Are Product Domains Dead?

I’ve been hearing from a lot of product domain owners lately that they can’t seem to make much money now that Google lists major brands and actual products above-the-fold in their search results. People have been coming to me asking for development and monetization tips and I have no advice, I’m not a product domains guy! While years ago (or even last year in the case of some products) you can find solid product domains in position one, two, or three in Google, those days seem to be numbered or completely gone in some cases.

Let me give you a few examples. Suppose I wanted to make money selling “mens jeans” well then I couldn’t think of a much better domain to do this on than MensJeans.com. Let’s take a look at what Google shows when I search for this term:

mens_jeansYou can click on the image above to see the full-size image or just do the search yourself. What I see is three ads dominating most of the space followed by a list of related searches all showing major brands and then, finally a domain name – oh wait, it’s another brand, Gap. What if I scroll a bit further down? Well then I get some ads for mens jeans for sale at major brands along with photographs of the jeans themselves.

Let’s look at another example, in this case let’s say I’d like to buy an ice cream maker, here’s what Google gives me:

icecream_makerOnce again you can click to enlarge this. What I see here is a list of brands and then a nice set of photographs linking me directly to the sales page of a store nearby. Below that I get probably the biggest brand in the business – Cuisinart, followed by the online shopping giant Amazon.

Let’s try one more – how about the super-hot market of laptops. Here is what Google shows:

laptopsAs you can see there are two ads at the top, followed by the related searches area, then you have a huge brand – Best Buy, and then the shopping results with images and ratings along with easy ways to find these at stores nearby.

Since about 80% of the search traffic goes to everything listed above-the-fold it is pretty clear to me that unless you are building or running a major brand, you probably won’t be found. Now this doesn’t mean there is no hope – if you build a huge business and invest millions of dollars you can win in the new product game. Take a look at RunningShoes.com – this domains sold for $700,000 earlier this year and I’d imagine the buyers are sinking a lot of money into building a major brand here. While they aren’t yet above-the-fold on Google yet, in due time I’m sure they will be…but it takes a major investment to make it happen, it takes building a business on the domain not just parking it or putting-up a quick and dirty affiliate store.

However what happens to the average Domainer? Honestly, I’ll stick my neck out here and say, unless you’re willing to build a major brand on a product domain, I think the market is dead. If you’ve got a million bucks you can still do it however if you’re buying a product name through an expiry service or for a few thousand bucks and hoping to park it or build it out for $1,000 I don’t think you’ll be making much money.

To make thousands of dollars a month you need tens of thousands or hundreds of thousands of visitors, and if your domain is stuck below the fold this can be hard to do. So what do you think? Am I crazy? Are product domains still hot, or has Google killed them by pushing them a bit too far down the page by giving preference to big brands?

Since I’m not a product domain guy I can only go by what I see in Google and what I hear from blog-readers who email me with their experiences. If you’ve had some great success with a product domain – I’d love for you to comment and share your experience. If you’ve had a major failure feel free to share that too. I’m not claiming to be an expert here by any means, I just know that as someone that searches for products on Google quite a bit I’ve noticed that major brands now seem to own the above-the-fold real estate in just about every niche.

As usual this blog is not a one-way street, I want to hear from you! Comment and let your voice be heard!

{ 26 comments… add one }

  • Snoopy May 30, 2011, 6:24 pm

    This should be very good news for those running proper ecommerce sites, in terms of getting items right on Google like that. Bad news for those with affiliate sites and MFA.

    Reply
  • James May 30, 2011, 6:50 pm

    @ Snoopy
    As Morgan said, even you are running proper ecommerce sites, you have to have a large budget to compete with the big brands. That is hard. I agree that it is bad for product domains and for those small players who want to use search engine to sell their products, no matter they have product domains or not. SEO will be much more difficult for any product websites.
    However, there have been other channels than SE now and I think people will explore those. For example, they will use social media like facebook more.

    Reply
  • Bill May 30, 2011, 8:09 pm

    Google is starting to look like the old AOL . Why do I need them to show me only huge brands I already know? I can go to Amazon or Bestbuy myself . Google can declare war all they want on domain owners and small business, but both will still be relevant when Google is just a bad memory .

    Reply
  • Snoopy May 30, 2011, 8:54 pm

    “As Morgan said, even you are running proper ecommerce sites, you have to have a large budget to compete with the big brands.”

    //////////////

    Well you do need to be able to profitably convert paid traffic, if a small site can’t do that then I’d say it isn’t viable long term. Relying on free traffic isn’t a good business model for an ecommerce site.

    Reply
  • Adam P. May 30, 2011, 9:04 pm

    I would have to agree with you Morgan, I saw these changes way back in the Vjnce updates (I was doing SEO work for a satellite Internet reseller that once outranked the actual brand until the update. No major changes to either site but it was like a light switch was flipped.

    In a way it does make sense because it’s peoples natural tendency to tie a brand to a product (that’s the actual purpose of branding btw). So home security = ADT. Also a lot of it is derived from user feedback ….Google is buying ISP data and seeing data on you visit to Gap vs your visit to Adams-Blue-Jeans.com

    Doesn’t mean you can’t survive though, here is a good equation for how to win:

    Solid Domain + Worthwhile Content/Unique Business Value Proposition = Victory

    Reply
  • Rob Monster - Epik May 30, 2011, 11:23 pm

    Interesting thread.

    In my view, HayNeedle, CSN Stores, and Quidsi (aka Diapers.com) blazed the trail when it comes to using domains as branded destinations that leverage descriptive domains. The logical projection of that established online retail success formula would be further hyper-segmentation of retail , extending ultimately to as many as 100,000 unique categories of products.

    As for Google and Bing, they are increasingly become “Decision Engines”. They are giving the consumer a reasonable answer to their query. As content and data become more and more structured, the case can be made that Google is every bit as likely to give the definitive answer to a growing array of queries. This would include providing consumers with a directory of places where they can buy a particular product that they are searching for, and quite possibly getting paid for the resulting click to those retailers.

    In other words, product domains that exclusively present affiliate feeds have limited value to search engines when they themselves can package similar affiliate feeds of comparable quality, and in the process eliminate one degree of separation between the search engine and site where a purchase transaction can occur.

    At Epik, we remain highly bullish on product category domains, and have been buying more on a daily basis, mostly on the drop. In parallel, we have been working on a few other enabling developments:

    1. Better ability to combine content and commerce. See Candida.com for an illustrative example of this emphasis on content WITH commerce. Many more examples to come. This site is already on page 1 of Google for a highly competitive term.

    2. Cost-effective transaction clearing. It is not economic to maintain 1,000 merchant accounts. Our upcoming release of MasterBucks.com will be a step in the direction of providing a no-fee PayPal alternative that will work anywhere in the Epik network.

    3. Increased community engagement. We are working on content tools that drive more engagement from users and editors who wish to engage with the sites that we host. This turns these sites into genuine destination sites with social value and editorial substance.

    So, long story short, we at Epik are still big believers in product category domains. The transition to scalable micro-commerce will not happen overnight, but I am absolutely convinced that this is where the internet will allow us to go.

    Reply
  • Attila May 31, 2011, 4:38 am

    I just bought a product domain recently (USBmemoryStick.com) for $3,000+ NOT as a domainer but as an end user with plans to develop / operate a small e-commerce site, selling just that, memory sticks.

    Later I found out Morgan Linton owned the domain and we had a good laugh how we’re good friends yet never knew who the buyer/seller was until after the transaction. The transaction took place through a domain broker (Toby Clements). When Toby sent the newsletter out, I saw the name, the price and stats…just had to have it :-p

    I am big in product domains (specially electronic domains) and I can tell you, they usually convert well from direct navigation visitors. Visitors from organic search hardly convert as they’re still in research mode or comparing prices or whatever reason. And for anyone running an actual business, chances are they will have Adwords or some other kind of marketing to help balance out targeted prospects.

    Hate to say it, but product domains are truly “only” beneficial to an end user. Domainers can benefit from flipping the product domain OR just dealing with the low conversions and payouts via the platform they’re using to monetize the name.

    Reply
  • DRASK May 31, 2011, 5:46 am

    I happen to agree with Morgan. I saw way back that it would be very hard to compete with big business in the Products category. I believed that a better bet was to compete in the Services category and target the local level. This still remains my focus with a portfolio of hundreds of domains in this category. There are few national brands competing here, and it’s still possible to achieve a high search engine ranking.

    Reply
  • Anders May 31, 2011, 6:18 am

    Runningshoes.com is #1 on international google on my screen for runnings shoes #2 for “running shoes”. Even if google tips the scale in favour for the more profitable “brands”, a good descriptive name of a sought after product will be in demand still. Just don´t overdo it on the “easier attainable first spot” pitch. That no longer holds water. Morgan: if you´re not in to product domains, what are you in to?

    Reply
    • Morgan May 31, 2011, 6:33 am

      Great comments everyone!

      @Anders, since 2007 my focus in the industry has been generics and keyword domains.

      Reply
      • Morgan May 31, 2011, 6:36 am

        Also it would be great for someone to share an example of a product domain they own that make a good income, let’s say above $1000/month – any examples?

        Not trying to insult product domains by any means, I just honestly don’t know anyone making over $500/month with a single product domain but I know TONS of people making over $2,000/month with a keyword domains…

        Reply
  • Lennard May 31, 2011, 7:03 am

    Unfortunately I can’t help you out there Morgan, I have none 🙁 I so wish I did.

    Reply
  • Anders May 31, 2011, 7:28 am

    So. “runningshoes.com”. Is that a product domain, a generic, or a keyword domain. I must admit I’m confused. To me its all of the above.

    Reply
    • Morgan May 31, 2011, 7:59 am

      @Anders – RunningShoes.com is a great example of a brand done right on a Product Domain. They invested $700,000 into the domain and are most-likely spending hundreds of thousands of dollars building the brand if not million – this is what it takes to build a successful product domain. For Domainers I think what Attila said is spot on, the way to make money would be selling to end-users but there’s not much money in development and monetization unless you have a million-dollar budget like RunningShoes.com does.

      As for what RunningShoes.com is, it is a Product Domain which means a domain name that describes a particular product. A generic would be something like Running.com which is a generic word that does not describe a product – other generics are things like Bounce.com, Happy.com, Building.com, etc. Some examples of product domains are – Toasters.com, Shoes.com, MensJeans.com, Shirts.com, etc.

      Reply
  • Warren May 31, 2011, 8:36 am

    I disagree. When I first bought Bobbleheads.com I spent about a week putting up a quick off-the-shelf shopping cart system – and surprise, after about a couple of weeks Google had us listed in the #1 position. That was despite ZERO SEO work, and after the name had been parked for years.

    We didn’t spend “millions”, we didn’t even spend $1 on SEO tweaking in the beginning. We just had a developed site with unique content that was an exact match keyword domain. Google found the site, thought it was a great match for the search term, and placed it accordingly.

    And isn’t that the way it is supposed to work? Google is intended to provide the best match for a term, and in our case, that’s what it’s doing.

    Reply
    • Morgan May 31, 2011, 8:40 am

      Thanks for sharing @Warren – great example!

      Do you think this is because of the size of the niche. For example if you owned Jeans.com or Shirts.com do you think you could have followed the same process?

      Also if you don’t mind me asking, is your revenue in the $xxx-range or $x,xxx+ range?

      Reply
    • Morgan May 31, 2011, 8:45 am

      Just did a quick search comparison for exact-match volume: Bobbleheads gets 8,100 exact match local searches – could the size of the market also be impacting this?

      Something like Running Shoes gets 60,500 exact-match searches, or Leather Jackets which gets 40,500 searches are probably much more challenging to rank well for vs. product categories that get below 10,000 exact-match searches.

      Interested to better-understand what kind of revenue you can make with Bobbleheads.com – it definitely is a product category but I’m not sure there’s a six or seven-figure business in there like there is with Running Shoes or Leather Jackets where the big brands own the space…

      Reply
  • Mike May 31, 2011, 8:51 am

    I would never build out a brand that relies on Google for my traffic.

    Basically Morgan, you are seeing what I have been saying for years. Organic search will disappear. I see the whole first page having paid spots for commercial searches and organic pushed to page two. They already have a beta site they are working on where everything is paid on the first page.

    Folks had better start learning to build for their customers and not worry about getting indexed in Google. They need to start forming traffic networks elsewhere. It’s either now or later once Google forces the issue.

    Reply
    • Morgan May 31, 2011, 8:57 am

      @Mike – excellent point and so true! It’s all about customers, I think a lot of the people that built for Google or have relied on Google are already seeing how that easily that can all fail, and quickly! I think Social Media is going to be one of the keys to success for brands now and in the future.

      Reply
  • Warren May 31, 2011, 9:18 am

    I’m not going to disclose private data here, obviously. But there are companies in this industry who are currently doing 8-figures per year in sales, so these are invalid assumptions about the revenue opportunity.

    Back to the original point – product domains are not dead, and are still as valuable as ever. They just have to be developed properly in order to take advantage of their full potential. I think that’s the real point.

    Reply
  • Robert Janes May 31, 2011, 12:56 pm

    @Warren – I think you are right in saying that it is how they are developed that makes or breaks a site; which is what Morgan is saying as well. We always need to remember that the internet is microcosm of spaces and that the space for Bobble Heads is different then the space for Men’s Shirts or Brown Dress Shoes. This also may be where the long tail comes into play.

    If a site about Men’s Jeans does not rank well for “mens jeans” can one still build significant traffic on the bottom 34% of traffic keywords (1 Stdev)? Even with the Google keyword tool and such, 30% of Google queries are unique. Is there a solid methodology to build traffic on the unknown?

    Reply
  • Afif May 31, 2011, 8:03 pm

    @Morgan – Regarding your statement “While they aren’t yet above-the-fold on Google yet, in due time I’m sure they will be…but it takes a major investment to make it happen, it takes building a business on the domain not just parking it or putting-up a quick and dirty affiliate store.”

    RunningShoes.com is currently sitting for the first place about
    “running shoes”

    Reply
    • Morgan May 31, 2011, 8:33 pm

      @afif – over a year ago Google changed their results based on who is searching – so what is #1 for you could be #15 for someone else. The only way to know the average position is to use Google Webmaster Tools.

      RunningShoes.com is absolutely an example of a product domain done the right way and in my opinion does shows how a $700,000 investment plus several hundred thousand dollars in development and marketing can make a major brand.

      Reply
  • Stephen Douglas June 1, 2011, 7:06 am

    Hi Morgan,

    As usual, I agree with “Mike” (and I’m not sure which “Mike” I’m agreeing with in this biz).

    You are going under the assumption that your domains require “google” to set their value. In fact, over 70% of domain buyers think that Google is their “ticket to riches”, and lots of them buy into the Domain King’s slobbering promotion of this.

    This is clearly wrong. More money has been made in the SALES of domains to other parties, usually end users, than any money totals made from “parking”. The point is, the only domain worthy of it’s maximum value is the one that can be sold to an end-user that will implement it as a “product domain” (meaning “generic descriptive). If you’re dealing with marketing directors who don’t understand this process of “backbranding”, then you’re not educating them well-enough.

    The truth is that most “google” domains punching out the big returns are typos and TMers that are still skirting the sheriff. Anyone with a power domain name, or one word naturals, will have figured it out already that it’s better for them to build out the domain than “park” it, even at Frankie’s new parking service. That service is good for about 100 -200 domainers who got into the typo domain hunt years ago.

    The big problem for typo power domains is that you can’t “build them out”. Hence, rush like your ass is on fire to the Domain King’s slobbering over Frankie’s service.

    However, if you are buying domains to RESELL to companies that will use them as backbranding domains, a little buildout gives the potential buyer a “scare” because they can see the potential from the opportunities you provide them as “hints” on how that domain can promote their company and their prodservs.

    Truth be told, the enduser sale, even on a clearly definitive prodserv domain that doesn’t get a lot of traffic, is more valuable to the enduser as a backbrand (or “product domain”) than continuing to try to muscle and wiggle your way into getting payouts you deserve from Google. Oh, and don’t forget trying to get decent placement, money spent on SEO, blah blah blah…

    Attention Domainers: Selling your domain as a backbranded domain is a better investment in the terms of time and ROI than eeking out a monthly payout from non-transparent SE adlinks. Beyond that, it’s smarter to BUY PRODUCT DOMAINS than it is to try to figure out Typos and TM domains for purchase, how long they’ll last before they’re taken from you, and your feeling of parasitical delight making money off of misspells, even if the source of your revenue comes from a company that doesn’t reveal how much your domain name link made for them.

    HOW TO GET RICH OFF OF DOMAINS (don’t take my word for it, ask the Domain King and any domainer to compare their yearly revenue from parking compared to their yearly revenue from domain sales — which one do you think comes out way ahead?

    So here’s the simple process:

    1) Buy a domain name that represents exactly a prodserv that exists or will exist
    2) Put some simple relevant content on that domain so that it doesn’t look like those lame landing pages.
    3) Organize the domain industry as a unified force that wants to educate all businesses that the basic “Hero” domain purchase of “baby.com” by J&J a decade ago has proven to be the most valuable investment any company has ever made for a marketing technique.

    Let companies know why domains are essential marketing assets they NEED to own before their competitors.

    If you have a nice generic descriptive domain, consider having it developed, and investing in it’s buildout just like a store owner would do.

    cheers,

    Stephen Douglas
    BLOG: http://www.Successclick.com
    Successful Domain Management™
    http://www.TitleDomains.com
    “Own Your Competition™”

    Reply
  • Adam June 1, 2011, 10:54 pm

    “Also it would be great for someone to share an example of a product domain they own that make a good income, let’s say above $1000/month – any examples?”

    On ppc ? or generally ?

    For product domains , I think Warren’s example works well because there isn’t a strong brand contender in the mix. Branding makes people think like this “I need new running shoes . . . they type in Nike.com or Reebok.com etc. Billions of dollars have been invested to get that action . . . and it translates online too. If you think I need a gift , 1800flowers wants you to think of them. . .more branding. There’s lots of brand campaigns that make product specific domains hard to compete against brands and bigger stores (that also get in on the branding game) . So you think I need cheap running shoes and you think Target.com instead of runningshoes.com. Brands have the spend and the reach to eat away certain domains cachet imho.

    If you say I need a bobble head, there’s no brand that most people would click with so the natural thing people would do would be to search or type-in. I’d say to look for a product or niche that isn’t overly dominated by huge brand campaigns. . . .kind of like the previously mentioned CSN stores, etc. If you are buying a bar stool you aren’t likely thinking I need a “xyz brand” you are looking for a style or color or the right price. Dartboards, patio umbrellas, deck chairs, garden tools, . . . etc.

    I think with niches like these, if Google has no brands that are clearly dominating, the natural thing would be to rank a large seller of the item and this could very easily be the generic keyword domain. I’m no SEO guy. I think I agree with Warren that product domains are still hot but only the right ones. . . . . It’s just like any kind of domain. You have to dig in and learn more about the product, competition, etc.

    Reply
  • patrick June 13, 2011, 9:28 pm

    Welcome to the soon to be semantic web if G and the broadcasters and big corporations have there way just like the old system,remember cable tv.

    Reply

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