Costs of Neglecting a Domain Name Strategy
June 12, 2009
I recently came across a post on a popular social networking platform announcing the launch of a new company [unnamed for reasons below]. Wisely, the poster had registered the corresponding .com domain name in advance of announcing. Unfortunately, the company name does not translate well into a domain name and, as a result, they stand to lose significant traffic with increased exposure unless they take a proactive approach to their brand protection.
To begin with, of the two words comprising the name the first word ends with an “s”and the second word begins with an “s”. This raises the possibility of traffic loss due to the common mistake of people neglecting the first “s” when typing the domain name into the url bar. The potential for type-in loss is compounded by the fact that the first term, a made-up brand name, rhymes with and is only one letter distinguished from a very common English word –a word not commonly associated with an “s” ending.
So, the company is presented with the following scenario:
Owns:
[brands][service].com
Does Not Own :
[brand][service].com
[brants][service].com
[brant][service].com
["brant" used to roughly correspond to a rhyming, one letter variant.]
As of this post, all of the unowned domain names are available to register.
It’s safe to assume the owner of this, or any, new venture has every intention of seeing it succeed. Correspondingly, it’s safe to assume that with heightened brand awareness and increased success the potential for brand hijacking and cybersquatting increases. As such, domain names–including typographical and phonetic variations–that are taken for granted as irrelevant or are simply overlooked in the early stages become relevant and more prominent as your online presence grows.
Considering the cost of filing a Universal Domain Name Dispute Resolution Policy (UDRP) action begins at $1300 (not including associated legal fees), whereas the cost of defensive registrations can run as low as $7 per domain, implementing a domain name strategy prior to launch and in anticipation of success can mean substantial savings, increased traffic, and avoiding distracting disputes.
Brainstorming the possible spelling and phonetic variations on your company name and securing the corresponding domain names is an important part of a sound domain name strategy and should not be neglected as you construct your overall business plan.
Our Perspective on .US Domains
June 11, 2009
Bolstered by the launch of a dedicated forum at cctlds.com [country code top-level domains], the just-completed TRAFFIC conference devoted to cctlds, and several well-respected industry veterans announcing their plans to invest in cctlds, country-code domain names have seen a substantial expansion in interest over recent months. This is especially true for US-based domain investors. In fact, it’s probably more accurate to say that the interest in cctlds (especially .co.uk, .de, .fr, and .pl) has always existed abroad, while attention to the market is just now taking root here in the US.
The following is a brief outline of our thoughts on .us domain names from the perspective of domain investors and end-users.
Domain Investors
Though they comprise just a small portion of our portfolio, since our inception we have always looked for good values in .us domains primarily because we believe the market for .us domains, still in its infancy, presents investors with an excellent opportunity to purchase premium domain names with minimal risks, provided you are willing to buy and hold. Our recent acquisitions include CreditChecks.us, RealEstateLaw.us and PropertyLaw.us, IDTheft.us, and RehobothBeach.us, to name a few.
Although sales on .us domains have been few and far between–our most recent being workboots.us–this suits our approach: we have little interest in selling our .us domains unless we receive what we deem a fair offer matching our conception of future value. In other words, we don’t invest in .us domains to sell in the near term. While me might be inclined to sell a .com domain at a lower profit margin, we buy .us domains because we believe the market is poised for expansion and values and demand will rise in the long term.
When we received the offer on workboots.us through Sedo, we countered at 10 times the original fully expecting that it would be dismissed. It wasn’t and the buyer responded with an offer close enough to our counter and conception of value to prompt us to accept.
End-Users
Companies looking to acquire and build a website on a category defining, search-engine friendly domain name are often disappointed to discover that the price of their desired domain well exceeds their budget. While we would argue that price of premium .com domains offered for sale by reputable sellers is often justified by the benefits conferred by owning the domain, we also believe the availability of keyword .us domains offers a worthwhile alternative at an attractive price point.
Purchasing and developing your website on a .us domain name as opposed to on a .com comes with certain concessions. Most importantly, you run the risk of traffic loss through direct navigation to the .com– an extension so ingrained in US consumer consciousness that people often simply type in a keyword plus .com in the url bar, perhaps even assuming your company can be found at the .com equivalent.
That said, the combination of increasing public awareness of the .us extension, companies such as BMW.us and ClubMed.us using the extension, and attractive pricing on high-profile keyword domains makes the .us extension a viable and cost-effective opportunity to own and build on a category defining domain name at a fraction of the price of the equivalent .com.
.us Nexus Requirements
Finally, it should be noted that registering and owning a .us domain name is subject to US presence requirements. Per the extension’s Nexus Requirements (.pdf document):
Registrants in the usTLD must be either:
1. A natural person (i) who is a United States citizen, (ii) who is a permanent resident of the United States of America or any of its possessions or territories, or (iii) whose primary place of domicile is in the United States of America or any of its possessions [Nexus Category 1],
2. A United States entity or organization that is (i) incorporated within one of the fifty (50) U.S. states, the District of Columbia, or any of the United States possessions or territories, or (ii) organized or otherwise constituted under the laws of a state of the United States of America, the District of Columbia or any of its possessions or territories (including a federal, state, or local government of the United States or a political subdivision thereof, and non-commercial organizations based in the United States) [Nexus Category 2], or
3. A foreign entity or organization that has a bona fide presence in the United States of America or any of its possessions or territories [Nexus Category 3].
Please feel free to contact us with questions you may have on the .us extension.