What’s the real value of domain names?

Whether you want to set up your own business or a blog, it’s crucial to have a domain name that not only reflects what you’re doing but which also contains SEO-friendly keywords.

The right combination of words can be the different between a successful online venture and an unsuccessful one – but why are people so hooked on having the perfect URL assigned to them by the likes of UK2 domain registration and what’s the real value of domain names?

Your name, your identity

Choosing a domain name is no easy decision as what you settle on will effect everything from brand identity to organic growth and search engine popularity. It’s what people will type when they want to visit your site and as specific keywords could generate considerably more traffic than others, keyword research is necessary. What’s more, each domain has a value. While some can be bought relatively cheaply thanks to competitive domain providers, others are off-the-scale expensive and out of reach even for companies with a larger budget.

One word = big bucks

If you take a look at the top 20 most expensive domain names ever sold it’s clear that one word domains go for big bucks. Why? Well, because they’re often centred around highly searched words such as ‘insure’, ‘hotels’, ‘fund’ and ‘porn’ and have a high Cost Per Click (CPC). Insure.com, for instance was sold for a whopping $16 million back in 2009 while sex.com was purchased for an impressive $14 million in 2010. Hotel.com went for $11 million and fund.com was up for grabs for 9.9 million. A few other examples include business.com which was sold for $7.5 million in 1999 and diamond.com which was also acquired for $7.5 million.

Typically, people make money from one-word domain names by a process called domain flipping. This means they buy exclusive domain names and hold onto them until they can get an excellent return on investment – and there’s a lot of money to be made by doing so.

.com names = higher value

When analysing the highest priced domain names it’s also obvious that .com names are still the king of the internet world. This could be because .com has an international appeal and is associated with commercial trading and general business activities. It’s the domain extension many people default to and while there are many different domain endings including .uk and .ca, .com appears to make web users feel comfortable and at home – perhaps something to consider when you next make a domain purchase.

Cybersquatting

Cybersquatting is becoming a real problem for many businesses with people creating domain names that are designed to profit from popular trademarks and brand names. Car maker Audi, for instance, has just filed a complaint against the registrant of Audi.cars and Audi.auto which, of course, was just a little bit too familiar for Audi. Domains of this kind come with hefty price tags around the $2000 a year mark and yet many cybersquatters are left undeterred showing the lengths some people will go to in order to have a catchy, memorable or highly searchable URL.

While some domains are clearly worth more than others, there’s plenty you can do to ensure your website stands out from the crowd including the implementation of well thought out content creation, SEO and marketing strategies.