What is the Value of a Domain Name?

09 April 2010

A domain name might seem like a relatively insignificant thing in the world of e-commerce. After all, it's only a term you type in to go to a certain webpage. How valuable could it possibly be? However, some domain names have sold for millions of dollars, and some are literally priceless.

It all has to do with how the name is constructed and how it is related to any website. It's a complicated formula when you dig through it all, but we can simplify things greatly by looking at the common sense side of high-valued domain names and then relating that same method to your particular business so you can choose a name correctly.

First, look at a domain name at its simplest level. Imagine you had a hankering to play a game of bingo. What domain name could possibly be better than Bingo.com? It's so simple yet so brilliant the name sold for over $200,000.

The first important factor of that domain name is its descriptive nature. The domain name accurately corresponds to what the actual website is about. It's extremely straightforward. Another very important factor to the name is that it's short. This makes it both easy to type and ridiculously easy to remember.

What about names of companies out there?

If you're looking to operate a successful online business, then you can take a lesson from the person who came up the domain name Mp3AudioBooks.com. Now, this isn't as short as Bingo.com, but look at how the name is formatted.

It's easy to remember and about as descriptive as you can possibly get. By looking at the domain name, you already know everything you need to know about the website. You'll find MP3 Audio Books there.

Another important factor of this particular name is the number. In search engine rankings, 0-9 comes before A-Z in alphabetical order. This means the 3 will help the site to earn higher placement than simply a domain name titled AudioBooks.com. Inc. of Santa Rosa paid $8 million for the rights to the Mp3AudioBooks.com domain name.

When thinking of a domain name for your business, you want to keep the aforementioned information at the front and center of your decision making process. You want to be as completely descriptive as you can be, while also keeping the name relatively short and easy to remember.

Any domain name you choose should give a complete idea of what the website is about. If you think of a catchy domain name but it doesn't have anything to do with what your site sells, then it's basically worthless in terms of using it for your business.

Look at it through another great e-commerce tool: keywords. That's what most popular domain names have in common. Their names are still keywords and phrases that people regularly search online to find products and services.

Some other great domain names include ForSaleByOwner.com and AsSeenOnTV.com. Take a lesson from the way these names are constructed and keep your domain name short, relevant and catchy in order to gain the highest value.