If you are starting a new venture in your life, you will need to buy a domain name for it. This is because every business needs an online presence to thrive. However, you don’t need to start something new to purchase a domain name. Domain names are in high demand. The fact that every business needs one makes them a valuable asset. Domain names with high brand value, typically short and simple ones with high-ranking keywords, can cost thousands, even millions, of dollars. Those familiar with the domain registry market know which domain names will make for good future investment.
If this is your first time buying a domain name, you need to know how to identify the right one for your latest venture or investment. You also need to understand how the domain name industry works, how to secure a valuable domain in a highly competitive market, and how to protect yourself from fraud. In this article, we’ll talk about a variety of things you should know before buying your first domain name, some interesting facts to get you excited about your new purchase, and some valuable information that will help you make the right purchase decision.
But before that, let’s define what exactly is a domain name.
What is a domain name?
Simply put, a domain name is the text you type in your browser's search bar to access a website. The text in a domain name corresponds to an IP address, a series of numbers such as 220.127.116.11, which is the actual address of a website but is too hard to remember or type. A domain name helps make this address more understandable and easier to locate on the internet.
A domain name is not the same as a website. It is the address where the website is located. In the brick-and-mortar world, your street name and number would be your domain name, and your house your website.
A domain name has three parts: The Hypertext Transfer Protocol (http://), the subdomain (www), the domain (the part after the www., typically your brand name), and the domain extension, or the top-level domain (the last part of the domain name, such as .com. .net, .store or .tech).
Now that we know more about a domain name, let’s get to the facts.
8 Facts you should know about domain names
1. There are a lot of domain names on the Internet.
As of August 2022, there are 1.97 billion live websites worldwide. Thirty years ago, in 1992, that number was just 10. This means that in 3 decades, the number of live websites has increased many, many times over. On the contrary, the world’s population has increased by 30% in the last three decades. The internet is perhaps one of the few human inventions that has surpassed our own growth.
2. There are some really expensive domain names.
Domain names have been sold in the millions since the late 90s. In 1998, former search engine AltaVista bought altavista.com for $3.3 million. As of 2022, the most expensive domain name ever bought is cars.com, which sold for a whopping $872 million! This just goes to show how simple domain names come at the highest premium. If you are interested in buying and selling domains, knowing which ones have a high brand value is essential. Dynadot releases blog posts on the top selling domain names in their aftermarket each month if you’re interested in staying informed on popular domain name sales.
3. There’s more than one way to buy a domain name.
Are you familiar with the life cycle of a domain name? Moreover, did you know that you can reserve a domain name that is still in use? The process of doing so is known as placing a backorder, and it can help you beat your competitors in securing a high-quality domain name. Here is how it works:
- Domain owners can let their domain name expire for various reasons. They may not need it anymore, or their business may be shutting down.
- If they fail to renew their registration, the domain name enters a 30-day grace period, during which the owner can still renew it at a higher price.
- When the grace period lapses, the domain name enters a 5-day “Pending Delete” stage, where it is not available for purchase either by the former owner or new buyers.
- After these 5 days, the domain name is finally released for sale. Domain names are sold on a first-come, first-served basis, and competition for purchasing them begins even before they become available (through backorder placements). This is why domain names are considered to be a hot-selling asset.
4. There’s a chance you’ll make more than you spend on your domain name.
Perhaps no one can vouch for the profitability of buying premium domain names better than Mike Mann. He has been in the domain selling business since 1998, when he sold menus.com, a domain name he purchased for $70, for $25,000. In April 2012, he famously bought 14,962 domain names within 24 hours, setting a record for the most domain names ever purchased in a day. He is the owner of DomainMarket.com, among other Fortune 500 companies, which owns over 400,000 domains.
5. There are some really really short domain names.
When registering the right domain name for your business, short and sweet is the way to go. Shorter domain names are easier to communicate, type, and remember, making your business easier to find. Don’t believe us? Here are two of the shortest domain names in the world owned by the most prominent companies: x.com (Elon Musk) and w.org (WordPress).
6. There’s no need to limit yourself or your domain name.
The Internet namespace is crowded, but did you know that registering more than one domain name for a website can benefit you? More iterations of your domain name improve the probability of people finding your website. Here are a few things to consider when purchasing multiple domain names.
- You can register domain names that account for common typos to prevent people from not finding your website due to human error. For instance, if your domain name is friendlyneighbours.site, you can also register friendlyneighbors.site, friendlyneighbor.site, and so on.
- You can register domain names with new extensions that better communicate what you do. For instance, even if you have a companyname.com domain, you can register companyname.store if you are into eCommerce or companyname.tech if you have an interest in technology.
7. There’s a way to keep your domain name purchase private.
Is there a way to secure your identity as a domain name purchaser? The Internet Corporation for Assigned Names and Numbers (ICANN), the international body that governs domain names, requires certain personal information of a domain name owner to be publicly visible in a database called WHOIS. But you can keep your information private by signing up for the WHOIS privacy service. When you do so, your personal information, such as name, phone number, and address, is replaced by that of an anonymous proxy identity. This can save you from identity theft and fraud.
8. There are several alternatives to a .com domain name.
Did you know that as of 2022, there are over 1,500 new domain extensions worldwide? The evolution of domain extensions is testimony to how rapidly domain names and the internet have advanced. The first extension was .com, created in 1985. This was the only generic extension available at the time. The others, such as .net and .org were niche, while .gov and .mil could only be used by the US government and military, respectively.
Fast forward to 30 years later, and there is a domain extension for every industry and purpose. As a first-time domain buyer, it is important to know that you have far more options than the traditional .com. You can opt for a domain extension that is more suited to your company, such as .Store or .Tech. As an investment, too, it can be advantageous to purchase a domain name with a new extension that is rising in popularity and has global appeal, such as .Online and .Site.
Today we take the Internet for granted, but a lot has gone into shaping the digital world we live in. Going back in time and learning more about the inner workings of the domain name industry can make us better equipped to act in the present while looking at the future and buying the right domain name in the process.