Archive for the ‘blogging’ Category

Elliot Hunts for Scaleable Margins (but he’s a domainer at heart!)

Friday, November 27th, 2009

Elliot-Silver-ProfitElliot’s Blog has an interesting post today where he states, “it’s better to have many smaller successful sites that require less time and effort than one large one that doesn’t earn enough to make you a living and can’t be scaled.” My perception is that Elliot is trying to move from a high margin business which is tricky to scale (domaining) to one with lower margins (development), which has the challenges of managing outsourcing/hiring to make it scalable . Then, per his post, within development he is trying to find the the best business to scale at decent margins.

There are those that manage to profitably scale domaining (Latona etc.), there are those that manage to profitable scale a single geo-domain, and there are those that live off mini-sites. The margins in each are different, but it is the leaders in each of the markets that make the most money because they have achieved scale. The key is being good enough to scale something!

I think domainers perception of profit is sometimes skewed by the fact that they underpaid for domains and have a lower than market value cost basis. They may think they are solid developers, but their true smarts are in getting domains at the right price. Any truth in that?

I look forward to seeing which path Elliot Silver decides to follow. If you think about it, if an e-book on parrots can make $400,000 per annum isn’t tropicalbirds.com the real goldmine if scaled? Or if you look at the Burbank advertising market size isn’t Burbank.com the site that deserves to be scaled? Or considering the Jewish population worldwide isn’t it Torah.com? Could any one of these domains make millions if scaled?

To me it seems that Elliot’s business model is evolving to value-add domaining, where domains are developed to show their potential and are available for sale on a multiple of future rather than current earnings (tropicalbirds at $45K when it makes dollars a day in AdSense). That in itself could be the business that he can best scale at the highest margins.

Elliot Shares his Crowd

Tuesday, November 24th, 2009

elliot-silverFollowing on from my comments yesterday about the open approach of Tyler Cruz, Elliot Silver has outdone him! For over a year now I have been an Elliot’s Blog subscriber, and enjoyed the commentary on the domaining industry. But for me, far and away the most interesting posts have been Elliot’s updates on his development activities.

As a domainer turned developer Elliott has always been very upfront about the limitations of his development smarts (although to look at www.burbank.com you would think he is an expert). His humility pays dividends as you will see from the mass of value-add comments he accrues as high level industry players such as the Castello brothers offer advice. When it comes to  SEO, Elliot will often just fire out a specific question, and I have often made use of the answers in my own SEO activities.

Then today Elliot informed his visitors, “Richard is looking for constructive criticism and some content feedback prior to launching his site.” To me this shows what a powerful resouce the readers of the blog are – that third parties are now seeking to tap their knowledge. I also found the web site that we readers are asked to review very interesting: IHateYourCompany.com aggregates customer feedback to identify companies that fail to deliver on reasonable customer service levels.  With the feedback of Elliot’s crowd I am sure major domainer Richard Whitney’s site will get an early boost.

The Cruz Crowd

Monday, November 23rd, 2009

Mr. Tyler Cruz

I like the way that Tyler Cruz writes his blog in an open fashion, giving his readers the blow-by-blow on how he manages his web site developments, affiliate campaigns, and software developments. It’s far more useful than the usual fare served up by the make money online gurus.

Right now Tyler is making regular updates on how he is developing a flash game: RobotWarz. He hasn’t developed anything like this before, and is opening the kimono by showing his mistakes as well as his progress.

Why is Tyler showing us this level of information when it risks leading to copycats threatening his business?

Because he is smart. If you look at the way Tyler asks questions in his posts, and the valuable feedback he receives in the comments you will see that he is benefiting from his readers who are part of the development process. He doesn’t have a budget for extensive user testing, but what he does have is a loyal tech-savy readership. By providing such useful information Tyler has gained the willingness of his readers to support his success.

I am pretty interested in how it all works out. I’d love to develop a flash game some day.