April 11, 2018

The Ultimate Guide to Purchasing a Domain Name

written by

Joe Uddeme

Joe Uddeme

The Ultimate Guide to Purchasing a Domain Name

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Getting right down to basics, here’s NameExpert.com Director Joe Uddeme with our definitive guide to buying a domain name. Whether you’re a complete beginner or a would-be domain trader, it’s a great place to start.

 

A domain name is your website’s unique identifier. It is the address people type into their browser when they want to visit your website. For example, typing “nameexperts.com” in your browser leads to this very website.

Most businesses with an online presence need a domain name, but business owners sometimes don’t know how to get one. If you want to buy a domain name for yourself or your business, you’ve arrived at the right place.

Key Takeaways

  • What to do before buying
  • Choosing the right name and getting it registered
  • Buying a domain owned by someone else
  • What to do next

Before Buying Your Domain

Let’s examine the essential steps to take before buying a domain name:

Choose a domain name

A domain is a unique web address, meaning two websites can’t use the same domain name. The first step to buying a domain is to choose the right domain name for your business.

The domain should be brandable and easy to remember. It’s how customers will find you, so avoid any name that gives people headaches when trying to remember it.

The domain should preferably include the name of your business so that people can easily guess the address if they are not sure what it is. Let’s say you run an electronics store named MJ Gadgets; the perfect domain name is MJGadgets.com. If this domain isn’t available, you can look for alternatives like ShopMJGadgets.com, BuyMJGadgets.com, and MJGadgets.net.

Choose a premium domain name if you can afford it, as they are short, catchy, and memorable domain names that draw valuable organic traffic. Most successful online businesses use premium domain names.

Choose an Extension

The extension is what comes after the dot (.) in your domain name. “.COM” is the most popular domain extension and should be your first choice. If “.COM” isn’t available, you can pick alternative extensions like “.NET,” “.ORG,” and “.CO.”

Google and other search engines have confirmed that your choice of extension doesn’t impact rankings. However, it significantly affects consumer perception. People generally don’t trust uncommon domain extensions like “.XYZ,” “.BLOG,” “.WEBSITE,” etc.

Understand How Domains are Valued

Before making a final decision, you should understand how domain names are valued, especially if you plan to sell the domain later. Many factors contribute to a domain’s value, including:

  • Length: The shorter a domain’s length, the easier it is to remember and the more valuable it becomes.
  • TLD (top-level domain): Some domain extensions are more valuable than others, such as “.COM” “.NET,“ .AI,” “.IO,” etc. The more popular the domain extension, the more valuable it is.
  • Length of domain history: The longer a domain name has existed on the web, the more likely it is to command a high value.
  • Keyword popularity: Domains with generic keywords people frequently search for tend to have high value, e.g., “Amazon.com,” “Stripe.com,” “Square.com,” etc.

Verify if it is available

Considering the above factors, it’s time to check if your desired domain name is available. You can do this by simply going to any domain registrar and typing the desired name in the search box.

If the domain is available, the registrar will offer to sell it to you. Otherwise, the registrar will notify you that someone else has already registered the domain.

To demonstrate, let’s search for a random domain, “ournameexperts.com”, on Namecheap, a popular domain registrar. Namecheap said this domain name is available, and we could register it immediately.

Now let’s search for “nameexperts.com.” Namecheap said this domain name has been registered by someone else since 2000. Of course, that’s the domain you’re currently on, so you can’t register it for yourself.

If your desired domain name is available, move to the next section on how to buy a domain name outright. If it has been taken, move to the ensuing section on how to buy a domain name that is already registered.

 

How to Buy a Domain Name

1. Choose a domain registrar

Any domain name must come from an accredited registrar, such as Namecheap, Dynadot, Hover, Bluehost, and Domain.com. Over 2,400 domain registrars are accredited by ICANN, the governing body of the global domain registration system, so finding a suitable one shouldn’t be an issue.

You can see the full list of all ICANN-accredited registrars here. Any supposed registrar not on this list is illegitimate.

2. Select your domain and extension

The next step is making a final choice about the domain and extension for your online business. We’ve discussed the factors that should influence your decision, but it’s worth reiterating that “.COM” is the best extension. This is the first extension most people consider when looking for a brand’s website.

If a random person wants to guess your website name, they’ll likely type the name followed by a .COM and hope their browser will show your website.

The .COM extension is easily recognizable and helps your website rank higher on search engines. Domain names with this extension also command a higher resale value, giving it a competitive edge over other domain extensions.

3. Select How Long to Register the Domain

Domain name ownership isn’t etched in stone. Every domain has an expiry date, although you can renew the registration for as long as you want. You can register a new domain for up to 10 years, with each additional year carrying higher upfront costs.

The bright side is that you don’t need to bother about short-term price changes once you’ve registered a domain for many years.

If you want to build a valuable long-term brand, 5 to 10 years is the optimal period to register a new domain. But if you can’t afford a long-term registration, you can register it for a year and turn on auto-renew so that the registrar automatically renews it when due.

You can’t technically buy a domain forever, but you can use some workarounds to own it for a seemingly infinite time.

4. Purchase your Domain

Enter the available domain name into your registrar’s search box and click the buy button. On the checkout page, most registrars suggest adding domain privacy to the registration package. Some registrars offer domain privacy for free, while others demand extra fees for this perk.

Do you need domain privacy?

Domain privacy protection means hiding your personal information from the public WHOIS database. This ICANN-operated database contains information on all domain owners and is open to anyone.

However, you might be uncomfortable with your contact information being out in the open. In that case, you can request domain privacy for your registrar to hide your personal details from the WHOIS database.

If you have no issues with your contact information being publicly searchable in the WHOIS database, you can ignore your registrar’s domain privacy suggestion.

5. Complete the Registration Process

Pay for the domain name with a credit or debit card and complete the registration process. Your registrar will ask for contact information, including a name and email address, to register the domain. This information is usually listed in the WHOIS database, but domain privacy lets you hide it.

6. Verify domain registration

Your registrar will send a verification email confirming ownership of the domain you purchased. Click on the link in the verification email and smile because you have formally joined the club of domain name owners.

How to Buy a Domain that is Already Registered

We can predict your disappointment if you find out that your desired domain has already been registered. However, don’t fret—there’s still a way out. You can contact the owner and formally offer to acquire their domain, especially if it isn’t connected to an active website.

Finding a domain owner and making a reasonable acquisition offer can be exhausting, so seeking a domain broker’s services is advisable. Domain brokers are experts who specialize in buying and selling domain names– the internet’s equivalent of a real estate agent.

If you’re interested in a house not publicly offered for sale, you’ll likely seek a real estate agent. Similarly, if you want a domain that is already registered, seek a domain broker to handle the negotiations.

Domain brokers can help you find the owner of a domain even if their information isn’t available on the WHOIS database. Then, they’ll reach out to the owner for negotiations.

This part is critical because domain brokers have proper knowledge and experience in domain name valuation. If you’re negotiating directly, you might underbid a domain and cause the owner to ignore you. Or you may overbid and get played. A domain broker sets a reasonable bid on your behalf and adjusts when necessary.

If the owner agrees to sell their domain name, the broker handles the escrow and ensures you aren’t cheated. Then, they’ll transfer the domain name to you.

Sometimes, the broker will explain that they have found the owner but they don’t want to sell for any reason. In that case, it’s wise to avoid beating a dead horse and seek a new domain name instead – preferably something similar to your first choice.

It can be as simple as choosing another extension – such as saying goodbye to OurNameExperts.com in favor of OurNameExperts.net.

One of the most important things we do for clients is advise them on domain name strategy. We have many years of experience in suggesting and sourcing valuable names that have incredible potential.

Seated man and woman high-fiving in business setting

 

What to Do After Buying Your Domain

You’ve acquired a domain, so what’s next? A lot can happen. The obvious choice is to connect your domain to a website and work on attracting traffic.

You’ll need a web hosting plan from a reliable company. The company hosts your website on its servers so that people can access it anytime, and you’ll pay a fee for this perk.

The good news is that web hosting has become more affordable than ever– you can find hosting packages for as low as $5 monthly.

The type of website you want determines your hosting provider. For example, if you run an online store, you’ll need an e-commerce hosting service like Shopify, Shift4Shop, Squarespace, and WooCommerce for WordPress. If it’s a news site, social platform, booking website, or anything else, you can find endless hosting options for it.

You can also create a professional email address attached to your domain name. Professional email addresses make your business look brilliant and increase the chances of getting a response when you pitch to clients.

You can trademark your domain, market the website, and even sell it later. There are endless things to do after buying a domain name.

 

About the author

Joe Uddeme is Director and Principal of Name Experts, one of the world’s leading domain name brokerage services. He has overseen domain name sales and acquisitions totaling more than $150 million and is renowned worldwide as a go-to expert in buying and selling premium domains. Contact us at: [email protected]

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How to Buy a Taken Domain Name

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If they are actively using the domain to promote their business and have spent their time and money building a website, then you’ll want to make them a fair offer that reflects the domain’s value. If you partner with a domain broker, they can tell you what the domain is actually worth. They’ll conduct a valuation of the domain and can provide you with their estimate of a fair price. You can then use that to make a great offer that will simplify the negotiation process and hopefully get you closer to the outcome you desire for your business identity. 5. Negotiate Without Emotional Attachment Whatever you do next, don’t become emotionally attached to the asset when you start negotiating a price for the domain name. Ultimately, this could add headache, stress and more money to the equation if you start making decisions based on emotion. Remember that a negotiation is a give-and-take and should always try to create a win/win for both buyer and seller. If the price isn’t right and goes beyond your budget, you should be willing to walk away. Once you agree on terms, in most instances you would then either enter into a contract or purchase and sales agreement with the prospective seller or simply move right to one of the formidable escrow providers such as Escrow.com. Contracts and documents can become tricky and need to be completed diligently and professionally if necessary. You will also need to have proper legal representation to make sure you are protected accordingly. Documents can get stuck in legal or need board approval, and can certainly slow down the overall acquisition process. 6. Transfer Ownership of the Domain So now you have made proper contact, negotiated a price, handled the paperwork and set up the Escrow transaction. The buyer has agreed to terms and now you are ready to transfer the domain name. Domain transfers can sometimes be tricky but typically follow two forms for completion. The easiest way to transfer a domain name is by “pushing” the domain name within the current registrar. Alternatively, you may also choose to transfer your domain name to another registrar. To complete this, you will need an authorization code from the seller. Make sure the domain name is unlocked and privacy removed before you try and transfer the domain name. Once the transfer has been completed, you can release the funds to the seller and mark the transaction complete. The entire process for a domain name transaction can be completed in as short as 3-5 days, however most transactions take longer. Some transactions take months to come to fruition, but when complete you will have successfully purchased a domain name that was owned by someone else. What To Do if You Can’t Find the Domain Owner? If the Whois lookup doesn’t provide the contact information you need, it does not mean your path to purchasing the domain ends. Instead, reach out to a domain broker to continue the research process. They can conduct additional investigations into who owns a domain – or at least begin to track down contacts who can get them closer to finding that information. Partnering with a broker at this phase of the process is a great step to take as everything that follows can be challenging to do on your own. Not only is it time-consuming, but they’re experts at this and spend every day figuring out how to help people find their perfect domain.   Getting Support in Buying A Domain Name That is Already Taken Working with successful brokers can save you a lot of time, money, and hassle when it comes to getting the domain name you want. Reach out to us, and let us help you grow your business. We’d love to answer any questions about our services and help boost your confidence when it comes to buying and selling domains. 7 key reasons why you should buy a domain name: 1. Professionalism and Credibility Owning a custom domain (e.g., yourbusiness.com) makes your business look more professional and credible compared to using free services like yourbusiness.wordpress.com or Gmail addresses. 2. Brand Control A domain name helps establish and protect your brand identity. It ensures your business name is uniquely represented online and prevents others from using it. 3. Easy Online Access A custom domain makes it easier for customers to find your website, improving your online visibility and brand recognition so consumers can find your site properly. 4. Custom Email Addresses A domain allows you to create personalized, professional email addresses (e.g., [email protected]) that look more professional than generic ones. 5. SEO Benefits Having a relevant domain name can improve your search engine rankings, making it easier for potential customers to discover your website through organic search. What makes a ‘relevant’ domain? Check out our post about why a .com domain name is still king. 6. Long-Term Investment A domain name is a valuable digital asset that can appreciate over time, especially if it’s a premium or in-demand name. 7. Security Owning your domain means you have full control over your online presence and don’t rely on third-party platforms that could change policies or shut down. Buying a domain helps you establish a unique and trusted online presence, improve credibility, and create opportunities for future growth.   About the author Joe Uddeme is Director and Principal of Name Experts, one of the world’s leading domain name brokerage services. He has overseen domain name sales and acquisitions totaling more than $150 million and is renowned worldwide as a go-to expert in buying and selling premium domains. Using his years of experience, negotiation skills and little black book of contacts, Joe is an expert at helping clients secure .com domain names that are already owned. 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Close up image of a person at a laptop as they investigate a domain name
What is Domain Name Escrow & How Does it Work?

Escrow is important when buying domain names, especially those of high value. Domain name expert Joe Uddeme explains how domain name escrow works – and why you should use a domain escrow 3rd-party when making highly-priced acquisitions.   What is Domain Name Escrow? Domain name escrow is a specialized service designed to protect both buyers and sellers during domain name transactions. In this process, a neutral third-party agent holds the payment and domain information until all conditions of the transaction are met. This setup ensures that the buyer receives the domain name and the seller gets their payment, significantly reducing the risk of fraud and deception. By using domain name escrow services, both parties can enjoy a secure and efficient transfer of domain ownership, providing peace of mind throughout the transaction. A domain name consulting service can help make the process much easier. What Is Escrow? Escrow is an arrangement in which a neutral third party temporarily holds money meant for a purchase until specific conditions are met. The money will only be transferred to the intended recipient when the conditions are met. If the conditions are not fulfilled, the money will go back to the buyer. In domain name and other transactions, the escrow process often involves a lawyer managing legal documents, ensuring compliance with laws, and securely holding the assets and money in a trust account until the terms of the agreement are fulfilled. What Can Escrow Be Used For & Why Escrow is common in transactions where a significant amount of money is involved, e.g., real estate. It is necessary to protect the buyer from losing money in case the seller does not fulfill the terms of the deal. Domain transactions can be pricey, which makes escrow and other services necessary just like with real estate. After all, domain names are online real estate. Escrow protects against: Sellers refusing to deliver a domain despite agreeing to do so. Buyers refusing to pay for a domain despite an agreement to buy it. Payment being made – but the domain not being transferred to the buyer. Secure payment is crucial in domain name transactions, and escrow services ensure that the financial exchange is safe and protected. In short, escrow ensures that both parties in a deal stick to their agreed terms. It is a mediator of the transaction and refuses to complete it until both parties act in good faith. How Does Escrow Work? 1. Agreement on price and deal The buyer and the seller negotiate and agree on how much is to be paid for a domain name or group of domain names. They also negotiate important factors like the date of payment, method of payment, and what currency to use. 2. Buyer places agreement with an escrow company With the deal terms drawn out, the buyer finds an escrow provider and deposits the payment with an escrow agent. Once the payment goes through, the buyer pays escrow company will notify the seller and tell them to transfer ownership of the domain name related to the escrow transaction. 3. Domain Name Is Transferred The seller will transfer the domain name to the buyer. The wire transfer procedure varies depending on the domain registrar, but both parties will work together to ensure a smooth transfer. It is crucial to involve legal counsel in domain transfers to secure the transaction and ensure compliance with legal requirements. 4. Domain Transfer Is Confirmed After the domain is transferred, the buyer will notify the seller and agree with the escrow company that the seller has fulfilled their part of the deal. 5. Payment Given To Seller With the domain transfer confirmed, the escrow company completes the escrow transaction by using a money order and sending the money deposited by the buyer to the seller. What fees are associated with using an escrow service? The escrow usually charges a commission on the value of the deal. Some may also charge a flat fee in addition to a commission. The exact commission may vary depending on the deal volume. Benefits of Using Escrow For Buyers and Sellers The benefits of using escrow for domain names include: Security: The escrow holds the money until all deal terms are fulfilled, so there are little chances of the buyer losing their money without getting the intended domain name. The buyer also feels more secure dealing with a trusted escrow company than with a stranger over the web. Additionally, escrow services safeguard domain transactions by holding funds and domain holder information, minimizing the risk of fraud. Assurance: The buyer is assured that they will get the domain they want, and the seller is assured of payment once the domain transfer is confirmed. Customer support: Escrow services usually offer customer support and can guide the buyer throughout the process of acquiring a domain name. Choosing the Right Escrow Services Selecting the right 3rd-party escrow provider for domain name transactions is crucial for a smooth and secure process. Start by looking for a reputable and licensed escrow company with a proven track record in handling domain name transactions. Evaluate their fees and payment terms to ensure they fit within your budget. Additionally, consider the quality of their customer service and support, as this can be invaluable if any issues arise during the transaction. A reliable escrow provider should offer a secure and transparent process to deposit funds, with clear contractual obligations and a well-defined escrow agreement. Research the company’s reputation online and read reviews from previous clients to ensure you are working with a trustworthy escrow company. Domain Name Transfer and Intellectual Property Transferring ownership of a domain name involves several steps and can be particularly complex when intellectual property rights are involved. A domain name can be considered intellectual property if it is trademarked, which can impact its value and transferability. Before proceeding with a domain name transfer, it is essential to conduct a clearance search to ensure the domain name does not infringe on any existing trademarks. Utilizing a domain name escrow provider can facilitate this process by ensuring that both parties fulfill their contractual obligations and that the domain name is transferred securely. This helps protect best interests of the buyer and the seller, ensuring a smooth and legally compliant transfer of the domain name. Alternatives To Using Escrow Attorney A licensed attorney can draft a sales contract that is legally binding for buyer and seller. If any party breaks the contract, they can be sued for damages in court. The attorney can also act as an escrow organization and only transfer money from the buyer to the seller if the terms of the contract are fulfilled. An attorney is crucial in selling domain names to ensure all legal aspects are covered, and the transaction is secure. Domain marketplace There are many marketplaces where you can acquire domain names. Here, the marketplace acts as a custodian of the domain and only the seller transfers it to the buyer after payment is confirmed, which is then given to the seller. Best Domain Name Escrow Services Escrow.com Escrow.com is the world’s largest online escrow service, and it has specific features for domain sales. The buyer can initiate the escrow request and provide the seller’s contact information for Escrow.com to get in touch. The buyer transfers the agreed sum to Escrow.com, and it is only when they confirm the domain has been successfully transferred that Escrow.com will disburse the money to the seller. Escrow.com charges 3.25% for deals between $0 and $5,000; 0.89% for deals between $5,001 and $25,000; and $162.5 + 0.25% for deals over $25,001. Sedo Domain Transfer Service Sedo is a popular domain name and website marketplace, especially useful for those looking to buy or sell domain names. Its domain transfer service puts it as a middleman between the buyer and the seller. Sedo receives the payment from the buyer and the domain name from the seller. When both ends are confirmed, Sedo transfers the domain to the buyer and the buyer sends the money to the seller. This service incurs a 3% fee on the domain purchase price, with a minimum of $60. Afternic Afternic is another popular domain name marketplace focused on high-value domains. It offers an escrow service to protect both the buyer and the seller. Afternic holds the agreed amount and only disburses it to the former owner or seller when the buyer has confirmed receipt of the domain. If either party breaks the deal terms, the sale will be canceled and the money given back to the buyer minus the escrow fee. The drawback here is that Afternic doesn’t charge escrow fees separately. It takes a 20% fee, which includes both sales and escrow commissions on all domains listed on its platform. Using an Escrow Service It is necessary to use an escrow service if you are paying a significant amount for a domain name and it helps protect you and the seller. If you need guidance in the domain buying process, including escrow, contact us for help. We have negotiated over $150 million in domain name sales and have over a decade of experience in domain name buying and transfers.   About the author Joe Uddeme is Director and Principal of NameExperts.com, one of the world’s leading domain name brokerage services. He has overseen domain name sales and acquisitions totaling more than $150 million and is renowned worldwide as a go-to expert in buying and selling premium domains. Contact us at: [email protected]

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