For many hardcore webmasters, investing in domains is a part of their every day life. Although they are not considered an actual commodity, there is certainly potential there.

We all despise those people that got 95% mortgages, making 100% ROI within the space of a few years. If only we could turn back the clocks, right?

Remember, at the time, these gains were not guaranteed. Many people put all their assets on the line. They made calculated investments that paid off. The position many people were in then, is similar to the position that domain investors are in now. Their question was then, and is now; is this investment going to make me, or break me?

With property becoming unstable in the UK and the internet booming, could investing in domains be the nest egg that we all dream of?

Background research

Stats to help with investing in domains can be found on IDNX. This is about as close to valuing the domain market as anyone is going to get, for the time being. It gives a good visual overview of the market as a whole (take that into account).

Valuations

Appraisals are fairly pointless; the market operates similarly to unique artwork. When the price that a seller will sell for, is equal to that of the price the buyer is willing to pay, it will sell. Of course, the above could be applied to any market.

That said; compare this to the property market, prices of property will generally be inline with historical pricing. Investors can take the prices of multiple sales in the past, apply the increase/decrease in the market since the sale and get a fairly accurate idea of what the value is.

This is coupled with the fact that houses, using mortgages, are leveraged investments; increased potential gains, but losses too. This is obviously the reason why investing in domains could still be lucrative. As soon as detailed information relating to domain investing is released, the margins will close up; so the time is now or never.

Choosing domains for investment purposes

Here is one of the rules we have been using; if a basic ideas don’t pop into your head for a domain within 5 minutes, don’t buy it. Obviously it gets a lot more detailed than that. The ideas should consist of:

What is the purpose of this domain?

Fetch.co.uk recently sold for £17,500. The idea behind the new site will be a transportation based company.

Who will buy the domain?

Typically, “end-users” will pay MUCH more than other domain investors. Yes, you could flip a domain for 100% profit, but factor in those domains that don’t sell for 5-10 years; you’re probably making a loss.

How will you value the domain?

Each to their own, we have a fairly detailed formula for valuing domains on an individual basis. The formula is adapted based on SEO value, traffic, historical sale prices (of that exact domain and other similar tlds), CPC cost, search traffic and more.

This is our “assumption” of what a domain is worth and by no means fact.

What will you do with the domain?

If the time was available, would you invest time and energy, trying to develop a project and implementing SEO strategies? If not, most end-users are probably thinking the same thing.

The result

Investing in domains has proven to be profitable for some, but then again, so has poker. Like great poker players, great investors fill in gaps in information, the ones others fail to see.

Our unbiased opinion is that there are plenty of opportunities out there, but each opportunity should be studied in depth. Thin the herd, find the great opportunities.

At the same time, hang around for the right price. The same buyer might pay up to $2,000 for a domain that is advertised for $1,000. This was the case for hotels.cd, which sold for $986 (Feb 07) and $2,022 (Aug 07).

Prepared to spend time on SEO? That domain is probably worth investing in…

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Domain names play a very important part in the way we use websites. Why? Website addresses are initially formed out of numbers. On their own, these numbers would make very little sense to most of us. So domain names replace the numbers with a language that we can all understand.

Overall, domain names are straightforward enough, but they still need a little explanation.

So we’ve produced 4 short tutorials to help you understand all things domain name related.

The first 2 videos will answer a couple of simple questions ‘What is a domain name?’ and ‘What are domain name extensions?’

Then we’ll take a look at ‘How to choose a domain name’ and ‘How to register a domain name’.

So sit back and relax…you’ll be a domain name wizard in no time!

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Domain name extensions are an important part of any website address.
They can represent either an international location, for example .co.uk, or a type of website:
• .com (company)
• .org (organisation)
• .net (Internet)
• .info (information)

Domain name extensions are controlled by regulatory bodies. However, the actual registration of domain names is processed by domain registrars, like 123-reg.

It can be a good idea to choose an extension that reflects what your website does. This really helps people get a clear idea about what your site offers.

Alternatively, you may wish to pick an extension which represents your international location. Doing this will give your domain name a sense of identity within the global community.

Top tip: .com is the most popular and widely recognised extension. As a result, there’s a real shortage of original .com domain names left. So it pays to consider alternative extensions, like .net and .org. Doing so will give you a far greater chance of registering the domain name you want.

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In this tutorial we’re going to look at the relationship between domain names and website addresses.

First of all, what is a domain name?

Domain names are made up of 2 parts, the domain name and the domain name extension.

To help us understand the role domain names play, let’s take a look at a website address: www.website.com

The universal ‘www dot’ prefix represents the World Wide Web. This is followed by ‘website’ (the domain name) and ‘ dot com’ (the domain name extension).

Together these 3 elements form the website address, otherwise known as a URL.

Typing a URL into your web browser allows you to view the website to which the address belongs.

A URL will appear in your web browser address bar whenever you are connecting, or connected, to a website.

Top tip: website addresses can often look quite complicated. This is because ‘www.website.com’ is only an address where web files are stored. So when you see an address like ‘www.website.com/news’, ‘www.website.com’ has a file or folder called ‘news’ stored on it.

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When choosing a domain name you are effectively selecting your website address. This is the phrase that anyone typing your address into their web browser will have to use. Therefore, it makes sense to choose a domain name that’s memorable and relevant to your site.

Of course, if you’re a brand, organisation or a company, you’ll want to use your trading name. But even if you’re only setting up a hobby site, like a blog or portfolio, you’ll still want to use an appropriate domain name phrase to represent your website address.

Top tip: Domain names are very important to search engine like Google.
You’ll rank higher in search engine results if your name contains words that people are searching for. So including words in your domain name that relate to the products or services that your website provides can be a really good idea.

For example, if you run an online coffee shop in West London, then the domain name phrase ‘west-london-coffee’ could help with search engine rankings.

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Here’s a step-by-step video showing you How To Register domain names through 123-reg.co.uk

To register a domain name you need to first check that it’s availabile eg: mysite.com

This search is done through a domain name registrar such as 123-reg.

If your chosen name is unavailable you can either:

• Register your preferred name using a different domain name extension (‘mysite.net’)
• Reword your name using a hyphen (‘my-site’)
• Come up with a slight variation on your name (‘MySiteRocks’)
• Or simply think up a new name that’s available with your preferred extension (‘mywebsite.com’)

Next you need to register your new domain name. This gives you legal ownership of your domain name, so no one else can use it.

Get your name on the web. Registering domain names is fast and easy with 123-reg. And they’ve now registered over 2.7 million name domains, making them the UK’s favourite domain name registrar. And why are they so popular? That’s easy to answer. For 10 years they’ve been offering good value domains and first class, UK based support.

>>> Buy Your Domain Name Today <<<