My Belated Annual July 4th Post. A confused Industry.

Morning Folks!!


I have made a July 4th post as long as I can remember online. I started writing this a couple weeks back along with several other thoughts and posts that were never finished or just decided not to publish. There is so much to say right now. So much confusion and second guessing. I re-evaluate things every waking day. New info, could mean a new result or just fortify what you believe even stronger.


Let’s just admit most of us have A.D.D. (Attention Deficit Disorder) and I think I can prove it. First of all we would likely not be domainers as we would be satisfied with just one domain name. We would be satisfied with perusing just one project. We would be happy owning one business. Shall I go on? Call it what you like, but as unfocused as we are, I think I am seeing even less focus as folks begin to doubt themselves., their futures and their own beliefs because they just don’t have the inner strength not to be swayed by their peers or the masses.


Domains are becoming very important and moving to center stage as I always knew they would and have said so repeatedly over the years. Almost decades! However many Domainers are weak and throwing in the towel. The numbers say 80% will give up before finding the success they so dearly wanted to find. Budgets are stretched and domain investors are forced to become domain flippers.


I see the weekly auction numbers like you do. It mostly shows weakness. $1.4 million this week, $1.2 million next week, $1.5 million the week after. To me, shows weakness. Not because of the numbers or even the number of sales. But the prices and the reasons that are forcing that sales. BILLS! OVERHEAD! MORTGAGES!


Domain Investors have been overrun with all types of other folks making a living off domains. That’s not a bad thing unless you don’t recognize and understand that. They have different agendas and goals with a lot of overlapping. Overlapping does not mean to ignore the defining lines and the various sectors and many new sectors to come. It means to understand them, use them, be one of them if that is your calling. But don't ignore anything.


For years I have talked about type ins and am always abruptly interrupted with a chorus of different views minimizing traffic. Well sorry, this game IS about traffic. Maybe not all domains, but you need a BASE of domains with traffic to support those with value that can’t support themselves. Those that ignore this continue to struggle more than any other group because they are missing a key piece of the puzzle and play the game with a huge handicap.


The entire PPC system is based on type in traffic!! Not based on seo traffic. The seo was just a way to abuse and take advantage of the system and Google allowed it for some DUMB or monetary reason. So if you don’t use ppc you are forced to be a flipper. It’s kinda funny for me. I entered domains and the Internet and the first place I ever posted was on a board with a bunch of folks flipping Mobile Homes. It was the same group as I see today on domains except the cost of doing business with domains is lunch money. They quickly removed my posts and tossed me out with the garbage for simply suggesting they could substitute this thing called domain names and do the flipping faster and make loads more money. I think Serge may be the only one that actually remembers because he was there and he too had his posts removed.


The industry is weak today as sales are forced. Forced to pay the bills. And when you are forced to sell, you have to sell your best. Junk is hard to sell. Sometimes you can’t even give it away. NNN.co for example. Nobody even wants the carrying charges or can afford them. Not even domain flippers and that says it all. Besides, why pay more for something proved to be inferior and pay 2x or 3x as much? But step away. Domain names, especially .com are stronger and more powerful than ever!!! The masses are just beginning to realize the importance and power and so many domain investors just can’t quite see the end of the tunnel. Don’t give up! We are almost there. Land ho! Land ho! This is the START not the end. Do everything you can NOT to sell you unique assets. Values are going to explode! And if .whatever does not lead to the promised land, they will explode again and even more so.


I have been enjoying the clarity of what is happening and what is to come. If you look at things as a snapshot, then fear comes. When you look at it as an evolution and a revolution, a huge smile comes. I feel JOVIAL!! I also feel bad for those that either don’t believe in themselves or don’t believe in their domains. That had to do it “Their way” regardless of the results.


If you are being FORCED to sell domain to survive, something is wrong and so many are in that situation including some large companies in the space. But look, we all see things differently and all I can do is share the way I see it and if what I share rings true, then hopefully understanding will come along with it.


I watch folks and domainers chase what happened yesterday. What a waste!! You don’t chase yesterday folks, you set up shop on tomorrow and have them pour you a drink. You don’t CHASE, you WAIT! Because if you wait, it means you got there before them and you know they are coming. If you chase, that train already left the station and it may be never before the next train comes.


So if you positioned yourself well, sit back. Take a deep breath. 1000 doors of opportunity are about to flood the market. And just like metal, there is gold and tin and a market for each. Many won’t be metal at all. Clay and they will break apart the moment they are touched.


So clarity and excitement and fulfillment all at once. As I mentioned on my email last week, there have also been a few constants. At the core are the 350-500 domain investors that came from every walk of life from all points of the globe that refuse to give up their vision. Have minds as varied as the stars and are bonded together by something we ourselves can't even explain. We are explorers with varying booties of treasure. None the same, but many alike. We have nothing in common and everything in common.


So for those that think it is over, let me tell you a tiny secret. It has yet to even begin. We are at Babe Ruth valuation not Derrick Jeter. Don't know or understand the difference?? Then don't waste your time disagreeing with me, invest your time and learn why I am right! Because sales is the driving force, understanding and great need will happen. SALES!! New Clients. Growth. But it won't be in your time frame, it will be in their timeframe. All we can do is accelerate and bend how long it all takes. Need, want and desire will be the path to the future and following the money will tell you the answers. Consumer money is smart. Investor money is not as smart. Type ins are the consumer speaking. It's the holy grail whether you want to accept it or not and it is going to determine the fate or success of almost every non-brand extension to come.


Thanks for reading and here is my post from July 4th 1998. Times changing?


Have a GREAT Day!

Rick Schwartz

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20 thoughts on “My Belated Annual July 4th Post. A confused Industry.

  1. Paul J Kapschock

    “….let me tell you a tiny secret. It has yet to even begin.”
    “This is the START not the end. Do everything you can NOT to sell you unique assets.”
    Rick….for me, this is one of your best posts!
    Lots of encouragement….thanks.
    Everything takes time…months and years. You must have a 5 or 10 year plan.
    Is the internet and websites at their apex…or will this”internet thing” continue to grow and grow each day and year? is the internet dying and losing viewers?
    No…this is only the beginning of the future and we are watching and participating and helping it grow. This is the starting point.
    We are at ground zero, many things are changing…. but things still take time.
    Rick, Thanks again for great post.

    Reply
  2. Andy Kelly

    hmm spot on advice if you have the well earned luxury of being an early adopter and a very interesting perspective.
    Thing is you have the luxury of holding out for mega bucks Rick…you earned that right so I’t not meant as a back handed compliment.
    Early – domain – adopters such as you and others that maybe can be counted on two hands and two feet max.
    As a broker (in the main) I’ll offer another angle. In the last 3 weeks we’ve brokered 4 n.d.a’s in the high xx,xxx region and all with 4 separate buyers and four separate sellers.
    All 4 sellers initially wanted the following $500 k, $250 k, $150 k, and $100 k and all four came down and sold in the $70 k to $99 k price range.
    All four made a very good profit (id estimate a 30% – 150% mark up for all four)
    Sometimes you are best to flip at a profit. Holding out for mega bucks isn’t always the best strategy imo.
    best
    Andy

    Reply
  3. Rick Schwartz

    Thanks Andy, understood.
    But one point to make. Many of us still to this day hand register domains that get type in traffic.
    As a broker, I would want to study a domain for at east 30 days before I flip to see what the value might be. And if I see that domain value going up, no need to sell or flip.
    But I do understand your model and that of many others. I jst don’t see many millions that way and it is a hard grind at times.

    Reply
  4. I'll give you $100 for that domain!!!

    It’s peculiar how many domainers don’t even care about type-in traffic. It’s the majority of my focus.
    When the economy crashed in 2008 and many domainers were stuck with no income, meaning no PPC or sales, however, even though I took a hit as well, my direct navigation income more than paid for all the renewals and helped me navigate the storm. As a side benefit, I had cash to buy up the nice drops, which were everywhere at the time, at VERY nice prices. It appeared that many of the other domainers just were not there because they did not have cash.
    BTW…we are already entering another recession/depresson. Save your nickels folks to buy domains. Right now prices have gotten expensive on the expired lists.
    A big opportunity will reveal itself if this perfect storm happens: 1. Recession/depression hits
    2. New TLDs get launched
    3. Domain to domainer sales soften b/c of #1 and #2
    4. Even more domainer money is removed from the market b/c it is going into the new TLDs
    If this happens there will be a big opportunity to load up on .com domains at great prices again.
    Nice post btw, Rick!

    Reply
  5. jeff schneider

    Gratefully, Jeff Schneider
    Hello Rick.
    I have read many of your posts over the years and many light bulbs have gone off. This is a post that made the hair on my head stand up.
    The sheer beauty of its truth shines through and illuminates who you really are. One whose only motive is to educate and show the way for all the many tiers or classes of Domainers in our Industry, from the small fry to the Big Fish.
    We all have taken many arrows over the years, and have suffered through many Dog and pony promotions, only to be confused and mislead. Thank You for this trutfull Vision.
    Jeff

    Reply
  6. RaTHeaD

    the internet is just a fad… smoke signals are the future.
    i’m headin’ down to the patent office today to register all the best shapes and colors. great post.

    Reply
  7. Kevin

    Every industry goes through cycles. The domain market currently has far more sellers than buyers which is suppressing sales and prices but also creating lots of buying bargains for those with cash. Most domains are total crap and will never sell no matter how low the price. Anyone who overloaded their portfolios with non-quality and non-typein domains is getting zapped.
    From my observations, this is simply due to the two main market conditions that the traditional monetization methods dried up significantly in the past couple years as did the ability to generate search traffic on a continuous basis for the domains in portfolios that were non-typeins and heavily relied on Google and other SEO sources for traffic.
    Sales are fine for those with quality typein domains. The majority of high end sales continue to be private ones you don’t hear about.
    My best advice for domainers is to prune your portfolio to a manageable fixed overhead and keep only your truly great domains. The key to success going forward is FOCUS! You don’t need thousands of websites to be successful and make lots of money on the Internet, just a handful and sometimes only one domain and site will get the job done. It’s also critical to understand you have to be more than just a website developer. You have to be an ONLINE BUSINESS BUILDER and have lots of skills and areas of knowledge to succeed.
    Like Rick is saying the domain game has not ended, it’s just changed. Recognize that fact. ADAPT to the new”board” and you’ll continue to make lots of money.

    Reply
  8. Dean

    Rick,
    Your NNN.Co will not be worth the registration fee when the new extensions come out.

    Reply
  9. Scott Alliy

    Spot on Kevin, Couldn’t agree more Rick. History does repeat itself and just as many could not see in domains what you saw years ago even with all the sales history and success stories of Internet businesses built on good names most still an’t see it.
    Doesn’t mean they never will, means the end user buyers haven’t seen the need or benefits yet.
    Got a price quote request for an events industry name we own which we later determined the inteested party holds the .co .uk extension.
    Obviously they are in the business and obviously they are interested in the name. So what are we to do because they bonked … give or flip the name away with sadness and defeat? Not on your life.. they will return as sure as the internet will continue to morph and grow and as print declines digital and digtal properties including good .com domain names will increase in value proportionate to their value to individuals and businesses.
    Stay focused, stay patient and stay tuned is my advice to those with good names and the finances and mental strength to weather the current sales / price slump.
    BTW looking forward to news of you next xxxxxx.xx sale and to sharing news of one or more of our own soon.

    Reply
  10. Gene

    Great post.
    I also get the feeling that a lot of domain investors are worried about long-term valuations, with developments like Siri, apps, and Google Glass; and as a result are quick to flip names more out of fear than a profit motive.
    While apps are wonderful, they represent an extremely focused user experience. Try turning Microsoft’s or IBM’s site into an app, when each has many thousands of documents and presentations built-in. Most major websites today are incredibly comprehensive and not at all conducive to becoming ‘appified.’ And their gateway requires a domain name.
    And regardless of ‘how’ one arrives at a website (voice, eye-tracking, touch), it still doesn’t change the fact that (a) the domain name is the ‘people-friendly address’ (b) the site’s brand would be seriously undermined if a numeric IP address were used as a substitute for the domain name, and (c) Google isn’t going to fundamentally change how it indexes sites (even if it does change the presentation of those results when accessed by Google Glass).

    Reply
  11. Dean

    Rick,
    LMAO!
    Now… if those NNN.Co’s were NNN.Com’s, and you took them to China (or anywhere else), you could trade them for ALL the Tea in China!

    Reply
  12. Raymond Hackney

    Rick would love your opinion of Frank’s post, as much as people follow you they follow him too. Frank is flipping calling for a high water mark, that all brands will have their own tld in a decade.
    He is someone like you that wrote brilliant posts about the value of .com, him flipping on .com is a big deal. I am not saying he is right, but he influences a lot of people.

    Reply
  13. Rick Schwartz

    Raymond,
    I can’t give you one until I sit down and talk to him in October. I wish him nothing but success!
    What I can say is when you have extra dollars you look to put those dollars to work looking for an oil well. Looking for another hit. It’s natural for a businessman to do that.
    Here is how I would frame it. Frank mortgaged everything he had to get into the .com game. Would Frank mortgage everything he had today to get into .whatever? $60 mil is a major chunk of change, but his net worth is substantially more.
    I study human nature and humans can be like rockets or mules. They will decide the fate and direction. I think content will be the driving force with any new gTLD. Unless there is what I would call”Destination content”, I don’t see things changing for decades at the earliest.
    I never used the word”Clusterfuck” in my life until I saw this clusterfuck. But success with a new gTLD and clusterfuck may or may not be related. Clusterfuck for most, riches for a few. See you can sell a dream and get lots of money, but the day you turn a profit is the day reality hits.
    I PRAY that one of the new gTLD’s break out. With what we have learned, it would be great. I just don’t think the second coming will happen for 40 years. I do 20 year plans only. lol

    Reply
  14. Rick Schwartz

    I am just a numbers guy. When I take the”Pulse of Business” and think of businesses on Main Street and Wall Street, I see a 90% rejection rate right from the get go. 90% will say I already have my domain name, my business name and really don’t need any others. 90%. Before we even delve into the numbers 90% will reject the notion. Reject without thought because it is something they don’t need, want or desire.
    Now 10% will examine it and consider it. 50% of those will reject it.
    That leaves 5% of the market at best in my eyes. 5% that want something and do desire something. Unfortunately the results won’t be so desirable and then they will be forced to abandon. That is assuming you get 100% of that 5%.
    And if I am really wrong, you can double the numbers. If I am really right, you can diminish those numbers by 50% or more.
    And all the unemployed SEO guys spamming the world will have something new to spam. No TRUE SEO guy is EVER looking for work. EVER! These are just spammers.

    Reply
  15. Jeff Schneider

    Hello Rick,
    You as usual are”Dead Balls On”
    Your servers are heating up and the increased traffic may be the cause? Lots of people want to know what you know , Heck me included.
    Gratefully, Jeff Schneider (Contact Group) (Metal Tiger)

    Reply
  16. rob sequin

    “You don’t CHASE, you WAIT! Because if you wait, it means you got there before them and you know they are coming.”
    From your lips to God’s ears as they say.
    I have 2500 Cuba related domains.
    Still waiting :-)

    Reply
  17. Jeff Schneider

    Hello Rick and all True Domainers,
    Although Domainers may be Dazed and Confused about which direction to go, this is only a short evolutional phase, leading into your brightest future imaginable.
    We are coming out with a published article within days, that will Rock the Domaining World, but more importantly Rock all the many new Business owners streaming into Cyberspace with their new businesses. We see the largest business expansion in recorded history lying dead ahead.
    Gratefully, Jeff Schneider (Contact Group) (Metal Tiger)

    Reply

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