Make Sure Your Domains Make Sense

Today, I saw a domain name on a drop list that had two strong keywords, and I almost bought it.   I did a bit of research, and I immediately realized why it hadn’t been renewed by the owner – it didn’t make sense as a domain name.   Calcutta is one of the largest cities in India, and there are millions of people in the world who practice law.   However, in India, I don’t believe these people are called lawyers.   Therefore, CalcuttaLawyer.com, which has under 60 results in Google for “calcutta lawyer” would not make sense as a domain name.

On occasion, I will see a well priced domain name that has a couple of strong keywords, and I have to do a bit of research to see why it’s priced so cheaply. Usually it’s because it doesn’t make much sense as a domain name. Would you want to own HawaiiSkiing.com?   I think not!

When you come across a domain name that looks interesting, check out the number of results there are in Google for the quoted term.   You should also check the number of searches that are performed for that keyword.   While there are plenty of gem domain names that can still be found every day, there are plenty of worthless ones as well.   Knowing what’s worth something and what’s not will end up saving you a lot of money!

Potential Liability for a Newly Purchased Domain

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Before you buy a domain name, especially an acronym, check to see what is currently being displayed on the website to make sure it’s not infringing on another company’s mark. If you buy a domain name that had infringed on a company’s mark in the past, you could be held liable for the domain name’s past use.

Take this as an example. You decide you want to buy a great 3 letter .com domain name. You search Google for acronyms just to see how it could be used, and you find out that a major technology company is sometimes known by the acronym. When you check the domain name, the current landing page has this company’s ads (or a competitor’s). This could put a new owner in harm’s way.

Not only do I look at the current landing page and ask the owner about the landing page history, I also do some research to see what was on the page previously. I like to use Archive.org to see what was previously displayed on a website. It’s always better to ask questions to gauge potential risk down the road.

Devils Advocate of Leasing Domain Names

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There are many great reasons for a person to consider leasing a domain name.   Although the cost of leasing a domain name rather than buying it can be much larger over the long run, it’s a great opportunity for a fledgling business to get started with lower upfront costs.   The company is able to prove their model, and they would hopefully be able to buy the domain name after a set period of time. Also, some domain owners are reticent to sell a prized domain name, so leasing it is a win/win for domain owner and leasee.

While there are plenty of reasons to lease a domain name, there are some things the leasee should consider prior to signing a lease agreement. For the sake of playing devil’s advocate, let’s say you sign a 10 year lease @ $500 month for a great domain name.   You are leasing the domain name from a company owned by a person (or just a person) who registered the name 10 year ago. You build a great interactive website on the domain name, and traffic is growing, revenue is flowing, and all is good.

Four years into your lease, the company owner dies/declares bankruptcy/gets divorced/loses the name in a lawsuit/can’t repay a loan he took on the name…etc. What happens to your website built on this great domain name if something like this happens and the name is no longer owned/controlled by him and/or all living financial agreements are made null by a court?

At the moment, there are many apartment renters who are faced with eviction when their landlord was forced to foreclose.   As for a domain lease, what contingencies are in place in the event of this to 1) prevent losing your ability to lease the name 2) prevent having to pay $xx,xxx in a lawsuit to stay a court order?   It is critical to think about all of this before signing a domain lease and building a website on that domain name.

Back Up Your Data!

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I’m glad this post isn’t a “I wish I backed up my data before the fire, flood, pool incident…”   Instead, it’s more of a best practice reminder because it’s something I frequently need to remind myself about so I don’t forget to do it.   Back up data!

It’s probably enough to back up all computer data on a flash drive at least once a week, and that flash drive should be kept in a secure location.   If you are so inclined, you might do it every night, especially if you are working on a major web development (or similar) project. In fact, if you are working on anything that would be difficult to start from scratch, it’s a good idea to back-up your drive as much as possible – just don’t keep your flash drive attached to your computer all the time.

Another best practice is to back it up at least once a month with a flash drive that is stored off site – like in a bank deposit box.   If a fire or flood were to ever damage your computer, it’s possible that it will get your back up source if it’s not kept on site.   You should take precautions, because at the very least, if you are audited, the IRS won’t be accepting of a data loss excuse for the reason you can’t produce your files.

Apple has a product called the “Time Capsule” which automatically backs up data while you are working, in a machine that is also your Wifi base.   The Time Capsule, which can store one terabyte of data, is very expensive, but it does automate the process. The downside is that the Time Capsule is kept on site, so a fire or flood would also probably render the data useless.

However you back up your data, please choose to do it often and keep a back-up copy somewhere.   Having a good backing up strategy will help prevent you from having to come up with an emergency data recovery strategy!

Investing in Call to Action Domain Names

Major corporations seem to like call to action domain names nearly as much as they like their branded domain names. Call to action domains can be more memorable to a consumer than just the brand, and it typically encourages the consumer to take action quickly. They are less expensive than generic domain names, and they’re more readily available.   They can also be more trackable than a standard brand URL.

Call to action domain names are frequently used for a short period of time, usually during a company’s interactive or integrated marketing campaign. They are liked by companies because they can help spread a message, usually in a fun way. They aren’t typically expensive to acquire, and many of the creative ones that incorporate a company’s brand are unregistered.

For a domain investor, the problem with owning these domain names is that there are several obstacles in selling them:

1) The company could easily change a word to differentiate and buy an unregistered version (CallUsASAP.com could easily be changed to CallUsRightNow.com)

2) Because they are short campaigns (usually), the budgets for creating the advertisement are typically more limited – with the exception of the Super Bowl and a few other big advertising times.

3) It’s hard to find one of these names before it’s in demand, and to acquire a great number and hold on to them, it can be cost prohibitive.

4) Usually the advertising agency creates the advertisement, and they don’t want to spend their allotted budget on a domain name, when the money can be billed for internal labor costs rather than external unrecoverable costs like a domain name.

5) On a creative pitch, there are usually 5-10 ideas and 3 final ideas presented to the client.   Between the internal agency pitch and the pitch to the client, there isn’t much time to negotiate a domain acquistion.   Agencies won’t pitch an idea to their client unless they know exactly how much a domain name costs.   Getting in touch with some domain owners is difficult, and if they can’t secure the name before the final client pitch, the idea may be ditched. The last thing they want to do is get the client on board with a great idea, only to tell them it’s not feasible because of cost or because they can’t even get in touch with the domain owner.

I get a lot of emails from people asking my opinion on call to action domain names. While I think many of them are neat from a consumer’s perspective, I think it’s very difficult to sell them to a company. I highly doubt a company will tailor an expensive advertising campaign around a domain name, and they probably wouldn’t acquire it for a future campaign (all of this assumes the domain owner is even able to get in front of the marketing decision maker).

My advice is to own a couple of these names if you must (buying them at registration fee), but don’t spend too much money on them.   Buying call to action domain names is more like playing the lottery.

***Edit***
Just for further proof about this, next time you see a call to action domain name, do a Whois History search on it. See if the company was the original registrant and when the domain name was registered. If you see that it was previously owned by someone, drop them a note and ask them about it. I’ve learned some interesting things about domain acquisition strategy (much of it I can’t post because they asked me not to make it public). I think you’ll find that most of the call to action domains that are being used were originally registered by the company using it, rather than being older domains acquired in the after market.

Your Internet Persona Follows You

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There are a lot of people on the domain forums who don’t have much business experience, and there are others who do have business experience but don’t have much Internet forum experience. Many became domain investors by accident, and by one way or another, they found a place like DNForum or NamePros.   I had been selling domain names for two years before even realizing there was a domain industry and   DNforum was the first Internet forum I joined in early 2006.

Yesterday, I received an email from a person who shall remain nameless informing me of a new service he was offering.   I recognized something in his email, which reminded me about a person on DNForum, and a subsequent email revealed that they were “business partners.” After exchanging a couple additional emails, one of which was mysteriously from his partner’s email address – all under the same email string, I became even more suspicious, and I am not interested in working with or publicizing their company as a result.

Whether the emailer and “his partner” are different people using the same Gmail account is something someone else can determine, but I want to use this as an example for a post I had been meaning to write.   I’ve never done business or had a dealing with this person’s “partner,” yet I was reluctant to do any business with him or even work with him because of this person’s domain forum persona.

There are a number of people who I would put in the same category as this person.   From seeing their posts on domain forums, I wouldn’t do business with them for a variety of reasons. There are scammers, spammers, cybersquatters, lowballers and other people whose business practices I find abusive, annoying, or unethical.

Using Google and other free resources, it’s fairly simple to link a person’s name with their online identity (as I did yesterday). I think people should consider the implications for their forum commentary before they post. Not only could it impact their business today, but it could have long term implications, too. Career advisors recommend that job seekers review their Facebook/MySpace pages before applying for jobs.   Likewise, domain investors should know that there are always people who will judge them based on their Internet persona.