15 Ways to Be a Better Domain Investor

The competition in the domain industry is steadily increasing. More and more people are becoming aware of the impact of domain names on business and global markets, and professional investors and huge corporations are staking their claims. This once primitive name exchange has become a booming, multi-billion dollar industry.

Today’s domain investors need to rise to a new level to have continued success and enjoy sustained profitability. Below are 15 ways to be a better domain investor.

Utilize the forums
Forums in the domain industry play a crucial role and serve as a great resource for beginners and professional domain investors alike. Whether you are looking for honest appraisal and opinion, or asking questions that only other domainers would be able to answer, domain forum users are there to assist 24 hours a day, 365 days a week.

Over the years, this constant stream of domain information has shaped many beginners into skilled and successful domain investors. If you’re not a member of a domain forum, you should seriously consider joining one today.

Are you a domain investor or a domain developer?
Are you buying domains for quick-profit sales? Are you buying domains for the long-term traffic revenue? Are you buying domains to develop and grow? Whether you choose to do one or all three, you’ve got to come to terms and clarify a viable business plan. Narrow your overall strategy to a specific objective and focus, focus, focus,

Dissect your portfolio
I once spoke to a guy who boasted a domain portfolio of over 3000 names. After hearing how he was considering selling a few of his “best” domains, I offered to peruse the list and maybe assist him by finding some end users that might be potential buyers. He agreed and the next day he sent me a list of about 1000 of his best domains that he was willing to sell. To my surprise, over 90% of them were (in my humble opinion) not worth much more than the reg fee. I explained to him that I was only able to find 75-100 names that might lead to decent sales. He was stunned. He declined, stated that my appraisal was incorrect and thanked me for my time.

Three days later I received another email from him asking for help selling the names I had previously mentioned. It turns out that he had spoken to a few other domain investors and had received the same evaluation of what he called his “best” domains. He thought that, since his domains contained popular words like gamble, casino, sex and technology, it automatically made his domains ultra-valuable. What he hadn’t ever considered was that the multiple hyphens and terrible combinations of typos and keywords undermined the value of nearly every name he owned.

Don’t be a domain investor with a huge list of terrible domains just to brag about how large your portfolio is. Trim your “extra” domains—streamline by selling or trading, and use the capital to invest in quality names that are a sure thing for immediate revenue or immediate development. Be proud of the quality of your portfolio, not the number of domains it contains.

Know your rep
I amazed on how many people I encounter that in the domain industry that have no idea who their representatives are for such companies as Sedo, Moniker, Go Daddy and other big domain powerhouses. The representatives of such companies exist to assist their customers who utilize their services— your reps are the quickest and easiest way to get something resolved if you feel a mistake has been made.

If you have domains parked or offered for sale with an aftermarket venue, send a quick email to find out who your representative is, introduce yourself, and do your best to maintain a professional and courteous relationship with him. It’s easier to ask for assistance from someone you know and knows you than it is to ask a complete stranger.

Stay clear of trademark infringements
This should be a no-brainer. Time and time again I see domainers struggle with the headaches caused by trademark infringements and bad faith domain registrations. Domains that infringe on trademarks are not quality domains. Save your registration fee and steer clear of legal woes.

Auto-renew
Now that your portfolio is streamlined and contains only select domain names, you don’t want to lose any by letting them drop and be purchased by someone else. Do yourself a favor and set your domains for auto-renew.

Limit your hand registrations
Hand registrations are domains purchased from a publicly available source at the standard registration fee. They are either brand new (never been purchased) or have expired and are no longer owned by the previous owner. Go Daddy is a domain registrar that is popular with domainers and is consistently used for hand regs.

The possibility of stumbling across a good unregistered domain is always there; but, in reality, the likelihood is very low, and most domain names that are hand regged are poorly-researched impulse purchases that pad a domain portfolio with non-value names.

Distinguish yourself as a domain investor and limit the number of hand registrations you add to your portfolio. One good way to practice restraint is to wait 24 hours before registering any hand reg domain you find, and then re-evaluate before buying. You may lose a registration every so often, but in the long run you will save on unnecessary registration fees.

Stay current with news and sales
To be successful you’ve got to be informed. The domain industry is constantly evolving and a domain investor has to have an understanding of the next potential opportunity or trend being created within the industry. If you buy domain names, you are an investor. If you are an investor, you need to stay current with the news of your investments and other people’s investments. Do this by monitoring recent domain sales and news offered by many websites specifically geared towards today’s industry.

Blog around
Domaining blogs are sprouting up everywhere and domain investors are eager to share their experiences, setbacks, lessons learned and tips with anyone who wants to listen. We all need to take advantage of free and useful information, and visiting various domain blogs to get other perspectives on our industry is the way to do it.

Don’t forget to subscribe to RSS feeds where offered—all this information will be sent directly to you to read at your convenience…for free.

Don’t know where to start? Try this list of 41 must read domain name industry blogs.

Diversify with other TLD extensions
While some domain investors swear that .com is the only extension worth being bought, there are others who think that there is value in other TLD’s. Sure, .com is the most valuable, but generic domains selected with thought toward the appropriateness of the name for the extension can still be valuable and are still a highly sought after commodity with no signs of slowing.

Familiarize yourself with other TLD’s beside .com and evaluate your domain purchases on a global niche scale the next time you go to buy a domain.

Consider fractional domain ownership
Fractional domain ownership is simply sharing the ownership of a domain with a group of investors sharing in it’s profits, development and use. Owning a portion of a high value domain is a great way for a new domain investor to begin, to understand the ins and outs of professional investing, and to share in the profit and growth associated with that particular domain. It also allows investors to pool their funds and own a premier domain name without as much financial risk.

Optimize your parked pages
Once you buy a domain name, it is up to you whether your domain will contain a fully-functional website, or whether you will “park” your domain and allow it to be systematically populated with targeted content and monetization mechanisms. If you choose to park your domains, it’s imperative that you understand how domain parking works and how your domains can be optimized to bring better results.

Update your WHOIS information
The WHOIS database is sort of like a directory of purchased domain names that contains the owner’s contact information, purchase date and expiration of a certain domain. One use of this information is that potential buyers are able to find and contact a domain owner to inquire about purchasing a domain. Without the correct information in the WHOIS database, a potential buyer may not be able to contact you. Contact your domain registrar and make sure your WHOIS information is current and correct. If you opt not to be contacted by potential buyers, you may consider using privacy services that protect your personal information and keep it confidential.

Contact more end users
So you have a great domain name that is considered gold in a certain industry. Great!

Now, if you have decided not to develop it and simply want to profit from a sale, contact an end user. What’s and end user? An end user is someone who would use the domain name specifically for creating brand recognition in a certain industry. Here’s an example:

Adam owns OrganicDogFood.com and Bob owns an organic dog food company in Texas but uses the domain BobsSuperGoodOrganicDogFood.com. Adam contacts Bob and offers a shorter, brandable and easier to remember domain name that can increase Bob’s exposure on the internet for people searching for organic dog food. Adam has just contacted a possible end user.

A domain name can usually be sold to an end user for a higher price, as it is valued more by the actual user of the domain name than it would be by a domain investor.

Change your views on the domain industry
Are there still opportunities to be successful in today’s domain industry? Yes.
Is there still time to take advantage of the booming domain sales? Yes.
Is it still possible for a domain newbie to come in and thrive even with a small initial investment. Yes.

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