People keep asking for advice on how to become a successful domain investor today, so I thought, why not make a blog post about this topic. Some of my blog readers are experienced domain owners already, but maybe you will find something helpful anyway.

First of all, it’s wrong that you’re too late. You can still start buying domains and make a living from it today. Generic domains have become expensive over the years and they’ll not stop going up in value anytime soon. Therefore, you must concentrate on cheaper domains and a way of finding good but affordable domains is to be creative. Below I’ve compiled a list with a few tips on how to get into the domain business if you don’t have enough money to buy your way into the high end of the market.

1. Register lots of domains

This is an obvious method, but many new domainers have failed taking this road already. Most of them failed because they started registering domains before they knew anything about the value of a domain name, which means they registered mostly worthless domains. The first thing to do before stuffing money into the pockets of your favorite domain registrar is to read as much about domains as you can. You will find useful advice on any of the domain forums. In addition to that, you should subscribe to domain blogs such as the ones listed on the right menu bar of my blog. Don’t forget to read Ron’s weekly domain sales reports at DN Journal for current domain sale prices. As soon as you think you’ve learned a great deal about domain value, about which domains can be sold and which can’t, you should be ready to buy your first names.

There is money to be made with newly registered domains. You do not have to get your hands on high-value domains, but it should be domains that can be resold for a profit. What you can try to do, is to register domains at $7 each and then resell them for $xx each. If you resell a domain at $27 you’ll make a $20 profit. This isn’t much money and it might not buy you more than a meal and something to drink, but if you choose this method of getting into domaining it is about volume. Your aim should be to quickly resell hundreds of domains.

After a few months of successful domain reselling you might find yourself in a financially better position to purchase domains on the aftermarket. Additionally, you’ve completed several domain transactions and gained hands-on experience about how to sell and transfer domain names. You can then reinvest the domain you made in higher quality domains, which are for sale on domain forums and domain marketplaces.

Now, an obvious question would be, how do I know which domains to register? Basically, you should concentrate on domains that are generic in nature. You can, for example, register domains consisting of two- to four-word search terms. Use Google’s AdWords Keyword Tool to find popular search terms (the Overture keyword tool has been more accurate than Google’s tool, but the Overture search suggestion tool was taken offline, unfortunately). Sometimes I also use Google Trends for seasonal search terms.

To give you some examples of available domains, I recently read an article about budget weddings becoming really popular. The following budget wedding domains were all available for registration at the time the article came out:

BudgetWeddingCeremony.com
BudgetWeddingCeremonies.com
BudgetWeddingBand.com
BudgetWeddingBands.com
BudgetWeddingCake.com
BudgetWeddingCakes.com
BudgetWeddingDress.com
BudgetWeddingDresses.com
BudgetWeddingFeast.com
BudgetWeddingService.com
BudgetWeddingGown.com
BudgetWeddingGowns.com
BudgetWeddingPresent.com
BudgetWeddingPresents.com
BudgetWeddingRing.com
BudgetWeddingRings.com
BudgetWeddingGifts.com
BudgetWeddingGift.com

Each of these domains is worth more than $7, in my opinion. I also regularly find good local domains that are still available. So be creative and think of domains that can help an end user make money, and you should be able to come up with domains worth significantly more than the fee for registration.

By the way, I don’t want to get into traffic monetization in this post, but I’m astounded by the great number of domains that I newly registered and which immediately started receiving type-in traffic and generating pay-per-click revenue.

2. Register domains (lower volume approach)

If you don’t want to start making money in domaining by reselling domains at $xx each, you can try to register or acquire fewer domains that you think will have potential in the future, e.g. domains for upcoming technologies. Such speculative domain registrations usually take longer to turn into a profit, but they have the potential to sell for higher prices should they really become valuable at some point in the future.

In order to find domains with future potential it would be a good idea to subscribe to lots of blogs and to read technology and science magazines, because you must spot trends early on.

3. Limited supply

Three-letter domains were not considered very valuable once. But as you probably know, three-letter domains only rarely sell for less than high $x,xxx today anymore. This little piece of domain history should teach you that domains can become valuable if they’re limited in quantity.

I believe that four-letter domains will become quite valuable, too, as I wrote about in my article “Investment Opportunity: Four-Letter Domains“. Especially CVCV.COM (consonant-vowel-consonant-vowel) domains have seen a nice jump in value in the past 12 months, according to recent domain sale prices.

Four-letter domains can still be bought for $xx to $xxx, depending on the letters they contain. Some CVCV.COM domains have also been sold for prices in the four-figure range. And a major corporation, NBC Universal, has chosen the four-letter domain hulu.com for their new YouTube rival. You see, there is value in LLLL.COM domains and now would be the time to invest.

By the way, three- and four-letter combinations can be an acronym for popular terms. Use AcronymFinder.com to find out about the possible meanings of LLL/LLLL domains you want to buy.

4. Find good domains in drop auctions

Every day you can buy expired domains in drop auctions. My favorite service for expired domains is SnapNames.com. Due to the vast number of expiring domains there are lots of crappy domains that have been deleted, but there are also some good and even a handful of highly valuable generic domains on the daily drop lists which the previous owners mistakenly or stupidly let expire.

An expired domain service catches expired domains and auctions them off to its users. At SnapNames.com the minimum bid is usually lower than $100 per domain. This makes it a great source for valuable domains that can be bought below value, because some good domains are overlooked among the high number of names dropping every day. If you’re lucky you’re the only person who expressed interest in a particularly nice domain and you then get it for the minimum bid without having to go to auction.

Many expiring domains have been actively used and therefore have a history. The following tools can help you determine if an expiring domain is likely to receive traffic:

• Whois tools: Look up the creation date and expiration date of a domain name (e.g. iWhois.com)
• Archive.org: Past uses of the domain name
• Marketleap.com: Backlinks (or search for link:DOMAIN in Google)
• DMOZ/Yahoo: Is the domain listed in one or both of these directories?

5. Development

If you’re good at making websites you can register or buy a few domains and develop them into useful websites or full online businesses. Developing a domain requires lots of work, but it is rewarding in the end, as you will be able to sell the domain plus website for a price much higher than what you would get for the domain name alone. In addition, developed websites can make money from Google AdSense or affiliate ads (CJ; AzoogleAds).

Today it’s easier than ever to develop a website, because there are various open source content management systems that let you build large and interactive websites without requiring deep knowledge in PHP programming. Wordpress is a popular solution, for instance. Joomla is also good if you want to launch a bigger site. Both programs make it easy to customize your website with plug-ins and downloadable templates.

If you want to develop a domain of yours, don’t forget that you’re developing it for “human beings”. This might seem obvious, but many “developers” just put up made-for-AdSense sites with duplicate content nowadays. A domain+website will be more valuable and it will receive more traffic if it is unique and has quality content to offer.

Now that I’ve pointed out proven methods of becoming a successful domain investor, let me complete my article with some general advice:

- If you’re still uncertain about how much money you should spend on domain names, set yourself a limit (e.g. $500 per month) and do not excess this budget. The learning curve in domaining can be steep and a monthly budget helps you limit the amount of money you lose while making your first steps in this business. Raise your budget once you make a profit. 

- Do not, ever, invest in domains that infringe on someone’s trademarks. First of all, this is illegal and you can be sued for hundreds of thousands of dollars. Second, you are only one person, one important part of an entire industry that relies on you when it comes to being a trustworthy business person. The domain business has been considered as somewhat shady for a long time; in fact, the image of this industry has just gotten better over the past two or three years thanks to some positive articles in major publications and because of industry conferences like TRAFFIC and the impressive work of the Internet Commerce Association. People monetizing TM-infringing domains let this industry appear in a bad light and they’re the reason why there is still so much talk about cybersquatting and domain kiting.

- Don’t be afraid of asking questions. Everybody had to start somewhere. There are “newbie” sections on all major domain forums where you can post questions, and in most cases there are experienced domainers who are very willing to share their knowledge.

Final sentence? “Good luck!”

Innovative Industry Event Features Town Hall, Auction and Continuing Education

DomainSponsor™, the domain monetization business of Oversee.net, today announced that the second annual DOMAINfest Global event will feature the first Domainer Town Hall Meeting, an innovative auction, and a series of continuing education courses. The conference is scheduled for January 21-23, 2008 and will return to the Renaissance Hotel in Hollywood, California. DOMAINfest was created specifically to respond to the needs of domainers operating in today’s business environment.

In commenting on the event, Ron Sheridan, Director of Business Development for DomainSponsor said, “Our goal is to continually offer more to the domainer community and establish DOMAINfest as the premier conference and marketplace for our clients in the domain industry. We understand the importance of our partnerships with top domain professionals and are pleased with the outpouring of support we have received. First and foremost, this conference is about listening to our customers and nurturing key relationships with them and our business partners. DOMAINfest Global 2008 will be a memorable event.”

This year, domain investor and industry expert Frank Schilling will participate in person at DOMAINfest Global by leading the first Domainer Town Hall Meeting, an in-depth discussion on the state of the industry, as well as a free-wheeling question and answer session with the industry veteran. Much like presidential Town Halls, participants will be able to ask the questions that are on their minds and most relevant to their business.

“We are delighted that Frank Schilling has agreed to join us this year,” noted Lawrence Ng, Oversee’s Chief Executive Officer. “Because this event is targeted at both experienced and beginning domainers, we are adding new features and formats that have been suggested by our colleagues. This makes our event truly interactive as well as helps stimulate new ideas, networking opportunities, and business prospects.”

The conference will also feature the second DOMAINfest auction, in an innovative new format. For those interested in submitting names for auction or who want additional information, please send your inquiry to buyers@domainfest.com or sellers@domainfest.com.

Continuing education courses for both experienced and beginner domain professionals are being designed to make participants’ time more productive by teaching and refining skills they will be able to use on site at the conference. Sessions are being offered in negotiation, business structure, finance, taxation and network building.

All DOMAINfest guests will receive VIP treatment. DOMAINfest Global is open to domain professionals as well as those interested in the growing domain industry. Registration is $795. Existing or new DomainSponsor members are eligible to receive a rebate of up to 100% of the cost of an individual registration. To learn more, visit www.domainfest.com/register.php.

To register or to get more information about DOMAINfest Global—including speaker and sponsorship opportunities—visit http://www.domainfest.com or e-mail info@domainfest.com. Hotel reservations can be booked at http://domainfest.com/hotel.php.

LONDON (Reuters) - About 16,000 words have succumbed to pressures of the Internet age and lost their hyphens in a new edition of the Shorter Oxford English Dictionary.

“People are not confident about using hyphens anymore, they’re not really sure what they are for,” said Angus Stevenson, editor of the Shorter OED, the sixth edition of which was published this week.

Source: Reuters.com

This really is a sign of the power and omnipresence of the Internet. People prefer shorter URLs, so they don’t type in hyphens and, as a result of that, they stop using hyphens offline, too. Lots of hyphenated domains just went down in value, I guess.

(via Owen’s Blog)

I’ve already blogged about Steve Forbes delivering a keynote address at the upcoming T.R.A.F.F.I.C. East 2007 show. Today T.R.A.F.F.I.C. published a press release with more details:

PEMBROKE PINES, Fla., Sept. 20  /PRNewswire/ — T.R.A.F.F.I.C, the domain industry’s premier conference, today announced that Steve Forbes, CEO of Forbes, Editor-in-Chief of Forbes Magazine and former presidential candidate, will deliver the keynote address at the upcoming T.R.A.F.F.I.C. East 2007 show October 9-13, 2007 in Hollywood, Florida.  Forbes’s presentation will draw parallels between historical investment and entrepreneurial epochs in American history — such as the Gold Rush, the advent of the oil and railway industries at the turn of the century, real estate and the information technology revolution — and current opportunities in Internet traffic.

The domain industry’s signature conference series, T.R.A.F.F.I.C. East 2007 will bring together domain owners, search engine companies, leading registrars, pay-per-click aggregators, sponsors, Wall Street investors, and financial and advertising executives with analysts and experts on targeted Internet traffic to discuss strategies, trends and best practices.  Presented by the World Association of Domain Name Developers, Inc. (WADND), other prominent speakers at the invitation-only event include: Ammar Kubba of TrafficZ.com, Ron Jackson, Editor & Founder of DNJournal.com, David and Michael Castello, Castello Cities Internet Network, Divyank Turakhia President of Directi, Frederick Schiwek, EVP, International Business Development for EuroDNS.com, Frank Schilling of Name Administration, Mathew Bentley, CEO of Sedo, Monte Cahn, CEO of Moniker.com/DomainSystems.com and others.  For a full list of speakers and events visit http://www.targetedtraffic.com/miami_show.html.  The main topic of T.R.A.F.F.I.C. East 2007 will be verticals such as travel, real estate, gaming, financials and many others for which domain owners host substantial traffic.

“Internet traffic and domains are the prime real estate of the 21st century,” comments Forbes.  “This market has matured, and individuals, brands, investors and organizations who do not grasp their importance or value are missing out on numerous levels.”

The domain channel is a major marketing industry.  According to Fabulous Research, $400 million in advertising dollars were spent via the domain channel in 2006.  Major search engines rely on domain traffic for over 10% of their traffic volume.  Moreover, ten million .com marketing websites are controlled by domain portfolio owners.  Nearly 800 businesspeople came to New York City for the highly successful T.R.A.F.F.I.C. show in June during which over $12 million in domain names changed hands in only 3.5 hours!

“Steve Forbes is going to entertain, illuminate and inspire T.R.A.F.F.I.C. attendees to transform their lives and businesses,” says Rick Schwartz, cofounder of T.R.A.F.F.I.C. and WADND.  “His experience and instincts for identifying economic trends are inimitable.”  Forbes will speak at 8:30 p.m. on Wednesday, October 10th at the show.

The climax of every T.R.A.F.F.I.C. conference, which are held three times per year, is the largest live domain auction in the world, hosted by Moniker.com and its CEO, Monte Cahn.  The auction at the recent T.R.A.F.F.I.C. East show in New York City included one domain that went for $3 million and another for $1.8 million.  In all, more than half of all the domains offered were sold.  To request an invitation to T.R.A.F.F.I.C., or to inquire about speaking or sponsorship opportunities, please send email to admin@targetedtraffic.com or fill out our form available at http://www.targetedtraffic.com/contact_us.html.

About Steve Forbes

Steve Forbes is President and Chief Executive Officer of Forbes and Editor-in-Chief of Forbes magazine.  Since Mr. Forbes assumed his position in 1990, the company has launched a variety of new publications and businesses. The company’s flagship publication, Forbes, is the nation’s leading business magazine, with a circulation of 900,000.  A widely respected economic prognosticator, he is the only writer to have won the highly prestigious Crystal Owl Award four times.  The prize was formerly given by U.S. Steel Corporation to the financial journalist whose economic forecasts for the coming year proved most accurate.  In both 1996 and 2000, Mr. Forbes campaigned vigorously for the Republican nomination for the Presidency.  Key to his platform were a flat tax, medical savings accounts, a new Social Security system for working Americans, parental choice of schools for their children, term limits and a strong national defense.  Mr. Forbes continues to energetically promote this agenda.  Mr. Forbes is the author of the recently published Flat Tax Revolution: Using a Postcard to Abolish the IRS (Regnery, 2005).  He also wrote A New Birth of Freedom (Regnery, 1999), a book of bold ideas for the new millennium.

About T.R.A.F.F.I.C.

Presented by the World Association of Domain Name Developers, Inc. (WADND), T.R.A.F.F.I.C. is the domain industry’s premier conference.  Three times per year T.R.A.F.F.I.C. (Targeted Redirects and Financial Fulfillment Internet Conference) brings together domain owners, search engine companies, leading registrars, pay-per-click aggregators, sponsors, Wall Street investors, the banking, financial and advertising communities as well as analysts, developers and experts on targeted traffic.  An invitation-only event, conference attendees collectively control over 10 million domain names and host tens of millions of unique visitors to their websites every day.  The Internet’s biggest companies support and participate in T.R.A.F.F.I.C., including Google, Yahoo!, Sedo.com, Marchex, TrafficZ, Fabulous.com, DomainSponsor.com and many others.  Legendary “domain king” Rick Schwartz and Howard Neu, a prominent Intellectual Property attorney and former three-term mayor of North Miami, Florida co-founded and manage the event through their company, the World Association of Domain Name Developers, Inc. (WADND). Corporate headquarters are located at 1152 N. University Drive, Suite 201, Pembroke Pines, Florida, 33024.  For more information, send email to admin@targetedtraffic.com or visit us at http://www.targetedtraffic.com/.