Click To Hit

We launched the referral program over at SharedReviews yesterday. It’s pretty basic to start, everyone who signs up and references an existing member earns a free review credit which is worth about $2 each. The person who was listed during the signup receives a great bonus themselves, earning up to 4 review credits ($8) when their referrals achieve certain milestones of approved reviews themselves. Specifically:

* 3 Approved Reviews = 1 review credit
* 10 Approved Reviews = 1 review credit
* 25 Approved Reviews = 1 review credit
* 40 Approved Reviews = 1 review credit

We’ve also launched some buttons that people can use on their site. When someone clicks on any one of them, the sign up page locks the user name of the account that generated the button so make sure you login and get your own button code. Since I don’t want to earn any referral credits for my own account, I figured I would reward our top 3 reviewers by placing their nicknames behind the sample buttons below.

Here’s the Button:

Here’s the Banner:

Here’s the Medium Rectangle:

After spending several years catering to it, I still closely watch what’s happening in the domain aftermarket. In the last couple of days there’s been a flurry of activity from a Business 2.0 article on Kevin Ham by Paul Sloan. I think the article’s great since it gives some well deserved credit to Kevin and Colin for the fantastic domain empire they’ve built over the years. Although I never had the opportunity to interact with them directly, I’ve been afforded many an insight into how savvy these guys are from a few of the competitors they and I both dealt with over the years.

An interesting thing occurred since that article was posted, the overwhelming focus seems to be a public backlash on the deal they did with the Cameroon government to wildcard the .CM CCTLD. What this means is that any traffic that goes to an unregistered .CM domain (such as sharedreviews.cm) resolves to a page with advertising hosted by these guys out of Vancouver. Although I won’t comment on the brand infringement that could occur from .com domain typos that I find unsavory, overall it was a shrewd business deal and one that I’m sure many an individual are kicking themselves for not thinking of first.

To me, the biggest benefit in the article is the exposure of the light side of the Direct Navigation search market. With our new startup, companies like Marchex, Hitfarm, Demand Media, and many others who are looking to develop their domains into microportals are great targets for us to license content from our startup in order to generate additional lucrative revenue streams for our community. Take a look at a post I made on our startup blog yesterday that touches on the power of product reviews, and what they can do for anything from ecommerce providers, to corporate sites, or even microportals such as those that Kevin, Marchex, and Demand Media own.

In either event, maybe Mark is right… this may have more to do with reader political affiliation than any real issues with these guys directly

I have to say that the conference is very well attended, from Entrepreneurs to Investors to Services Providers, right down to a ton of Enterprises all looking to leverage the “user revolution”. I would estimate almost three thousand attendees have come here from around the world, and even though some of the sessions were a little disappointing from a content depth perspective, we’ve acquired some valuable learning and the networking has been amazing so far.

To our surprise we’ve run into quite a few domain professionals here at the conference. It’s refreshing to be able to connect with these contacts in a non domain centric environment and talk about some of the stuff they’re working on in terms of integrating a little “web 2.0 sprinkle”, as Richard Rosenblatt likes to call it.

The keynote yesterday was a little disappointing since it appeared to be more of a pitch on Amazon’s new development services, but it was pretty cool to watch Tim O’Reilly poke Jeff Bezos over the Alexaholic incident in front of such a huge crowd.

Today’s keynotes were much better. There was some fantastic data analysis from Dave Sifry of Technorati and Bill Tancer of Hitwise on traffic trends, new site growth, and the health of the blogosphere. Also, there was a great interview with Eric Schmidt where they delved into everything from Google’s new presentation addition to their docs and spreadsheets family straight to comments on the recent Double Click acquisition.

That’s about all the time I have to blog for now, but hopefully I’ll be able to do a more in-depth write up once I get back from the conference. In the meantime I’m going to lose myself in some more 2.0 goodness.

Wow, take a look at this:

On Domain Monetization

We note that there is a meaningful difference between Domain Tasting and Domain Monetization. Monetization is a straightforward arbitrage between the cost of domain registrations and the revenue from as much pay-per-click traffic as the domain owner can get from people who visit web sites in the domain. It’s a fundamentally sleazy business, since the web sites have no useful content and the way they get the traffic is basically by tricking people, either via typos or recently expired domains. More importantly, the presence of such website makes web-surfing by ordinary users far more difficult and confusing than they should be.

We do not think it is appropriate in this case to make ICANN as a regulator to watch and prohibit the Domain Monetization practices per se. Instead, on behalf of ordinary Internet users, we call upon those commercial enterprises such as Google or Overture to take appropriate measures such as to stop paying for clicks on pages with no content, thereby dealing with a problem that is not limited to typo and expired domains. We’ve seen click arbitrage, people buying Google ads to drive traffic to pages that are simply other Google ads. This kind of self-generating traffic for pay-per-click advertising is confusing and unnecessary for ordinary Internet users and, in the long run, not healthy for the development of Internet as a whole.

Since Domain monetization is a relatively new phenomena, the impact to the ordinary users and the wider Internet community is hard to measure at this point. It seems clear, however, that it does not improve the user experience at all. We think it is worth to keep watching on how it develops and may seek for specific actions when we have clearer understanding of measurable impact.

I haven’t read anything in recent years that didn’t shock me with its ignorance and arrogance more than these three paragraphs. It’s obvious to me this group has no idea of the impact or value Direct Navigation brings to the search market or to Google and Yahoo’s bottom line. Direct Navigation is a true form of search; it’s a way for a user to find a search term through the address bar of their browser without having to wade through pages and pages of organic search spam to find what they’re looking for. Although Typo’s and Expired traffic is an exploited portion of the market that has ethical concerns that need addressing, it is a small portion and doesn’t come close to outweighing the benefits the larger percentage of true generic domain monetization pages bring to the search space.

Thankfully there are groups being put together to fight this ignorance …

I ended up heading down to the domainfest conference in the Hollywood hills this week, mostly because there are a few aspects to our new startup's business model that tie into the domain monetization market, but also because I knew it would be an opportunity to see all of the great people I've had the pleasure to get to know over my many years in the domain industry now that I’ve headed off on my own into a somewhat different vertical.

There were quite a few interesting sessions over the two days I was in L.A., but the one I found most intriguing was a keynote by Michael Arrington of Techcrunch fame where he touched on a synergistic convergence between what a ton of people are calling the web 2.0 phenomenon and the domain monetization space. Specifically, he cited the examples of what Demand Media is doing with a few of their micro portals, and how the learning from those efforts are fueling the hinted launch of a new Enom parking service that integrates social networking and user generated content sometime this year. Although Enom will more than likely require you use them for monetization in order to leverage this new platform, imagine if a new startup came out that offered something along the same lines which was also able to plug into any monetization provider you wanted? Well, enough hints for one day…

All in all the decision to head down was a big success. I received a ton of positive feedback on the little that could be divulged about our plans as well as lined up potential new partners and future customers for after we launch. 

With the largest attendance in history, the TRAFFIC Conference in Hollywood Florida was a great success both in Networking as well as Content. It was amazing to see how many new entrants and non-traditional participants were at this event, which is a testament to the ever increasing value this vertical is representing to the online advertising market.

Attendees included both large and small domain portfolio holders, multiple Registrars and Registries, representatives from Google, Yahoo and other top Search Engines, as well as tons of entrants from Internet Advertising and other verticals looking to see how their businesses can benefit from the high quality type-in traffic premium domains are providing advertisers today. For a more detailed breakdown of events take a look at Domain Editorial that offers more of a play by play take of the event.

Another record breaker was the LIVE Domain auction held the last day of the conference, where over $4.7 million dollars worth of domain names exchanged hands, most notable of which was the sale of cameras.com for $1.5 million to DirectNic Registrar. For a complete roundup of the auction results and prices take a look over here.

Although a little unexpected to me, Tucows was recognized as best registrar with the WADND Seal of Approval. I say unexpected only since we tend to be more of a higher priced domain provider with lower volume domain portfolio holders which are the majority of attendees at events such as these, but this recognition proves that our secure, stable, and feature rich domain services in both the reseller and especially registrar markets are an extremely safe and valuable offering in this evolving, growing, and maturing industry.

From Left (Tucows): Craig Hamilton, Peter Ejtel, Frank Michlick

According to the Register, It appears ICANN is set to vote on a PIR initiated proposal on allowing them to monetize the Domain Tasting process at $0.05 per taste.

For some time now, some registrars and their customers have been using the domain refund feature, which allows a registrar a full refund if a new domain registration is deleted within 5 days, to register domains in bulk and test for monetizable traffic before deciding whether the yearly registry fee was worth the continued registration.

PIR (The .org registry)  is claiming significant overhead facilitating these transactions on an ongoing basis, and although not willing to disclose specific numbers state that the vast majority of daily transactions are part of the tasting process. I have personally managed some projects for registrar customers of ours along these lines, and can personally attest that tasting in general is one of the major reasons why the number of domains registered in the top 3 TLDs has grown significantly over recent years.

I doubt the infrastructure overhead claim has much merit, but based on the fact that most if not all profitable domains have been registered, it does make financial sense on the registry's part to try and monetize what they can since all of this traffic is leading to a lower and lower percentage of monetizable registrations going forward.

The one thing I do not like about this is the clandestine nature of the review process for this proposal. I couldn't find many comments about it even though it was listed on the proposal page. We'll see what happens with the vote, but based on little or no discussion or commentary, I can not only see ICANN approve this proposal but also a quick turnaround from the COM/NET registry to follow suite.

With the Direct Navigation market significantly increasing year over year, today's domains that don't pass mustard may become profitable in the future, and IMHO the registries may just be shooting future business in the foot with this strategy.

I've been afforded the unique position of having spent the last 5 years of my career heavily involved in both the aftermarket and traditional domain industries. This background provided a unique perspective that allowed me the foresight to recognize the potential of .EU in the aftermarket early on when most if not all other TLD's hadn't even seen close to the level of growth as .COM.

The domain aftermarket is mostly driven by the mindshare and demand of Internet users, and for most surfers even today .COM is the only immediately recognizable TLD out there. It's no wonder then that when I asked Domainer customers of mine years ago if they were going to make a play for .EU when the launch was still in the rumor stages, most if not all stated they would wait to see how it would play out. According to SEDO, it seems to be playing out fairly well.

Now SEDO is of course incented to hype this market, obviously from a transactional perspective the more demand that can be drummed up, the more revenue they could potentially acquire on their platform, but I feel there are a couple of differentiating factors that should lead any investor to take a closer look at .EU where I'll point toward the somewhat tempered growth of the .INFO domain space as a learning example.

Back when .INFO was still going through landrush, there was allot of hype from the European market due it being the first unrestricted alternative to .COM. Combine this with the the fact the European market had somewhat missed the initial growth spurt of the Internet resulting in most “good” .COM's having already been taken by North American owners, and you can see why all of the excitement developed across the pond. With 5 years to mature, and a tremendous number of unique and even somewhat aggressive marketing efforts under the Afilias belt, .INFO still remains smaller than .ORG from a transactional perspective in the traditional market, with the occasional blip of a 5 figure transactions in the aftermarket. Why, you may then ask, has .EU already seen more domains registered than .INFO and aquired aftermarket transactions in the six figure range with less than half a year of history under this fledgling registry's cap?

in·fo (nf) 
n. Informal.

Information.

Info, an abbreviation that is prevalent and powerful in the west, but meaningless or rarely used in most non-English speaking countries, which leads to my answer… its all about Mindshare.

The .EU registry is riding on the tails of a massive educational and political campaign by most if not all EU members, which was designed to acquire buy-in from the population for the consolidation of the Union in the first place. Add this to the fact that the European market has been competing to catch up with North America on the Internet for a long time and you see how there would be a jump on this bandwagon of an EU based domain space that's meaningful to all yet also transcends any language barrier.

So, with this TLD you have mindshare through millions if not billions spent on marketing, a user base pining for an alternative to .com that separates them from North America, and combined addresses most if not all of the shortcomings of the INFO hype. A definite investment win in my books. 

Based on a Businessweek report, Google and Ebay have announced an exclusive deal where Google will provide all text advertising on Ebay International sites. This comes on the heels of a deal announced back in May between Yahoo and Ebay where Yahoo cornered exclusive advertising rights on their US based properties.

The key to this new announcement is the fact they are promoting the advertising medium of “click to call” which allows a surfer to enter their phone number directly into the ad itself, where the system will then call both the surfer and the advertiser and connect them on a conference call. Both Ebay and Google have VOIP solutions through their respective GoogleTalk and Skype technologies. 

This move is a definite boost to the concept, which had allot of hype when I first posted about it back in November last year, but hasn't really materialized into as popular of an advertising medium as I had originally thought. In my previous article I hailed Click Per Call as an advertising medium to watch since it provided a tangible and manageable process to online sales, something that PPC could only dream to achieve. An interesting comment came in lamenting the hype, stating that although Click per Call had some immediate applications, anything that didn't have a complex sales cycle wouldn't necessarily see an immediate benefit.

In hindsight the statement was quite prophetic, and IMO this deal was more to foster buzz and communicate the benefits of this advertising medium for both of their VOIP solutions versus anything really revenue related. Neither company is willing to confirm that this deal will affect their bottom lines for at least the next two years, and they were unwilling to commit as to which of their technologies would be used, so to me this has more of an awareness and marketing strategy behind the announcement than anything tangible from a revenue perspective.

I've really been trying to wrap my mind around the science of Direct Navigation as of late, and I had a bit of an epiphony recently that most of you thinking about this space have probably already thought of but few may be willing to admit… and that's the Internet industry's renewed vigor in the “eyeball” hunt.

That's right, I said it… Eyeballs… it's not a dot boom relic like my last entrepreneurial effort, but a confirmation that most of the predictions around online advertising and site “visitors” were correct albeit definitely a little ahead of their time.

Ok, so the market's matured, most surfers are on broadband, most are comfortable with shopping online… so what does this mean for Internet Traffic and why is it important to think of all of these coveted valuable and monetizable streams as “eyeballs” and not just a faceless term that removes the humanity from the gold almost every search and media company online is striving to compete for?

My realization started when I was sitting at the airport waiting for a flight to Los Angeles last week… the flight I was on was packed, there was no room to breathe and I was wedged into a middle seat between two big guys with 17″ laptops watching Soprano's and Lost episodes respectively. If you've ever been on a United Airlines mid-jumper you'd know exactly what I mean since I swear that airline has the smallest amount of legroom in the industry.

Being trapped in that claustrophibic position without the ability to breathe let alone grab my laptop or a magazine to take my mind off the grueling 3 hour flight, I couldn't help but find my mind wandering back to when I was standing in line and watching the cram of people bumping and shoving there way to check-in as if being first in line would speed up the trip itself. I remembered looking around the room noticing everyone almost stepping over each other trying to get into position when it hit me… Although they were from all different walks of life, had different  reasoning behind why they were there, where they were coming from, and where they were going… they all shared one very important commonality…

They were all following the same instinctual human process to achieve a shared intent, arriving at their destination expeditiously by aggressively jockeying into position to check in even though they all knew it wouldn't necessarily speed up the trip itself.

Why is this a very important realization you may ask? Of course traffic is comprised of people you may say. Well, one of the things I think most hunters of online traffic forget is the catalyst, the intent or the reasoning behind the origin of the traffic which results in a transaction that fuels the e-commerce food chain. IMHO, we focus too much on conversions, traditional search versus direct navigation, click through rates and all of the demographics and labels for the process that we use to describe how people find and acquire what they want online.

I realized that without understanding the psychology behind the motive from a sometimes flawed human perspective, you will never understand the true underlying science behind Direct Navigation traffic, it's dominance, logevity, or market share in the online search space. It's like trying to figure out the meaning of the existence of the universe without understanding the intent or logic behind the big bang, it all becomes hit and miss conjecture or theory no matter how much we understand of what has happened since.

I'll expand on my attempted discovery of this “intent” and how that fits within the different search methodologies popular today in future posts, but if I may leave you with one message with this article its: Eyeballs are good, Traffic is bad, which may be a little contradictory to what everyone's comfortable opinion of this space is today.

I've been spending quite a bit of my time focusing on the Domainer or Direct Navigation space as of late. I had the great fortune to attend the Targeted Traffic Conference in Silicon Valley recently where I was able to make a lot of new contacts and also learn a ton of information on where those both inside looking out, and outside (eagerly) looking in feel this industry will lead next.

I was recently pointed to an interesting article by one of these participants that talked about a Jupiter report predicting future trends of online shoppers and one of the statements really struck me.

By 2010, 71 percent of online people will use the Internet to shop, compared with 65 percent last year. The small increase indicates that retailers will mostly be dealing with an experienced population of online shoppers who are savvy about finding free shipping and deeper discounts, the research firm said.

This peaked my interest since a while ago a veteran in the direct navigation space told me that an extremely small percentage of their traffic came from traditional search engines such as Google or Microsoft; the type of traffic that they mostly monetized was more similar to my parents who wouldn't necessarily use a seach engine to find what they were looking for. They first try to type what they want directly in the address bar of their browser and find what they are looking for on a page that has links to resources (PPC)… which at the time at least gave me the impression that the savvier you were in your search habits, the less likely you would be to follow the direct navigation food chain. (If anyone is interested you can learn the basics of how direct navigation operates by reading this)

Now I know that's a simple analogy where there are more complexities to the mix, but I think we can all agree that most of the ebb and flow of search traffic primarily revolves around where surfers find the most relevant targeted results. If search technology continues to improve and more and more shoppers become aware of tools that provide a wider and deeper degree of relevant results, would such a large segment of online shoppers (even my parents) continue to type a generic domain into an address bar as their first choice of search?

On the other hand, with the increases in the development of domain properties into actual applications (Businesses), and what I feel will be an inevitable trend to include more rich and related content, photos, videos, and even shopping interfaces directly into PPC / Lander pages, direct navigation results should become more and more relevant to even the savviest of surfers potentially even “training” search traffic to migrate from google or MSN towards direct navigation for their primary source of shopping resources.

Which of the two wins out or does the balance continue? I tend to think that even with the staggering pace of technological developments in the search race (RSS etc…) the building out of domain properties beyond just a directory of links (as has traditionally been the case) will at least offset any attrition to traditional search by “basic surfers” if not morph this vertical into something potentially even greater than what it is today.

Well, the traffic anyways… I've been indirectly involved in this segment of the industry for over 4 years now, and if it wasn't for the confidential nature of how most of them have traditionally operated it definitely would've been a much larger focus of this blog due to the amazingly sharp and charismatic participants as well as the unique niche they've carved out that's proven to be quite successful in our online ecosystem.

I received a sneak peak of this article written by Business 2.0 last week, which is a great introduction to the industry and goes through a historical overview of how the worlds of CPC advertising and domain investment have collided to the benefit of both the Search Giant's and the domain portfolios left with an uncertain future after the bubble.

No one knows for sure how much Web traffic comes from type-ins, and Google and Yahoo execs won’t discuss it. But privately, during one of the late-night parties at the Traffic conference, one Yahoo official estimates that type-ins could make up 15 percent of its search business.

And that's over $3.6 Billion annually…

When Overture (with the Yahoo acquisition) and Google Adsense started out, the initial plan was to monetize the Internet Search technology provided to the world for free. It was a phenomenal idea that's made them a ton of cash and revolutionized Internet Marketing efforts in almost every vertical online. The one thing they noticed early on was that they were leaving a huge chunk of business on the table by only focusing on search results, and when investigating new verticals for their CPC advertising model they were quick to identify the opportunity through type-in traffic resulting in partnerships with many a domain portfolio holder today.

The secret? It has to do with what’s known as type-in traffic, or, in Wall Street jargon, direct navigation. Though it may seem odd in the era of powerful search engines, it turns out that millions of Internet surfers don’t use search at all. Instead, they type what they’re looking for right into the top of their Web browser.

Although a few of the individuals mentioned in the article expressed it wasn't 100% accurate, the results were close enough to the facts to do this segment justice and highlight how they operate in a very positive light. I even appreciated the comparison of Yun Ye to Keyser Soze, and if you've ever had the pleasure of communicating with him or any of his associates you'd definitely agree that the comment has some weight.

Every domainer knows of Ye, but few have ever met him. He’s the domainers’ Keyser Soze. “My attorney happens to be his attorney, but that’s as close to him as I can get,” says Bahlitzanakis, 29.

What I had to go through just to get a direct email exchange… well, needless to say doing your research and persistence were keys that's for sure.

The weird thing I noticed is that the day after I received the sneak peak, the Wall Street Journal posted this article (Subscription Required). I knew the Business 2.0 article had been in the works since the TRAFFIC event back at the end of October, so the timing of the WSJ article a day after I had seen the 2.0 sneak peak combined with the resultant early public ”pre-release” of the 2.0 article the next day seemed a little odd.

It appears that the “outing” of this hidden gem in our industry is being fought over by a few of the media outlets… what some of them don't realize is that for most who've been successful in the Internet domain industry this gem's been pretty much public knowledge for anyone interested enough to investigate since the beginning.

Whether someone had the insight to jump in is another story… I know a few who did

This is but a teaser of what's to come. In the near future you'll notice additional press coverage and the resultant ”outing” of an entire industry that has traditionally remained a pretty private club of Traffic Monetizers, Public Companies, Speculators, and even Institutional Investors.

“The Fish.com transaction underscores the value of owning a mission-critical domain name,” said Afternic President Roger Collins. “There is no question that premium names help businesses establish the impression of brand leadership and allow them to become more effective Internet marketers.”

… and at a cool million being spent on just the rights to use a particular domain name, it's pretty hard to argue with that logic.

Think of a domain name as your key to an effective Internet real estate strategy. It's the Internet equivalent of the “location” your traditional brick and mortar makes or breaks their business on. One thing even some Internet experts don't realize is that a pretty significant portion of Internet Surfers assume they can find what they want by merely doing a type-in before even considering a search engine.

He said that not only does a domain name like Fish.com reel in excellent search engine results, but it is an ideal domain to drive “type-in” traffic to the new owner's business. Type-in traffic is generated by consumers who simply type a generic URL into a browser and land on a site.

If I want a bicycle, I'm sure that bicycle.com will have what I'm looking for. If I need an aquarium, I'm sure that fish.com will have what I need. It seems that www.dog.com was willing to bet a million dollars on that and based on the what I'm sure was quite a significant investment to acquire dog.com, horse.com and bird.com as well, a pretty proven model.

The next steps? Well this private club will now start to expand, there will be additional interest, media, and buzz surrounding these deals as more and more of them are publicized.

What will happen to the existing members of this club? Well some will take their profits, sell off their assets and get out. The smart ones… well that's a different story. Instead of selling, they should invest in this prime Internet Real Estate by doing exactly what dog.com is doing. Build an Internet property around these key locations.

Why just sell or lease a premium storefront where with today's technology combined with this innovative and resource rich medium called the Internet, you could become an effective and competitive e-tailor with little to no start up capital or specific expertise required. There are many Web Building Tool services, tons of competitive ecommerce gateway providers to collect your payments, billing / shipping solutions galore, and  tons of wholesalers in almost every vertical to fit any domain real estate needs.

The old axiom of “build it and they will come” is morphing into a question you should be asking yourself if you own any of these prime properties..

“They're already coming, so why haven't you built it yet?”