I am still away for DomainFest, and two of my friends have written guest posts related to topics in which they are experts. On Monday, Jeff Behrendt of INForum.in, wrote about investing in Indian domains. Yesterday, Richard Douglas discussed social media for domainers. Today, Richard discusses investing in dropping domain names. Richard has a diverse background is systems administration, web development and security. You can read more about domain development on his blog or follow him on twitter.

==

If you scan the drop lists, you’ve probably noticed a lot of good quality drops lately. And I think this trend will continue throughout 2009.

When I look at drops, I’m looking for domains that could be developed into full sites.

In addition to checking keywords, search frequency and advertiser interest, here’s a few tips of how to spot good drops for development.

Domain drop tips

1. Domain age – look for domains that are 8+ years old. The SE’s like old domains, it’s a trust issue. I’ve had great results taking an eight or 10 year old domain that ranks for very little, building out a site of unique content and ranking in the top 10 for one or two word phrases and #1 for long tail phrases. I use a script using the whois command from my linux CLI to check domain age. There are lots of tools out there to do this, of course.

2. Check for back links – in a perfect world, a domain with back links, especially .edu or .gov back links, would jump to the top of my list as a good drop for development. The SE’s give a lot of trust to domains that have .edu and .gov back links because these type of back links are less spammy and harder to acquire. I use yahoo search using the following command formats to check for .edu and .gov back links: “linkdomain:domain.com .edu” and “linkdomain:domain.com .gov”. I use this command to check all back links to the domain, except internal links from the domain itself: “linkdomain:domain.com -site:domain.com”.

3. Verify the back links – if you find that the drop has back links, you need to verify them too. You never know if people played games to get back links, and the SE’s have devalued or ignored the back links. Once you use yahoo search to find those back links, copy the back link URL and search for it in google to see if google lists it. If the page is listed, that means google is giving some weight to the back link. Normally, I just check the .edu and .gov back links in google because they are the most valuable.

Put it to the test

Elliot has added a top drops page to his blog. I recommend that you check it out regularly.

As an example, I have selected a domain from Elliot’s top drops page to illustrate the tips. The domain is: discoverhawaii.com

1. This domain was registered in 2000. Great, keep it on our list.

2. The domain has 83 external back links according to yahoo search. Woohoo!

3. The domain even has four .edu back links, and three of the four are listed in google!

In this example, discoveryhawaii.com is a domain worth chasing on a drop for development.

What do you look for in a good drop?

As with most industry conferences, the first day of DomainFest Global was mostly spent catching up with old friends who I don’t get to see on a regular basis.  It was good to see most people in positive spirits, and it looks like the tough economy is helping people step out of their comfort zones to explore new ways to generate revenue with their domain names.

Here are a few notes from the first day:

Several months ago, I wrote about domain security and how I thought there could be improvements made to add an extra layer of protection over our domain names.  Moniker introduced MaxLock a while ago, and I learned last night that Name.com has a great new security feature available. As reported in CNN Money today, Name.com is offering customers a security key fob with an ever-changing authentication pass code.  Customers must enter their standard password, and they are then prompted to enter the security code from their key fob.  This is certainly a great way to protect a domain portfolio.

Rick Latona wrote a compelling post about why domain investors should consider attending the TRAFFIC show in Amsterdam.  He and I spoke about it in greater depth last night, and I all but bought my ticket to the show.  I have to work out a couple of things, but I am fairly certain I am going to attend. I know enough about country code domain names to know that I need to learn more about them.  I saw them used quite frequently throughout Europe during my honeymoon, and it seems like a good way to diversify a domain portfolio.  Tickets to attend TRAFFIC Amsterdam are now on sale.

The Moniker no/low reserve auction netted about $128,000.  Not too bad in my opinion and a fairly good start to the show.  Eat.net was a pretty strong sale in my opinion, and there were also a few bargains.  Nothing really sold for a lot less than I expected, which is a strong sign.

Mike’s beautiful wife Judi celebrated her birthday in style last night and I am glad I had the chance to wish her a happy birthday in person.  One of the more difficult aspects of traveling to a conference is that I leave my wife for a week because she can’t miss her graduate school classes. Mike is very lucky to be able to travel to these conferences with Judi, and the best thing is that they both realize just how fortunate they are, and they always look like they are enjoying each other’s company.  Here’s to many more good years (and to Bandit’s leg healing quickly!)

Last night was a blast.  I had the chance to spend time with my friends at Thought Convergence - parent company of Domaintools and Trafficz, who continue to innovate and expand in the industry.  I also finally was able to meet Craig and Stephen of WhyPark.  I recently launched one of my niche domain names with WhyPark (Oenophiles.com), and I hope to share some results and feedback in a few weeks.

Well, that’s it for now.  I am running on little sleep right now, but I am pumped to get the day started.  This is what happens when you travel across the country and are on New York time in California!