Who buys domain names anyway?

[ojlewis]

An appraisal request I made yesterday generated a bit of discussion about brandable vs keyword domains, and it got me thinking harder about the different markets that are available to domainers.

I thought that by identifying the different target customer types it would certainly help the marketing process, and as such, based mainly on my limited experience of having sold a few domains (£250-£3000) I came up with the following 7 different types of 'reasons for buying'. If anyone is interested in this I would love to hear if I have missed any groups or whether this covers it?

Reasons why people buy domains:

1. Companies looking for the domain that exactly matches their existing company/brand/product names for obvious branding/marketing purposes.

2. Companies looking for the domain that closely resembles their existing company/brand/product names to ‘protect’ them against problems with cybersquatting/customer confusion/typos/international growth.

3. Companies looking for the domain name that exactly matches their planned upcoming company/brand/product names for future branding/marketing purposes.

4. Companies looking for the domain name that closely resembles their planned upcoming company/brand/product names to protect them against problems with cybersquatting/customer confusion/typos/international growth.

5. Companies that want to own a ‘space’ and acquire a domain for ego/image purposes and ‘just-in-case’ it benefits future marketing but have no specific plan for usage.

6. PPC/SEO (merchant and affiliate/advertising) marketers looking for keyword-targeted domains.

7. Domainers wanting to flip or invest for future sale (based on their ability to sell to one of the above).

Knowing who you are selling to and what the pitch will be is surely the first step when buying stock of any kind and domains I suppose are no exception.

 

[bermuda]

The seventh group of the list can sometimes cause serious problems, folks who simply purchase new domain names, simply as a hobby or merely because they have enough cash to register loads of names, hoping to make fortune in the future. Guess what will happen, they will park domains for weeks, months and years, preventing others from having their favorite names up and running and causing problems even from marketing aspects because parked domains for years can be difficult to promote always.

 

[fresh79]

Interesting list. of the 10 million UK domains, I would say that most of them would fall into 1,7

There are lots of other reasons too, things like bands/musicians, hobby & interest groups, community & social stuff

 

[ojlewis]

I have a feeling, looking at sold lists that the market is underpinned (large volume, low prices) by domainers buying to invest/flip but that the big money is spent by:

- end users looking to acquire the right name for their new venture. When a branding company is committed to a name, even a quirky one, they will try to convince their deep pockets client to fork out for the matching domain. So the domain cost just gets amalgamated into a product launch budget - in that context £20k out of £500k is not hard to justify.


- end users looking to 'upgrade' from amazingwidgets.com to widgets.com. Same sort of thing - if it's coming out of an old school branding/marketing budget of a big firm then the money is there, as opposed to fighting over pennies with a tight SEO affiliate who's analysing type-in volumes and Google keyword tool.