April 6, 2020

What Is A Domain Name and Why Do I Need One?

written by

Joe Uddeme

What Is A Domain Name and Why Do I Need One?

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Domain names are one of the foundations of every global brand – they’re your calling card online. In this post, domain name expert Joe Uddeme explains how they work and how to secure the right one for your business.

You probably know more domain names than phone numbers these days. Think of all the news sites you know the address of – plus Amazon, Apple and all those big brands whose website URLs you can guess because nine times out of ten, it is their brand name + .com.

While the world of domain names is easy and familiar at face value, behind the scenes, there’s a lot more going on.

If you’re getting ready to buy a premium domain name – one costing in the thousands that will be memorable and potentially valuable for a business in the long term – you need to have a solid grasp of what you’re getting into.

To stop you from confusing domain names with websites or even website hosting services, this post is a great place to start.

Key Takeaways

What is a domain name
How does a domain name work
How to choose the right name for your business
Securing a name that will keep your business on track

What Is A Domain Name?

To put it simply, a domain name is the address of your website. It is the phrase or word that you will type into your URL bar of your browser to find your website. For example, our website is https://nameexperts.com/

You can purchase domain names through a domain registrar, through a hosting provider, or let a domain name broker help you.

What is the DNS?

You can’t really answer the question, “What is a domain name?” without addressing DNS. Domain names are part of a large network called the Domain Name System (DNS) and it is managed by the Internet Corporation for Assigned Names and Numbers (ICANN). The ICANN is a non-profit organization responsible for management and maintenance of the DNS, as well as regulating domain registrars.

How Does the DNS Work?

When you type a domain name into your browser, your computer will check if you’ve previously looked at that domain. If not, then your browser will contact the local DNS server to pull it up.

Your local DNS server breaks down the domain name into sections. We’ll use our name again as an example. There are three parts to nameexperts.com – www., nameexperts, and .com. The .com is known as a top level domain (TLD) and the local DNS server will search for this section first, and then serves to find all the details of your domain name and send that information back to the browser you’re using.

There are obviously a lot more technical steps to it, but that’s the basics of how the DNS works. Let’s talk more about what you really need to know – what types of domain name extensions are available.

Different Types of Domain Name Extensions

All domain names are made up of a website name (nameexperts), and a top level domain (.com). Though the extensions can vary, we think it is useful to know the differences between the types of top-level domains available so that when it’s time to choose your domain name, you choose the right one.

The two types we are going to talk about today are Generic Top-Level Domains (gTLDs) and Sponsored Top-Level Domains (sTLDs).

Generic Top-Level Domains (gTLDs)

Normally, the best course of action is to choose a reputable TLD like .com, .net, or .org. But because these are so popular, there are millions of domain names that have been registered to date. So the name you want might be taken (read our post: “How to buy a domain owned by someone else”) – or it may be hard to find a name that works.

Here are some of the most generic TLDs:

.com (commercial)
.info (information)
.org (organizational)
.net (network)
.biz (business)

Subdomains

We thought we should also mention subdomains. A subdomain is also known as a third level domain and is an extra part of a domain name. They are viewed as separate websites by the search engines, so creating subdomains can help improve your site’s SEO. Specifically, a good time to use a subdomain is for a blog. It might look like https://blog.nameexperts.com.

How To Choose The Right Domain Name

Now that we’ve answered what is a domain name, we want to help you choose a strong domain name that accurately reflects your business. Ideally, you want to be easy for your target market to remember and be something that is timeless.

Your domain name broker can help you find the perfect domain name and get you started with the process that goes along with it.

Begin by doing some research on keywords that are relevant for your business. Whether it’s the name of your business or another keyword that relates to your business and you want to rank for it, this type of domain name will help improve your site’s SEO (search engine optimization).

Another tip is to keep your domain short and memorable. You want it to stand out but be easy to remember – try to keep it to three words or less.

You also want to make sure you avoid numbers and hyphens. People won’t remember where they go and they might mistype. Which leads us into another tip for choosing your domain name, make sure it is easy to spell.

Shy away from words with multiple spelling variations or one that might be difficult to pronounce. Think long term. You want a domain name that supports the growth of your business and will last for years to come. Changing your domain name later can really hurt your business.

Working With A Domain Name Broker – The Easy Solution

Getting your domain name right is crucial for your business or organization. It can help define your brand and form a lasting impression on your audience.

Do your research, and then if you’re serious about securing a seemingly unavailable name, reach out to a domain broker. We can help you buy and register a name – even if it belongs to someone else.

We can also advise on strong alternative names for your business. NameExperts.com has a selection of highly commercial names available for sale at any time. At the time of writing, these included eight.com, proud.com, fate.com and nickel.com.

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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One of the most common questions we are asked is, ‘Can I own my domain name forever?’ While the simple answer is ‘no’, Name Experts director Joe Uddeme explains a reliable workaround... While it’s not possible to buy a domain name forever in the classical sense, there are ways to ensure long-term control over your domain. Website registration typically involves leasing a domain name for a specific period, usually between one to ten years. However, some registrars offer lifetime domain registration options or auto-renewal features that can help you maintain ownership for an extended period to buy a domain name. By opting for these services, you can avoid the hassle of frequent renewals and ensure that your domain name remains yours for as long as you need it. This approach provides peace of mind and stability for your online presence, allowing you to focus on building and growing your website without worrying about losing your domain. It’s an especially important consideration when you want to buy a premium domain name. Key Takeaways Understand the truth about “ownership” of a domain name Know your rights and responsibilities as a domain name owner Learn about settings and protocols that can help protect you

Celebratory shot of the monday.com team after the relaunch of the business and the acquisition of the domain name they needed

How We Helped Monday.com Secure the Perfect Name for their Rebranding

Discover how Name Experts’ premium domain buying service played a key role in the rebranding of Monday.com. As the business goes from strength to strength, Monday’s rebranding is a testament to the power not just of a world-class brand name but of a powerful, memorable domain name, too. We’ve all heard of Monday.com. They are one of the biggest project management tools on the market. But that was not always the case. Before Monday.com was Monday.com, they were daPulse, a name that ultimately was a hindrance to their growth. The daPulse name was out of sync with the project management business and limited their ability to scale. Changing to Monday.com was a sound decision that contributed to the company’s massive success. It demonstrates how naming a brand is as essential as product development to any technology business. I was approached by the two founders, Eran Zinman and Roy Mann, to pursue a rebranding project. They wanted to buy a domain name that was both generic and memorable. One that ended in .com and could be used as a solidified brand. One of the names that stuck early on was Monday.com. After contacting the owner, the domain name negotiation and engagement was flawless, and ultimately, Eran and Roy were ecstatic with the result. Early on, however, I remember some of the feedback was, “What the heck is Monday.com?” But, with fantastic brand marketing, the team has done an exceptional job at growing and scaling the company. As with most great business ideas, it all starts with the foundation or a solid domain name asset to help build a brand. Here’s the story… In 2012, a group of Israeli entrepreneurs launched a company named daPulse. daPulse launched as a platform for enterprises to organize project management and collaboration between their workers. Though it started in 2012, daPulse didn’t launch commercially until 2014 after significant product testing and development.

Computer keyboard with large red return on investment button denoting the importance of accurate price evaluation in domain names

How to Value A Domain Name

Did you make a speculative investment in a domain name some years back and are now wondering what it’s worth? In this article, domain name specialist Joe Uddeme provides expert insight into how to accurately value what you have in your portfolio. How to Value A Domain Name Valuations can be confusing whether you are the buyer or seller. “What’s my domain worth?” is a question that many owners ask themselves. “Why are domains so expensive?”, an intending buyer may ask after seeing the price of the asset they want. Utilizing an appraisal services tool is crucial to accurately assess the value of certain names for various purposes, such as buying, selling, or evaluating brand name changes. We will dive deep into domain valuation and the factors that affect the value of a domain, but first it’s helpful to understand why they cost money in the first place. Key takeaways Domain name values rise and fall as with other asset classes Accurate domain name valuation ensures both buyers and sellers leave the negotiation table happy Understand what makes one domain name more valuable than the next Access evaluation tools to help you arrive at a fair price Understanding Domain Value Domain value is a crucial aspect of the online business world, and understanding it can help individuals and businesses make informed decisions about their digital assets. Remember, values could rise and fall according to market trends and the desirability of a name to a particular buyer at any point in time. Knowing the value of a name is essential for both buyers and sellers, as it ensures fair transactions and helps in strategizing future investments. In this section, we will delve into the concept of domain value, its importance, and the factors that influence it – as well as offer a complete review of the best-known domain appraisal services. What is a Domain Worth? Domain worth refers to the monetary value of a name. It’s an estimated amount that an asset could be sold for on the market. This estimated value is influenced by various factors, including the domain’s length, keywords, and extension. Domain worth is a critical factor in determining the value of a business, as a high domain worth can significantly enhance a business’s overall value. For instance, a memorable and relevant name can attract more traffic, improve brand recognition, and ultimately lead to higher revenue. Why Do Domain Names Cost Money? A domain name is an online property – and property is not free. They are scarce by design; once a person buys an asset, it belongs to them as long as they pay the renewal fees. Likewise, it costs money to maintain the vast computing infrastructure that powers the internet, and selling digital domains is a way for registrars to recoup their costs. Expertise in buying premium domains is crucial to ensure accurate appraisals and competitive pricing, helping buyers avoid over-payment. Why Would You Need To Value A Domain? It is important to have an estimate of what a name is worth, whether you are the buyer or seller for any potential sale. Understanding a domain’s worth ensures that a buyer won’t overpay for an asset and a seller won’t sell their domain for a price far below what they could have gotten from another acquisition partner. Domain name valuation helps buyers or sellers assess the worth of a domain and pay or receive a fair market price. What Makes An Asset Valuable? The Top-Level Domain (TLD) The TLD refers to the last segment of a domain name that comes after the “dot” symbol (.com, .net, .ai, .co, .xyz, etc.). It plays a big role in the value of your asset due to supply and demand insight and data. For instance, .COM is the most popular option for buyers, so domains with this TLD tend to be more expensive than others with less interest. Some other TLDs also have a reputation for being expensive because of a strong market, like .ai and .io – according to current data. Domain Length The number of characters of an asset also affects its value metrics. The rule of thumb is that the lesser the number of characters, the more valuable the asset. Number of Words Similarly to length, the number of words in a name affects its valuation. The lesser the number of words, the more upside an asset has. This happens because domains with one or two words are easier to remember and thus command more brand power. Age or Domain History How long a domain has been owned by someone else contributes to its value. The longer the period of ownership, the higher the chances of that domain being recognizable. So, domains owned for a long time tend to command higher prices than new or short-lived ones. Domain Popularity If a name is already in use, the volume of the traffic on the site using it contributes to its value. High-traffic domains are more expensive because the new owner can leverage the existing traffic to drive eyeballs to their own website. Likewise, if an existing asset has backlinks from other websites, it will command a higher price because backlinks improve search engine rankings and help generate organic traffic. Understanding the domain marketplace is crucial for accurately estimating values and optimizing URL investments. Availability of Alternative Domains Can the purchaser find a similar asset elsewhere? (for instance Trucks.com > Trucks.co or Trucks.net or the .org). If the buyer can’t find a similar name somewhere else, then they may be more willing to pay a higher amount for it. Market Interest and Characteristics Market interest and characteristics are two essential factors that influence the names. Internet market interest refers to the level of interest in a name, which can be driven by trends, industry relevance, and the popularity of certain keywords. Characteristics, on the other hand, refer to the attributes of the name, such as its number of characters, extension, and keyword density. A URL with high market demand and desirable characteristics can command a higher price. For example, short, memorable domain names with popular extensions like .com are often more valuable sales due to their high demand and ease of recall. How To Determine A Domain’s Value There is no specific formula for this activity. However, there are some free tools and services to help you estimate the cost of a domain name. 1. Research Tools The first step in figuring out how much a name can sell for is checking out the rate of similar domain names. Thus, you can use a research tool to see what similar domain names are selling for and compare them to your own. This will help you select a fair market price. Some sites are free to use while others charge a fee. DN Journal is a good example of a platform that collates sales figures and displays them to readers for free. Namebio, much like DN Journal does a great job cataloging recent names with an easy to use scan tool. They offered a monthly service fee for multiple inquiries. Domain Name Wire is another free resource. You can find blog posts about notable domain sales to help you estimate what you can sell yours for. Godaddy is a great resource to see what names may be available. They also offer a fast transfer service. There are many others, but these a few good places to start. 2. Use An Appraisal Service A domain appraisal service estimates the market value of a name. They appraise a domain based on many factors, including popularity, search engine ranking, social media shares, TLD, and by comparing it to similar domains. These domain appraisal services platforms make it easy to get an educated answer on how much a domain is worth. A free valuation tool can give you an overview of the appraisal value, such as godaddy. 3. Find Out What Others Are Willing To Pay A more direct way to answer the question of “what is a domain worth?” is to understand the domain sales marketplace and see what others are willing to purchase it for. The easiest way to do this is to list your domain on a marketplace like Sedo and Afternic and see what offers you receive to purchase. Create cool landing pages to help drive leads. This data can help set better pricing. You can use the offers as the yardstick for valuing the domain. Combining AI and Human Expertise To accurately determine domain value, it’s essential to combine artificial intelligence (AI) and human expertise. AI searches can analyze vast amounts of data, including market trends, search volume, and similar domains, to provide an estimated value request. They are vast resources for information. These automated tools can quickly process information and identify patterns that might not be immediately apparent. However, human expertise is necessary to interpret the data, consider the nuances of the domain name, and provide a more accurate appraisal. Experienced domainers and brokers can offer insights that go beyond raw data, such as understanding the potential for future trends and the strategic value of a domain within a specific industry. How To Increase Your Domain’s Value There are several ways to boost the value of a domain, including: Search Engine Optimization (SEO) This refers to optimizing a web page such that it ranks high on search engines. You can do this by including relevant keywords in your niche and getting backlinks from other websites. If people can find your website on Google algorithms, they will click on it more often and give you higher conversions, which translates into a higher domain value when you analyze the data. Market Your Site You can advertise your website on appropriate venues like social media services, search engines, or even use free word of mouth for your Company. This lets people know you exist and will likely drive higher eyeballs to your domain, giving it a greater value. Availability of Other Domains People are less willing to pay a high price for a domain if they can get something similar for cheaper elsewhere, e.g., Cars.com > Cars.co. One way to avert this is to buy the keyword across multiple TLDs, e.g., Box.com, Box.org, Box.net, etc. This way, the intending buyer will have less leverage. Build An Online Presence You can create profiles on social media platforms to build an online presence. This gives your domain more brand power and, in turn, a higher evaluation figure. Types Of Domain Name Valuations There are three main types of domain name valuation: Retail Pricing These are domain names directly offered by the owners to end users with a clear use case. The end users already have something in mind to do with the domain, usually for a website, so are more willing to pay a higher sum than the estimates. Liquid Pricing This comes into play when domain names are being offloaded by an owner, court order, or a bankruptcy proceeding sales. The domains are typically sold as a group and are cheaper to buy because it is a fire sale. However, the chances of finding domains with liquid pricing estimates are slim compared to the others. Liquid pricing is usually between 20% to 30% of retail pricing. Investor Pricing This is when domain names are offered for sale by professional domain brokers or flippers. You can find these types in an auction where you will likely bid against other people to acquire a domain. Some people may exchange domains with other Internet portfolio investors or team up to acquire a single valuable name for their domain portfolio. Investor estimates pricing between 40% to 60% of retail pricing. Working with Domain Investors and Brokers Domain investors and brokers play a crucial role in the domain name market. They help individuals and businesses buy, sell, and appraise their names, leveraging their expertise to ensure fair and profitable transactions. Brokers, meanwhile, act as an expert go-between the buyer and seller of a domain name. Role of Domain Investors Domain investors are individuals or companies that buy and hold domain names with the intention of selling them at a profit. They often have a deep understanding of the domain name market and can provide valuable insights into the value of a domain name. Investors typically maintain a domain portfolio as part of their business, which includes a variety of domain names that they believe will appreciate in value over time. By analyzing market trends and leveraging their experience, domain investors can identify undervalued domains and acquire them at a lower cost, with the aim of selling them at a higher price in the future. 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]

Why Work with Name Experts

Name Experts offers personalized domain brokerage services, assisting clients in buying or selling premium domain names with expert appraisal, negotiation, and complete transaction management while ensuring confidentiality.

What Is A Domain Name and Why Do I Need One?

Domain Buying Guides

Name Experts provides premium domain service to:

What Is A Domain Name?

What is the DNS?

How Does the DNS Work?

Different Types of Domain Name Extensions

Generic Top-Level Domains (gTLDs)

Sponsored Top-Level Domains (rTLDs)

Subdomains

How To Choose The Right Domain Name

Working With A Domain Name Broker – The Easy Solution

About the author

Subscribe for More Domain Buying & Selling Advice

Related posts

Can You Buy a Domain Forever?

How We Helped Monday.com Secure the Perfect Name for their Rebranding

How to Value A Domain Name

Why Work with Name Experts

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Name Experts provides premium
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