Investing in domain names
Basic advice for domain name investment
Investing in domain names
As with any investment risk is involved however domain names are a fairly safe bet if you do your homework and stick to some golden rules!
Buying the right domain name!
This really depends on your personal budget but we will discuss basic dos and don'ts to help you on the right path. The safest domains are premium one word English dictionary names like Finance.com Marketing.com Travel.com etc etc etc but names like these now in 2022 are extremely rare to fine on the market at investor/reseller price level, these are worth 7 figures! (yup)
So what can you do? if you want one word English dictionary domain but the .com is not available try exploring other extensions for the keyword like .io .xyz .co .tv .me etc - the keyword still holds value and if the .com is in use or not for sale this only leaves alternative extensions for companies and big brands to use.
Secondly you can look at 2 word combination names for example CheapLoans.com TravelFast.com HomeLoans.com ComparePlans.com again some of the best combinations have already been gobbled up by companies or investors so when looking through auction sites or domain marketplaces look for logical combinations that make sense and have commercial value, stick to generic words and avoid potential TM names for example DON'T buy ShopAmazon.com or GoShopify.com as these are clear trade mark infringements and you don't want to bark up that tree!
When you have found a suitable domain name, run a background check! By this I mean google the exact keyword/s of the domain and see what comes up, if the name has multiple potential end users go for it, also run the keywords through LinkedIn and other social media platforms to determine the potential for a successful flip! If the domain only brings up 1/2 potential end users globally your chance of a successful sale is naturally reduced. Try to stick to the rule of only buying domains which have minimum 5 potential end users!
Who is an end user for the domain?
Typically speaking end users are companies/brands who have a commercial interest in the given keyword/s of the domain name, especially so if the keyword already exists within their current domain name, for example; You invested in FlyMe.com and you spot a company with the domain TryFlyMe.com they would be a logical end user to approach.
Remember this; The company who will pay the most for your domain name is the company who will gain the most from owning it! So before pitching the name to them put yourself in their shoes and ask;
Is it a logical acquisition? What's the ROI for us? Do we have brand equity in the keywords of this domain? Can we afford it and do we even need it?