Start Your Domain Investing Journey With These 4 Tips
This post could be a great resource for you if you are serious about making money investing in domains. This is not the definitive guide to domaining or business dealings. But if you are genuinely interested in such a business, it helps to be aware of the fundamentals of domain investing. Although it won’t make you an expert in domaining, it will at least point out the blind spots and dangers. It can be compared to an ABC (A Beginner’s Codebook), which will provide answers to your basic questions about domains and their nuances.
1. Avoid Deep Water
The most practical tip for such a venture is to avoid going where even experts are afraid to go. You might choose the opportunity if it requires a minor investment because the financial risk might be minimal. Additionally, it might be a cheap way to learn about domains and their erratic nature. However, if the investment is substantial, beginner buyers should exercise caution, as the saying goes. When we don’t know the pond’s actual depth or how shallow it is, it makes no sense to leap in. A too-large investment entails significant risk, and the rewards might not be enough to make it worthwhile.
It is wiser to start investing with a few dollars before increasing to hundreds. Because if you lose, which you will initially, you will only have lost a small amount. You’ll still have your shirt and be able to fight another day, as they say. To start with, the good ones are .com domains. The .com extension is definitely the most popular one with 233.6 million registered domains as of July 25, 2023. There is no need to look any further to start your domain investment journey.
The problem is that with so many domains already registered, finding the few good names still available is a daunting task. Nevertheless with some expertise and taste you will find one, especially by consulting the list of dropped domains like those offered by expireddomains.net. You will become soon addicted to this site. You will feel like an old gold miner, trying to find the gemstone in the rock. Choosing wisely which domains to invest in will be like looking for a needle in a haystack. You will require a strong magnet.
Spend some time evaluating the domains you find that fit within your price range. A domain name might possibly be valuable for a number of reasons that are not always obvious, including length, brand-ability, target market, SEO metrics if the domain was previously used, and friendliness to search engines.
More expert investors can buy expired domains at auction websites like GoDaddy auctions or SnapNames or use drop-catching services like DropCatch. The entry point in terms of money for this advanced level of investing is high, so these are things you will learn to master with time and dedication when you are already profitable.
2. Stay Informed
I am passionate about the domaining industry, some would call me addicted. LOL. As such I am an active member of the namepros.com website, the world’s largest community of domainers where people can connect with seasoned experts and look for advice, grow their professional network, and generally stay informed about industry news and market trends.
There is one main reason why all are looking for .com domains – if your business wants to reach an international audience the .com name is a must. Most internet users will go to the .com domain because they are used to and you would lose a slice of your audience and potential customers to competitors without it. But there is also a second reason, especially for domain investors who have the goal of reselling the domains they buy. You know everything about .com domains. You have wide data sets of sales through sites like NameBio and DNPric.es through which you can accurately appraise your domains or at least have an idea of how much a certain domain could sell for.
3. Mind the Renewals
Domain names have a recurring annual cost that is around $10 at the cheapest registrars at the moment. The most reliable ones I use are Sav.com and Dynadot. So if you do not sell the names in the first year, your cost will increase year after year like a mortgage. If you do not plan to use the names to generate a profit and just buy to sell, the costs can rise pretty fast and heavily influence your profit margins. It is a widely accepted metric by the industry that a domain portfolio of a certain quality has a sell-through rate of 1-2% per year. That means that if you have a portfolio of 100 names you will sell 1 or 2 names over a year. Since renewing that portfolio will cost around $1,000, if you sell only 1 name you will have to sell it for at least $1,000 to break even. More than that to profit. So money management in domaining, as well as in any other business, is a very important aspect to master, to eventually succeed in your endeavor.
4. Choose a Monetization Channel
The options for investing or monetizing websites are genuinely endless. Some of these may be simple for you to comprehend and carry out, while others may just require a small outlay of cash. Each of these approaches has pros and cons, so you may need to decide for yourself which one(s) to pursue. Getting an affiliate website seems to be trendy right now. You can think of a memorable or beautiful domain name and then register it. Then include links to adverts for related websites in your website’s design to make money whenever a visitor clicks on those ads and completes a purchase. Alternatively, or in addition, you might choose PPC, or pay-per-click, platforms. These resemble affiliate deals but pay for the click of the ads without the necessity of a final customer’s purchase. The most widely used PPC platform is undoubtedly Google AdSense.
There also exist domain parking services, such as ParkingCrew or Sedo (this one is also a platform to sell your domains), where you can easily park your domain and then it will be forwarded to other websites or will load with automatic adverts, exactly like it would with PPC or affiliate marketing, and you will be paid for clicks. If someone is interested in utilizing your domain name, you can rent or lease it. And of course, if you buy domains with the only goal to resell them, you can sell the domain entirely when the right offer comes in. As an alternative, you can go all out and register your domain, work on it in terms of design and content, and make it into a lucrative website. Then, you can either live off the profits or sell it for an astronomical sum 😁. You have a choice!
