Domaining MBA Monday: The Great Divide Between Domaining and Monetization

The Great Divide
Domaining MBA MondayI used to think that monetization was a subset of Domaining. Now, as my business has matured and I’ve had the time and experience to sort things out I see more and more how different development and monetization is from pure-play Domaining. I have also now seen hundreds of Domainers fail at development as well as plenty of developers fail at Domaining. The point is, these are two different fields and thinking you can do both, all by yourself is relatively unrealistic once you’re scaling a six-figure business.

Yes, if your goal is to make $1,000 or $2,000/month you can mix the two, but once you’re looking for a growing sustainable business model it really is one or the other. If you look at people who are running websites that generate tens of thousands of dollars a month, they typically aren’t also buying and selling domain names. The same is true when you look at a big domain portfolio holder, they aren’t typically building out site after site that’s making big money every month.

So let’s talk about Domaining.

This is Domaining MBA Monday so the focus here is the business of domain names. Like I said above, I used to think this was a combination of developed sites and domains that you buy and sell. While some veteran Domainers can do this (and a few have really kicked-ass at it!) most need to focus on one main income stream and that is selling domains. If you have over 100 domains in your portfolio, face the music, you’re not going to develop all of them or even most of them, if you want to create a consistant cashflow you’ll need to be selling.

Most of the Domainers I know who make a few hundred thousand dollars a year or more generate the bulk of their income from sales. Some do it with many little sales, others with a few big sales, but almost none with 10 sites making thousands of dollars a month each. To put it bluntly, stop dreaming the impossible dream, mass development didn’t die, it really just never existed as a revenue model at a higher level.

So let’s talk about Monetization.

Putting a website on a domain name, sending traffic to it, and finding creative ways to generate revenue is a great thing, heck it’s down right entrepreneurial. But let’s be honest, it’s not Domaining. Yes, the domain may get you somewhere but it takes a lot more than a great domain to generate meaningful revenue. You need a business plan, a solid team, and a model that is built for growth. I’m all for monetization whether you’re using Google Adsense, Affiliate Ads, or Lead Generation there are people making big money in the monetization space, but they’re not Domainers.

Here’s my point.

There is a great divide between Domaining and Monetization. Monetization really falls in the world of web development and Domaining is much more in the world of speculative investing. Trying to do a great job at both isn’t possible all by yourself. If you’re a one man (or woman) band you’ll need to focus on one thing and really hit it out of the park. Far too many Domainers have hundreds of domains and their long-term strategy is to develop each one. Stop dreaming, here’s your reality check, if you can’t sell them, you sure aren’t going to develop them all.

If you’ve got the development bug, pick one and really make it happen. Know, however that this will take your eye off the ball when it comes to buying and selling domains. You can’t do it all and if Domaining is what you want to do then your time should be spent finding solid buyers for your domains not building a website.

As time goes by you can always hire people to follow a working business model you’ve perfected, that’s what I did and it’s allowed me to pull myself completely out of my business. Until you do that, you need to stay focused and decide how your business is going to make money, then do it and don’t look back. Just remember, to start your business will make money either selling domains or monetizing one or two websites, but it’s unlikely and unrealistic to expect to be doing both.

Photo Credit: tj.blackwell via Compfight cc

{ 8 comments… add one }

  • Mike July 1, 2013, 8:15 pm

    You mention you hired people to follow a working business model, is this for your domaining, or development? Can you explain this further?

    Reply
  • Louise July 1, 2013, 11:48 pm

    “to start your business will make money either selling domains or monetizing one or two websites, but it’s unlikely and unrealistic to expect to be doing both.”

    It may be a divide, but it shouldn’t be! In fact, among the domainers community I find the marriage which is most satisfying that domainers usually dabble in the development of at least a couple or handful of their domains – look at Mike Mann! Look at Berkens! Look at Silver! I like they have a few developed sites which are businesses. I always thought of you in that category.

    Then there is me with development skills. Moving forward, even if my hobby is developing, my brush with domain culture made me switch gears from developing on a three-word hyphenated dot com to a two-word dot tv, branding on dot tv.

    Reply
  • Morgan July 2, 2013, 5:17 am

    @Louise – what I’m talking about in this article is mass development, I have always found great results turning domains into real businesses, but haven’t found a way to scale this to hundreds of domains. Elliot, Michael, Frank, etc. also don’t do mass development, it’s all about being realistic with your goals.

    My Domaining MBA Monday post is for new investors that oftentimes are running their business on their own. Once you expand and hire more people you can do more and build-out some of your best names.

    The point is that far too many investors try to build a business that does ten different things, even though they only have a few hours during nights and weekends to devote to it. At the end of the day it’s all about focus.

    Reply
  • Cate July 2, 2013, 12:28 pm

    Louise – would love to hear more about your developing/branding on 2 word dot tv s 🙂 I’m catecolgan @gmail.com – look forward to chatting 🙂

    Reply
  • em July 2, 2013, 12:48 pm

    A spot-on article about the pitfalls of splitting one’s time between two very deep subject areas. “Developing” and “speculating” are two totally different things altogether. Had success at both, in the beginning, until I realized that I couldn’t sustain both in a narrowing environment. Not enough time.”Speculating” takes a certain mentality and long-term perserverance. Web Development has a level of satisfaction domaining will never have. The results with persistent work are obvious. Not so obvious with domaining. Not to deride domaining, it has its merits. However, it has limitations. The standard was set a long time ago, with domaining. If one deviates, clearly you have to develop the name ie .tv, .co, .biz. But that means web development. Domaining, in quantitative terms, without development, is very narrow. There are only certain names that have value, everything else is speculative. Two different mind-sets, clearly.

    Thank-you, Morgan, for a great article. Runs true.

    Reply
  • Louise July 2, 2013, 12:59 pm

    @ Morgan, I hear you. With my little, whittled-down portfolio, the domains fall into mostly four niches of mobile tech: flexible display or bendy, dual screen, multi screen, and mobile dtv. Therefore, developing a couple of each, since they’re related, those represent the mini-network. It’s easier because they relate to each other: Multiscreen services, multi screen delivery, etc., which I haven’t started developing, yet. They are facets of a niche.

    Being focused instead of spread too thin gives grounds for an optimistic future, IMO. That is what future trend has allowed me -thanx @ Stephen Douglas!

    Reply
  • Louise July 2, 2013, 1:03 pm

    @ Cate, I emailed you – thanx! 🙂

    @em: “Development has a level of satisfaction domaining will never have.” Being I failed at domaining, it’s easy to agree! I think @Morgan is happier starting up a business and focusing on one thing, than what came before. Yet, what came before surely influences the present!

    Reply
  • Alan Dodd July 2, 2013, 5:23 pm

    I think it’s possible for domainers to develop a few well proven affiliate niches such as hotels/hostels/textbooks with web sites that require very little maintenance but run like a dream.

    The names simply must have decent traffic or else it’s a pure startup. I tried a lot of mini site development years ago and this was what I realised. The google fun is gone but its still worth it.

    As touched on earlier, development is fun, ESP if you get into coding. As for domaining, what is it?

    It comes down to sifting through mud – literally thousands of names – looking for a nugget of gold! It’s a grind, grind, grind all the way!! If you didn’t do some dev, then maybe all domainers would crack up!

    Reply

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