In this guide I will explain everything you need to know about the domain business and I will teach you all the tips and tricks the pro's use to make daily income with domains.
IntroductionIf you don't know what domains are, here is a quick explanation. Domains (also called Domain Names), are web addresses. Ebay.com is a domain name. Google.com is another domain name. Well, you get the picture. You need a domain to build a website. A website needs a home and that is what a domain is. It's like a home for websites. Usually, people register domains first and then build websites for the domains. Most hosting companies offer domain registration services such as Godaddy.com and Moniker.com, in addition to hosting websites. You need a domain to have a website, but you do not need a website to make money with domains...Domains have value just like real estate or gold. Just like beach front property or land, there is only so much.
As more and more domain names become registered, there is less and less short names available. So this makes the value rise. In October of 2007, there was over 1000 four letter domains available (Example: ldxv.com or qzdu.com) By December of 2007, 2 months later, those 1000 domains were registered by people and there were none available. In October you could have registered all 1000 domains for around $8.00 each. In December prices for each 4 letter domain name on ebay were a minimum of $40.00 each. (Whoever regged all 1000 domains made a nice profit. They had to have made a minimum of $32,000. Not bad. That's around $10,000 a month) Not all domains have worth though. If you purchase fjkdjfie.com, it's not worth anything.In order to own a domain, you must first register one or purchase one. When a domain is brand new, when nobody has ever thoughtof a particular name for a domain, it is unregistered. It does not even exist because nobody has ever thought of the name before.
Ebay.com exists because someone thought it sounded like a good name and decided to build a website and business on it. Ebay.com is a 4 letter domain. 4 letter domains are going up in value because there are no more unregistered ones. Since ebay is pronouncable, it is worth even more. 3 letter domains can easily fetch thousands of dollars because there have not been any available for many years now. Ebay.com was created many many years ago. But because it's a fourletter name, it's worth something. Because it was registered a long time ago, it's worth something. Because somebody built a well known business with the name, it's worth ALOT.
There are many factors that determine a domain's worth. A short domain name is always good, but once in a while longer names might have more value then shorter names, based on many other factors. But I have to admit, the first thing I would do when registering a domain name (or purchasing one from somebody else), is look at the name. A short name is more attractive because it's easier for people to remember, so it is easier to promote and advertise with. Easier to build a namebrand or business with. Ever notice how most of the largest internet companies have 1 word names? Google, Cisco, Yahoo, Ebay......If you want a short name, there are still many available.
But there are no more 3 or 4 letter .com's available anymore. They have all been registered already. You can still find some pronouncable 5 letter domain names available. A very good tool for finding 5 letters is 5letter.com (This site may be down due to maintenence issues they have been having lately. If it's down, just check back another time.It's not really important, just a helpful tool sometimes.)
Another thing that determines a domains worth is traffic. Traffic is actually what determines a domains value more than anything. Traffic is how many people visit a website in a day or a month. If your domain name has lots of visitors everyday, without you having to do anything to keep those visitors coming, your website is worth something. It's worth something because now anybodywith a product to sell could purchase your domain name, set up a website on it and instantly have people visiting the site, even without any advertising. Traffic can come from many different places, but most of the time it comes from backlinks and advertising. Backlinks are links which lead people back to a website. Ebay.com has tons of backlinks. Lots of people talk about ebay on the internet and post links to ebay items on other websites. So when someone clicks on one of those links, it will bring them to ebay's website.Domains with traffic are most valuable because traffic equals customers and customers equal money. Many people are willing to pay alot of money for domain names that have lots of traffic and backlinks.
You can take a look at how much domains with traffic are selling for at tdnam.com (godaddy's auction site) or Sedo.com . Sex.com sold for 14 Million dollars because it is short, it's brandable (meaning that you can very easily create a brand, a product or a business with it), it has about 7 million backlinks on the internet, and it's old (It's been around longer than 10 years). Also, it probably has alot of type-in traffic. Type-in traffic is when you receive traffic to your website from people who are typing the actual url address in the address bar at the top of their screen. For example, If I want to find an office chair online, I might go to google and search for "office chairs", or...I might go to the url address bar at the top of my internet explorer or firefox and type in the actual address www.officechairs.com. If I were to type in the actual address, that would be what we call "Type-In Traffic". Type-in traffic is very valuable because it means that a website does not need to advertise at all or create backlinks to get people to come to their website.
Professionals usually research previous sales of domain names when deciding which domain name to purchase or register and for how much. A great tool to do this is at Namebio.com. It gives you the ability to look at what domains have sold in the past and what prices they sold at. You can also just check the marketplace where domains are being sold. The 5 most popular places where domains sell is Sedo.com , TDNAM.com, Moniker.com, Ebay.com, Afternic.com (and Afternic Bazaar). There are many different ways to build up backlinks to yourdomain and I will explain this more in detail later.
ExtensionsThere are many different extensions for domains. You probably already knew this, but just in case you don't, I'll explain. There are .com's, .net's, .info's, .org's, .mobi's (extension for mobile devices, cell phones have small screens so if you wanted to make a website that is small that people on cell phones can see more easily when they are using their cell phones to surf the internet, you would get a .mobi extension instead of .com or .net etc.). Extensions can mean something like how .mobi meansit's for mobile devices, and they can also designate countries. For example, .th is the country code for Thailand. Also, .co.uk is the extension for people in the United Kingdom. So if I wanted to make a website about Thailand, I might choose the domain name www.thailand.th insteadof www.thailand.info, because people in Thailand probably only know .com, .net and .th. and the .com and .net names are already taken. If www.thailand.th was taken, I might choose www.thailand.tl (Extension for the country of Timor/Timor-Leste) because Timor is one of the countries close to Thailand and peoplethere probably look up Thailand on the internet alot. But .com is always more valuable though because everybodyin the world knows .com. If you can't have a .com, then .net is usually the next in line as far as value.