Well its certainly an interesting read over at SEObook.com a site dedicated as you would guess to SEO topics
Mr. Wall’s ultimate theory that domain names relevance are being killed off by Google’s new products and algorithm changes. His post highlights a recent newsletter from MediaOptions.com as proof that holders of Category Killers are trying to sell, trying to unload their domains, knowing that the SEO value for exact match domains are in and will continue to decline.
“The idea of an exact match domain (EMD) is that you are buying a piece of land right next to the highway. You sink in a lot of money upfront, but hope that it backs out over time by lowering your traffic acquisition costs. For many years this model was both logical and profitable.”.
“At the peak of the domain name bubble recently, the domain name Poker.org sold for a million Dollars.” (note this sale took place
“A domain name is an asset just like a stack of cash, a piece of gold, or a CDO is. But rather than having a fixed universal value, it is only a *relative* store of value that can go up or down based on market conditions.”
“In 2008 Eric Schmidt made the famous quote about how consumers are hardwired for branding. I mentioned how he was signaling the future of the algorithm, but was largely ignored at the time. Since then Google has launched:
- the Vince update, which was driven by query refinement (and thus promotes brands)
- the Panda update, which puts such an emphasis on brand-like signals that it allows doorway pages & scraped Tweets to rank on select authoritative websites
“The algorithm is only going to keep adding more signals that boost brands.
“PoolTables.com might have better editorial content than a mega-retailer like Amazon.com, but it is hard for them to collect as many reviews as Amazon can.”
“Matt Cutts also stated that they like the potential of +1:
Cutts confirmed what Google said when the +1 button launched: Google will use +1 activity to influence its search results.
“It’s definitely a signal we’re paying a lot of attention to,” Cutts said. “It has tons of potential. It looks very promising.”
Big brands can do giveaways to their core customer base to expand into new markets, allowing customers to pay for the discounts with a vote, stuffing the ballot box on these new “relevancy” signals.”
“Google shifted the top AdWords ads to having a longer headline, which provides roughly a 13% lift in CTR. ”
“For commercially viable keywords these have the net effect of pushing the organic search results further down the page.”
“In certain high money verticals Google offers Google Comparison / Google Advisor ads, which allow them to place a 4th ad slot above the organic search results.””Google has offered graphical product ads automatically matched to the search results. Generally for bigger brands Google offers these on a risk-free cost per acquisition pricing, whereas smaller advertisers need to pay by the click to use this ad format.”
“Search clicks are a zero sum game, so the more risk-free clicks the big box brands get from this ad format the lest clicks there is to go around for everyone else.”
“When Google Chrome launched it replaced the address bar with a search box.”
“That allows Google to…”
- intercept & redirect type-in traffic demand
- re-highlight content you have already seen in the past (likely to be from some larger brands, as they have larger ad budgets & more ways to be found)
- recommend popular searched-for keywords (which are often brands, since awareness-based advertising creates search demand
“When Internet Explorer 9 was launched Microsoft also adopted these featuresTaking control of the address bar one step further, Google has a beta version of Chrome out where the address bar is not even visible unless you scroll over that part of the page. Firefox also offers a similar beta extension! If this feature goes mainstream it wouldn’t be surprising to see Microsoft follow suit.”
“At first that statement seems like it could be saying that it consolidates search volume to a smaller set of keywords & thus could make domain names more valuable.”
“However, if you have ever looked at a list of the most popular keywords you would know that they are largely filled with branded keywords. ”
“The media was aware of this obvious shift & Amit Singhal had to do an interview stating that there was no brand bias to Google Instant.”If you buy a “category killer” it is critical that you rank #1, but in many niches the exact match domains that ranked #1 for nearly a decade are now #3 or #4 in the organic results. ”
“Add in 3 AdWords ads above the organic results & things like product ads and it isn’t hard to end up below the fold. If your relationship to that 1 keyword is your core competitive strategy but you can’t even promote the keyword (because you are below the fold) then the strategy is a failed one.”
“Further, as Google keeps adding more usage signals into the relevancy mix that will keep favoring brands.”
“This is not to say domain names are dead across the board. there is still plenty of opportunity in some areas, but equally some names require large investment & as an SEO strategy may get thrown under the bus by any of the above”
“I Stopped Buying Domain Names””I believe I was one of the first SEOs to publicly highlight the benefits of exact match domain names. Back when Google engineers were dismissive of it some of the smart money was dismissive of what the engineers stated and made plenty of money from it. But I have pretty much stopped buying domains at this point…as in most cases the valuations generally don’t make sense on a risk adjusted basis in the current market”
“The person who was likely the single SEO most responsible for running up the price of exact match domain names (he over-paid for some of them based on the presumption that the numbers would back out similarly to some of his earlier investments in a market that was dominated by a government-sponsored bubble) has now become a domain seller.”
“Now even he is now dumping many of his exact match domains, which I discovered in the most recent Media Options newsletter:”
“In March Matt Cutts talked down exact match domain names, but the truth is that Google never really needed to discount them, simply by adding more criteria to the relevancy algorithm which boosts brands they already had the same impact.”
“The smart money is now saying that domain names are generally significantly overpriced, especially as an asset class valued based on SEO potential.”
Finally Wall lists two final blows:
“Google also hit PPC parking revenues hard by being so dominant in search that they forced Yahoo!’s bean counter CEO to outsource search to Microsoft. “In one of Google’s new (literally no more than a couple days old) beta search results, they show domain names above the meta description / snippet. That could slightly increase the perceived value of some domain names, but a brand can always leverage relevant subdomains & new domain extensions will soon flood the market, so ultimately any benefit here could end up coming up as a wash.”
So boys and girls what do you think?
I personally have never spent hundreds of thousands of dollars for .net or .org domain or significant money on domains solely on the basis of how they would rank on SEO.
I have bought some category killers on my believe is such a domain puts you in a business immediately.
So if you own say RestaurantSupply.com that’s a business.
MotocycleHelmets.com that a business.
You can take one of these direct match names and start a business tomorrow. You can’t do that vary easy with a web 2.o name a three letter domain, or a long tail.
Over the years I have been approached about partnering with people who had SEO skills to buy a non-com for the sole purpose of SEOing the hell out of it getting it to rank in a high paying lead gen. topic.
I never pulled the trigger on it, because those domains values do in fact depend substantially on SEO and Google which we always have known, is subject to significant change at any time.
However for .com and other highly brandable domains like .Me there value comes only in part from SEO value but a larger part comes from brandability.
Having said that, the two sites we have developed into try eCommerce sites, with Exact Match Domains as Mr. Wall calls them, Luxurybedding.com and DiscountBedding.com are still ranking #1 under Google (and Bing) despite all of the changes.