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Still Domaining, even in 2008.

Several friends have been saying lately that “all the good domain names are taken“. Several domainer friends are sifting through their portfolios right now, dropping lesser names, and looking to list mediocre names for sale to raise revenue for buying premium domains on the aftermarket. I can’t help but think “buy on rumor, sell on news“. Is the increase in domain auctions and aftermarket domaining the “news” part of that? Are the established players getting out now that domaining is a well recognized income opportunity for Everyman? Is it time to sell, not buy?

If that is the case, then the aftermarket for premium domain names is risky. You can’t trust that the market price represents actual value, given the possibility that the hype has exaggerated the appearance of demand, and inflated the pricing. But reg fee domains remain a viable investment. How could they not? At $7 or $8 per domain name per year, how could even a mediocre domain not be worth the investment risk?

But aren’t they all taken? And is it true that “there is no more drop” as I have heard a few times at domainer conferences in the past year?

In my experience, there are still good domains available at reg fee, and the cost of finding them may not be as high as you might think. Maybe I am just a super creative individual, able to imagine possible domains no one else has thought to try? I doubt that. If that were true I wouldn’t be finding worthy previously-registered domains. Someone else once thought they were good.

It is more likely that my vision of what is a “good” domain name is skewed… I think I got a good one, but everyone else thinks it stinks. Therefore, by definition, it has no market value… or does it?

Just as I think my domain has potential, someone else may think so, too. I only need one person who wants my domain in order for me to realize a profit on my investment. Of course I need to find that buyer, but at $8 per year, I have some time. Reg fee domains are a very good investment that way.

Another reason I might be seeing good available domains while others are lamenting how “all the good domains are taken“, is the psychology of belief. If you are told something is true over and over again, in different contexts, you tend to believe it to be true. It is so easy and risk-free to say “I really tried hard and couldn’t find anything“, with no accountability. Are people doing that? Just saying it? For many reasons, we don’t hear too much about those who did find good names.

I can’t list the domains that I buy and think are good, as much as I would like to, because in the context of an SEO blog, domains become targets of aggression by competitors and search engines. A domain owned and operated by an SEO is more suspect than one owned and operated by Everyman, or at least that is my experience. Haters report domains as spam just because they can, and competitors copy everything that can be copied. Domains actively utilized are usually part of a network, and it would be foolish to expose an SEO network just to highlight a good domain purchase.

But I will say I just picked up BackgammonLover.com and BackgammonLovers.com at reg fee, and I had offer for them at a significant markup almost immediately. It took me just a few minutes to discover that those were available and to register them, and just a few more minutes to market them to people involved in backgammon. I haven’t closed a deal yet, because I’m not sure I want to let them go so fast and at the offered price. What do you think? Were these worth $8 each as domain name investments?

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6 Responses to “Still Domaining, even in 2008.”

  1. B.K.Saravanan Says:

    I know that so many hot names are still available. But we have to spend much more time, money and trend analysis to acquire much more. None of a domain can be sold at registered price. Even the worthless domain costs more than 100 bucks if it is kept for more than a year. If we caught up with some thing like a generic keyword, then we are the real winner. If you have a visit at my portfolio. You know that how much you have to work to acquire a niche domain. I Strongly say Good Keywords are still available. The only thing is you have to search for hours to pick it.

    Best Regards

    @BK: Pure domainers perhaps look at the domain as costing $100 after a year of holding, but it is soooo simple to publish these days that serious domainers will have domains working for them in some capacity before they have been held a year.  Once a domainer has mastered the major technical issues of platform publishing, the per-domain cost of supporting the domain enterprise is much much lower than that.

    I am tending to agree that the days of the generic, non-specialized domainer are coming to a close, but that is a natural evolution of any new business model, isn’t it? Specialization is necessary for survival in a competitive environment. It’s not really an option, but a requirement.

  2. JaeWeb Says:

    I still have this weird feeling that something big technologically is going to happen which is going to render domain names moot and completely gut the domain market. i wish i knew what it was, so that i could invent it……

    @jaeweb: Not sure I agree with you, as I tend to think it is too easy to put off the hard work of today by simply saying it’s likely to be all changed come tomorrow. However, I do believe in the power of politics. I have always assumed that local politics will eventually bend the web to the breaking point. The thinkers in the domain world should probably look very closely at the .ASIA endeavor. A private group creating a top level domain branded globally like that, with all registrations thrown to competitive auction, certainly changes the face of domain name opportunity on the Internet. Ownership of natural resources have long suffered local political efforts like nationalization. Why not TLDs? Who is stopping a government like China (or even the US, under the guise of National Security/Homeland Security or “resolve”) from mandating a TLD much like they mandate taxes or other corporate governance? We have 50 states fully equipped to manage it locally “on our behalf”.

  3. Peter Davis Says:

    Usually, when I hear someone saying there are still good domains to be registered I find someone with a portfolio full of stinkers. I don’t know the details on your BackgammonLovers.com deal, but there’s a huge difference between reselling domains for good money (in the thousands of dollars) or the usual $25 or so that I see very often. Even if it only took a few minutes to think up those names, by the time you have them registered, find a buyer, do the transaction, push the domain, etc, you’ve got at least a good hour into it. Now, for a lot of people earning ten or twenty bucks for an hours work might be very good, especially if you’re in a third world country. And, if you can repeat that a dozen times a day, you might make a good living. Personally, I’d rather have a handful of sales each year and make five figures on average per sale. Same amount of work for those bigger dollar transactions.

    @Peter:  Are you saying that in your opinion Backgammonlovers.com is worth $25, or perhaps sub $100? I value your opinion, so I’d like to qualify that. It really is all about that valuation, isn’t it? If a non-generic domain name has a $1,000 value or $2500 value of a $100 value. As a born-and-bred New Yorker now living around Seattle I am very very far from a third world citizen’s view of the value of a dollar, and of my associates I tend to land on the high side of the economic value scales… I value quality and pay for it more often than not.

  4. Paul Bliss Says:

    I agree 100% with the post – everyday great domain names (IMO) are still out there – while there are no generic names left, catalog and category phrases still exist and are only going to climb in value. I say let “them” cry about the lack of domain names or how it’s too late to get in. Just means more money for the rest of us.

    @Paul: But are you sure your choices are not just “stinkers“?  This seems to be the new face of domaining…. understanding the role a domain name plays in an industry or market, and registering and marketing the domain to sell it, based on it’s inherent value. Last I looked, that added value will increase both the price of worthy domains and the demand for them. All good for commerce. Kudos to Stephen Webb of IamDomainNames.com as he has been doing this in his market since he got involved in domaining.

  5. algoholic Says:

    @John: LOL, More Seriously – Increasing exposure to backgammon works for me and is recommended, the only difference is I don’t really play the game, just the SERPs ;)