Facing The Absurd

My lead generation business happens to be the fastest growing department in the company, with 350% year over year growth. Over the course of a year, the lead generation business grew from 1 person to 9 employees and by the end of the year I would like to have at least 20 in lead gen. So far we are only active in the Czech Republic where we are getting the proof of concept right before we expand abroad in the next few months.

At this point we are very close to doing $100k in revenue (we should pass that level next month) a month from lead gen with a 35% gross margin. It still contributes very little profit in comparison to my domain portfolio, but it is a huge growth business that in 2 years time could be a substantial contributor to our EBITDA. Our revenue target for 2010 is $1.8 million, which should be very attainable.

In the past year we’ve done a lot of tweaking of the model, implementing new marketing channels etc and I am pretty sure we’re getting the model right now. I’d like to share our model with with you guys. Maybe it could bring some inspiration to you or you could in exchange share some of your ideas how we can further improve.

90% of our lead generation business is finance – personal loans, payday loans, mortgages, credit cards, car insurance, life insurance etc. We are trying to expand the model into other areas now such as telco and utilities, but that’s still going to take time.

We work with clients only directly. Our selling point is pretty much this – Let us handle your performance marketing, instead of clicks we will provide you with more targeted leads (where you can exactly measure the performance) and we can generate volume. And lastly, we put our money where our mouth is – we invest in all the media buying on our own account and hope we will make the money back on leads. Compare this to various SEO/SEM consultants that offer ambiguous advice.

Once we have secured the client we build a professional landing page (we now have a lot of experience with this) that will convert well. Then the integral part is the marketing mix. The marketing is really just a form of arbitrage where you want the money that you spend on advertising to make you more on leads. This involves a lot of testing, measuring conversions etc. Currently our marketing mix that we find to work looks like this:

• Killer domain – we own some of the best generics in the finance sector in the .cz namespace such as the equivalent of “loans.cz” – pujcky.cz (example of our lead gen site).
• PPC – we buy quite a lot of clicks via Seznam.cz (largest Czech portal) and Google and arbitrage that against the leads
• SEO – we work hard to get organic rankings and happen to be pretty good at that
• Affiliates – we created our own affiliate network which now has more than 360 affiliates and is on of the top5 affiliate networks in .cz
• Display advertisig – since we need to create volume, we are also a pretty big spender on display advertising. Downside is that leads from display convert worse for advertisers than say, from ppc. But you need it for the volume.
• Email – we still haven’t realized the full potential of email marketing, although we have collected an opt-in database of over 110,000 email addresses. Still a lot of potential there.
• Mobile marketing – since we usually have the mobile numbers of people, we are starting to experiment with this as well. So far we mainly use mobile marketing as a way to improve to quality of leads for our clients – for example by certifying that the customers mobile phone number is real. We could use mobile marketing more aggressively though.

So this is pretty much how our model works and I am sure we are getting it pretty right.

So how do we plan to grow our lead generation business this year? Mainly through 3 opportunities:

• Focus on more sectors – As I said, we want to diversify more into telco, utilities, travel etc.
• Take a jump up the value chain – We want to be able to offer clients not just a lead, but also the closing of the sale and hence take a bigger cut of the action. We are starting to build our own callcenter for this.
• Expand abroad – This is probably where the biggest potential is. Our marketing mix may be a little bit different though. I see a lot of potential in especially arbitraging my domain traffic to leads. I currently get about 700k uniques a day so that’s a decent supply of traffic.

Ladies and gentleman, welcome to my new blog about domaining and other related industries. In many ways this is a coming out for me (I have quite a few gay employees, so I often find myself using their terminology). Since I started in domaining in mid 2007 (started with cctlds, bought my first .com portfolio in December 2007) I have kept a pretty low profile, so most of you probably have not ever heard of me. In the course of the last 2 and a little years I have built one of the top 10 largest domain portfolios in the world. When I was starting, people would tell me that all the good domains have been long gone. Fortunately I didn’t listen…

Anyway, when I look back I’ve had a pretty phenomenal run in last two years since I finished University. Although I’m still just 24, my businenesses now span across domains, lead generation, affiliate marketing, domain monetization, a car insurance broker, search, arbitrage, facebook apps & games, mobile marketing and even a liposuction clinic altogether employing more than 70 people fulltime.

So why have I started blogging. Well there are multiple reasons. One is that the domaining community is simply great and I think it’s time to give back a little. When I was starting I was pretty much addicted to Frank Schilling’s blog (I finally got to meet the guy last month!), it was probably the most valuable resource for me and I would try to reverse engineer many things that Frank would talk about. Now it’s time for me to share some of my tips & tricks! Second reason, connected to the first one slightly, is that there really aren’t many decent domain blogs out there. Pretty much the only ones I find worthwhile of reading are TheDomains.com, DNW.com, DomainNameNews.com and DNJournal.com for the features and sales charts.. All others just seem to have a lack of insight, are limited to publishing recent sales and worst of all, don’t get the game and some are complete attention whores. So I plan on to bring a new interesting resource via my blog, Facing The Absurd. And thirdly, since I am starting quite a few new ventures, I need new channels of promotion, and a blog is a perfect way how to push the message.

I’ll be posting mostly about domains, monetization, acquistion strategies, financing etc. But I will also touch other related businesses such as lead gen, affiliate stuff, online marketing because in many ways these industries will come much closer to domaining in the future.

And lastly I might as well elaborate a little on why this blog is called Facing The Absurd. It’s a reference to my highschool love of absurdist/existentialist thought coming from authors like Camus, Sartre, Dostoevskij, Kafka etc. In many ways I view my life through the absurdist lens and my life is really about facing the absurd state and finding a meaning in a meaningless world.

So, happy reading, I’m off to write a few first meaningful posts…