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Casale
Media sponsored breakfast for those able to roll out of bed
before the opening session at 9:45 Wednesday. That
was a development tools seminar conducted by Alan Warms
of ParticipateMedia.com, Lou Doctor, Darren
Cleveland and Adam Dicker. Cleveland pointed
out that the biggest decision comes before you even start
development – that is which of your domains
would be the best to build on. He said Recall Media looks
for the most viable product or service in a category that
offers the chance to develop multiple revenue streams.
Doctor
said making the right choice can have an astronomical
payoff, citing one development devoted to selling bicycle
tires that was started on a $15 domain but wound
up grossing $8 million a year in sales. Doctor
said building up that kind of business takes time. “I’ve
heard some say they want to develop one site a month,”
Doctor said, “I think it would be more practical to plan
one a year if you want a better payoff. Also, keep in mind
that development is much harder than it looks. It probably
only makes sense to develop your best domains because
successful developing requires a passion that is difficult
maintain.” |
Darren
Cleveland
President/CEO, Recall Media Group |
Dicker
gave some nuts and bolts advice on developing content and traffic
to new websites and Warms went through a case study of his ongoing
development of RumorMill.com,
a joint project he is working on with domain owner Rick Schwartz.
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Next
up at 11am was a session on “Structuring Joint
Ventures and Domain Development Deals” with Chris
Mulligan and Jordan Rohan of RBC Capital
Markets, Ari Bayme and attorney Steve
Sturgeon. Sturgeon covered the various options for
legal structures such as LLC’s and what dictates
the best choice – a decision tied to the kind of
lifestyle you want to have, tax considerations and growth
potential.
Bayme
recommended that you not use friends as development
partners as the end result is often that you are no longer
friends and you are not making money! For successful development experience
is a far more important parameter.
Mulligan
discussed the circumstances under which a joint venture
makes sense. Those could include situations where a domain
is a must have but cannot be purchased because it is
either too expensive or not for sale. It also makes senses
when your partner’s content is more effective than yours
and when you have a need for cost predictability. |
Chris
Mulligan
RBC Capital Markets |
The
Wednesday luncheon was hosted by another new T.R.A.F.F.I.C.
sponsor, SnapNames.com. Company Vice Presidents Mason
Cole and Nelson Brady each took a turn at the podium to
talk about the popular expired domains auction service that has
been a highly respected industry fixture since 2000. It was also a
pleasure to meet SnapNames Chairman and CEO Sudhir Bhagwan
who was attending his first T.R.A.F.F.I.C. Conference. Just about
every domain owner in this business (including me) has used
SnapNames to make key portfolio acquisitions.
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Copyrighted
photos - photos may not be reproduced
without written permission. |
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SnapNames
Vice Presidents Mason Cole (left) and Nelson Brady (right) |
I
also spoke during this luncheon to bring the audience up to date
on the latest industry sales trends. I leaned heavily on some new
research from Sedo’s Matt Bentley that studied sales
data from DNJournal.com combined with Sedo’s own sales database
(including many sales that have not been released due to non
disclosure agreements). That sample reflected a huge increase in
sales activity in the year ending Dec. 31, 2006. Both the number
of reported sales and the dollar volume of those sales doubled
in that 12 month period with the total value of reported sales
soaring from $50 million to $100 milllion. Since reported
sales are only a fraction of the overall market, we believe one
could reasonably assume that the total market is 5-10 times higher than
that $100 million figure from Bentley’s data sample.
|
Ron
Jackson, Editor/Publisher
DNJournal.com |
The
average sales price of domains sold only at Sedo increased
from $1,500 to $2,200 in the past year. When you
add DNJournal’s sales data to the mix, the average price
jumps to $3,881 but that number is skewed higher
because we do not track sales below $1,000. If we did, it
would pull the average number from the combined
sample closer to Sedo’s average price. Bentley said Sedo
enjoyed a 60% increase in sales revenue over the
past year, a number that we would guess many other popular
venues approached given the exceptional health of the
market.
.Com
remains the dominant TLD, accounting for 73% of
all reported sales volume, however that is down from 81%
in 2005 as investors appears to be looking for additional
profit opportunities in new and untapped markets. Bentley
said the biggest increase in these non .com categories was
in country codes such as .cn (China), .ca
(Canada), .it (Italy), .se (Sweden) and .ch
(Switzerland), to name just a few. |
After
lunch, the final seminar session for this edition of T.R.A.F.F.I.C
was held with Mark Van Dyke and Alan Warms returning
to the dais to join Brian Benko of NoParking.com in
a discussion of development successes and failures (and how
to obtain one while avoiding the other). Van Dyke said the success
of his Army.com could be attributed to these factors;
self-funding, open source applications, slow growth and strategic
relationships.
|
Brian
Benko
NoParking.com |
Alan
Warms
ParticipateMedia.com |
Warms
advised developers to concentrate on a good user experience and
understand that it takes time to build up traffic. Don’t expect
to make money from day 1. He also cautioned against overspending
for website design – citing $5,000 as a ceiling he
doesn’t think is necessary to exceed.
Benko
said that once you make the decision to develop, get the site live
as soon as possible so it can start getting indexed by the search
engines. Don’t worry about fonts, colors and assorted design
issues that can be tweaked along the way. Benko also thinks that
for your first projects you should work with a local designer that
you can stay in close contact with. Once you have defined your
needs you can consider cutting costs by moving your development
work offshore.
With
that final seminar in the books, it was time for what has become a
marquee event at T.R.A.F.F.I.C. – Moniker.com’s live
domain auction. Veteran auctioneer Joel Langbaum was again
flown in from Florida to direct the action while Moniker CEO Monte
Cahn helped spot bidders from the dais. Other Moniker crew
members were stationed at floor level around the 13,500 square
foot hall to make sure bidders were seen.
Auctioneer
Joel Langbaum (left) calls the action
as Moniker CEO Monte Cahn spots a bidder in the crowd
When
the dust had settled $4.3 million worth of domains had been
sold and the percentage of names sold was an all-time record,
hitting 67% - approximately double the success rate
from the T.R.A.F.F.I.C. East auction in October. That indicates
that Moniker is getting better and better at identifying names
that will sell (and that have reasonable reserve prices) with each
event they conduct. The absence of a 7-figure sale (like the one
of Cameras.com at $1.5 million at T.R.A.F.F.I.C.
East) brought the auction in a little under the record live
auction total of $4.7 million in sales at T.R.A.F.F.I.C.
East.
There
were however seven impressive six-figure sales, led by Families.com
(a developed website business) at $650,000, Greeting.com
at $350,000 and Blogster.com at $275,000. Settlement.com
went for $200,000 while the other three that cracked the
six-figure barrier were all two-letter .coms; ET.com ($225,000),
OL.com ($150,000) and PX.com ($120,000).
There
were also some strong sales in the .mobi extension topped
by RealEstate.mobi at $85,000 and
Casinos.mobi at $52,000. You can see a complete list
of all of the winning auction bids here.
Bidders
track the action at the Moniker.com Live Auction
An
online silent auction was also conducted in conjunction
with T.R.A.F.F.I.C. West and that event went on until the evening
of March 14th. The silent auction yielded another $1,188,646 in
sales, making the combined total for the live and silent auctions
just under $5.5 million. That is a new record for
the combined auctions, eclipsing the $5.3 million in sales
done during the live and silent auctions at T.R.A.F.F.I.C. East in
Hollywood, Florida in October.
| After
the live auction, everyone headed for a networking cocktail
party sponsored by iMonetize.com and Domainer’s
Magazine (a new print publication being produced by
iMonetize chief Jerry Nolte).
The
party segued into a closing dinner sponsored by Klickerz.biz
that featured fare worthy of the T.R.A.F.F.I.C. name with
each plate graced with filet mignon, lobster tail and a
chicken breast. The desserts were also exquisite which
explains why you will see no T.R.A.F.F.I.C. attendee
anywhere near a set of scales this week!
After
detailing his PPC company’s unique co-op model, Klickerz
founder Fin Lemonde presided over some nice prize
giveaways and some special treats. One of the nicest was a
live performance by Klickerz customer service rep Emily
Anne (Emme for short), who happens to be an
extremely talented singer-songwriter that we expect you
will hear much more about when the music industry inevitably
steals her away. You can sample her music now at Emme's
MySpace page. |
Klickerz
founder Fin Lemonde |
Emme
Rocks!
That
brought the curtain down on another very successful T.R.A.F.F.I.C.
conference, though there was an informal breakfast Thursday
morning for those who stayed over Wednesday night. T.R.A.F.F.I.C.’s
Board of Advisors (who are elected by T.R.A.F.F.I.C. attendees at
the East show each fall) also met Thursday morning. That group
makes suggestions on future show themes, seminars and locations.
T.R.A.F.F.I.C. West will return to the Venetian in Las Vegas in
2008 (dates not yet announced) but the 2008 T.R.A.F.F.I.C. East
show may move from South Florida to Orlando. Of course,
there are still two shows to go on the 2007 calendar – New York
City in June and T.R.A.F.F.I.C. East in a return engagement at the Westin Diplomat
in Hollywood, Florida
October 8-12.
Hats
off again to T.R.A.F.F.I.C. co-founders Rick Schwartz and Howard
Neu. By pioneering the domain conference space and maintaining a
consistent level of excellence you have been the catalyst for this
industry’s spectacular rate of growth over the past three years.
As always, Alina Schwartz and Barbara Neu deserve
a special thank you for being such wonderful hostesses and making
every T.R.A.F.F.I.C. attendee feel welcome and right at
home.
Alina
Schwartz (left), Ray Dillman and Barbara Neu (right)
I
have been remiss in not singling out Barbara’s son, Ray
Dillman, for special recognition before now. Ray has also
worked quietly behind the scenes to help make every T.R.A.F.F.I.C.
show a success. He has clearly inherited his mother’s “people
skills” and I will guarantee you that this intelligent and
athletic college junior will be a huge success when he
moves into his chosen career. Ray has his eye on the FBI
Academy and I wouldn’t be surprised to see him running the
agency one day!
So
another one is now in the books. Next stop – New York City.
We hope to see you in June when T.R.A.F.F.I.C. makes its first
stop in the Big Apple!
*****
Wait!
There's More! See Our T.R.A.F.F.I.C. West 2007 Photo
Gallery!
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