I just received the following statement from Snapnames, and I wanted to share it with readers of my blog, who may have been impacted. Below the statement is some commentary and additional information from Snapnames.

“Recently, SnapNames.com, Inc., discovered that an employee had set up an account on the SnapNames system under a false name and, under this name, bid in SnapNames auctions.  This is a clear violation of our internal policy and was not approved by the company.

Extent of impact

This conduct affected a small percentage of SnapNames auctions:
·         Bidding affected approximately five percent of total SnapNames auctions since 2005, most of which occurred between 2005 and 2007, before SnapNames was acquired by Oversee.  To a much lesser extent, auctions in 2008 and 2009 were also impacted.
o        In less than one percent of these auctions, the employee won the auction
o        In the other four percent, the employee lost the auction
·         The incremental revenue from the bidding represented approximately one percent of SnapNames auction revenues since 2005.

SnapNames further discovered that, on certain recent and limited occasions, when the employee won an auction, the employee secretly arranged to refund from SnapNames to the fictitious account a portion of the winning bid amount.

To avoid any question about whether the company benefited from this conduct, SnapNames will offer a rebate to impacted customers, including 5.22% interest (the highest applicable federal rate during the affected time period), of the difference between the prices they paid in winning auctions, and the prices they would have paid had the employee not bid in the auctions.  Impacted customers will be notified by SnapNames or its representative with instructions for the offer of a rebate.

SnapNames has already begun notifying customers of the situation.

SnapNames also has taken further action to ensure its policies regarding auctions are followed, and the company remains committed to taking whatever action is necessary to protect the integrity of its auction platform.

SnapNames deeply regrets this situation and is committed to addressing its customers’ needs quickly and fairly.

Customers with questions may contact:

By e-mail:                     support@snapnames.com
Phone:                          +1 (866) 690-6279 (toll-free in the U.S.)
+1 (503) 241-8547 (outside the U.S.)”

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Last year, there were issues surrounding a Godaddy employee who was bidding on expired domain auctions. At the time Oversee.net told Domain Name Wire, “Oversee.net employees are strictly disallowed from bidding against customers.”

Mason Cole, a spokesman for Snapnames has told me the company will not reveal the name of the employee, but DNN is reporting that the user name involved is “HALVAREZ.” The company will not disclose any legal matters related to whether charges are going to be filed against the employee.

One has to also wonder if Oversee.net has any recourse related to the private Snapnames acquisition. The bidding activity impacted revenues prior to the acquisition, and it also had an impact on bidding activity as well. I want to applaud Oversee.net for taking the actions they did and for coming forward with this information. I am sure it will hurt their bottom line, but their reputation is much more important.

I will post further information as I receive it.

I think one of the most important things you can do in order to achieve success in this business is to define the goals for your business and set milestones to achieving your short and long term goals. Think about the question, what would you like to accomplish in the domain investment business?

If you are looking to buy and sell domain names as a hobby, you can probably forget all about mini sites and web development. You will end up spending a lot of money on things that are unnecessary. Keep abreast of domain news, trends, and threats to make sure your business model is evolving as necessary. Continue buying good names for good prices, and do what you can to keep your costs and overhead minimal.

If you see yourself being involved in the domain business full time at some point, I strongly advise you learn about web development and SEO from non-domainers (similar to what Alan said). I may be able to share a little bit of knowledge about web development, but you really need to learn about that stuff from experts. I can help you with domain names, and I can share the things I am doing with you, but when it comes to web development, programming, SEO and other technical things, I am just learning, too, and the best advice I can give is to do what I did and research the smartest people in those fields and learn what you can from them.

For me,  two years ago, I realized that it might get difficult to make a good living (for my career) simply buying and selling domain names, so I opted to go the development route. I’ve made plenty of mistakes along the way, but I’ve also done some things right. Fortunately, the domain sales business has remained pretty good, and I have built value on many of my development projects, but I am constantly refining my plans and path for the future. It’s critical to keep your eyes focused not only on the things that are right in front of you, but also on things that are going to happen down the road.

Think about it for a minute. On domain forums, blogs, news sites, corporate sites…etc, every person and company situation  is different. Some people do this as a part time hobby, others do this full time because they were smart enough to register great names many years ago, and yet others are somewhere in the middle. There are people living in high tax areas and people living in tax havens. Some people are married and have kids, while others are in college or high school. We all are in different situations and what one person does has no bearing on what others should do.

How you see yourself in the future as it relates to the domain space is important, because you need to do things now to accomplish your future goals. Take some time to figure out where you see yourself and do what it takes to get there. Everybody has a different path and a different road map. What’s good today may not be good tomorrow.

One of the few new companies I learned about at Traffic New York was Elephant Traffic, and I just saw the press release below announcing the launch of their platform. The company has a large presence at Ad:Tech New York this week, and I think it’s good to see domain portfolio holding company reaching out at a mainstream event. The company is officially launching this week, and they’re holding a launch party tonight in the City.

Here’s the press release:

Elephant Traffic announced today the official U.S. launch of its new web-based interface to drive targeted search traffic to users’ domains. The service is designed to help advertisers optimize online spend by offering a steady traffic stream that is 50% more likely to convert and 40% cheaper than that of pay-per-click ads. Elephant Traffic provides real-time reporting and unprecedented transparency.

Elephant Traffic and its partners have a vast portfolio of domains with high traffic that results from direct navigation searches, which entails searching by URL such as laptops.com or mexicovacations.com as opposed to using search terms in a search engine. That traffic, which can be grouped by vertical and geography, can be directed to the buyer’s site of preference using the Elephant Traffic’s web-based interface found at http://Elephant-Traffic.com. Advertisers select streams of traffic from available domains and redirects can be set-up with a few clicks of the mouse with real-time monitoring. Elephant Traffic is the only provider of transparent direct navigation traffic, which allows you to choose the exact domains from which you would like to receive traffic.

Wei-Hai Chu, Elephant Traffic’s CEO, explains, “Not many people are aware direct navigation search amounts to 14% of all online searches and that only 11.5% of this traffic is being captured by traditional online advertising. Elephant Traffic gives advertisers the ability to capture this highly targeted yet untapped traffic quickly and easily using a streamlined interface.”

Discussing the direct benefits for advertisers, Commercial Director Daniel Goris says, “We’re able to give advertisers direct access to consumers who are twice as likely to complete an online purchase. Direct navigation search traffic has been neglected till now but our research has shown that it delivers up to 50% higher conversions rates than standard PPC advertising. What we’ve put together offers advertisers a great tool to diversify their online budgets and boost conversion rates.”

Elephant Traffic is pleased to launch in the U.S. at ad:tech New York and will host an official launch party on Nov. 4th at 1OAK on W. 17th St. between 9th and 10th Avenue from 7-11pm. The event is by invitation only but to register for more information, please visit http://Elephant-Traffic.com/adtech.

Elephant Traffic specializes in providing advertisers with high-quality targeted redirects originating from direct navigation search traffic. Elephant Traffic is part of Elephant Orchestra, a Prague-based company dedicated to innovation within the world of domains and traffic monetization. For more information please contact Jeremy Lopez at +420 725 060 188 or email jlopez@elephant-traffic.com or visit http://www.elephant-traffic.com.