Domain Name Evaluation

This is one of the most debated topics on the web. How to chopose a good domain name and what is the value of a domain name are discussed in forums and on blogs all over the web and have been since the Internet became a medium.

There was a time that all you had to do to get a domain name was email a guy named Jon Postel and he gave it to you. Since then a lot has changed.

I started buying and selling generic domain names in 1995 and have sold hundreds of my own and more than 1000 for clients.

I received an article about domain name evaluation in my email that I’ll share with you along with my own comments.

One of the most important considerations in valuing a domain name is the “TLD,” or Top Level Domain. This is the extension that appears at the end of the domain name, such as .com, .net, .org, etc. All other things being equal, a .com name will generally sell for about four times the otherwise equivalent domain in one of the other common global extensions, such as .net, .org, and .info.

From a purely SEO standpoint, the TLD doesn’t matter at all. If you are going to advertise your domain name on tv or radio, dot com is the only one to consider. But if your website traffic will mainly come from search engines and links on other websites, then it doesn’t matter.

What does matter is that your domain name reflect the exact search phrase you want to target most. I can hear some of the seo gurus groaning already. many of them will say the domain name does not need keywords or does not need to be the exact phrase.

But all other things you do for your seo being equal, having that search phrase as a domain name will put you ahead of your competition for that phrase. I have the search results in google to prove it so bring on the debate.

The .mobi extension, utilized for content to be delivered to mobile devices, is rapidly gaining popularity and value, especially for domain names suitable for such devices.

Nothing could be further from the truth. Dot TV said the same thing years ago. They said that TLD was the only one to own if you are going to produce multimedia rich websites. However, dot TV does not stand for television as they wanted everyone to believe.

It’s a ccTLD or country code TLD that stands for Tuvalu island. Idealabs bought the rights to sell domain names on that TLD by paying off a few islanders who did not even have Internet or TV.

The dot Mobi people want you to believe that to provide content to mobile device users you need a dot mobi TLD. Nope. Mobile devices can access domain names on any TLD. It’s just a marketing ploy like dot TV.

An extremely important consideration in the value of a domain name is the number of words it contains. Single “real word” domains (no misspellings or abbreviations), especially in easily monetizable internet industries, can be enormously valuable, particularly in the .com extension. Two word domains, again without misspellings or abbreviations, can also be quite valuable, as long as the domain name can easily be monetized, and the TLD is of high quality. Values really plunge when you get to three words or more.

That statement is so 1995. If longtail keyphrases are good to target in PPC and SEO, then domain names that contain those longtail phrases also have value. Searchers are getting smarter and they are typing longer phrases into search engines to get more relative results.

Couple that with the fact that ALL one-word domain names for every word in the dictionary are already registered and talking about getting one of those is a moot point unless you have a few hundred thousand or a few million dollars laying around.

Domains containing misspellings, abbreviations, hyphens, characters not on a standard keyboard, and other oddities often have very little value. Also, domains containing phrases that are trademarked may be worth nothing, as the trademark owner may be able to summarily confiscate the domain.

Again, this statement isn’t entirely true. A domain name with hyphens can have SEO value, therefore have monetary value as well. Not as much as the nonhyphenated version, on that we agree.

There are also some valuable misspelled domain names that get type-in traffic because the fact is that people do misspell words. Misspelled words bring in traffic from PPC and can do the same for domain names.

On the web, people click links. They will rarely know how to spell the domain name anyway and rarely care since they can just bookmark the site. If you rank high for the misspelling of a word, you will get traffic. You may get bookmarked. You may even make sales.

Now if the author is only talking about selling the domain name, I agree, it’s hard to sell these domains.

The extent to which a domain can be monetized has a major impact on its value. Domains in the sex, financial, and health industries often top the list in terms of high value sales. Domains related to industries that cannot easily generate revenue on the web will usually have little value.

Add travel-related domains to that list. Add real estates and mortgage-related domain names to that list. I could add more, but you get the idea.

Generic domains tend to be more valuable than non-generic ones. A generic domain is one that contains only real words (ones you can find in a dictionary), and has no contribution from proper names (first or last). Generic .com domain names in highly monetizable industries can be immensely valuable, and are for the most part very hard to obtain (without spending a lot of money!).

Yes, I agree with him here. Many companies are stuck in the rut that they should have their company name as their domain name and refuse to see how a generic domain name would benefit them much more.

This mistake was made early on the web and still causes companies problems. If these companies have the best and brightest working for them, then why didn’t GM or Ford Motor Company figure out that cars.com was better than gm.com or ford.com?

There are thousands of other examples. The big companies did such a bad job at recognizing the value of generic domain names that they attempted to use their lawyers to lobby trying to make generic domain names nonexistant. They actually tried to eliminate the ability to own a generic domain name in the 90s. They even succeeded in doing so in Australia.

The number of letters in a domain name also affects its value. Three letter .com names can be quite valuable, even if they mean nothing. Four letter .com names usually need to be pronounceable to have value, but they need not necessarily be real words in the dictionary (cool sounding four letter .com names can be very brandable, even if they are made up). When you get to five letters or more, value is driven by quality of the word or words (generic vs. non-generic, monetizable vs. non- monetizable, etc.). Once you start getting over 8-9 letters, value tends to decrease a lot, unless the name is highly monetizable.

All 3 and 4 letter domain names are registered. Once again a moot point. Another thing is that the days when the length of the domain name determined the value are long gone. This author reads too much stuff that was written for the domain speculator game in the early 90s.

For instance; ivideo.com is shorter than videorentals.com. Videorentals.com is way more valuable than ivideo.com because no one searches for i videos.

having the search phrase you want to target has value. If you are targeting a longer search phrase, get the longer domain name. Abbreviations for the sake of having a shorter domain name has no value at all.

Adding the words or letters like; online, website, virtual, i, v, world, etc. does not add any value to the domain name.

ToysOnline.com lets say. Well since it’s a domain name it can really only be online so it’s a little redundant. Same with VirtualToys.com unless you sell virtual reality toys or something.

I’ve seen people who think their domain names are valuable and have something like VirtualOnlineDatingWebsite.com. Talk about redundant.

The extent to which a domain can be branded may be very important in determining value. Domain names that are easy to say and remember, easy to type in, highly reflective of predictable monetizable content, and/or generate a lot of “type-in” traffic (people typing your domain name directly into the address box in their browser rather than finding your domain via a search engine) are highly sought after, and may transact for significant sums.

This does not mean that because google and yahoo are made up words that you can make up a word and register it as a domain name and then sell it for a lot of money.

A lot of domainers do this and cite yahoo and google as examples of why their made up word can have value too. It took millions of dollars worth of advertising and marketing to brand those made up words.

If a company is going to spend all of that money to promote a made up word why would they pay you a lot of money for your made up word when they can make up their own and register it for just $6.99 at godaddy?

About the Author: Stewart Engelman is a web programmer and domain reseller. Stewart operates his web programming business (Champlain Micro Systems) and domain sales and rental business (DNI Services) from South Burlington, VT, USA.

Don’t take offense Stewart. Some oif the advice in the article was very informative, but much of it is outdated. And remember they call me a name critic not a name appraiser.