by Domain Graduate Staff

As a new entrant in the domain investment industry, you’re likely to find more opportunity in development than in parking alone. Generic names are often sold at high yearly-revenue-multiples (YRMs) based upon PPC revenues, which places them out of the price range of most investors. While the first chapter of the domain industry has unfolded, keep in mind that you’re entering at a stage where there’s still a great opportunity to begin developing names and doing well with smart keyword research.

When selecting names beyond prime-generics, it’s important to be selective and come to understand the potential in a given market. As a first start, since we’re targeting search-engine traffic, you’ll want to check out WordTracker (FreeKeywords.Wordtracker.com) which provides ISP-level data on search query popularity. Make sure the root keyword(s) in your domain reflect a popular industry and have market demand. Let’s take an example of forming a solid-two word domain around the accounting industry – suppose we chose [Word]Taxes.com or Taxes[Word].com where [Word] reflects your choice of prefix or suffix (these can be verbs, e.g. FindTaxes.com, adjectives, e.g., BigTaxes.com, or nouns, e.g. CityTaxes.com.) Wordtracker tells us that the term “taxes” is search 2,679 times per day – this is a strong industry, as we would expect.

Now that we have verified there is market demand, you’ll want to see the monetization potential in the chosen vertical. There are two aspects to this question: advertiser prevalence and SEO-competition. Google provides us with two proxy metrics for each of these questions. To determine advertiser density (the number of PPC advertisers for a given keyword) we can check: http://www.google.com/search?adtest=on

This reveals there are 50+ advertisers on the term “taxes” – this is a green light. However, it’s also important to analyze the difficulty of ranking for such a term – so we analyze the title tag prevalence of the term (how often developed sites use the term “Taxes” in their meta title tag – a prime component of SEO targeting.) We search for intitle:”taxes” on Google to find nearly 2 million competitors for this prime generic term – chances are, when developing a new site we’ll have a tough time ranking for such a top-level term.

Taking the next step, it’s important to analyze the WordTracker data to find “long-tail” keyword that we can target – these will have fewer searches, but will be more directed in user intent, and will certainly have less competition. When choosing domains to begin development keep in mind that Google looks for quality keywords as well as domain age (ideally you want to purchase solid, aged domains at good values on the aftermarket, but when registering a new domain for development, register it for at least 2 years). In the next article we will hone in on how to begin targeting prime niches and choosing a platform for development that is cost and SEO-effective.

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