Sunday, June 17, 2007

Way #4 to Generate Income - Domain Name Buying

Hello everyone.
It's good to be back after a weeklong hiatus. Today's post is going to be about Way #4 to generate an alternate stream of income - buying domain names.
First of all, you might ask yourself, what is a domain name? Well, a domain name is basically a website's URL (i.e. www.yahoo.com). Here, the domain or the host of the website is Yahoo! But let me explain a little further.
During the late 90s, there were a lot of small Web companies with names like www.1800flowers.com or www.beaniebabies.com or even www.watermelons.com. Some of these companies -these dot coms - survived and did well. But others went bankrupt and were put out of business. Subsequently, Internet users weren't visiting that now defunct site and so the name was less lucrative. That's where domain name buyers come in.
Because these website names did not generate a lot of traffic after the companies went bankrupt, some of the more enterperneurial websurfers out there decided to go to www.afternic.com or www.register.com and try to bid on different domain names.

Okay, now, you may say to yourself. I know how this works. But how does it makes money? Good question. Well, just as advertisers pay bloggers each time a blog visitor clicks on a link, if you buy a domain name, anytime someone visits that website with the domain name you own, and clicks on an advertiser's link, you get paid. The trick is to buy domain names that are common enough that lots of people visit the site.

Think about things this way. Whenever someone is looking for something, she doesn't always Google it. If a woman were looking for wedding dresses, she might go to www.weddingdresses.com. Or if a guy were looking for a new stereo system, he might go to www.stereos.com, where he would find tons of advertisements for stereos and other audio/visual equipment. The owner of the domain name 'www.stereos.com' makes money in her PayPal account everytime someone clicks on those advertisements.

Go to www.afternic.com, create an account, and check out the site to learn about how to bid for domain names functions. Also, here is the link to an interesting Business 2.0 article about one of the most successful domain name buyers of our time - Kevin Ham.

http://money.cnn.com/magazines/business2/business2_archive/2007/06/01/100050989/index.htm

Thanks for reading and I hope you all enjoyed. And please feel free to post any questions or comments.

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