.C. such a great value regardless of the cost of entry. We create a circumstance in which great things can happen with great people working with great companies. That’s 5 dimensions further than what your average trade show can accomplish. When you look down the list of T.R.A.F.F.I.C. shows, it looks like a list of important benchmarks. The introduction on  T.R.A.F.F.I.C. #1 rang in a new era in Delray Beach, Florida. The focus on Hijacking of domains in  T.R.A.F.F.I.C. #2 in Las Vegas created a fund of $56,000 that we used to try and prevent the increase in fees coming this fall. With a little broader support, who knows? 

We saw the legal aspects of things in T.R.A.F.F.I.C.  #3 with a priceless consultation with the brightest lawyers in our space.  10 weeks later we were bringing deep pocket investors and VC guys in Silicon Valley for T.R.A.F.F.I.C.  #4 which manifested itself in Las Vegas for T.R.A.F.F.I.C.  #5. That brought us to the Madison Ave showdown with T.R.A.F.F.I.C. #6 in Miami. Then last March,  Las Vegas brought us T.R.A.F.F.I.C. #7 with a record crowd of over 600 strong and some real momentum building. On top of that, each show produced a more important live auction by Moniker.  

Now the big one in New York City. It took 7 shows to build the momentum we have. But as you can see, each show had a reason and a vision and all are tied into the main vision. So while everyone tries to imitate our success, let me say once again that you can’t lead by copying. Don’t leave your family and homes to go to a “trade show.” That is a waste of your  time and money. With T.R.A.F.F.I.C., we create opportunity because we have a formula, a vision and a record of success. We create life changing conditions and that is why folks continue to make T.R.A.F.F.I.C the key event in our space. When you bring the biggest, the best and the brightest together and you do that in New York City…great things will happen. 

Inside the Grand Hyatt

DN Journal: Of course going to New York comes with a cost, a lot of cost – both for you and Howard Neu as the show’s promoters and for those who are attending. Everything is more expensive in New York from hotel rooms to hot dogs (let alone the filet mignon you typically serve at T.R.A.F.F.I.C. dinners). It hasn’t stopped you from deciding to stage the show there, but do you think it will have an affect on how many people attend?

Rick Schwartz: Howard and I knew the minute we considered New York that this show would cost money out of our pockets to produce. But we have a mission and we are determined to bring that mission to a successful conclusion. 

There was no way to have this success we dream of without marching into New York City. The prices there are about 2x higher than anywhere else and more. For attendees, we negotiated a rate $200 a night less than the regular rate. The $350 price is the same as it was at the Miami show. Most of the cost is in the food. When we serve 600 steak and lobster dinners, we are talking nearly $150 a plate plus, plus, plus. So luckily most of the increases are being absorbed by us. 

As we get closer to the event I think folks will realize that this is the moment they really have been waiting for. To let an extra $400 or $500 stand in the way of coming may be terribly shortsighted when you compare it to the upside. I mean if you were a baseball player and you were going to the World Series would you let $500 stand in the way of you going?  Then there are some that plan to show up in New York, that won’t pay the admission fee and think they can set up shop and do business at our expense.  That only disrupts the show and cheats both sponsors and attendees. I’ll tell you right now, don’t do it! It is unacceptable and I am going to get on stage and name names at the show if this happens. It’s not fair to us and it certainly is not fair to the industry. When sponsors or attendees cheat like this I often wonder if they would cheat on the payouts or traffic? Like I have said, “All hands on deck!” Don’t be cheap with your destiny because it just may come back and bite you in the ass. It’s really not worth it. It stinks that I even have to say it.  

DN Journal:  When this show is over and done with – what do you hope to have accomplished by taking domains to Madison Avenue’s doorstep? 

Rick Schwartz: If Madison Ave can just see domains as another tool for their toolbox or another illusion as they perform their magic it will have been a great success. If we can present compelling evidence of what we have learned about online selling and branding it may make just one of them to sit up and take notice. What I learned in Miami in October is there is no courage in Corporate America. It will take one guy with brass balls and a strong gut to break from the pack and the rest will follow like a row of dominos falling in sequence. 

Even if Madison Ave is not ready, I can guarantee you that Wall Street is. Some accuse Madison Ave of being out of touch with the digital era. There have been stories written about it. But you asked the right question…the only thing we can do is bring it to their “Doorstep.” Like the papers they advertise in. They will either pick that paper up or just toss it out. I’ll accept either because I know we did our job by investing 3 shows in presenting what we have and why they should pay attention. Meanwhile we will be on record for the day that they do put 2 and 2 together. It won’t be the first time that I make a presentation and make a sale 2 years later. So no worries either way. Our job is just to do our best to bridge the gap sooner rather than later. I hope if nothing else they will appreciate that we gave it our best effort. 

Additionally, I hope we can use our efforts to help the ICA (Internet Commerce Association) stand strong against predators that want our assets without paying fair market value. There is so much infighting that nobody is looking at the real pitfalls we are about to face. If folks want to protect their futures they need to be proactive. We buy all this insurance for our homes, cars, boats, jewelry, toys and it amazes me that domain owners and sponsors won’t pony up the dollars needed to defend our assets and to get some positive PR out. Many focus on the negative and a lot of it is self inflicted. But there is a positive story to tell and at the end of the day this industry needs a Madison Ave PR firm to brand us differently. Maybe someone smart will show up and show us the way.  

Collectively our industry will begin to pay tens of millions in extra fees this fall for no bona fide reason. Actual expenses going down but someone got a sweetheart deal at the expense of everyone.  Extra fixed costs. Extra overhead for no reason other than we failed to fight the fight. I hope we learned something. They don’t deserve to get away with this ever again. 

DN Journal: It’s often said that once you have made it to New York you have really arrived. What is left for you to accomplish with T.R.A.F.F.I.C. once this one is in the books? 

Rick Schwartz

Rick Schwartz:  I can’t say it any clearer or stronger. All hands on deck!! We need everyone’s help. I am not ashamed to ask for each of us to put an oar in the water and paddle. This is our moment and moments like this are ones that we live for. Don’t even think twice. This is it. We can do some of it, but we can’t do all of it. Your support and enthusiasm along with each of your stories is needed. I approached T.R.A.F.F.I.C. as a 3 year mission, not a career. In Miami in October, I am going to take that stage and say two words. “Mission accomplished” then together we will chart the future. 

When we look back at where we were in October 2004 and where we will be by October 2007, there will be no disagreement about the progress we have all made; profound and life changing progress. This business will never be the same when we leave New York. After that, I won’t know until that plane ride home when I sit and reflect what we have accomplished. Howard and I have talked about making the show twice a year as the sprint is over and the marathon now begins. But that is a bit premature. It will be one of the things we discuss with the attendees themselves and the WADND Board of Advisors and as always it will be events that dictate our decision. 

In closing, I would just like to say that as an industry we are on the threshold of a new exciting era. I have patiently waited close to 12 years for this overnight success and I believe when we leave New York, the folks that came will feel that it was the single smartest thing they ever did. We will engage people that will engage back and great things will happen. Destiny awaits and I am anxious to see what the future holds for all of us. 

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