Why I Don’t Like Investing in Brandable Domain Names

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It’s always fun to start of a blog post with a caveat, so here goes! Many people have made millions of dollars selling “brandable” domain names. There is nothing wrong with investing in brandable domain names. I personally don’t really invest in brandable domain names, and I will share some reasons for that.

To make money with a brandable domain name, you generally need the following things to happen:

  • Buyer wants to create a brand that matches your domain name
  • Buyer has funding (self or third party)
  • Willingness to pay your asking price
  • No other alternative domain names under consideration (other brand names, using a hack, or adding a word in front)

As you can see from the Afternic’s and Sedo’s weekly sales reports, there are plenty of brandable domain names that sell. There are even more that sell in private that aren’t reported. However, compared to the amount of domain names registered, the number of sales is a tiny drop in the bucket.

Some people treat domain names like lottery tickets, and that is fine. When you look at them in this manner, you most likely need to own more domain names in order to increase your chances of success. Unfortunately, owning more brandable domain names doesn’t necessarily mean you’re going to get more sales. It will, obviously, increase your holding costs, especially if it becomes difficult to give up and drop some unsold domain names since we all think the next big sale is just around the corner.

I read Morgan’s post about brandable domain names, and this certainly isn’t a knock on him or anyone else that sells this kind of domain name. I’ve sold many descriptive domain names in the last few years, and I am sure Morgan has sold his share of brandables as well. As I’ve said in the past, there are many ways to make money from domain investments, and I want to share some of my personal business philosophies.

Millions of dollars in domain sales are achieved each year from brandable domain names. Many times that figure is lost (paid to domain registrars), most likely to never be recovered.

Again, re-read the first paragraph. There are plenty of success stories, but there are many more failures that you probably don’t hear about because the owners either disappear from the domain investment space, or they hold out hope that the next big sale will be theirs.  There are many ways to make money from domain investing.

I don’t invest in brandable domain names, and I wanted to give you my rationale. As always, your thoughts are welcome.

97 COMMENTS

    • Just to chime in, maybe your examples don’t match my idea of a “brandable”, yours sounded a bit like hacks. When I invest in a brandable, it’s normally:
      -a short, 4/5 letter pronounceable domain. Example Waspy.com, Zoovu.com, Zudog.com, Jewdy.com, LMFAO.co (I’m not a big .co fan), WNKY.com, Zoovu.com, Appmo.com. I’ve had some success in this area and you’re right, somehas has to want THAT domain. Tough sell and you usually wait. Can’t really email toomany end users.
      -a catchy, keyword heavy domain. Like LivingSocial.com, I’ve invested in what I consider some nice brandable keyword + social domain names that get decent offers. Or trending keyword play on a name- Appmo.com, ModernRoyalty.com (young celebrities, ModernGal.com.
      -Something like ThatBroke.com. Forum for people to post their stories about how broke they are and crazy shit they’ve done for money. And end-user probably doesn’t want this name, and I definitely don’t have the time to build it out or a team for that matter, but it will sell.
      -Brandable phrases like ILikeThePrice.com Could be an aggregate price finder like PriceGrabber, but with a little diversity, could be the next hot think. Maybe bring FB “likes” into the algorhytm. Who knows, this is just one name with one shot in the dark idea behind it, probably a poor investment that I can be honest about.

      These are just a few small areas to which I diversify my portfolio and have had some success. There are MANY others as we all know. As Elliot mentioned, it’s probably not strategic to put all your eggs into brandables, as they only make up a small portion of overall sales. But then you look at Morgan Linton and are like, hmmmm….. Guy builds brands like its his day job and does pretty damn good apparently doing it.

      Just wanted to chime in. To all our our success this year!

    • I have no idea what brandable names Morgan has sold, so I can’t comment.

      There is a HUGE difference between building a brand and selling a brandable domain name to someone that wants to build the brand. I am only discussing the investment in and sale of brandable domain names rather than building brands.

      Even with building a brand, I prefer descriptive keyword domain names like I did with DogWalker.com. Similarly, DogGroomers.com hasn’t done nearly as well, but I could sell it profitably because it’s a keyword name and there’s burndown value. Had I sunk $5k into the development of GroomerRama.com and done as poorly, there wouldn’t really be any burndown value in the name.

  1. I guess it depends what you define a “brandable” domain as.

    If you are talking made up terms that is one thing. If you go out and reg every semi decent LLLLL.com (there are 11M+) that might not be a great investment.

    However there are plenty of “brandables” that are not keywords but have many end users.

    Brad

    • Do you think there would be trademark concerns on “brandable” names with end users, especially on names that are parked or use a default registrar landing page with PPC links?

      I am not talking about phrases or terms that are common when I refer to brandable (see above comment).

    • Even generic keyword domains can have TM concerns.

      There are countless UDRP filed for generic domains, and every once in a while some judge will rule against an obvious generic, Vanity.com for example.

      Also, not all brandables are created equal. Some formats are way more popular with buyers.

      For instance My(Word).com are always popular. Are you considering that a brandable?

      I think the definition of brandable is highly subjective.

      Brad

    • I consider a brandable domain name up to 8-letter .com that can be easy to pronounce. If you have some valuable domain that you are afraid of UDRP, why you don’t file your own TM application then? That would prove your good faith then, right? 🙂

  2. My definition of “brandable” is first tier generic or geo domains. We sold three this year (not reported – all three buyers wanted NDAs) and made a pretty penny. We also bought Nashville.com in 2003 for six figures and have already realized a 400% return not to mention the huge deal we just cut with DevDigital.com).
    And you are correct – to sell one of these puppies you need to hit an enduser head on who not only understands the value, but has the funds. The good news is they’re out there.

  3. – Buyer wants to create a brand that matches your domain name
    – Buyer has funding (self or third party)
    – Willingness to pay your asking price
    – No other alternative domain names under consideration (other brand names, using a hack, or adding a word in front)

    Hmmmmm, most or all of your points could also apply to any domain buyer, really, whether it’s a pure generic .com or brandable name.

    • Perhaps, but it’s way easier to seek out a buyer for a descriptive domain name. When I first prospected to sell CallCenters.com last year, I had a ton of interested parties and ultimately found someone who wanted to pay what it would take for me to sell it.

      IMO, it’s far more difficult to seek out buyers on brandable domain names.

    • It all comes down to budgets, coming into 2013 we are seeing sales like Rockies.com going into 7 figures, rightfully so…

      1 in 1000 domainers might have the funds to do that sort of deal, the other 9999 fight over similar sounding, twisted letter brandables.

      Of course you will have better success with those high premium domains, but you have to pay to play.

      I see Elliot you do step up, and pay high 4, and low 5 figures in the aftermarket. Your risk is your reward, not many domainers can emulate that strategy without getting stuck with inventory, and eventually running out of bankroll. Make a few big sales, and you can start creating a larger nest egg, and bankroll, honestly a bit of luck is involved, sometimes end user sales happen, when their a an expiring auction closing, and you can take that 10x multiple, and flip it into a entry level price for a solid domain.

      Domaining is Strategy, Patience, and Luck.

    • “I see Elliot you do step up, and pay high 4, and low 5 figures in the aftermarket. Your risk is your reward, not many domainers can emulate that strategy without getting stuck with inventory, and eventually running out of bankroll. Make a few big sales, and you can start creating a larger nest egg, and bankroll, honestly a bit of luck is involved, sometimes end user sales happen, when their a an expiring auction closing, and you can take that 10x multiple, and flip it into a entry level price for a solid domain.”

      Yep… when I see someone spending $9,000 a year on 1,000 crappy made up names that they email me to buy or help them sell, it bothers me knowing that they could have bought 1 excellent name that costs only $9 to renew, rather than either paying the full price to keep them all or trying to figure out what to keep and what to kill.

  4. I knew this was going to be confusing. All domains are brandable. Some of the most expensive domains are the words that are nouns but “branded” into something else. Amazon, Apple. You like straight up generic words. It’s a safe market. Nothing wrong with that. The domains you listed are just made up words or tenses of dictionary words. And yes, they are much harder to sell……because they have limited users. The goal of all domain investing is to invest in names that have the most possible end users, easy for people to type and remember. No more no less.

  5. Most domainers talk regularly about “brands” and “brandables” even though they don’t begin to understand what a brand is or why a company chooses to brand, beyond what they might read in a Wikipedia article. They just know some incredibly broad guidelines and repeat the same shit over and over. Yet another example of dogmatic information absent real world knowledge.

    While owning a major (City.com) is swell, if Hooterville.com is sitting there domainer-developed, I live in Hooterville, I lay hands on MyHooterville.com, I have boots on the ground and I’m willing to put in the effort, I’m not worried about the few who make a navigation error. I’m going to make substantially more money than they are while the “domainers” sit around patting themselves on the back for having the theoretically optical domain name and making an extra $10 a month. I’ll console myself with the real money.

    “Brandables” are tough to invest in from a domainer perspective, they’re usually dead-weight parked. I keep a balance of generic keywords and brandable domain names. I’ve made a meaningful amount of money off brandable domains but you have to stick with real quality, mostly aftermarket stuff. It takes brass balls to lay out two grand for a name that gets 8 type-ins a month, but sometimes, that’s what it takes.

    • The gain on the theoretically optimal domain name is usually order of magnitudes greater than the “$10 per month” that you quote.

    • And that extra money comes at the expense of you working your tail off to drive the traffic and branding, which goes to a site you don’t own.

      I welcome all comers to develop websites and spend marketing dollars on variations of descriptive keyword domain names I own. VisitBurbank.com? Have at it!! GoLowell.com – be my guest and thank you!!

    • Is it?
      I agree that’s the case with a booby-trap of a domain like .co, but is the ‘bleed’ meaningful?

      Domainers and businesses think of traffic in VERY different ways. Domainers think of it in terms of volume and clicks, businesses think of it in terms of flowage and user relationships. Either iteration could be drawn as a visual picture- the first being fragmentary and sporadic, the latter being congruous and predictable.

      What your get with ‘bleed’ is the former, not the latter. The latter is literally all that matters.

    • @ Eliot

      It would be challenging for someone to snatch the rug out from under you on Burbank.com or Lowell.com since you have pretty meaningful city guides on those domains. If your presence was weaker, it could be done. Simply.

      As I noted, ‘domainer developed’ garbage is trivially easy to overcome in the hearts and minds of local SMEs who are looking for something more substantive than an ‘impressive domain name’.

    • Valid point.

      That said, I would be reluctant to build or invest in a brand that doesn’t have the matching domain name unless it was a killer idea. Frankly, they will always want the matching domain name (maybe even need it) and it will just get more expensive as time goes on and that EMD gets more traffic / earns more money.

    • Speak of the devil…

      On the afternic sales report published today on TheDomains.com, someone did just buy MyBurbank.com.

      Maybe we’ll get to see a case study after all.

  6. Brandable domain names are made up of one word or non-descriptive, non-dictionary word such as Trendi, Twitter, Facebook, iPad, Cocacola, Mercedes etc…..that required millions of dollars in marketing before become world’s recognized brands…..

    VisitBurbank.com or VisitLondon.com are descriptive domain names, not a branded domain names.

  7. Although I do feel brandable’s can be like lottery ticket my biggest sale was a brandable that contacted me. I made a rookie mistake and sold for way less then I should have, but was happy with making the sale.

  8. “I like to think I learned something about branding in my Masters program in marketing at NYU”

    Either you slept thru those classes or should get a refund. Any domain can be a brandable.

    Generics – Shoes.com, Hotels.com

    Made up words, just check the travel sector – Expedia, Travelocity, Orbitz

    First Names, Last Names

    Words that have one meaning but branded to something else – Amazon.com, Monster.com

    whatever.

    It’s the marketing behind it that helps build the brand.

    Should have just said you don’t like investing in made up words.

    • Yes, but I am strictly talking about brandable domain names, not descriptive domain names that are used as brands. I thought it was clear that I like brands built on keyword domain names, especially in light of my successful development of DogWalker.com and other sites (that are less successful right now).

      There is a difference between brandable domain names and descriptive domain names. Both can be used as brands, but keyword domain names are easier to sell because the audience is much larger. For another example, it would be much easier to sell DogWalkers.com vs. DogWalkerz.com.

    • Chris- great commnent, response was great too and valid. I like your attitude Elliot. Keep posting the controversial stuff, breeds good debates and brings valid points across the board for all of us to take in.

  9. When it comes to Brand-able domain names, it’s like any other class of domains, they get to “ripe”. Names require patience, wit, and high level of information. You do need to know the past, and be able to predict the future; sometimes known as trends.

    I’ll give you an example, I registered PlatinumMint.com. The anticipation is that one day a President of the United States could order the minting of platinum coins to save the world economy. For that, I also registered Minteresting.com to collate this development. Could it all come to naught? Sure. But, it can also pay off. When dealing with Brand-able names, futuristic or otherwise, you are betting on a roulette table, perhaps putting it on black, and perhaps it might just land there. However, you are not supposed to put all your eggs in one basket, to mix my analogy. Plus, nothing prevents you from buying generic, keyword names at the same time. That is what’s exciting about our industry. You get to hold names until they ripen. Or not.

  10. There are good brands and crap brands, just like not all generics are created equal. At the end of the day, I’ll take any good brandable domain over a long tail, given that they are priced the same.

    I think you will find brandables equally rewarding in sales, if not more. But I understand that you stick to the niche you know. 😉

  11. The key to not sucking wind buying brandables is mastering (if that is even possible, but we all try) the art of buying them with traffic but not treading on TM’s. Some great names just will have traffic for various reasons. Easier said then done.

    If you have *enough* traffic you need nobody, not even the big G. And this, again, easier said then done.

    Most people, not even domainers, ever fully grasp this concept and how powerful it can be.

  12. Brandable names are more like a home run…
    I am sure we heard few weeks an article about USHIP.COM …

    Name like i ipad , ipay , upay, umakeup, kash , have a good value 🙂

  13. Hershey’s, Xerox, Kleenex, Apple, AT&T, etc., etc.—-it took work and sweat to develop these reputable businesses and give them the ‘good rep’….or ‘Goodwill’ as the business world calls it…..”Brandable domain names.”

    Google bought up many many many of these new extensions coming out, I see. They will make a killing when the public trusts Google to do a keyword search for information—-“brandable domain names” will not pop up….sites and domain names with keywords will…..more hits for Google.

    Most people don’t go to Google and put in a brand name domain name—they go to Google to find info they are looking for, I’d say 78-84% of the time. Then their computer’s cache will remember that site for them so they don’t have to Google again for it.

    And sometimes for fun—-trade’em like baseball cards! 🙂

    Here’s a name to hopefully bring a smile to some faces on this dreary afternoon on the east coast: http://www.culosfantasticos.com

  14. I do agree with you Elliot that generic domains can be brands but a real brand can stand alone outside of the internet. An example would be Hotels.com but without the internet connection of dot com the word Hotels can not stand on its own so this is were it gets cloudy. You can’t tell someone to visit Hotels like you can tell someone to visit Target. Great brandable names have the following characteristics and basically are 5 categories- Real words, Misspelled words, Two words, Mashed together words, and made up words

    1. they should be real words but unique such as Yahoo, Twitter,Bing, Target, Pandora
    2. misspelled words work also Tumblr, Flickr, Digg, Google
    3. two words placed together such as Snapchat, Facebook, Youtube, Netflix, Dropbox, StumbleUpon, Comcast, Slideshare, MySpace, BestBuy
    4. mashed together words such as Instagram, Pinterest, FedEx, Groupon,
    5. made up words like Skype, Etsy, Mozilla, Yelp, Sonos, Ebay, Zimbio,

    These are considered real brand style domain names and yes I agree they are hard to sell but so much fun to own. Some of my own favorite dotcoms are Sqix, Avoq, Snapwheel, Hookbox, Zagd, Leapbright, Zipbeat, Popkiss, Nvert, Blurtbox, Choww just to name a few.

    • As a domain collector……I did carry away…. and it’s fun to own brandable name such as Eyeblet.com…. inspired by the popular word Tablet.

      It may take off one day….Eyeblet.com is a future trend for eye control tablet.

      Who knows…..

  15. It appears that PlatinumMint.com is about to ripen just to the first stage, therefore, I raised the price. It’s still a steal for intermediate domainers to snap it at $9,997. It’s making national news, TV Networks, Cable, but most importantly, it’s turning from a kooky idea to mainstream for the US to mint Platinum trilion dollar coins to save the world economy. If not sold with the week, I will raise the price to $150,000 and hold it for 40 years.

  16. Great post and great discussions…keep ’em coming!

    As someone who’s built a strong (and growing) business around the word “brandable”, I can tell you that it really means different things to different people. The only way I can describe to someone what brandable is, is to tell them what brandable _isn’t_: a plural noun, or an adjective+plural noun. For example: Apples.com, or Sofas.com. A plural, dictionary noun is a type of name that is hard if not impossible to use for anything other than to sell what is in the name.

    So, except for that, just about any other domain can be picked up by a company and used for anything they want. Apple is a technology company. One of the sites I used to drool over the design of was a software company named “Sofa” (http://www.madebysofa.com/) that got acquired by Facebook. Verbs are classic brands — PriceYeti.com got funding and wanted to spend a good chunk of it on a new name, so they bought Decide.com.

    Then you get to add all of the non-dictionary made-up words (that you all have good examples of above), hacks, and everything else to the pot.

    The bottom line is, almost everything is brandable, but there will be a different size pool of buyers — and therefore a different price point — for every type of brandable name. There are thousands of potential buyers for a dictionary word. For a made-up word, the spelling and sound really has to strike a chord with the buyer for them to justify paying an aftermarket price, but it does happen.

  17. The type of brandable domains I like are the made up domains that don’t mean anything or a blend of 2 different words not in the dictionary for example ‘Voxala’.

  18. I´m not really a domainer but have something like 200 domains carefully chosen in the span of 7 years… and must say that people contacts me through the whois email but always say they have no money for some desired domain I happen to own… and they are brandable, like LLL ending in .es making some catchy dictionary English word

    I always respond that they are not for sale but offer them to send me the best offer they could make and usually never hear from them again.

    I think I´m attached to almost 99% of my domains, specially the LLL ones but would love to know why this people ask and disappear…

    BTW nice entries Eliot

  19. Can’t say I found this article too useful. Brandable domain names are the ones that always stand out. Think, Twitter, Facebook, eBay, Pinterest.. etc they keep going. It is very difficult to stand out in a market without a brand style name, because other descriptive names are categories of brands, not really a brand itself. Check out the video on the homepage of this site to see why brandable name are so great: brandable domain names

    • Nothing wrong with having a differing opinion.

      If you build something completely unique that consumers want, the brand name matters less, otherwise, you are spending millions of dollars on marketing the brand so people know what it is. For 99.9% of the people who are doing work online, they won’t build something that is in demand as much as those brands.

    • I would say that is when the brand name matters most. If you are building something completely unique what will you call it? If you choose a descriptive style name then you are no longer unique. Skype offered something unique at the time so it needed a unique name. Would have “VoiceOverInternet” been a better name? It most definitely wouldn’t have developed the attention it did had it been named that. There’s no curiosity or attraction towards a name like that. Unique brand names allow companies to create their own meaning of the made-up word they chose, whereas choosing a bland descriptive word totally limits the company. It limits them in terms of future expansion and broad appeal. I sure as heck don’t enjoy VoiceOverInternet as much as I do Skype.

      • Skype is voice over IP, and they’ve spent millions of dollars to make sure people choose Skype when they do voice over IP. If you hadn’t heard of Skype, you’d have no idea what they do. On the other hand, you would know what Hotels.com does.

        In any event, branding is very important and I have absolutely nothing against branding. From a domain investing point of view, I invest in descriptive domain names.

        I’ll get over the fact that you appear to me to be intent on commenting simply to drop a link, otherwise there would be no reason for you embedded link. Keep in mind, it’s a no follow blog and Google could actually penalize you for embedding a link like that since it looks like your intent is to get some sort of back link.

      • Why would you make it a no-follow blog? Even having links to outside sites improves your PR doesn’t it? And no Google only penalizes for constant and same use of Keywords in your anchor tags. tying to “get some sort of back link” is exactly what people want to do and is how Google ranks your page. You actually get better attention for those links than you would dropping a full URL… especially if you’re aiming for only certain keywords.

  20. I love brandable domain names. If you have a knack for picking up the good brandables, you can sell them. I have one BD that I created a nice logo for, I added a description, and I made it look like it’s worth millions of dollars. It’s a really nice made up word. 7 letters. I have received an email from a really interested buyer. This person realizes the importance of a really good brand. Especially today, it’s all about being remembered. A deal is about to transpire. And yes, I’m selling it for 7 figures. It’s all about making connections with the right people and getting the domains in front of their face.

  21. Some of your points are on the money about brandable domain names. Yes, you need to find the right customer, and the other variables need to be in-line in order to sell. However, being in this business is actually providing a valuable service to any entrepreneur, developer, etc who needs a great name for their product. These individuals don’t have the time to search and register a great brand… they want to focus on their business. More often then not, its very difficult for them to name their new venture since the names they’d like are already taken, and its hard to even contact a domain owner and negotiate a reasonable price. Services like mine (Namerific.com) make it easy for people to find a great domain name that matches their budget and project. If you know what to look for in a domain, you can run a successful domain business just focusing on this niche alone.

  22. I think there are a lot of people who register domains thinking they are ‘brandable’ when the truth is they are not, however brandable domains are in the eyes of the end user. What some people think are not good brandables others may think are perfect. I think there is value in short, catchy, memorable names. I think you need to utilize all the tools to find them and also utilize the likes of Namerific and brandbucket to sell them.

    available lists of ‘brandable’ domains can be found on http://www.Excitemental.com

    • What about it?

      I don’t like made up brandable names as domain investments, like Drungle.com or Goringa.com or something that is meaningless.

      Igloo is an actual term that is repositioned. I’ve sold plenty of “real” keyword .com domain names that are used (or will be used) as brands.

    • If you bust ur butt to build worth and public trust to your made up ‘brandable’ domain name, Goodwill increases, the name becomes valuable, and especially on balance sheets, whether you sell your brandable domain name or not.

      Matching a made-up brandable domain name to entrepreneurs looking for a marketable name to build a company on from concepts they already have for their services or product is another way to reg a name and sell it for profit—-small business owners would appreciate your help—a larger company probably has inhouse marketing and advertsing departments doing that work already……

      Here are some examples of brandable names that are worth bucks, especially on a company’s financial statement but were ‘meaningless’ without product or service recognition: Kleenex, Xerox, Microsoft, Google, Charmin, Scott, Nestles, TacoBell and even YouTube—or now Vimeo or Vevo. The trick is coming up with a name and matching it to the proper entrepreneur, which personally is a waste of time for me…… : \

      Uniquely branding a product or service I think usually happens AFTER the conceptual design for the product or service is already in place. I mean, Steve Jobs didn’t say to himself, I am taking the word Apple and building some kind of company around it…..it was the other was around.

      As for ‘igloo’, RU……isn’t there an ice company that already owns that name?

      Speaking of igloos—–some of them are really neat, well-built and display cool lights inside and are quite well insulated, some have ice bars with very chilled vodka served out of real ice martini glasses……

      Um, sorry about the ranting….I just finished half a bottle of diet peach Snapple and I’m wide awake now…..speaking of brandable names, “Snapple” is another good example.

  23. I think made up brandable .coms can be great but they have to be memorable and generally evoke a positive feeling or even better warping or blending a relevant keyword into a new name. If it almost feels like a real word before it’s marketed it will have a much better chance to be successful.

    My Examples:
    Snapably for a photo app
    Hornzy for adult oriented products
    Buildler for an easy-to-use app builder
    Brandists for a marketing / design studio

    I hand registered all of the four above .com domains in the last 12 months so there are still creative, short, premium brandables to be had but it’s getting harder to find quality all the time. I now have an online brandable marketplace (http://BustABrand.com) and target suitable end-users via email. If you have .com brandables that you’re trying to sell… Submit them to my site and if accepted I’ll list for free with a custom designed logo that makes it easier for entrepreneurs to browse for a brand name.

    • Hey, Busta,
      I like the ‘kick-ass’ ticker on your site.
      Yours,
      One of the 33% of the females associated with Domaining:
      Busty Broad Patti

  24. Thanks for the article. The problem is that you need to have a match between the buyer and the seller… It is really difficult to sell a domain name if you don’t sell it through a platform which is designed for that. We released OneClickName.com which allows buyer and sellers to meet together and to make a transparent transaction with a clearly defined price. It might be a way for domain sellers to make money. And for buyer to be happy 🙂

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