In Lesson 3 of SEO 201, there is a suggestion that “if you sell wool socks AND cotton socks, then have a page dedicated to each kind”.
The owner of the website I’m trying to optimize said that she was once told that it’s a good idea to have several domain names for that same purpose. For example, have a separate domain for wool socks and one for cotton socks. What do you think of that idea?
I think that’s a terrible idea. You can read up on this issue here but basically, creating multiple sites defeats the whole purpose of trying to attract traffic and promote a single brand. If you have multiple web sites, not only is it confusing to customers, but other sites will be linking back to several sites instead of your main site/brand and that dilutes your link popularity.
Google and other engines will be looking at the number of links your site has pointing to it and if those links are spread across several domains, you will lose trust-rank and therefore won’t rank as highly as you would if all links pointed to your single site.
I understand the desire to rank for several products, but you can easily achieve this on a single domain if you design individual pages for each product and carefully optimize those pages for keywords relating to each. Alternatively, you can use sub-domains for each product which provides the bonus of having each product page sitting at the root level of your site. Google staff actually recommend using sub-domains in this manner.
More information on this issue can be found in these older posts: