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Jeff Reynolds
AmericanFlags.com
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A
perfect example of this is AmericanFlags.com,
a name 38-year-old New Yorker Jeff Reynolds picked up on Ebay
three years ago for just $2,650. Reynolds didn�t
know it at the time, but landing that generic gem would change his
life forever. To see just how much it would impact his world you
have to take a look at the path Reynolds originally embarked on
before hitting a detour that sent him to an unexpected destination
� the domain industry and a new role as an internet entrepreneur.
Reynolds
grew up in the Long Island community of Holtsville, New
York, a town best known as the home of the Internal Revenue
Service. The IRS is all about collecting money, but that
was never the focus of life for the Reynolds family. Jeff's mother Maureen
was devoted to helping others as a public health nurse and Jeff
decided lending a hand to those in need would be a central element
of his life as well. He went off to college and earned a Bachelor's
degree in psychology followed by a Masters in public administration.
Today he is completing a Doctorate in social welfare policy at the State
University of New York at Stony Brook. |
Reynolds
has helped staff a variety of health care and social service
charities and continues to work in that arena, primarily focused on
governmental affairs, public policy, public relations and
fundraising. As if his plate weren't full enough, he also opened his
own marketing firm. Reynolds told us �I intentionally keep one
foot in the charitable field and one in the business world as each
complements the other. I believe wholeheartedly in community service
and try to bring some of my business skills into that field. Vice
versa, I try to bring a sense of fairness, justice and ethics into
my business dealings. I wouldn't be happy doing one without the
other and my financial success has enabled me to do even more for
causes I care about.�
Much
of that financial success can be attributed to Reynolds fortuitous
discovery of the domain business five years ago. �I stumbled
into the domain world in 1999 when I found a bunch of URLs listed on
Ebay,� Reynold said. �All were selling for huge prices, so I
trotted over to Netsol to find out what they cost to
register. I was shocked to find out that they only cost $70!
I picked up some clunkers, but then got ModelingAgency.com. I
found it available one day, slept on it and then registered it the
next afternoon. Shortly thereafter I sold it on Ebay for a pretty
nice sum and I was hooked!�
Like
just about everyone else who trod that path before him, Reynolds did
hit a few bumps along the way. �I fell into the typical pattern
back then of registering a bunch of crappy names and then minutes
later exchanging inflated appraisals with other folks on the old Afternic
boards. Over time though, I had some decent Ebay sales and did
some pretty steady business with regular buyers. It really was a
trial and error kind of thing, but I began to figure out what buyers
were looking for, learned the drop cycles and other ins and outs of
the business�
�Taking
it to the next level required some help,� Reynolds said. �The
support, guidance, encouragement and friendship I've enjoyed at Rick
Schwartz's domain board has helped me immeasurably.�
That board is an invitation-only forum that is growing rapidly after
recently opening to all who attended the recent T.R.A.F.F.I.C.
2004 domain conference in Delray Beach, Florida.
Reynolds was a featured panelist at that event where he made a huge
impression on the attendees with his account of how he built a
thriving business with AmericanFlags.com.
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Reynolds
(center)
Speaking at the T.R.A.F.F.I.C. 2004 Conference
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�I
think we all look for that life-changing domain and I found it on October
6th, 2001,� Reynolds said. "That was the day I won
AmericanFlags.com on Ebay. Given that 9/11 had happened just
three weeks earlier and the country was bathed in American flags, it
seemed like a pretty safe bet. The dream could have gone up in
smoke though, as the Ebay seller was approached by an
unsuccessful bidder who asked him to "forget that the
auction happened" and to instead sell him the domain for
$8,000. However the seller kept his word and forwarded me the emails
with the higher offer in case I wanted to put a deal together with
this unsuccessful bidder - something that wouldn't have happened at
any price!�
Reynolds
added, � I keep those emails close to me even today as a reminder
that there are two very distinct types of business people out there,
especially when it comes to online business - those who are ethical
and those who are not. Another unsuccessful bidder wrote me a very
nice email and became my chief supplier of flags until he ran out.
We both made out pretty well.�
Reynolds
thus embarked on an adventure that would require him to learn an
entirely new industry and go off in a direction he had never
envisioned before acquiring AmericanFlags.com. Parking a domain on a
PPC (pay per click) page and collecting revenue is one thing.
Developing a full fledged business with marketing, inventory acquisition
and order fulfillment is an entirely different ballgame. However
with the targeted traffic being drawn by that domain name, Reynolds
felt he had no choice but to follow the development path.
�I
started carrying some basic 3'X5' flags and they moved pretty
quickly from day 1. However my supplier drop-shipped everything for
me, so I really needed to simply email him the orders on a daily
basis,� Reynolds said. I supplemented the product roster through
some affiliate programs. Most of those started out offering me a 5%
commission. You can't imagine how good it felt to call some of them
and say in a demanding and somewhat obnoxious voice, "We are
AmericanFlags.com and we want at least 20%. To my surprise they
agreed!�
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For
Reynolds that
brought home the power generated by a good domain name.
"As my guy blew through his inventory, I needed to find a new
supplier. In the process I figured out that I could make much more
money on some products by carrying them and shipping them myself.
So, I picked out half a dozen main items that seemed
popular and started processing orders in-house.�
In
2002 flag sales started to cool off a bit so Reynolds decided
to test a new marketing idea, an idea that propelled his business to
another level. �I started doing a Free Flag promotion. I
still run it, usually linked with news events and holidays. For
example we promote the giveaway every July 4th, Memorial Day,
Veteran's Day, Flag Day, and on the anniversary of
9/11. We also did a flag giveaway to mark the passing of Ronald
Reagan. That was huge and left us packing and shipping
flags for weeks on end,� Reynolds said.
�Under
this promotion, the consumer pays shipping and handling charges of
$5.99, which leaves us a decent margin, but also provides an
opportunity for an upsell to a better, larger, more expensive flag or
other items later on. We used our customer base, for example, to
sell a ton of those Iraqi Most Wanted playing cards and
recently to sell the ribbon car magnets you see everywhere."
Reynolds added, �The free flag promotions have also gotten us a
ton of free media coverage in local and national media outlets -
radio stations, TV stations, print and online. I'm a PR guy,
so this is my strength, but the response has still been
phenomenal!�
AmericanFlags.com
now directly ships about 20 different products and they carry about
400 total with the rest being drop-shipped through a major
manufacturer. They carry everything from U.S.
& State flags to residential and commercial flagpoles to
banners, bunting and patriotic memorabilia. Jeff gives his
significant other, Maureen Mullin,
credit for keeping the enterprise clicking on all cylinders. She
helps field phone calls, oversee shipping and put out the inevitable
fires that crop in every busy business. |
Reynolds & Maureen Mullin |
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Reynolds
said, "Our site isn't fancy by today's standards, but it gets
the job done well. Most of our customers are older, somewhat
inexperienced computer users and most don't love flashy stuff
anyway. We've got some great corporate accounts - including some
major defense contractors who buy a lot of very large flags and some
great school and small business accounts.�
Reynolds�
products range in price from a few dollars all the way up to $5,000
for giant flags. There is something for everyone and that has
generated a tremendous flow of income. However Jeff told us there is
also a downside. �People call at all hours of the night wanting to
check the status of their orders and we get a few emails a week from
folks asking about flag etiquette rules (after all, we ARE
AmericanFlags.com, right?). I know far too many people working at
the Post Office on a first name basis. I have learned far too much
about the intricacies of flag construction and can identify most
state and international flags at this point - a talent that few
really appreciate.�
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Still
Reynolds wouldn�t have done things any differently. �Developing
the site from scratch and watching it blossom has been incredibly
rewarding and I've learned a lot about business/ecommerce in the
process. I also think that I've added quite a bit of value to the
domain, which would come into play should I decide to look for an
exit strategy in the future.�
There
is a never ending debate in the domain industry about whether it is
better to monetize domains through pay per click revenue parking
pages or through site development. Reynolds has done both.
�Development is hard work, plain and simple. Essentially, I use
PPC to generate the revenue I need for new acquisitions and
development. I think PPC offers domainers an incredible venue for
making money and the folks at Domain
Sponsor and Fabulous.com
in particular run first-rate operations. I do, however, worry
about the long term impact of PPC if surfers who type in
domains find only familiar looking parking pages with a ton of links
on them,� Reynolds said.
Reynolds
has noticed that PPC providers are beginning to produce more attractive
pages with far more relevant links that will give surfers a more favorable
experience than in the past. �The proliferation of attractive PPC
parking pages is probably outpacing the average Front Page
user,� Reynolds said. "The key I think is developing high
quality destinations either through advanced PPC systems or through
individual site development. We need to reinforce and reward type-in
behavior.�
Of
course a lot depends on the the merits of each individual domain
name you have. �At the end of the day, the objective is to
maximize revenues,� Reynolds said. �Some domains are not great
candidates for development and it's probably not worth the time and
effort. Prime domains, however, may be worth the time and effort.
Type-in traffic is more valuable than any other type of traffic and
if you have it, by all means max it out. Why settle for a few
pennies or even dollars per click, when you could net $100, $1000 or
more? I make about $3,000 on a $5,000 flag sale. How many clicks
would I need to rack up on a parking page to make that same
$3,000?�
Reynolds' other
sites include
SantasMailbox.com |
His
success with AmericanFlags.com has prompted Reynolds to
branch out into other areas. He has CounselingDirectory.com,
Discrimination.com, MyWeddingDay.com, TopWeddingWebsites.com,
BestPsychics.com, LegalReferrals.com, TopPhotographers.com and DivorceDirectory.com
as well. �All of those sites feature links/referrals to
surfers in those markets," Reynolds said. �We
also run JackOLantern.com
featuring Halloween products and SantasMailbox.com, a
letters from
Santa service. It's a pretty diverse group of ventures and
it can be labor intensive, however, I think that kind of
diversification and reach is critical to success.�
With
approximately 500 domains in his portfolio, Reynolds has found that
time is in far shorter supply than good development opportunities.
"Time consuming" is an understatement! Still, the business
potential is SO huge, it's hard to not continue full steam
ahead,� Reynolds said. The demands on his time are so intense,
Reynolds has had to realign his priorities. �I still acquire
domains for possible development and/or resale, but am limited by
the demands of my developed sites, etc. I don't work the drops
anymore and the auction drop prices tend to get out of hand, so
that's not a game I play very often," he said.
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Instead
he does some direct buys from resellers on various boards and tries
to snag some bargains from non-domainers while also looking at
emerging trends for domain ideas.� I believe that domains are one
of the very best investments one can make and while we'll probably
see some fluctuation as time passes, the overall trend will be an
upward one,� Reynolds said. While many think the window of
opportunity in domain acquisition has just about closed, Reynolds
doesn�t agree, �It's still there, you just have to look harder,
act faster and work smarter."
As
hard as it is to get away from business, Reynolds makes time for an
intense game of basketball every Saturday afternoon. Once in awhile
he squeezes in a round of golf or a weekend trip to the nearby Connecticut
casinos. Even then it�s hard to get his mind off domains. Aside
from the many business opportunities still out there he thinks
more time needs to be spent on burnishing the image of the
industry as a whole.
�As
domain holders, we need a clearer, louder and better organized voice
to counteract the cybersquatter image that's often portrayed in the
media - sometimes fairly, but generally unfairly,"
Reynolds said. He has gotten involved in helping organize a new
trade group called the World Association of Domain Name
Developers to help address that situation. Reynolds hopes WADND
(website coming soon) will spur the development of �a more
consistent ethic and a steady presence for an active, intelligent
and articulate community rather than a bunch of far-flung folks
sitting in bath robes, working in solitude, muttering to ourselves
while developing carpal tunnel syndrome! That�s the logical next
step for what can now be called an industry,� Reynolds said.
Wherever that project or the industry as a whole goes, odds are Reynolds
will be found where he is now, right in the middle of things.
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Photo Credits: The photos of Jeff Reynolds in this article
are courtesy
of Marcia Lynn and Warren Walker of http://www.myrtlebeachgallery.com
& MyrtleBeachInc.com
Editor�s
Note: For those who would like to comment on this story,
we invite you to make use of our Letters to the Editor
feature (write to editor@dnjournal.com).
If you missed our previous Cover Story click
on the headline below:
Successful
Trade Show Heralds the Start of a New Era For the Domain Industry
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