Danny Sullivan wrote up a summary on the current ‘ads on parked domains’ discussions, which were started off by ‘research’ (MS Research: Typo-Squatters Are Gaming Google) published by Microsoft (I am still wondering if this means that they are not going to try to get into this market with their Adcenter offering.).

I was planning on a summary, but his article give me a good starting point – while I don’t necessarily share his opinion:

Search Engines Making Millions Off Type-In Traffic From Domains

It’s not that domain traffic is necessarily bad nor that domainers are necessarily doing anything wrong. But there’s a difference between the person who did a keyword search as opposed to someone who did a navigational guess (a type in) versus someone who sees ads placed contextually on pages. Advertisers deserve the transparency of doing these as separate buys.

For a while I thought about this the same way, but is there really a difference? A lot of users seem to use domain names as a replacement for search queries. A generic domain that is typed in by the user would probably be the most likely to convert. Someone else follows a link that points to a domain that has been grabbed in a domain drop, will it convert? If they type a domain name of a brand wrong, they might end up on a PPC page. Will they find the brand name they were looking for in an ad on that page?

It would be great if someone (maybe one of the aggregators?) could provide data that shows that domains do work well for the advertiser. I am convinced that there are numerous examples out there. I would just love to see some research – it could teach us a lot. Maybe it even makes sense to split the traffic, based on it’s origin. And of course we also need to make improvements on the other end, after the click on the ad. Bad conversion rates can also be related to a bad and non-targeted landing page.

For the advertisers this is really about the quality of traffic, or even more specific, the likelihood of conversion. Which mindset is the end user in? Which part of the sales cycle is he in? There are many more questions that need to be answered so we can ensure that all the parties are treated fairly in the process. How and where should conversions be tracked, and how much higher would the payout be for a click that converts? What if the conversion takes place 6 months after the click?

Even if a space is very non-public up to a certain point, it’s always a good idea to try to steer how and where this topic will appear publicly, especially if you have a suspicion that there is a strong chance for a negative twist. Now it’s now important to control the damage, which can be a long and painful process.

Some more posts/discussions about this topic:

http://www.searchenginejournal.com/index.php?p=2694
http://www.circleid.com/posts/whats_wrong_with_domain_names/

In the end, I believe that the short term outcome might be that advertisers will be able to pick between content syndication, search and domain advertising. This will have a negative effect for a lot of domainers, at least in the short term. Long term it might lead to a tiered structure where the payout depends on different factors (a combination of of pay per unique, lead, action, click etc).

Happy New Year. Since it’s always a good question to ask at the beginning of a new year: What will this year bring for domainers?

Here are some things that come to mind:

• publicity (this will include more negative coverage)
• newbies
• new investors
• different levels of domain/site development
• new ad models
• portfolio sales and partnerships
• launch of .EU (more on this later)

What are your expectations/plans for the new year?