sales Why Are Companies Reluctant to Spend Money on a Good Domain?

[Whizzbang]

The last article on “Underpinning Domain Sales” sparked an interesting discussion on the domain forum, NamePros. One of the respondents asked the question, “Why are companies reluctant to spend money on a good domain?” In this article, I hope to answer that question.

In my opinion, the dominant reason businesses don’t spend money on domain names is because of ignorance. On the whole the domain industry has not been able to mobilise itself and communicate cooperatively to businesses about the importance of domain names. I’d like to unpack this a little further.

The biggest problem has always been the question of whom should put up the PR/Marketing money to generate interest and understanding in domains. Some people point to the registries, others the registrars while others say the current domain owners should all chip in. These discussiona often degenerate into name-calling and a lot of inaction.

What domain investors need to appreciate is that once they have purchased a domain name the registries and the registrars have effectively done their job. There is NO incentive for them to try and market on behalf of existing owners to increase the demand for already registered domains so the price goes up. That’s an almost impossible job.

The job of registries and registrars are to convince existing owners to renew and to get new registrations from wherever they can. On the whole, new gTLD registries have been excellent at selling their product to the domain investor constituency based on scarcity. “If you don’t buy this domain you’ll miss out like you did in the .com rush.”

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[frank-germany]

I think that, in common with most domainers, you just don't understand how business works. Added to that, you also seem to be suffering from the "domainer's disease" - this is a terrifying affliction that appears to affect most domainers, and causes them to think that they know something about domains that even the largest co's on earth don't know, lol.

Some large companies have bought generic domains, and they do that (for the most part) in a defensive way and their reason for buying usually has nothing to do with "branding", or profiting from type-in hits etc...

I recently sold a really long domain to a large company for a lot
and the don't use it and it doesn't even show a webpage

but its theirs now

 

[frank-germany]

Don't be so absurd. They would already own a trademark on the product name, so why on earth would they need to buy the .com?!... And if they ever decided to acquire the .com they could just take it legally...

More domainer BS, and the stupidity they tell themselves, and attempt to tell others!...

wow you are really cute
thanks

 

[Ben Price]

I recently sold a really long domain to a large company for a lot
and the don't use it and it doesn't even show a webpage

but its theirs now

Yes, and the Candy Man delivers Candy through your chimney stack right in to your living room!

 

[frank-germany]

Yes, and the Candy Man delivers Candy through your chimney stack right in to your living room!

yes the candy man can

 

[guilty]

I think that, in common with most domainers, you just don't understand how business works. Added to that, you also seem to be suffering from the "domainer's disease" - this is a terrifying affliction that appears to affect most domainers, and causes them to think that they know something about domains that even the largest co's on earth don't know, lol.

Some large companies have bought generic domains, and they do that (for the most part) in a defensive way and their reason for buying usually has nothing to do with "branding", or profiting from type-in hits etc...

I admit. I don't know everything about domaining and I'm still learning but I guess you know what you're talking about and large companies don't. So you're saying that you know how the business works but large companies are wasting their money? Alright, I'll play along. Define "in a defensive way". And please don't talk about trademark.

 

[frank-germany]

just because it's a larger company
thats doesn't make them necessarily knowledgeable
in terms of domain names

actually some of them are extremly
.. lets call it : uneducated...

their focus is their business
domains do often not receive their main attention

and trademark law is complex
so you better ask a specialized lawyer
instead of guessing

 

[Ben Price]

Define "in a defensive way".

It just means that it's an action they are taking to prevent someone else from building on an identity, or else it helps to ensure that perceptions (in their brand/s) remain high.

Such acquisitions or registrations have no other use really. McD's, for example, don't need to own hamburgers.com and if they ever did decide they needed it, it would only be to prevent upstart reporters from crafting stories along the lines of "Are McD's still king of the hamburger?", with the story going on to explain that some retard domainer in XYZ land owned hamburgers.com and McD's somehow had their eye off the ball.

 

[frank-germany]

It just means that it's an action they are taking to prevent someone else from building on an identity, or else it helps to ensure that perceptions (in their brand/s) remain high.

Such acquisitions or registrations have no other use really. McD's, for example, don't need to own hamburgers.com and if they ever did decide they needed it, it would only be to prevent upstart reporters from crafting stories along the lines of "Are McD's still king of the hamburger?", with the story going on to explain that some retard domainer in XYZ land owned hamburgers.com and McD's somehow had their eye off the ball.

It would definitely not hurt them to own it
- I didn't check who actually owns it-


and don't forget
its not their core business
but still its a business

so owning hamburgers.com
for them can never be wrong

as they might decide to sell it later on
when we all have become vegatarian in the end

and make a very decent profit
out of this late sale

 

[Ben Price]

and trademark law is complex
so you better ask a specialized lawyer
instead of guessing

I'm glad you said that, because it's true and I am very well acquainted with the law in this area.

...you intimated 'though Frank, that I may be "guessing" - can you elaborate on this, or will you back down again?

 

[frank-germany]

I'm glad you said that, because it's true and I am very well acquainted with the law in this area.

...you intimated 'though Frank, that I may be "guessing" - can you elaborate on this, or will you back down again?

I was not referring to you Ben Price
But to you = 'everybody interested in the subject'

 

[guilty]

It just means that it's an action they are taking to prevent someone else from building on an identity, or else it helps to ensure that perceptions (in their brand/s) remain high.

Such acquisitions or registrations have no other use really. McD's, for example, don't need to own hamburgers.com and if they ever did decide they needed it, it would only be to prevent upstart reporters from crafting stories along the lines of "Are McD's still king of the hamburger?", with the story going on to explain that some retard domainer in XYZ land owned hamburgers.com and McD's somehow had their eye off the ball.

So you're saying that those large companies that buy premium domains pay six-figure to seven-figure for the domain to only prevent reporters from crafting stories? Lol. What a waste of money. You are saying that they don't care about buying domains for traffic nor branding but they only care about those upstart reporters? But again, I might be wrong and you might be right. I mean they have a lot of money so they can afford wasting it to prevent upstart reporters from crafting stories as you said.

How did you come up with that idea anyway? Are you in marketing? I mean you need to give me something to back up your opinion. You can't just tell me that I'm wrong and you are right with no evidence.

 

[frank-germany]

just now:


Mike Mann‏ @mikemanndotcom
Most companies should have picked a better name and domain before starting ...

 

[Ben Price]

How did you come up with that idea anyway? Are you in marketing? I mean you need to give me something to back up your opinion. You can't just tell me that I'm wrong and you are right with no evidence.

It is just an example of their reasoning and this, of course, may not always be the answer. And no disrespect intended, but I don't think I need to comment further really, and as for the "evidence" you seek i'm pretty sure i've explained myself very well in this thread - please re-read my comments 'though, or ask a specific question, if anything seems unclear.

Cheers,

 

[Ben Price]

just now:


Mike Mann‏ @mikemanndotcom
Most companies should have picked a better name and domain before starting ...

A quote from a guy who has a vested interest in selling domains at the highest price possible... Hmm, real professional (and impartial) advice eh!

I love the picture, by the way. Who wouldn't want to buy their next web ID from a guy like that????

 

[frank-germany]

I mean you need to give me something to back up your opinion. You can't just tell me that I'm wrong and you are right with no evidence.

well I support Ben
as I do not think he needs to prove anything

you may ponder about his ideas
or not

same is true for my input here

 

[frank-germany]

A quote from a guy who has a vested interest in selling domains at the highest price possible... Hmm, real professional (and impartial) advice eh!

I love the picture, by the way. Who wouldn't want to buy their next web ID from a guy like that????

yes you are right again

Why believe a guy who has made so much money selling domains???

obviously he just wants to make more money ....

 

[frank-germany]

just now:


Mike Mann‏ @mikemanndotcom
Most companies should have picked a better name and domain before starting ...

and for me its obvious he is right

 

[guilty]

It is just an example of their reasoning and this, of course, may not always be the answer. And no disrespect intended, but I don't think I need to comment further really, and as for the "evidence" you seek i'm pretty sure i've explained myself very well in this thread - please re-read my comments 'though, or ask a specific question, if anything seems unclear.

Cheers,

I am not sure if you really explained yourself. You said that companies buy generic domains to either prevent someone else from building on an identity or to prevent upstart. You said that based on your opinion. I mean if you did work in a large company and have a marketing background then yes sure, you have a point since you know how companies think.

Let me ask you this question since you asked for a specific question. soups.com is owned by Campbell Soup Company. Can you tell me if they bought it to strengthen their brand/get traffic or if they did buy the domain to prevent upstart reporters from crafting stories...?

 

[frank-germany]

I am not sure if you really explained yourself. You said that companies buy generic domains to either prevent someone else from building on an identity or to prevent upstart. You said that based on your opinion. I mean if you did work in a large company and have a marketing background then yes sure, you have a point since you know how companies think.

Let me ask you this question since you asked for a specific question. soups.com is owned by Campbell Soup Company. Can you tell me if they bought it to strengthen their brand/get traffic or if they did buy the domain to prevent upstart reporters from crafting stories...?

come on

that really doesn't matter

it's a brilliant domain for them to own

is that not enough to you?

 

[guilty]

come on

that really doesn't matter

it's a brilliant domain for them to own

is that not enough to you?

Lol. I'm just trying to learn from him. I don't want to live a lie thinking large companies benefit from owning generic domains.

 

[frank-germany]

Lol. I'm just trying to learn from him. I don't want to live a lie thinking companies benefit from owning generic domains.

ok you got me ..

 

[Ben Price]

Can you tell me if they bought it to strengthen their brand/get traffic or if they did buy the domain to prevent upstart reporters from crafting stories...?

Soups.com is a purely defensive registration/acquisition on their part, and to help prove that this "category killer" domain is just used by them as a redirect to their REAL brand!

 

[guilty]

Some large companies have bought generic domains, and they do that (for the most part) in a defensive way and their reason for buying usually has nothing to do with "branding", or profiting from type-in hits etc...

Soups.com is a purely defensive registration/acquisition on their part, and to help prove that this "category killer" domain is just used by them as a redirect to their REAL brand!

You see my point? you're contradicting yourself now.

It's all about competition. Large companies do everything to get themselves one step ahead of their competitors. Bank of America acquiring loans.com, and Toys R Us acquiring toys.com. That's called marketing and I am sure both companies benefited form owning these domains. Anyway, this has been a very productive talk.

 

[Ben Price]

You see my point? you're contradicting yourself now.

It's all about competition. Large companies do everything to get themselves one step ahead of their competitors. Bank of America acquiring loans.com, and Toys R Us acquiring toys.com. That's called marketing and I am sure both companies benefited form owning these domains. Anyway, this has been a very productive talk.

I have not contradicted myself in any way, and you clearly know nothing about marketing and appear to be unaware that all you're doing is helping to prove my point!

With the BOA and Toys R Us domains, for example, you're helping to prove that these companies care so little for these prized identities that they couldn't even be bothered to build them out, lol.

As I say, they're defensive registrations...

 

[Ben Price]

and I am sure both companies benefited form owning these domains.

Ok, i'll bite. Explain to me how those companies have actually benefited from owning those particular domains... I'd love to know!