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November 21, 2016

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Repaving the Parking Lot: Have Domain Developers Won the Debate?

It has been the domain industry’s version of the Great Debate. Is it better to try unlocking the full potential of your domains through development or does it make more sense to just avoid the hassle and park your names with a good pay per click service provider? 

After all, development is hard work and there are no guarantees that the sites you develop will ever attract enough traffic to earn more money that you can from parking anyhow. Besides that, many investors own thousands of domains. Even if they were inclined to develop all of them, it would be humanly impossible to do developmental justice to more than a fraction of them in one lifetime. 

(photo courtesy of the Bettman Archive)

Even so, over the past few months “development” seems to have become the buzz word in this business. At the T.R.A.F.F.I.C. conference in Silicon Valley in January, even the Wall Street analysts who are new to this space were telling the crowd they could enhance the value of their domains with development.

It is an alluring idea. Even though many (perhaps even most) sites never work out, we’ve all seen the occasional destination, developed from scratch, that becomes a runaway hit, paying hundreds or thousands of times more than parking could provide. Even if your site isn't the next big thing, solid content and skillful development should generate a traffic boost, which in turn should elevate the domain's value. 

It takes time and money to get there though, with an unknown payoff at the end and that leaves many in a quandary over which path to take. That being the case, we thought it would help to explore some of the options now available with the hope that one of them will provide the right solution for your particular situation.

For a lot of people, the best news of all is that you may not have to do anything. The parking companies seem to be hell bent on bringing development to you! You would be hard pressed today to find a PPC provider that isn’t offering attractive, graphics rich landing pages with varying degrees of customization available to domain owners. Execs at some of those companies still believe that click through rates are better on plain pages with nothing but ad links, but you have to give the people what they want. Customers call the shots and many of them are convinced pages that look more like websites will convert better and that camp has their own set of backers in PPC executive suites too. 

SmartName.com and TrafficZ.com were among the very first PPC companies to give the old plain Jane parking pages an extreme makeover. As pioneers in that movement, they remain on the cutting edge today, allowing their customers almost total control over how their landing pages look (including adding their own content and outbound links to other sites they own). 

Ari Goldberger

SmartName is run by Ari Goldberger (who also happens to be one of most successful domain attorneys in the world) and Lawrence Fischer (a well-known domain investor) who is in charge of Business Development. We asked Goldberger what had triggered the rush to turn PPC pages into mini developments. 

“The market is driving this change,” Goldberger said. “Users are tired of seeing plain search pages. I believe we were the leaders in this area and others have followed our lead. Back in 2003, the conventional wisdom among many in the industry was make everything a one-click page to increase revenue.” 

“I heard from so many friends and colleagues that were not in the domain space telling me they hated those basic old search pages. They all look the same. Allowing users to customize sites avoids that disgust factor and brings tremendous value to our users. I strongly disagree with the argument that a plain Jane page makes more money as a general rule. To a certain degree, I think that was stated by PPC companies that did not want to expend the resources to innovate, as it’s a heck of a lot easier for each page to look the same,” Goldberger said.  

“Perhaps some tried nicer sites, got poor results and switched back to plain Jane without trying alternatives. The fact that more and more sites are adopting the nicer look is proof that nice sites work. In the long run, domainers will demand nicer sites because users will grow more and more tired of the dull sites that all look the same and they’ll exit those pages before they ever click.”  

“We started allowing complete customization of sites in 2003. We believe that a domain name should be a “destination” that users stop and hang out at, as opposed to just a mere billboard that people pass by as they travel the web. Adding customization was driven by our own philosophy, as domain owners ourselves, that a domain name has more value, and users are more likely to stick around, if the domain name looks like a web site.”  

Goldberger added, “SmartName was the first to allow users to place links to other domain names they own to create a network of sites. For example, Transit.com (see screen shot below) is linked to other transportation domains like boating.com, driving.com, biking.com and flying.com. SmartName’s commitment to allowing users to dress-up their domains has attracted high profile domains that deserve having a great looking site.” 

As one of the top attorneys in the domain business, it shouldn’t surprise you to know that legal considerations played a role in how Goldberger's service handles parking pages. “We have always believed it’s important to protect a domain against potential legal challenges by demonstrating that the domain is being used in connection with the bona fide offering of goods and services," Goldberger said.

"Back in the early PPC days of 2000-2002, Overture (then Goto) actually had a statement at the top of every parked domain page that said something like This page is not developed, but try searching for something below.  Every domain owner ever contacted by a prospective buyer or trademark owner who says “I see you’re not using this domain…” understands why that statement was not a good thing. You are in a better position from a legal point of view and greatly enhance the value of your domains if they look like they’re being used for a web site.”

To that end, SmartName.com rolled out one new customization feature after another. “In  October 2003 we began allowing partners to upload their own pictures, logos, and modify color schemes and links," Goldberger said. "In addition, partners are able to create fully custom sites like Mexico.com that go well beyond our standard templates."

"Our interface allows partners to add any html to their sites as well as RSS feeds. If it can go on a web page, it can be added to a SmartName page, provided it meets with certain requirements. To maintain control over this customization, all web sites that are created by partners are subject to our approval and do not go live until they are approved by our editorial team,” Goldberger added.  

While TrafficZ.com competes with SmartName.com for business, when it comes to landing page philosophy the two companies are on the same page.

Ammar Kubba
Chief Operating Officer, TrafficZ

Ammar Kubba, the Chief Operating Officer at TrafficZ told us, “The need to move away from the old school parked page is evident now more than ever. There is no question that the direct navigation phenomenon is on the rise, and leading industry experts agree that the rate of growth will only increase for the foreseeable future,” Kubba said. (Editor’s note: Direct navigation means typing a web address into the browser’s search bar,  rather than using  a search engine to find a web site) 

“Internet users, both expert and novice, are increasingly using direct navigation to seek out what they're looking for, but when a user types in a direct navigation domain name and ends up on a bland, boring landing page filled with nothing but links to marginally-relevant results, what incentive do they have to stay on that page, let alone ever return?,” Kubba asked. 

“Do this enough times and they may even give up on direct navigation altogether.  Such an outcome is bad for all of us, but especially the domain owners whose assets are being inefficiently monetized and even devalued by these poor user experiences.”

Kubba added, “In the brick and mortar world of real estate, a well-maintained, better-looking property will generate more income and increase in value faster than its uglier, neglected counterpart.  Virtual real estate is no different.  An aesthetically-pleasing, contextually-relevant page will produce more income for you today and increase the intrinsic value of your domain asset for the future.”

"For each domain in your portfolio we allow you to specify a layout, image, menu style, keywords, content, logo, title and metatags. Over the coming months we expect to increase our image library to more than 250 images, and we don't plan on stopping there. Soon we hope to have a relevant image for just about every domain in your portfolio, and with the ability to change the layout and add customized content, our clients can create a unique look and feel for all of their domain assets."

"We're also in the process of introducing new search partners into our metafeed to better monetize a broader range of traffic, as well as the opportunity for new revenue streams to supplement and/or supplant existing PPC income," Kubba said.

"The Internet was evolving all around us while our industry remained stagnant, and it was embarrassing.  People outside of our space would look at a parked page and could not believe that an entire industry had developed around such a seemingly bland and uninspired piece of virtual real estate! The thought of so much revenue being generated from so little was simply incomprehensible,” Kubba said.

TrafficZ screen shot from Reno.us

"We conducted extensive research and testing, both internally and externally, prior to developing our platform. What we learned was that people did, in fact, want more attractive, more relevant pages. We found that people were more likely to stay on a site if it simply appeared to be relevant to what they were looking for. TrafficZ 4.0 was the culmination of that research, but it is only the beginning of our vision...there is much more to come,” Kubba said.  

Kubba’s last six words are undoubtedly true for all of the PPC companies who want to remain competitive and that is good for domain owners. As promising as this all sounds, we know some of you will still have the urge to get your hands dirty and do it yourself, so to get some pointers we talked to a couple of guys who are already doing just that.    

Continue to Page 2 - Do It Yourself Developers

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