Why Domain Revenue is Falling

[mkellerman]

What do people think is in store for parking income in 2009?
More decline? When will we reach the bottom?

[hiOsilver]

Excellent question. I really do not know. I hope that RPC will bottom out as the world economy bottoms out. However, I am not sure what Google and Yahoo will do. Yahoo seems to keep getting weaker in terms of search, so I imagine that they continue to get less interest from advertisers.

[Acro]

It's simple: PPC companies and their feed providers have become greedier. Just like credit card companies raising their rates not because your credit is bad, but because they need to make the money they lost by investing in failed ventures.

[Raider]

Originally Posted by Acro

It's simple: PPC companies and their feed providers have become greedier. Just like credit card companies raising their rates not because your credit is bad, but because they need to make the money they lost by investing in failed ventures.

Or buying high priced domains.... Didn't Donny by Voodoo.com for 300K? Where do you think that money came from?

[hiOsilver]

Originally Posted by Acro

It's simple: PPC companies and their feed providers have become greedier. Just like credit card companies raising their rates not because your credit is bad, but because they need to make the money they lost by investing in failed ventures.

Certainly Google and Yahoo have figured out how to keep more of the advertising revenue. That is what I posted to start the thread.

As for the parking companies (like DomainSponsor, Sedo, Fabulous, etc), I believe that their revenues are down too. My approach is try to find where the traffic earns the most. The parking companies are in a competitive business. I don't believe that they have conspired to keep a bigger share at the expense of traffic owners. If they did that, then some other parking company would become more attractive and I would move my traffic there. I am always looking for better alternatives to my existing providers.

In a capitalist system, we are all motivated to increase our earnings (greed). Some people do it honestly. Others look for ways to do it without regards for rules. If a credit card company gives you bad rates, then change to a different cc company. I have multiple cards and try to make sure that I do not pay interest to any of them. I do not think that the parking providers or the parking companies are doing anything illegal.

At the last domain conference I attended (DomainFest in January 2009), Google staff blamed reduced parking revenue on the bad economy. In fairness to them, I think that this is also a factor, but not the whole story.

[khurtsiya]

hiOsilver, did you try AdSense for Domains already?

[hiOsilver]

Originally Posted by khurtsiya

hiOsilver, did you try AdSense for Domains already?

No.

[ShytKicker]

I do not think Google, Yahoo, or any other company would be able to take more money away from parking because they feel like it. First off, they are a public company. That makes it a whole different ball game compared to a private company. They would have too much to risk rather than gain by stealing domainer money. I believe they do what they say.

Domain feeds at Yahoo, Google, and other companies are usually within the search network rather than the content network. The overall traffic quality scores on these feeds can range from 1-10, or Unknown (which is not enough traffic to determine a score). Revenue is determined based on this score. A 9/10 could mean a difference of 30% in revenue from 9 to 10. It depends on the keywords and ads that are being clicked on.

The decline in domain parking revenue does have something to do with economy, but the economy is not enough. We would actually be seeing the same, or even more revenue than before if it were just the economy. Take a look at Google and Yahoo quarter over quarter earnings. They are still growing even during this economy.

But anyway, the main reason why domain parking revenue has dropped is pretty simple: Most parking companies at one point or another used search partners (such as Ask.com) to display advertisements. Ask.com has a search feed (not a domain feed) that is from Google itself. The difference here is that a traffic quality score of 1-10 on their feed still gets you the same revenue. On a domain feed directly from Google or Yahoo, you are smart priced. On top of that, chances are Ask.com has negotiated a really good revenue share with Google, perhaps 80-90%. Maybe even above 100% if Google wanted to buy them out (there was a pretty intense bidding war against Microsoft and Yahoo so it is possible that it was a 100%+ revenue share just to get MSFT and Yahoo not to work with Ask).

Now, the parking companies that had the Ask feed were the following from what I know:

Skenzo
Parked
Bodis
ParkingPanel
ActiveAudience

There was about 20 or so total partners. On about March 1st, 2008, all parking companies lost the Ask feed, meaning they had to get a contract directly with Google, Yahoo, or someone else if they didn't have one yet. That is one of the main reasons why we lost a lot of revenue in the domain industry over the last year. With the Ask feed, parking companies were basically able to run mediocre traffic, and get paid top notch dollar for it, without any problems.

There are other companies that syndicated just like Ask. About 2-3 other companies, but they are technically not allowed to. As soon as their contract renewal time comes, I am sure we will see an even bigger drop.

I stand behind Google, and I think most of what they are saying, or all of it, is the truth. They are not stealing, they are just either a) smartpricing, or b) policing their partners as they should be from the very beginning. We were to be honest a bit spoiled by the revenues we received between 2006-2008. And now we are getting back to where we should be.

What the revenue everyone is seeing boils down to is the deals that parking companies have. All ads may look like Google or Yahoo ads, but they may be or may have been through partners with really good revenue shares and minimal restrictions. Google and Yahoo is policing their partners more than ever before, and a lot of these contracts are terminated, canceled, or expired without the chance of renewal in an effort for Google and Yahoo to clean up.

[Doc Com]

Oh, I so dearly miss the Ask feed on Bodis.

But, I am still sold on Bodis as being the absolute best for foreign traffic and the .net, .org, .info, and .us domains.

[ShytKicker]

Originally Posted by Doc Com

Oh, I so dearly miss the Ask feed on Bodis.

But, I am still sold on Bodis as being the absolute best for foreign traffic and the .net, .org, .info, and .us domains.

Thanks.

Well it is surprising to myself, that all the traffic we let through scores us a perfect 10/10 for "search network standards". In other words, if we were to have a domain feed such as NameDrive or some of the other companies, our traffic quality would be equivalent to 30/10. This is what I hear at least from some industry folks. I guess time will tell.

There is still a way to get back to the revenue that companies generated via an Ask feed, but requires a decent deal with Google and Yahoo directly and a low operating expense. I think a lot of companies have a lot of employees, and are unable to give good revenue shares either. Sedo has for instance 100-200 employees from what I know. If each employee gets 100k average salary, that's $20 million a year in salary payouts alone. I can't speak for them or anyone else but this is my best guess.

It will take a lot more than a good deal itself to offer the revenue we've been getting 2 or so years ago. A good deal with Google or Yahoo and a very low operating expense.

Let's see what happens.

[Focus]

I have personally seen some very large revenue drops from vastly lowered click values from a yahoo parking feed (as in .25 clicks that used to be 10 times as much)..I am guessing they are starting to record certain clicks as content bid priced clicks for advertisers instead of search network click prices like they use to do..but hey, what do I know..now I am trying to find out what the absolute best google feed is..for search partner priced clicks..NOT content bid click prices..

[Raider]

This has been the worst 2 weeks at Parked that I ever had... I'm seriously considering moving all my domains to a Google feed... Revenue cant possibly be lower than what I'm making now, And if it is, it's time I consider dropping parking all together.

Originally Posted by Focus

now I am trying to find out what the absolute best google feed is..for search partner priced clicks..NOT content bid click prices..

When you find out, do let us know.

[ShytKicker]

Originally Posted by Focus

I have personally seen some very large revenue drops from vastly lowered click values from a yahoo parking feed (as in .25 clicks that used to be 10 times as much)..I am guessing they are starting to record certain clicks as content bid priced clicks for advertisers instead of search network click prices like they use to do..but hey, what do I know..now I am trying to find out what the absolute best google feed is..for search partner priced clicks..NOT content bid click prices..

If these domains are trademarks, or not converting, it is possible that the domain is blocked by Yahoo completely and you are being monetized on some second tier feed. My best guess for such a significant drop in revenue.

[trader]

Originally Posted by Focus

I have personally seen some very large revenue drops from vastly lowered click values from a yahoo parking feed (as in .25 clicks that used to be 10 times as much)..I am guessing they are starting to record certain clicks as content bid priced clicks for advertisers instead of search network click prices like they use to do..but hey, what do I know..now I am trying to find out what the absolute best google feed is..for search partner priced clicks..NOT content bid click prices..

Looks like you are not nearly as bullish about parked.com as you were in the past when your were their #1 supporter, what happened

[petrosc]

Originally Posted by Focus

I have personally seen some very large revenue drops from vastly lowered click values from a yahoo parking feed (as in .25 clicks that used to be 10 times as much)..I am guessing they are starting to record certain clicks as content bid priced clicks for advertisers instead of search network click prices like they use to do..but hey, what do I know..now I am trying to find out what the absolute best google feed is..for search partner priced clicks..NOT content bid click prices..

ShytKicker is right, Yahoo often blacklists TM domains and then your revenue will drop from $1/click to 1 cent per click. Some parking companies provide a feature that shows you the domains the next day they are blacklisted, other companies don't and you basically won't know until you ask them.

Although in your case, I never saw clicks higher than 1-2c on blacklisted names, so I doubt that its your case if you are getting 25c on average

[Doc Com]

Originally Posted by ShytKicker

If these domains are trademarks, or not converting, it is possible that the domain is blocked by Yahoo completely and you are being monetized on some second tier feed. My best guess for such a significant drop in revenue.

I'll ask as many have asked me -

plans on opening Bodis up to new sign-ups?

And overall, how successful have you been on starting your own service?

For those reading this thread, I will disclose that I am a Bodis member, I am not a paid affiliate or referral partner, and I do like the service.

[Fearless]

Originally Posted by Raider

Or buying high priced domains.... Didn't Donny by Voodoo.com for 300K? Where do you think that money came from?

cameras.com was way more than that.

[ShytKicker]

Bodis has been open to new sign ups for over 2 weeks.You just have to be logged out in order to register. Sign ups should be up now indefinitely and it doesn't require any manual approval process on our end, meaning everyone is eligible to register an account.

I think it has been mediocrely successful. Pays the bills and leaves off some profits for new features and developments.

We are trying to work out a direct deal so we are being very competitive even with new members. We pay out pretty much most of what we get for new members.

Just recently things have started to pick up. If we get a direct deal, I'm sure revenue will be about 3x what they are now, so I am patiently waiting on that.

[Doc Com]

Originally Posted by ShytKicker

so I am patiently waiting on that.

Lets be hopeful.

I know I have been pleased overall with monitization at Bodis for such a variety of reasons. Perhaps mostly due to domains that did not get any clicks at Sedo or Parked get very good conversion at Bodis. This must be due to all the variety of feeds to convert foreign traffic.

I just love having a .us as my number one revenue maker every month.

[ShytKicker]

Yes we do good with foreign traffic right now. US/CA traffic is not as great, but foreign traffic does really well. We have coverage where Yahoo feed does not have or where Yahoo feed has very little.

No more hoping. Just waiting.