12 May Top 10 Tips on Domain Name Reselling: Still a profitable Niche?

In my current rant about Domain Names, I wanted to discuss Domaining.  About 6 years ago, I made a $9 investment that turned into a sale offer of $10K.

Here is how it was done:

1. I always researched medical drugs and procedures. So I found a new procedure and hedged a bet that it would grow in popularity.
2. I purchased the name and built SEO value for the procedure’s keywords. I installed a readily available CMS via Fantastico (offers a 4 click installation that my 3rd grader can do).
3. I continued search engine optimization with addition of rich and keyword-dense articles. The seo value was high, and ranked within the top 3 for major keywords.
4. I watched analytics to see who was visiting and from where. I did reverse IP lookups to see what companies were looking at the site.

Amazingly, a major industry player was browsing and in those logs.

Some weeks later, an offer letter came from the Marketing department and after some back and forth, I sold out.

Here are some tips if you are interested in “domaining” or domain name investment. I personally have consulted with a intellectual property attorney for best practices.

• Do not cyber squat. There are actually respectable businesses that buy and hold domain names like real estate investors flip properties. Cybersquatting is the malicious act of securing a name with a malicious intent to resell to a rightful owner. In court, YOU WILL LOSE.
• Always use a generic name… unless it is your own.  Never acquire a name that is or could be the rightful property of an established trademark. Again, YOU WILL LOSE in court, if you had the funds to even show up.  A generic example would be tissue.com vs. trying to but kleenex.com
• Always try to buy the .com and/or the .net first. My sell of nearly 10K was a .net. The .com most likely could have been sold for double or more!
• Always be fresh on your landrushes. A landrush is when a new domain extension is released. Typically, the first days of a landrush are dedicated to allowing the rightful owners to prove why they should get the name… And then acquire it. After that period, the availability opens up to the general public and thus the ‘land rush’ begins.
• Make your purchases meaningful. Quantity is not necessarily better than Quality.  At one time, I had hundreds of domain names.
• Monetize parked domains. Find a way to break even on your purchase.  For example, if I have 100 domain names and each is costing me a registration of $10 per year, then I need to monetize each name by at least $1 per month to break even and have a few shekels left over.  Make a decent landing page with rich content and optimize the site for SEO. Monetize with Google Adwords or other contextual ad systems. Find an affiliate product related to your product and post it.  The alternative is to use a domain parking company. They will host a page for you and some are setup to revenue share with you based on visits and click throughs.
• Track visitors with analytics.
• Place your contact information on the sites for easy access for potential buyers.
• Register with a reputable Domain Registrar.  They will hold and allow you to manage your names.  The last thing you want is for them to go out of business when a wise decision could have been made upfront.  Consider becoming a domain registrar reseller yourself.  This way, you can buy names wholesale.
• List unused domain names in domain name market places.  Godaddy.com has one.  Check this out as a way to promote your names to those who are looking.

Overall, the domain industry still offers a profitable business model. There is much more competition now for names and even the registrars are in the game by reserving special names with boosted pricing.

Keep your eyes open for that Gem… It just may pop in front of you.