A few months ago I started investing in domain names, a name that identifies one or more IP addresses. It is basically like real estate but online. Virtual real estate if you will. On average domains will appreciate around 35% a year. This is significantly better than real estate's 10% appreciation per year (over a long timeline). Lately real estate has been depreciating hard so it does not even compare. What's more, you don't need that much capital to get into the domaining game.Since I am an SEO professional and recognize the importance of ranking high on the organic search results, I have used a strategy for buying domains that is different from most other domainers. I bought domains for the keywords within them with the intention of developing them slowly over time for very specific highly targeted keywords. With time it will gain visibility on the search engines that will help build up the amount of natural search traffic making the site easier to eventually sell. Here is an example of what I mean.
Selling Structured Settlement Group
The following domains all revolve around "selling structured settlements," a particularly expensive KW according to Google. Check out SpyFU for a list of keywords with the highest cost per click.
http://www.selling-structured-settlement.com
http://www.structured-settlement-investment.com
http://www.sell-structured-insurance-settlement.com
http://www.sell-structured-settlement-payments.com
I am making a bet that keywords in the domain are going to be a very important factor for search engines when determining the relevancy of one site for a particular keyword search over another. So far I have found that this works best on Yahoo and MSN than on Google. Also I will populate the sites with original content over time, as well as video's and pictures, and taking advantage of the slow adoption of optimizing your site for universal search.
The added bonus. Since I work as an SEO I need my own websites to experiment on and try new strategies for ranking higher. I can't do this with client sites since I need their permission to make changes and often time deal with other agencies just to get something implemented. This makes me a better SEO and can help me command a higher salary later. Also, by running ads on the domains I make some kind of an income while I wait for traffic to build up. This gives me an opportunity to experiment with different ad networks and different payouts. It's like real estate in that I can build on it and add value to it (add unique content) and then flip it while it makes me income (ad revenue). I will update this blog with new learnings from my adventures in domaining as well as other investment vehicles. Comments are welcome!
