Domain Names

I don’t recommend wasting time with typos and trademarks. Your time is valuable, and if you’re going to spend time or money on domains, might as well spend your time and money on domains that are defensible and have long term value. Typos can never really be developed or sold at a premium to cash flow, and trademarks are always at risk of being taken from you. Trademarks also expose you to the potential of getting sued for damages. My attitude is that there are bigger fish to fry. Leave the typos and the trademarks to the bottom feeders. If you’re going to invest time and money into a domain, might as well spend it on a good domain that can be resold with confidence or developed at a later date.

Forums, auctions, and direct negotiations are some of the most cost effective ways to acquire high quality domain names. You should scour the DNForum and NamePros forums for names for sale. Auctions are held regularly though Sedo, GreatDomains, Pool, Moniker Marketplace, SnapNames, Afternic, and other locations. Direct negotiations also yield good results. This is when you email domain name owners directly from the information in the Whois database. Often non-professionals that own domain names will not understand how valuable their name is worth. If you can contact them directly, you may be able to buy a domain name worth tens of thousands of dollars for only a few hundred or a few thousand dollars.

When dealing directly with another person for buying and selling, I recommend using Escrow.com for all transactions. Especially when the transaction is over $500. It’s not worth the risk. When you open escrow, make sure the domain’s administrative email is the same as the escrow seller email. This way you know you’re dealing with a real seller. Don’t do the final release of funds in escrow.com until the seller provides the name’s authcode, and you have used the authcode to successfully transfer the name to your registrar of choice.

When selling, I always ask the buyer to create an account at escrow.com and for them to open the escrow. Often scammers / timewasters won’t bother doing that. If you’re having the buyer open the escrow, it’s important to be specific as to what email address they should open the escrow to (it should be the same email you used to create your escrow.com account) and the fee arrangements. You should pre-arrange the fee split, i.e. 100% buyer, 100% seller, or 50/50 buyer/seller split.

PayPal is a dangerous way to sell because once you transfer a name to a buyer, the buyer can claim a fraudulent transaction with PayPal and have PayPal reverse the transaction and take the money back from you.

Always proceed with caution when dealing with buyers / sellers you don’t know.

Before you spend your hard earned money on domains, it’s important to know what constitutes value so you don’t waste your money on crappy domains.

Keyword Value

Short memorable domains, devoid of numbers or hyphens, and consisting of high volume keywords that drive sales are the most valuable domain names. I like to think of this as ‘keyword value’. Keyword value is the single most important thing I think about when buying domains. Backlinks erode over time, Google PageRank gets recalculated, Alexa rankings fall, and DMOZ gets updated, but Keyword weight never goes away. Examples of domains with the best keyword value are laptops.com, shoes.com, rentals.com, hotels.com. These are keywords that consumers frequently type directly into their browser or search engine with high purchase intent. They drive sales. Unfortunately all the best domains have already been registered, but hundreds of them expire every month that are sill worth bidding on at the drop catchers. And hundreds of them are available for sale on forums and at auctions in the aftermarket. The best way to identify domains with high keyword value is to use the following tools. You want to find keywords that are searched frequently and that have high CPCs.

I use the following tools when scouting for and deciding whether to buy domain names.

Premium Drops
Excellent dictionary terms filter to identify names that match dictionary terms.

NicheBot Classic
To get access to predicted daily searches on the major search engines.

Google AdWords Keyword Tool
Predicted search volume from Google search engine.

Google AdWords Traffic Estimator Sandbox
To get estimated average Cost per Click and Clicks per day.

Legacy Value

Every day thousands of domains expire. Many of those domains represent the culmination of thousands of hours of hard work and effort by a dedicated web site owner. Fortunately for us, lots of web site owners don’t know any better – and they drop their names when they give up on their web sites – and they forfeit all that web site value to drop catchers like ourselves.

We understand the value though, so we pounce when we find good names with stats such as Google PageRank, Alexa Rankings, DMOZ listings, backlinks, and/or aged domains. And so, domainers like us, pick up those domains for cents on the dollar, only to repurpose them with parked pages, 301 redirects, or as small developed web sites, often recouping the purchase price in a matter of days or weeks.

Legacy Value refers to domains that have Google PageRank, Alexa Rank, DMOZ inclusion, backlinks, an aged domain status, etc. Each of these things is important for SEO and raw traffic. Most of the list filtering software mentioned above will have tools that enable you to sort drop lists by these criteria. Or you can visit the Google, Alexa, DMOZ, or your favorite Whois tool to manually check prospective domain purchases yourself.

If you’re confused, or want to learn more about any of these terms, Premium Drops has an excellent Domain Terms Explained Dictionary that I recommend visiting.