I tossed and turned to write about this and well… I’m writing about it because I just can’t figure it all out.
I had wrote 3 posts about "Insurance" domain names purchased made by one company, 360 Quote LLC. They purchased at least 52 domains that I reported on for a total of over $210,000 . I have seen more domains they purchased but didn’t write about them and there are likely more that sold in private.
My point is, they purchased a good deal of domains for a lot of money!
Spending this money is not a game. It is real money and an investment that clearly they want to make a return on. The domain names were purchased for a reason but the million dollar question is.. was it the right choice!
Since the domain names were purchased, development has taken place.
So I started dissecting the development and that is where it makes me scratch my head and making me think… That can’t work and if it does, there is a better way!
So what did I find out when dissecting the development on the domains? Here are the bits and pieces with what is being used:
- Geo auto or car insurance domain
- WordPress
- Over Easy ~ Woo Themes template (blue)
- CPC Company (SureHits.com)
Repeat the process over and over again. Very little if any content was used currently. Now I am not sure what Joel used to decide what domains to purchase and for how much, but this is what makes me question everything so much.
Here is an example.
One domain that was purchased was ConnecticutAutoInsurance.com for $11,500.
The exact term is searched approx 1,900 times per month according to Google. Now with many "Geo" related searches on Google, Google shows their Local Business Center results. In return, this pushes natural ranking results down the page. To be exact, you do not even see NSR unless you scroll down for this search term.
Since a domain name like ConnecticutAuoInsurance.com is not what I would consider a "Direct Navigation" domain name without advertising (AutoInsurance.com would be a DN domain) 360 Quote LLC is banking on this domain name ranking well for the exact search term IMO.
The biggest problem I see, the site is not going to get that much traffic! Why? The site idea is not bad, but spreading the "site idea" out over 50+ domain names spreads traffic thin on the specific domains. Google likes Busy sites (traffic) and will rank you better if you have traffic.
Building a kingdom should take place on ONE DOMAIN and use that domain and the options you have with Sub-Domains and Categories to get specific!
What ranks #1 on Google for Connecticut Auto Insurance? CarInsurance.com .
CarInsurance.com is doing this a way that I can see it working! Using a category to put it’s focus on the search term, Connecticut Auto Insurance. CarInsurance.com repeats this with thousands of "other" popular car/auto insurance search terms which helps them rank well in SE’s. The reason behind them ranking well in SE’s is because of the Kingdom they built and all the traffic flowing to one domain. One Great Domain, then using the tools of categories to focus on the terms they want to rank for.
Since CarInsurance.com will be getting ALL the traffic for each niche they wish to focus on, it will be extremely hard to out rank. Why? CarInsurance.com is very likely to get Direct Navigation and secondly, traffic from SE’s due to the focus of search terms used as categories.
Now a little bit about the CPC program (SureHits.com) used on the sites like ConnecticutAutoInsurance.com . This is really like most affiliate programs. I personally would not click on anything on the site. Nothing really makes me want to. No cloaking in place, so it is clear to me that you will be leaving the site if you click on anything. The Geo focus is very minimal, with occasional matching Geo terms in CPC links.
For the site owner to convince a visitor to click on something is all about the wording and design. Link Cloaking in this case is very important IMO.
I would hope Joel did some testing before jumping into buying all these domains and building all these sites. If he did testing, that tells me that the affiliate program he is using, is Working. I have no way to tell if it is working for him or not, but when I look at the system being used, the amount paid for the domains.. it looks like an up hill battle.
Considering to do something similar? Take the Kingdom approach like CarInsurance.com did. Spend the money on the category kill domain and put your focus into the development of the kingdom. Funnel all your traffic into one source, a great domain which you can build a brand around and use that kingdom to put focus on your niche areas.
wannadevelop.com
It’s called arbitrage… You buy cheap traffic at google, yahoo, msn and all the 3rd tier engines and throw it at this pages which have an extremely high PPC potential.
The exact match of the domains also should help keep the price real low for the bidded keywords at adwords for example… Over the long run, the $ spent on all those domains will more than pay for itself but it was definitely a long term investment.
Sammy Ashouri
“Building a kingdom should take place on ONE DOMAIN and use that domain and the options you have with Sub-Domains and Categories to get specific!”
I definitely disagree. I’ve built a “network” of niche related domains and was rewarded very well for the time and effort put into it. It’s pretty much the same concept as this insurance network, so I can relate to what they are doing in a way.
“Considering to do something similar? Take the Kingdom approach like CarInsurance.com did. Spend the money on the category kill domain and put your focus into the development of the kingdom.”
Although CarInsurance.com would be a great domain to this with, sometimes it’s just not possible. A lot of people might go “WTF?!” but how much do you think CarInsurance.com is vs this bulk deal. Millions of dollars vs the $200K deal makes a big difference. Some can get away with their business idea for $200K as opposed to millions.
“My point is, they purchased a good deal of domains for a lot of money!”
Exactly… so imagine how much CarInsurance.com would be!!!
My point is if you have an idea and can’t get the category killer but can do the alternative (which is what these geo-niche insurance domains are), I say go for it!
Wrote quite a bit, fweef. Got side tracked making some pasta, so I hope it made some sense, lol! I almost wanted to make a blog post out of this comment.
Great post Jamie
.
Domain Development
Jamie,
Assuming that surehits pays a similar CPC rates to adwords, it looks like it would take about 6 months to achieve ROI on these insurance domain purchases — once the domain ranks in the SE’s. I’m basing this on getting 100 clicks a month at $25 CPC.
If the SEO, linking and content is done right on these sites, I think they’ll be making money on top of their investment starting in Y2, which would give them a 100% pa return.
If you bought CarInsurance.com at whatever the purchase price might be, I’d be amazed if you earned a 100% pa return on it.
There’s lots of niches out there like this where people pick the low hanging fruit all day long. Just have to find them!
- Richard
Fanny
Truthfully….I think everyone is right, but there are so many caveats, which makes it hard to be 100% right.
You can skin a cat using either of these methods, it just depends on your skinning techniques, and what you know that others don’t.
RKB
Jamie,
You always bring good pints out in your posts.
In this case you have some valid points, but I must agree with other comments.
As we have tons of geo specific domains, it is our experience that nothing beats these domains for resale as well as earnings even a simple one page site can recover your costs and then make some on top.
Local people feel secure dealing with a site that has their state/city/county/town name in the URL in my opinion. That’s where Joel is going to get a leg up on CarInsurance.com when it comes to converting the visitor.
PS: We sold some of the gei-insurance domains.
Thanks,
DNBlogger
Alan
Jamie,
Your opinion reflects one of someone who tends to theorize about domain development yet has never practically put it to use in the format Joel is doing.
$210,000 for these domains was a great price and one that will pay off many times over. Even if the sites stay the way there are now (which very well may not be the case) they have started indexing and will provide a return from day one.
Surehits is not comparable to affiliate programs or even Google. We earn a great deal of money from them and I can tell you thier payouts are far more than you would ever receive parking. In fact, the vast majority of insurance websites built for lead generation use Surehits as they are quality based mostly for sites with organic traffic and pay good for it.
Although I respect some of your opinions – you know, the 50% of the time you’re not complaining about something or someone
I have to say there are many ways to make money online and Joel’s concept is one he is extremely smart to do given the availability of such names at todays prices.
Of course, everyone wants CarInsurance.com but this way is the second best thing.
$210,000 is not a lot of money.
Its a lot of money when you dont have it but its really not a lot of money. Put $210,000 in a money market – get 4% – buy some domains and develop, get a hell of a lot better return with assets that will only go up in value. The only bet here is will the pure asset (comparable to cash in the money market analogy) will go down in value.
Highly doubtful – these names are pretty secure – with traffic they only become more valuable.
Even if Joel did testing – which I’m pretty sure he did – why would he share this or show the world his testing.
Your article assumes he never tested.
Pretty sure you’re wrong.
A key figure in this industry who spends in the millions per year buying domains for development emailed me the other day and I will quote his words direct in reference to your direct navigation comments
“If you’re good at SEO, who cares what the traffic levels are if the domain has search potential”
pretty much seems up why anybody would pay any price for a name without type in traffic.
Unless the traffic is substainial nobody gives a shit about it who can develop.
I’ve always said there are two teams in this industry – the domainers and the developers.
Developers build a domain’s value.
Domainers bitch about a domain’s value.
Bitching has and always will get you nowhere.
Peace.
RKB
Allan: Nice write up….mostly agree, even though I am a domainer (who occasionally bitches about value)
Jamie: Let me spill some beans here…..I am not talking about development earnings…..based on my experience with my insurance domains’ ppc earnings I can say that nothing beats insurance, period.
I have purchased 58 geo-insurance domains in last 24 hours. Now I don’t like to throw away money but I know they are worth way more than what I paid for them to the right party.
Get geos in insurance, law, loan, mortgage, credit, travel, home improvement related products/services and you can’t go wrong. I generally stick to population over 100,000.
Thanks,
DNBlogger
Anthony
RBK … Question for you … would you consider
a domain like BankingForum.com good to target
insurance, law, loan, mortgage, credit ?
(Jamie, another excellent post thanks)
RKB
Anthony: BankingForum.com is a nice domain. In fact, pretty good. If you develop it nicely, you can make living out of this domain imo. Yes, you can use it for everything a bank offers.
Ed Muller
It takes a long time to see results from a big investment with domain names that have never had content previously. Part of the reason is because there are so many other entrenched results and SE’s like things to get backlinked and move up perhaps slower than we might like them to. But once you gain top 3, you are really on your own and earning nicely.
I think anyone that develops $210k in names has a plan, and expects the long-term to pay off.
nSathees
You miss the SEO point. The exact term in link will rank the site to top. They should get the right SEO guy, and they can reach what they wanted.
Anthony
RKB … thank you for your response … the highest offer I have received so far has been $15,000 … I may develop it one day, right now I am focusing on something else … but if you want to do a JV …
Anthony
Jamie Zoch
My biggest concerns are if these domains will rank well in SE’s based on the current development. SE’s can clearly see the outbound links as affiliates and they knock a sites “rank value” if this is the case. Again, I do not see these domains as direct navigation type domains, so without a top 5 rank on P1 in SE’s, the traffic will be minimal without advertising and the costs that go with it (across 50+ domains). No matter how high the clicks pay, if there is not any traffic, the clicks will not take place. Overtime I can see this working but more development is needed on the sites.
RKB
I recently sold another geo insurance domain (www.CaliforniaInsuranceFinder.com) and the buyer already put a site on it….a simple site to run an actual insurance business.
Now this domain was a perfect fit for the buyer’s needs.
For similar (including the domains this post is about) domain sales, here is what buyer gets:
1. Affordable investment on a per domain basis instead of paying millions for CarInsurance.com
2. Spread the investment risk in to many individual geo domains instead of all investment in one domain such as CarInsurance.com
3. In case of a downturn, CarInsurance.com will lose much more of it’s value than these geo domains. It’s just like million dollar homes versus homes in $200k-$300k value.
4. Buyer has good chance of selling these domains for 2, 3 or even more times their original purchase price than CarInsurance.com, CarInsurance.com will have hard time becoming double or triple it’s purchase price if bought today imo.
5. Geo domains are esy to develop as the target area is small and exact search term can rank high in SEOs.
Then again, we all have our own preferences and I just like geo domains given my experience with them.
PhilKing09
Some great points in your article. Still, there is nothing wrong with niches on the internet. If you know where to find those online “fishing holes” where there isn’t strong competition, you can build a Google success spending time more so than big money.
Available Domains
To each his own… Not everyone can own a generic domain like CarInsurance.com but can own and market geo + keyword domains.
Domain Development
“My biggest concerns are if these domains will rank well in SE’s based on the current development.”
Jamie, if you’re talking about the duplicate content and bad user experience, I’d agree with you.
But I think the current owner is throwing up these sites to see what sticks and what he can get away with. That’s easier than full scale development, and we all know domainers are lazy!!
When I read your post, it seemed that your point was more about the domain names themselves and not the content and lack of user experience.
I think that these domains – with the right development – will make a tidy return on investment for years to come.
- Richard
jim
I’m anxious to see how autoinsurance.com will be developed. Currently there is no “orbitz type” site for auto insurance where the consumer can get multiple quotes by entering his information once, and buying the policy. You and I can go to individual insurance company websites, get a quote, and buy, but the companies won’t “share” their rates, etc. in an orbitz type format. Maybe autoinsurance.com can pull it off. I’ve noticed several stateinsurance.com url’s for sale, for what seems to be reasonable prices. missouri, tennessee, utah, and illinois (i think). Some of these can be had for under $100,000. If autoinsurance.com sold for $10,00,000 or so, aren’t these state specific url’s underpriced? I realize that autoinsurance can sell in all states, and a state-specific wouldn’t draw as well. The state name opens up other types of insurance though. Any comments or information on prior state sales would be appreciated.