How Much is a Domain Name Worth? Part 2

February 25, 2010 by  Filed under: other 

There are many elements that have contributed to the value of a domain, and they are changing all the time. For the foreseeable future, it appears that domain names will continue to rise in value overall and could be a great investment. In the past 11 years, I have owned and/or managed over 500 domains. By comparison, I am not a big player in the domain name game, but in my expenditures of both time and money, I will share with you what I have learned in my experience.

This article does not address websites, only and exclusively domains. This is important to note as many domains for sale come with a website and it is important to differentiate between the two, they are two seperate, independent things. It is also important to note that a domain names value can be strongly effected by it’s association with a website or not. Let’s say you see a domain name for sale, and it is only the domain name that is for sale, not the website, and a measurable amount of traffic is attributed to that domain. There may be a good number of incoming links to the domain as well, contributing positively to it’s value also.

If you pull the site away you pull away the content, if you lose the content, you lose the links, you lose the traffic, you lose the value. Be very careful in purchasing a premium domain. Some domain names may have had a website attached to it previously, but are independent now. You can see if a domain ever had a website by visiting the “wayback machine”. If you purchase a domain that used to have a website you have to be careful of what kind of site it was. It may have been a complete disconnect from your business or vision of what the domain means. This disconnect could cost you thousands and take a lot of time to “undo”. Check the history of a domain name. Here are some of the major contributing factors in domain name value. In informal order of importance and relevance to value.

1. Length. This is an old one and has not changed. The shorter a domain the better, generally still rules. When you can’t find the domain you are looking for with ending you may be tempted to go to, or God forbid,.us or worse. It’s not fair to say that you can’t have a great website with an extension other, but I recommend going with as SEO best practices. Sometimes you can buy version as a premium domain, and it may be worth the extra money.

2. Keywords in the domain name. This isn’t as important today as it was, but it is still a contributing factor. Given the choice, it is better to have keywords in the domain than not.

3. Existing traffic. This is a sticky one. This is what I addressed above. A domain name will only have traffic under 4 conditions: Existing or previous content that attracted traffic Incoming links that drive traffic and ranking due to “a.” Fake or PPC traffic. Details of this is for another article. Type-in traffic. Very hard to measure.

4. Brand-Match. This is one of the smartest ways to establish a good domain at a cheap price. You are able to choose any brand name you want for your product and many times able to find version of it for less than $10.00 per yr. It is important to mention that when using this strategy you should support the domain with very a strong multi-media marketing campaign, the two work well together and increases your chances for success with both the brand and the domain.

Existing traffic to a domain is probably the biggest element of value. It can also be the most complex. Buying a domain that someone else owns is like buying a used car, but worse. There is no singular source for finding out the history of a domain like there is on a car, a VIN number. The only historical data you can find on a domain is very limited. There is no way to know what the previous owner did to drive traffic to that domain. It could all be legitimate but there are unlimited ways to drive fake traffic to a website.

Fake traffic is invisible to a domain buyer and can also inflate the value. Buying and transferring ownership of a domain is another thing and best fit for another article. This can be tricky and you can get ripped off easily if you are not careful. Be very careful when spending money on a premium domain, I recommend using a professional domain name broker and dig up as much info as you can on the domain yourself.

Martin Walker is the President and CEO of Walker SEO, an SEO firm based in Ontario, California,

Article Source:

Martin Walker - EzineArticles Expert Author

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