Domain Names - Don’t Get Caught Out
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Domain names can be a very precious commodity, with the best of the best selling for ridiculous prices at places like Sedo.
As an example domains such as VIP.com ($1.4mil), BEER.com ($7mil), BUSINESS.com ($7.5mil) and SEX.com ($11-14mil depending on which report you believe), have all sold for very very high amounts of money. Of course these are generic domains and are valuable tools with the right marketing strategy, but it’s still a hell of a lot of money to throw down for a domain name.
Due to the prices that we see some of these domain names sell for, this has led to an increasing number of Internet speculators who will register a domain and then either park it and make money from the advertising revenue or they will try to sell it at one of the top domain auction sites, like the aforementioned Sedo.
If we take a look at some of the recent sales on Sedo, we can see that even the most normal looking domains can fetch fairly high prices. For example: musicvideo.info ($1114), caregiverz.com ($1588), glorylane.com ($2188) and malehq.com ($1800), have all made their respective owners a very healthy profit. Based on the fact that a domain costs on average $8-9, this is a very good return on their investments.
So how can you get caught out?
When you have a new business idea or you decide to start a new website, unless you are lucky enough to already own a suitable domain name, you will often spend a few hours searching for something you like. There are even some websites such as Domains Bot or Make Words, that will allow you to enter keywords and give you suggestions based on your keywords.
The biggest mistake that people make when finding and choosing their domain name is that they don’t register all of the extensions. This allows a domain speculator to come along, register the other domain name and then they will try and sell it to you or to a 3rd party for an extortionate amount. Even worse, a competitor could register that domain name and then point it to their own website. Both of these options will result in you potentially losing traffic/business.
A couple of real-life examples
1) A good friend of mine Everton, over at Connected Internet set his website up 3 years ago. He registered connectedinternet.co.uk but he didn’t register the .com of his domain. The domain was picked up by a domain speculator and it is currently for sale for…. $300,000! An absolutely crazy amount of money, but they obviously feel that if Everton or someone else wants the domain - then they can pay a premium for it. In Everton’s own words he says: “In the past I’ve toyed with purchasing connectedinternet.com, as I feel that not buying a .com address was my biggest ever blogging mistake. However, the owner asked for a ridiculous amount and now that connectedinternet.co.uk is well established, I doubt that I would benefit from the move.”
In a way he is right, as being well established with around 2000 subscribers to his feed and many more thousands of visitors each day, he has turned his website into a huge success. However, I’m sure he would agree that owning the .com of his domain would make him a lot happier.
2) When I first purchased the domain for one of my own companies, I too only registered the UK extension. At the time, I didn’t really think it would make a difference if I had a UK domain or a TLD that gave a more global appearance. So again, a domain speculator swooped in and registered the .com version, and then tried to sell it on to me for $15,000.
Like Everton, I’m very unwilling to pay a silly price just for the domain, so I declined their offer. I believe at present they want $7,000 for it, but I’ll still never pay that sort of money. Also, since my company is UK based and deals mainly with UK customers, I’ve not really lost any business because of this. Although, I do still have customers telling me on a weekly basis that they sent an email to us on sales@url.com instead of .co.uk.
5 Tips to stop you from being caught out
1) When choosing and registering your new domain, always try and obtain the .com of your domain first. When a customer hears your website or brand name, the first thing they are likely to enter into their web browser is your brand name followed by .com. If you don’t own that domain, that is a customer you could be losing.
2) If there is already a site using the .com version of your domain and they have good authority, think of a new name. It is far easier to think of a different domain name than it is to try and compete with a website using a name very similar to yours, with the best TLD and with more authority.
3) Register all of the relevant TLDs! The order I usually register my domains in is: .com, .net, .co.uk (if I will be aiming at UK customers/visitors as part of my business), .info and .org (only if the brand name really needs it). You should always get the .com and .net no matter what. At $8 each, they are not going to break the bank and you can save yourself a lot of money by ensuring that you have control of that name rather than a competitor or speculator.
4) Be careful where you search for your domains. There has been a lot of talk recently about Network Solutions registering domains that have been searched on their websites and then holding them for 5 days. Something that is known as ‘domain tasting’. Always make sure that you are able to register your domain name(s) as soon as you find them, rather than thinking you will get them and then waiting for someone else to get the name. Also, some registrars actually publish a list of recently searched for domains, so if someone sees something you’ve searched for and feels there is money to be made, they may well register the domain that you really wanted.
5) Don’t use any trademarks or existing company names in your domain. For example, registering something like ebayguide.com is likely to land you in hot water with eBay themselves. Anyone who owns a registered trademark or believes you are squatting on a domain that contains their business name, with no real intent to use it, can take legal action to reclaim that domain…leaving you with nothing. Better not to waste that $8 right?
Please let me know if this proves helpful to you and also if you have had any experiences similar to the above, I’d love to hear from you.
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I’ve had a similar problem in the past where my domain name expired, without my registrar telling me that I needed to renew it. Someone came along and registered it, then tried to charge me a fortune for me to get it back. It affected my business a lot and I would certainly never make the same mistake again.