6 Ways Not to Go Broke Developing Domains — Lessons That I Have Learnt the Hard Way.

Posted on 11 April 2008 by Lord Brar

Make Money From Domains

Ever since I made my Domaining Strategy post, I have been getting a lot of comments and questions from you all. First of all, thanks a lot for your comments and messages — that is exactly what keeps me motivated to write here.

Most of the questions which you have asked will be covered in upcoming posts about traffic, revenue, outsourcing, hosting etc. In this post, I am going to answer two important questions –

1. How to minimize your development costs?
2. How to Scale-Up this strategy?

This post will be one of the most important — if not the most — posts in the series as it describes the mindset you need to succeed in the game. These points are essentially derived from my own experience developing domains over the last 9 years — so yes, they are street-tested.

Let’s get started, shall we?

Tip #1 – Know Your Niches

This is perhaps the most important tip I can ever give you — Focus on niches you already have an interest in. This will make your life a lot easier, fun and profitable. To quote Diorex from WickedFire –

I dont think that unmarried college age guys are going to be rockstars at promoting a menopause product or even a baby shower list. Look to your life experiences for things you naturally know a little bit about. Sure you can learn, but why set yourself up for a longer more difficult road.


I’d also quote Hugh MacLeod from his HughTrain Post

Hugh Train

Even though the niche you are interested in may not be as profitable as pay-day loans or credit-cards but it would be easier for you to know what people really want and dominate your niche. This would translate into much higher overall profits and you’d have fun doing what you love.

PS: I have some finance domains lying around which I just can’t get myself to research into and develop! If you have an interest in grabbing them cheap, give me a holler.

Tip #2 – Think Small. Seriously.

It is particularly important to remember that you cannot satisfy everyone at the same time. If you try to do that, you end up disappointing everyone.

So, don’t try to build general-purpose and “one size fits all” kind of sites. TO make such sites truly spectacular you’d need a lot of resources — which should not be your objective.

Let’s say that fitness is one of niches I operate in. To build a general fitness site covering topics for both men and women would be absolutely crazy on my part. If I focus on Men’s Health, that would be better and easier for me but it would be very broad subject and still require a LOT of resources to create good site in.

What I would do is that I’d split the niche into further niches — building abs, reducing fat, dieting, bulking up, upper-body exercises, stronger legs, sports training, cardio-exercises, aerobics etc. — and build separate sites for them. This would make it easier for me to build the site quickly, promote my sites more easily and get more targeted traffic.

Now, I am not saying that you cannot build sites on broader topics — I do it all the time. But, be prepared to put more resources and energy into them. I have a lot of broad-niche sites but I have even more sharp-niche sites.

Tip #3 – Use “Out-Of-Box” Solutions

Don’t re-invent the wheel. If there is some “out-of-box solution” available for what you want to do, use that — even if it means some lost functionality, you will be saving tons and tons of money and/or time that you would have to spend on programming and design.

Most of the times you will be able to find a free open-source solution, all you need to do is look hard enough.

For content management use WordPress or Joomla and use free or cheap templates to change the look. For forums you can use vBulletin or PhpBB. Photopost PHP or Coppermine get the job done for a photo gallery. vBulletin will also take care of your Social-Networking needs.

Use a site like HotScripts.com to find out the various available scripts. You could download and install the script on your server — most of the times Read-Me files are detailed enough.

If you are not comfortable doing it yourself, hire a freelancer — but read Tip #5 before you do. Also, don’t use any third party hosted services except widgets and analytics.

Basically, the whole objective here is to use the already existing free or cheap tools to build your website.

Tip #4 – Re-Invest into Your Domains.

Start milking revenue from your domains right away by using affiliate links, CPA links, Google AdSense et. al. Contrary to the popular belief, sites CAN make money from low but quality traffic.

To give example of one of my own sites, it got only 8 visitors from search engine and made $147 in affiliate commission.

So, optimize your site for revenue right from the start — even though you may get only small amount to traffic initially, but you don’t want to waste it.

Now, whatever money your site makes, re-invest at least 75% back into the domain. Promote the site, get professional content written, buy new software or get custom scripting done — but, reinvest the money to grow your site.

Remember – your site’s revenue is not your pay day but rather your pay day will be when your 25% becomes substantial or if you ever sell the site.

Tip #5 – Freelancers Will Screw You

Or at least 80% of them will produce crappy stuff or miss deadlines and you will lose money with them. But it not all gloom — you have to know and follow certain rules of thumb which I will be discussing in later posts. I will embed a link to the post here whenever I publish it.

Also, if you are subscribed to the newsletter, you will get a buzz as soon as I publish the post. So, if you are not already subscribed to the newsletter, it is a good time to subscribe now.

Tip #6 – Keep Close Financial Records

The idea is to keep a detailed record of how much you have invested in a domain and what sort of returns it is getting. I have found that keeping records will not only keep you updated of your current reality but will also keep you motivated to work harder.

With my own sites, I keep an excel file with weekly details of how much traffic did the site get and how much money did it make from various revenue channels. If both don’t increase consistently, I know I need to get moving to grow these figures.

Also, do it on a weekend and don’t spend too much time on keeping super-detailed stats tracking every figure under the sun — just a bird’s eye view of where your sites are going in terms of revenue and traffic. Your priority should be creating and promoting your sites.

Closing Thoughts

Now remember — these are just the rules-of-thumb and the list is no way exhaustive. Also, every situation is unique and you will learn the most by diving in and doing. So, start working, start making mistakes and start learning!

Stay tuned for other posts on the subject including – Stockdale Paradox, The “Big Fat Lie” Media Wants You to Believe, Building Websites, Choosing the Right Host, Traffic Secrets, Art of Recurring Profits and Revenue Maximization.

26 Comments For This Post

  1. Bill @ AvailableDomainNames.com Says:

    Well written and a subject I’m very interested in as the current landscape of domain monetization seems to be heading more and more towards development. I look forward to the rest of the series.


  2. F P Says:

    Just want to say thanks for writing these great posts! I have a few domain names and am just beginning to develop them…I have had some of these ideas and learned new ones from you too in terms of streamlining the operation..

    Thanks a lot and good luck!!!

  3. Art Deco Says:

    Hello –

    I always enjoy your posts, but you are never specific enough for newbies like me – how about some numbers on how much time or money you put into a site before selling and what sales price range you are looking for? Like 2 months and $50 for a $500 range site or putting a year and $5000 into a $25,000 range site (just examples) ?

    Which would lead to another question about how to predict “when to hold ’em and when to fold ’em” ?
    Not really trying to steal your secrets, I’m just clueless.

  4. Neek Says:

    Thank you for the excellent series, and mindful, thoughtful, thought-provoking tips.

    I’ve read many domain development posts before, but yours resonates best and deserve the kudos you have.

    Keep up the fine work. And thanks.

  5. Aaron Says:

    Thanks for sharing all that very simple but very useful advice which most of the time gets overlooked.

    Did like the advice about the free scripts, theres usually a script to handle almost anything out there and I’ve always offered it to web design customers with the idea that some scripts have been in development for such a long time that you’d have a hard time trying to create something better by yourself, as you say ‘don’t re-invent the wheel’.

    That also goes for some of the paid scripts too, you have to price up how long it’d take you to develop and ask yourself honestly whether you could do a better job.

  6. Lord Brar Says:

    @Art Deco – I am wondering what you mean by how much time and money should be put in to site before selling it. Can you explain it a bit more?

  7. Troy Duncan Says:

    When I first started developing domains I would spend all of this time building sites from scratch. It took forever and that didn’t include any marketing. Once I started using WordPress, I became more productive.

  8. Art Deco Says:

    Maybe I didn’t express myself well. Quoting a wise man “I keep an excel file with weekly details of how much traffic did the site get and how much money did it make from various revenue channels. If both don’t increase consistently, I know I need to get moving to grow these figures.”

    With some sites it just seems like they plateau at a certain volume – maybe a 100 uniques/ month, maybe a few 1000 uniques/ month, but never enough to actually profit by either affiliates or ad cents clicks – and then they they just don’t grow much more. It is hard to know whether to put some more time or money into them or sell them and move on. That’s what I was talking about – some way of judging what the potential of a URL is, and how many times to submit it, or add content to it, or let it be.
    I assume you have to have enough domains running through your system that you develop some or list some for sale every day or every week, so when do you decide this domain is not worth holding?

  9. John Motson Says:

    Very nicely put together post. Cheers mate.


  10. Nimesh Says:

    Nice post.

    Can you give links to some of the niche sites you own?
    Thank you.

  11. Lord Brar Says:

    No – I don’t disclose the domains and sites I own.

  12. Holly from mobiEnthusiast.mobi Says:

    Thank you for your informative post. I have enjoyed reading your posts on the forums as well as your video with the CEO of mTLD but did not realize you had your own blog. I’ve just subscribed and look forward to more of your thoughts on domaining.

  13. Lord Brar Says:

    Holly – thanks for dropping by and your kind words. Appreciate it!

  14. damir Says:

    Great post – I hope that all domain name owners read your post.

    100% spot ON

  15. Lord Brar Says:

    Help spread the word Damir! =)

  16. Ervin Ter Says:

    This is the article I looking for from the beginning. Thanks for this nice article and you are bringing me out of my cloud. Thanks and Thanks again!

  17. Raj Says:

    Awesome post m8 🙂 Thanx a lot!

  18. jai Says:

    nice ideas, i initially learnt through the mistaked i made in selecting the hosting company for my domain. now i know to choose the right hosting company.

  19. 2D 3D Animation India Says:

    Very nice post, keep it up. Thanks for sharing it.

  20. Fero Says:

    Grate posts , I have a question since i don’t have much technical knowledge of building a web site ;

    Is it better to go for word pres web site or build your own 5-10 pages
    site as they are not that expensive to be build ?

  21. Gadgets Deals Says:

    Greats tips i also develop some niche site too

  22. Beau Scrabeck Says:

    I enjoy reading your site’s information and all and i like the threme structure including the colour but perhaps it requires a different feel to it, its been quite some time, what do you guys think?

  23. wet basement floor Says:

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