While premium brands engage in logo wars to win the hearts, minds, and pockets of the consumer market, a battle more explosive than logomania may be unfolding on the Internet with premium domain names.
Premium domain names are to businesses today what logos were to big brands in the last two decades. Interestingly, the Internet market considers “generic” names as premium brand assets critical to a winning online marketing strategy.
How can something premium also be generic?
Unlike their namesake, generic domain names are highly valued weapons in one’s online marketing arsenal, which is why we refer to them as “premium”. Think sex.com, business.com, diamond.com and beer.com. The popularity of these words in everyday language translates into a powerful magnet drawing the online market to those that own them. Needless to say, these generic names are premium online real estate that attracted jaw-dropping price tags when they went up for sale (more on this later).
The genome of a generic “premium” name
Highly valuable domain names are not necessarily clever, made-up names conjured by a clever marketer. They are, in fact, well, generic. It can be as simple as a description of your business: “discount shoes”, “sales coach”, “sydney plumbers”. Generally speaking, they are:
- Based on common search terms or phrases people use to find information on the Internet
- Composed of familiar, popular and memorable words that are easy to spell and generally short or monosyllabic
- Descriptive by nature
Rising interest equals rising prices
In the global domain name market (com, net, org), premium domain names are bought and sold at premium prices in what is commonly known as either the “secondary domain market”or the “aftermarket”.
To say that the perceived value of premium names in the global domain name market would be high is an understatement. Sex.com sold for US$14 million in 2006. The highest non-dotcom sale is Beauty.cc selling in 1999 for one million dollars, while Beauty.com sold in 2000 for US$800,000. For domain names closer to home, melbourne.com and perth.com sold recently in the US for $US700,000 and $US200,000 respectively.
It’s not known if their purchasers were paying for brand security, although many would suspect they were bought for future trading. Just like one invests in real estate in the hope of selling the property for a tidy sum in the future, one can invest in online real estate in the global domain name market.
What about com.au?
While the Australian domain space (com.au, net.au, org.au, id.au) has been tightly regulated in the past, its governing body auDA, announced early in March that it will lift the ban on advertising and selling .au domain names. However, auDA will not allow domain names to be registered for the sole purpose of resale. Eligibility rules still apply and domain names will need to be in possession for a period of six months or more before it can be sold.
Whether or not this condition will deter domain speculators is debatable. The impact however to business owners and marketers is clear: protecting your business name and/or brand name online is even more critical. Imagine the potential loss in business and brand equity to XYZ recruitment company if its domain, SydneyITjobs.com.au, was secured by a competitor in the net.au version. Interestingly, this is a common occurrence.
Domain name disputes
Last week, one of our readers posted a comment on the very issue of disputes in the com.au domain space:
“Owning a company name that is an exact match, acronym or abbreviation of the domain name you want doesn’t guarantee (sic) you will ultimately be the licensee of the domain name you’re seeking.” Read more
In the global domain name market, it is almost impossible to register the domain name you want unless you’re willing to pay a hefty price in the booming domain aftermarket where a price can be negotiated for the name you seek. On home front, registrations for Australian domain names reached the one million mark early this year and continues to grow solidly. And the good news is, generic domain names that are relevant to one’s business are most likely still up for grabs. The discerning business owner and marketer is likely to take steps to protect their brand online by securing relevant domain names in the Australian space.
And while the ownership of com.au can be disputed thru costly and lengthy legal proceedings, the new policy change provides a possible avenue to obtain the domain you seek that the old regime did not offer: the opportunity to negotiate on price.
Brand protection is prevention
Realistically, not everyone can afford to embark on a brand strategy that includes purchasing premium domain names, or to take someone to court over domain disputes. You can still stay on the online brand wagon if you apply all your marketing and branding arsenal when creating new domain names. Hopefully, you may be able to avoid the hefty prices the premium domain name market commands for the name that you should have registered in the first place. Our tip on how to name a good domain may come in handy and we recommend you review this article. Speak to a Melbourne IT e-business Consultant for domain name registration services by calling 1300 793 248 now.
“Do your research before registering a business name, or naming a new product, so you’re not disappointed. Alternately (sic) you might consider changing a product to fit in with a domain name available to you. Think beyond your boundaries and be creative.” Blog comment, 6 March 2008
Need help?
To help ensure your business is protected on the Internet, ask for a FREE Online Brand Protection Report. Call us on 1300 793 248. (International +61 3 8624 2300)
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