The primary reason the domain parking market is attracting investors is because of cash flows, but underlying that interesting is widespread dissemination of a single, head-spinning stat: 15% of people navigate via guessing a domain name — oooh, I think Paul’s “Infectious Greed” must be at www.infectiousgreed.com (it isn’t).
Call it the Granny Goto. No sensible person who had been around the Net for some time would ever imagine that they could simply guess a correct URL. Even the White House site is tricky if you forget the .gov and go for .com. Non-grannies navigate to new and existing sites via bookmarks, links and search engines (usually Google).
So here is the trouble with preying on Granny Goto advocates. While it works today, it’s predicated on ignorance and crummy technology. Both change quickly over time.
Ignorance changes as prior generations of naive sorts either learn to navigate the web, or, frankly, pass on. Crummy technology also changes, as that 15% of direct nav sorts aren’t exactly finding the experience pleasurable. Me-thinks they would happily use a browser that incorporated search and high-speed lookups to auto-suggest from the address bar (“Do you mean “White House”?).
The upshot. The current ardor for investing in vanilla domain parking looks short-lived to me. For sure there are many opportunities in related areas, and people will make good money from domain parking for a good while yet, but chasing solely after the Granny Goto strikes me as awry.