What’s in a domain name? Quite a lot, actually. And a domain by any other name doesn’t necessarily smell as sweet. But before we get into that, what actually is a domain name? The simplest way to think of it is that it’s a website address, and we use them every day.
So you know you can use them to buy stuff online, do your banking or check Facebook. But did you know that if you set your mind to it, you can actually make great money by investing in domain names?
You might have heard about the sale of the domain name ‘business.com’ for $7.5 million in 1999 after it was purchased only two years earlier for US$150,000, or the watermelon farmer whose multi-million dollar domainer career started with the purchase of watermelons.com for $3,000 back in 1997? That was the .com market way back when – now its Australia’s turn!
The reality is that a domain can be registered for as little as $20, so you don’t have to be a fat cat to get started. It’s a great hobby or work-at-home opportunity, and many Aussies have made hundreds of thousands buying and selling domain names.
InvestmentProperty.com.au – bought for $20, sold for $140,000. Hobart.com.au – bought for $1,000, sold for $65,000. Not a bad return for a ‘quick flip‘
Exactly how you create wealth from a domain name while you own it, and how much you can sell it for, depends on your own personal strategy as well as global news, markets and trends. Just like shares, the most obvious way is to buy low and sell high but the variations are almost endless.
It’s all about coming up with a domain name that ‘clicks’, registering (or buying) it and making sure that it at least pays for its own annual registration fee. Once you’ve done that, here are just a few ways you can make money from your domain name investment:
• Advertising – Publish relevant advertisements on a domain (e.g. pay-per-click). Think of the ad revenue as ‘dividends’ for the time that you own the domain name.
• Leasing – If you don’t want to publish ads yourself, you can rent the domain name to other advertisers or interested parties.
• Buying and selling – Register a new domain name or buy one from another owner, then try to resell it to another domainer, a company who wants the domain for their own site, or an advertiser who likes the keywords.
• Developing a website – Create a business model and actually develop a website with unique content features and design.
In 2014 we hit 1 billion websites globally, and it’s a growing market with more and more domains registered every day. Buying a domain name can be a low spend, low risk investment with low ongoing cost and potentially high returns.
To get your portfolio started and buy the right domain names, all you need is your imagination, search tools like the Google Keyword Tool and a bit of common sense. There aren’t as many rules and regulations as other investments, but you do need to do your homework (auDA is the regulatory body for .au domain names) and get in quick before everyone else cottons on to the potential!