The second option requires a bit more time and effort than a 301 redirect. You could do a mini overhaul of the site and turn it into a microsite for your main domain. This option is good for exact-match domains for your targeted keyword, and there are other reasons for going the microsite route that Rand's highlighted in his post about root domains, subdomains, subfolders and microsites. This strategy also works better if the old domain has decent rankings for the keywords you're targeting.
While traffic, as an abstract, is fairly easy to understand and get, getting it on a consistent basis is another matter entirely. That’s why a lot of affiliate marketers who are serious about generating online traffic are quickly paying attention to drop domains. Drop domains is not a new phenomenon. People have been registering drop domains for many years now to scoop up traffic that those domains still attract. However, as Google continues to crack down, and as more social media platforms impose anti marketing rules, or rules that have an anti marketing effect, drop domains have become more prominent in the online marketing landscape. If you would like to tap into a fairly easy and potentially powerful source of online traffic, consider drop domains.

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