How I “Really” Make Money From Domain Names

Posted on 08 April 2008 by Lord Brar

Domaining Strategies

This is My True Story

There was a time when I was extremely frustrated with my domaining business. I was seeing people sell domains for hundreds of thousands of dollars and yet I had so many domains which no one was willing to pay even registration fee for, let aside thousands. What was worse was that I was not making much money in parking either.

Whenever I saw the domain-sales charts I would cringe. What was I doing wrong? Was there a fault in my investment strategy? I had to do something about it or simply get out of domaining business. It was a do-or-die situation for me.

There is another thing — I hate failing.

So, I sat-back to take a rational look at my investment strategy and find out what was wrong with it. And very soon I did.

What Was Wrong With My Strategy

Simple – My domains were neither “premium” nor had butt-loads of traffic. Most of the domains in my portfolio were — and still are — keyword rich and brandable and had excellent development potential.

Most domainers look for easy money and investments where they don’t have to put too much effort — and development is not one of them.

My major problem was that I was selling wrong thing to wrong people.

But there were two other BIG problems — 1) Premium and Traffic Domains cost lot more than I could spend and 2) I had a lot of money invested in portfolio of keyword-rich domains.

Very soon I was about to discover something that would change my fortunes.

Finding the Solution

When I analyzed the domains which I had sold till now, I discovered that the keyword domains which had some sort of content on them were super-easy to sell. Not only this, whenever the domain had traffic and revenue, it was able to fetch much-higher prices, which meant more profit for me.

There was this dating discussion forum I had started. I had spent $160 for a vBulletin License, $120 for 1000 paid posts by forum-posters and a few hours on building links. Within a two and half months, the site was getting a few hundred visitors a day and made some revenue from adsense and a few affiliate programs.

I put it up for sale at an auction site and sold it for $1500 in a few hours. That was a profit of roughly $1200 on a site which took less than 10 minutes a day to run.

Sometime ago I had purchased a database of 1000 riddles for $20 and paid a coder $50 to code a simple script to read from this database and display on the site. I put it up on a riddles related domain of mine, posted links to it at some social networking sites and spent about 10 bucks for a 100 directory submission.

I ended up selling this particular site for $750 after five months. My investment was $80 and time spent uploading the database and script on my site.

Another was a small-business marketing related site where I had posted 27 blog posts which I had paid freelance writers $10 per post for. My cost was $270 and a few hours of link-building and sold it for $1300.

More interesting was this web-design related blog which I had purchased from someone for $700. I spent a few hours and wrote a kick-ass article which I was able to get on the front page of digg. Then I posted some re-printable and PLR articles and paid another 120 bucks to freelance writers to write 12 articles for it.

The site started getting loads of traffic and started making $200 – $300 from affiliate revenue, $70 or so in Adsense revenue and $150 from text-link sales every single month. After 5 Months, I sold it for $4250. I not only made a huge profit by selling it but also kept all the money it made from affiliate programs, adsense and text-link sales. My Net Profit from this site was roughly $5700.

All this was more than enough to prove to me that there was a potential to make money — and a LOT of it — by doing something that others were not doing. And the fact that I had keyword-rich and brandable domains was a huge advantage for me. All I had to do was to rinse and repeat.

Step by Step Method

Find a Niche. The very first thing that you need to do is to find a niche you will be developing the site in. You need to make sure that the niche has certain demand — which means that you will get some traffic — and you have a way that you can make money from it. You also need to know the methods that you can use to identify these profitable niches.

Register a Domain. Once you have your niche, you need to register the domain name which you will run the site on. The domain should be brandable and keyword rich to help with SEO. You need to know how to come-up with domain names, research expired domains and even purchase from the after-market.

Create a Site. The very first thing you need to do is to setup the site on your web-host. Be sure to read my article – How to Choose a Host Without Getting Ripped-Off — 6 Practical “Rules of Thumb” to Remember.

If you want to create a content site then you need a content management system like WordPress or Joomla. You could also setup a Photo Gallery or a Discussion Forum.

You could also hire a freelancer to code a script for you but you can usually find an out-of-box open-source script to do the job.

Publish Content. Once you have the site up, it is time to start posting the content. Remember, it is the content which attracts people to your site and gets you the rank in search engines. You can create the content yourself or hire freelancers to create it for you. You also have an option of using content with reprint rights. Getting great content is much easier than you think.

Revenue Streams. You don’t want to waste your traffic by not commercializing it. Put up affiliate links, CPA links, contextual advertisements, text links and products for sale on your site. Contrary to the popular belief, you don’t need thousands of visitors to make money. What you need is “quality traffic”.

For example, I have a site which got 8 visitors last week and made me $147 in affiliate revenue. I also have another site in more popular niche which gets a few thousand visitors a day and makes only a few bucks. I usually commercialize my site before I even start promoting it at all. After you have a pagerank, you can also start selling text-links on the site.

Promote the Site. When your site is up and running and has some content that people can use, you need to get the word out about your website. You can promote on the Internet by doing Search Engine Optimization and Link Building, Social Marketing, Paid Advertising, Viral Marketing, Internet Public Relations and what I like to call Twisted Marketing.

SEO is the cheapest and easiest way to get traffic to your site and keyword domains are a big help. If you have Link Building Tool by EasyLinkBuilding.com, it will be very easy for you to get quality back-links which are absolutely a must to rank high and get traffic from search engines.

Being on Digg’s homepage can easily get you 20,000 – 30,000 unique visitors in a day. Getting a top-blog to link to you is another very effective strategy. When LifeHacker.com linked to one of my sites, I got like 17,000 Uniques in a day and made a nice change.

Let it Ferment. While the results of paid and viral marketing are instantly visible but search engine optimization takes some time to show results. For most of my sites, I just optimize the site, build some links to it and forget about it. If the niche is not super-competitive, search engines start sending a fair bit of traffic.

Sell the Site. Once you have a site which has some good content and, hopefully, gets some traffic and makes some revenue, you may want to sell the site. Some of the options that you have if you want to sell your site are domain forums, auction sites, domain brokers or through private sales.

The Devil is in Details

As an entrepreneur, you have to remember that your profits are your revenues minus the cost.

Profit = Revenue – Cost

Your objective is to maximize your profits and to do that you need to increase your revenues and reduce your cost. The challenge is how you can reduce the cost of creating the site, creating content and promoting the site while maximizing the revenues, traffic and cost you can sell it for.

Stay tuned to follow-up posts or subscribe to the newsletter.

PS: Here’s a real-life case study of how someone new to domaining made profit with this strategy.

If you like this post and want to sponsor it on Domaining.com, click HERE.

80 Comments For This Post

  1. ImagesAndWords Says:

    Nice post, Lord Brar. I need to do something about the rest of my unused domain portfolio and this has motivated me to get my butt in gear! :)

  2. ferret Says:

    still think you should have charged 1,000,000 for it, Brar

  3. Mark Fulton Says:

    Sounds alot like my own personal experiences. Great read. Don’t forget to take a breather every now and then!

  4. Gaurav Says:

    how do you do backlinking of your site?? Do you have any bot for doing this job for you or you spend some money on freelancers to get the job done?

    waiting for the answer.

  5. Lord Brar Says:

    @Gaurav – I hire freelancers.

  6. Steve M Says:

    Thank you.

  7. Julio Says:

    Thanks Brar,

    For sharing this with us :)

  8. Graham Says:

    Thanks Lord Brar, you have inspired me to develop further.

  9. Nimesh Says:

    Good post. How/where you do find freelancers? I’m looking for 1.

  10. Genesis Says:

    Excellent post. I´ve got quite a few domain myself that would do well with this strategy. I also have the advantage of being a freelance writer, so doing my own content is pretty easy, but for anyone else, PLR articles might be a good option.

  11. Toolohen Says:

    This strategy requires months of patience. I don’t have patience. I want my money now!!!!!

  12. successvilla Says:

    This post is really an eye-opening one, it is as reaveling as it is informing, now i know how to optimize my domains for maximum profit

  13. Danish K. Says:

    Nice article, Good Advice. In short this article is an EYE OPENER for many of us.

    Thanks Lord Brar.

  14. alan Says:

    Great step by step guide. Top guide here.

  15. HairyHun Says:

    Could you elaborate on “Brandable” when you say:

    “The domain should be brandable and keyword rich to help with SEO.”

    Thanks
    HH

  16. Siva | Freespreeblog.com Says:

    Hey,

    This is great post on Making money with Domains.

    Can you give my where you can get 1000 posts for $120? Email is fine if you don’t want to mention it here.

    Thanks for the detailed post.

  17. emillyhardy Says:

    very intresting and informative thankyou

  18. Digital Point Sucks Says:

    I have been reading your posts. It’s all about showing traffic/revenue when it comes time for the “flip”

  19. Buy Me Domains Says:

    Awesome post! I never really paid attention to buying links and paying for directory submissions before but I will take your word on it and do so soon!

    Thanks.

  20. sandeep dhiman Says:

    its really great

  21. Raj Says:

    Great information. Thanx a lot!

  22. Fatcow Coupon Says:

    Thanks a lot for the informative post. I have wondering if you make money from pay per post too? I heard that is not bad for a good pagerank blog.

  23. Mickie Kennedy Says:

    I applaud you for your efforts. You certainly have achieved some remarkable results … but I think something is missing from your formula. I would like to see you build a real business, one that grows with the end goal being continued growth, not a quick sale. I did much of what you did above and created a business that does over $1.2 million a year. It is fully staffed and I haven’t been in the office in two weeks. Are you selling yourself short? Could you go further, dig in deeper and make a real profitable dent in a popular niche?

  24. Robert C - The Wholesale Products Guy Says:

    Great article..

    Just wondering if you could share some of the services you mention here..

    “120 bucks to freelance writers to write 12 articles for it.”

    “120 for 1000 paid posts by forum-posters and a few hours on building links. ”

    I am looking for a reliable free lance writer, and forum posters as well…

    Thanks for any and all information..

    Robert C – The Wholesale Products Guy

  25. 2D 3D Animation India Says:

    I never made money in Domain trading, but after reading your article i think i must try it one more time… may be now i will make some $$$

  26. DoFollow Blog List Says:

    I’ve thought about domain selling but have never been confident of my ability to pick the right domain names just for the resell value.

    Do you think it’s better to just sell the name or (as you say in your post) actually create content and THEN sell?

    Dwippy.

  27. Phillip Says:

    Excellent post, man. I’ll be spending some more time reading your blog this weekend. I don’t know too much about domaining but I do know it’s potential is great…

  28. DNyap Says:

    EasyLinkBuilding.com is parked at the moment. Is it the right URL?

    Best.

    - Paul

  29. encuestas remuneradas Says:

    buenas. como estas la verdad es que yo no me encontraba buscando nada acerca de este tema y es que en realidad este tema no me entretiene en lo mas minimo, pero te felicito porque la manera en que escribiste me fascino. Por primera vez he encontrado contenido digno en la red. Un saludo.

  30. David Says:

    Agree, a developed web site with traffic is of great value. However, with that said, based on hands-on experience, I can say end-users rarely if ever care about traffic and in fact don’t ask for any stats. Even if you offer them your stats, they don’t want to see it.

    Based on hands-on experience, I can say end-users rarely if ever care about traffic and in fact don’t ask for any stats. Even if you offer them your stats, they don’t want to see it.

    In view if the above I am far from certain a developed website with good traffic and typeins too will be appealing to end-user buyers, who actually may be a bit negative about your site and its branding.

    My comments do not indicate I am negative about developed websites, or do not value traffic. The exact opposite is true, since I have a number of developed sites which I am very happy with, most of which get good search traffic, plus typeins, and enjoy high SEO rankings.

  31. Keli Faggard Says:

    Reason, of which I can’t take part in at this moment through discourse to it is filled. Nevertheless I may gain and I can necessarily compose that we consider on this thought.

  32. trafficwave Says:

    I adore your website – nice job!

  33. Hawaiian Shirt Guy Says:

    What’s up with EasyLinkBuilding.com? It’s the wordpress basic page, completely undeveloped.

  34. self defense weapons Says:

    Thanks for nice sharing i love this post very much.

  35. electric underfloor heating Says:

    Thanks for the compliment coming from you that is praise indeed! I am also trying to develop, as selling names is not so easy. I am also keeping an eye open for new opportunities partcularly in real estate names, but from what I have seen getting the good generic names you mention is very difficult.

  36. self certification mortgages Says:

    Nice information. it open my eyes about different income source from internet. it looks great business. I think we have to good maintain before the site sold.

  37. Seve Says:

    well this is a nice thread no nasties here

    nice post keep it up

  38. Trafficvoodoo 2.0 discount Says:

    I want a domain name for my Email to make my buisness look more profesinal. I have been on a web site that sell domain names for £2.99 per year. Do I have to have a web site for a domain name or can I just add it to my Email. Realy I have’nt got a clue how it works can someone explain please.

  39. high eq people Says:

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  40. Hyaluron Kontaktlinsen Says:

    Hi bro, your post is genuine but where are the bookmarking buttons? I wanted to save your site in my bookmarks and can’t see the buttons. I use google bookmarks. I saved it instantly handsome, but it would be a hot betterment to put through bookmarking buttons. Compliments from Paris

  41. Wacky Wonka Says:

    I’m new to domaining and I’ve been reading a ton of stuff on the subject. This post gives me a great starting point to build from. Thanks a million!

  42. zayiflamayontemleri Says:

    Great great post !!!! Thanks

  43. adc Says:

    thanks I’m new to domaining, and this post has shown me the importance of developing my domains.

  44. MARTI HIDALGO Says:

    Interesante, felicidades, a ver si sigues escribiendo que yo siempre acabo dejando los blogs al cabo de unos años…

  45. SEO Says:

    sell domain on sedo :)

  46. Robin Ong Says:

    This is the first time I came across your blog. Honestly, you are good. Usually, I see domainers buying a great domain name then they either develop it or they just leave it in parking. Your method rhymes with what I believe. Great!

  47. Jim Says:

    You might want to take a look at http://www.DomainFlipClub.com I just bought their video training and Expired Domain Software which has given me an excellent system to grab domains the moment they drop to resell at auction for large profits. I spent countless hours researching the domain flipping subject. I am now a very happy person having finally found a program that will make me money. Update: I have just resold my first domain and made over $90 having just bought it for just $8 following the DomainFlipClub.com training.

  48. formula gana cash Says:

    Qué tal?. En primer lugar, quisiera decir que he quedado maravillado con la información que ofreces. Estoy sorprendido. Me gusta mucho tu estilo de escritura. Debo decir que no estoy de acuerdo al 100% con lo que dices pero respeto tu opinión y seguiré visitando tu blog para leerte. Un gran saludo y ojalá sigas posteando más información.

  49. Dinero En Encuestas Says:

    Las encuestas remuneradas se han venido convirtiendo en una oportunidad de negocio muy real y verdadero, cada vez son mas las personas que se unen a esta oportunidad de negocio.

    Para empezar a desempeñarse en este negocio solo necesitas adquirir una muy buena lista de encuestas remuneradas, registrarte en los sitios que te indican, (utilizando un correo electrónico creado especialmente para realizar esta actividad) y listo, ya puedes empezar a ganar dinero por internet con las encuestas remuneradas.

  50. Hollis Louth Says:

    There is a Wordpress plugin that you can use to display affiliate link-products in your blog so that they show up in a comparison price table. It pulls products from Commission Junction, Linkshare, Amazon and others. It’s really easy to use, sets up in minutes and works like any other plugin that you might have seen. Installing and activating the plugin takes around 30 seconds to do. Wait until you see what this software is capable of doing. You will have complete control over your price comparison product display modules. You can change colors, sizes and even the actual buttons that are displayed. If you want, you can have the software display a small image of the merchant logo next to the corresponding product. The software will automatically refresh the product prices on a daily basis if you tell it to. There is also a manual button that you can push in order to update prices. With full control of the product tables, you can make unique price comparison charts that look just how you want them to. If you wish, you can further refine your results by entering a minimum price, maximum price, Amazon category and Linkshare category. When the software goes out and retrieves the products, you can then choose to display only those products that you want on your page. Once you save the settings that you have selected, the product unit will automatically show on your page. Every step of the installation process is detailed in full, easy to follow even if you are a complete novice. You can use this plugin on an UNLIMITED number of websites. Check it Out -> http://adf.ly/1TxdN

  51. Internet Marketing Consulting Says:

    I am looking for a English writer.

  52. Gene Osenkowski Says:

    I prefer your blog than any other blogs on the internet

  53. Internet Marketing Consulting Says:

    how i can choose free ads domain name !

  54. Domaineering Says:

    There is another way besides flipping to make money off domain names. In the esoteric parlance of the vocabulary of the Internet aka computer jargon, “domaineering” is relatively new marketing term credited to the observations of ecommerce by Professor William Lorenz of Canada that has been gaining acceptance.

    According to Prof. Lorenz, domaineering is the niche web-based marketing business of acquiring and monetizing Internet domain names by purposely focusing on their use specifically as an advertising medium. In essence, the domain names function as virtual Internet billboards with generic domain names being highly valued for their revenue generating potential derived from attracting Internet traffic hits. Revenue is earned as potential customers view pay per click ( PPC ) ads or the Internet traffic attracted may be redirected to another website. Hence, the domain name itself is the revenue generating asset conveying information beyond just functioning as a typical web address. As the value here is intrinsically in the domain name as an information carrying vehicle and not in a website’s products or services, these domains are developed for advertising, ( i.e, “parked” ), and not into “conventional” websites. It is a mistake to characterize a parked domain as “unused” when in fact many are among the most highly specialized and monetized domains being as they are used solely for the purpose of providing an advertising service which generates income for their “domaineer” owners.

    As with traditional advertising, domaineering is considered part art and part science. Often to be the most effective as an advertising tool, the domain names and their corresponding landing pages must be “engineered” or optimized to produce maximum revenue which may require considerable skill and keen knowledge of search engine optimization ( SEO ) practices, marketing psychology and an understanding of the target market audience, including demographics and buying habits. Domaineering generally utilizes a firm offering domain parking services to provide the sponsored “ad feed” of a word or phrase searched for thus creating a mini-directory populated largely by advertisers paying to promote their products and services under a relevant generic keyword domain. Occasionally content is added to develop a functional mini-website.

    Ethical domaineers contend that their product, i.e., “domain advertising”, is a bona fide offering of goods or services in and of itself which provides rights to and legitimate interests in the generic keyword domains they use. This serves as a rebuttal or defense in addressing occasional spurious accusations of cybersquatting on trademarks. Domaineers and others who advertise online using generic keyword domains believe domaineering provides a useful, legal and legitimate Internet marketing service while opponents of domaineering decry the practice as increasing the ubiquitous commercialization of the world wide web. Those same opponents of domaineering suggest that a better use would be for one firm to develop a website for it’s products using a relevant generic keyword domain pointed at or as it’s url oddly for the same commercial purposes they cite the domaineer using it as, i.e., advertising. Allowing, however, one firm to control a relevant generic keyword domain in this way to exclusively market it’s own products under could be viewed as a significant barrier to entry by denying potential or actual competitors the same advantage to penetrate a market or maintain / increase market share. Domaineers instead can offer their generic keyword domains to several or more firms to advertise under thus promoting healthy competition and making markets more perfect than they otherwise might be which benefits consumers.

    Domaineering aka “domain advertising” is practiced by both large organizations which may have registered hundreds or even thousands of domains to individual entrepreneurial minded domaineers who may only own one or a few. The identification and defining of domaineering as a distinct Internet advertising practice is often attributed to Canadian Professor William Lorenz’s pioneering work in ecommerce evolution.

  55. Indian Recipes Says:

    I have a site named http://www.lovemewebs.com which i have bought 4 months ago and i want to sell it.Will you tell me how can i make it.

  56. Indian Recipes Says:

    Before 1 year one of my senior in work told me that he earns a good amount of money by selling and buying domain,now i understood how he made it.

  57. Android apps development Says:

    Excellent post, man. I’ll be spending some more time reading your blog this weekend. I don’t know too much about dominating but I do know it’s potential is great…I can feel that you have put in hard efforts.Good job!!!!!!!

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  59. Salvatore Sailer Says:

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  61. freelance seo firm Gurgaon Says:

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  62. Mike Says:

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  63. Darren Says:

    Very interesting read. You seem to be great at developing sites and creating quick income from them. Why did you decide to sell them rather then keep them? Did they take too much time to maintain?

  64. droid4pro Says:

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  66. web design Stoke Says:

    It is theoretically possible. But in reality, any domain name likely to be available for creation won’t be worth more than the cost of registering it. I tried this once. The best names I could find unregistered were things like ‘lacelike.com’ and ‘toadling.com’. None of them sold at auction.

  67. roman Says:

    Nice post! For those who are looking for a freelancer or someone to help assist them in their SEO needs, please reach out to me. I have done the rinse and repeat process several times over and can assist for a small fee. Please email me at: romanedmond@gmail.com for more details. Good Luck!

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  69. Servo Voltage Stabilizer Manufacturer in India Says:

    The most common and amongst the easiest and less time consuming is to put your domain name in the Google Adsense program. This way you will earn some spare change and your time you could still invest in that what you like.

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  72. c5 @ ohmsandvolts.info Says:

    Thanks for this post. I’m actually thinking of reselling my domains but thought of finding how. I have several domains meant as blogs but I have not given them much attention yet. I knew I will later. Meanwhile I’m making them grow older. It would be nice to have income that pays for its stagnant state somehow…at least…

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  78. Smias asdsa Says:

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  12. » Don Says:

    [...] he holds in order to concentrate on developing a few successful websites. Lord Brar talks about how he makes money from domains – essentially he develops them before reselling. Over and over we hear about how “pure” [...]

 
 
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