Choosing and Purchasing a Domain: Tips from the Pros

One of the first steps for aspiring internet entrepreneurs is purchasing a domain name. Selecting and registering a compelling domain is crucial to the success of a future startup. We offer youadvice from professionalsHow to register a beautiful domain for your business.

A good domain name is an important factor for success when creating and launching a service, online store, or even a homepage.

Many large companies acquired their domain names after they had already achieved success. For example, bookmarking service Del.icio.us acquired the domain Delicious.com, already a large, well-known project. Foursquare followed suit, acquiring the domain Foursquare.com much later – the project's first domain was playfoursquare.com.

A good domain name should be short and memorable. It doesn't necessarily mean anything. Etsy is a good example of this. The word "Etsy" has no meaning in English. But it's short, memorable, and well-suited for selling handmade goods (Etsy is the largest international auction site for handmade goods). One piece of advice investment gurus give when choosing a domain is: "Find a name that doesn't mean anything and give it your own meaning. That's how you build your brand." To see this, all you need to do is search for it in Google.

Another example is the name of the major online gaming company Zynga. The owner of the company bought this domain solely because it was his dog's name. This name had huge advantages – it was short and memorable. Over time, it developed into a well-known brand.

Finding domains has become more difficult and expensive recently. The average price of a good domain has risen sharply in the past year. Experts advised companies to spend no more than $10,000 on a domain; this recommendation was later increased to $25,000 and then $50,000.

Here are some more tips for searching and purchasing domain names (note that these tips apply primarily to the international domain name market. Domain prices in Ukraine are still lower):

• Don't obsess over acquiring a descriptive name. It's great to be called Kickstarter if you're building platforms for creative ideas, but it's not really necessary. Focus on a simple word—one that's short, catchy, and memorable.
• If you have a domain that's capable of working, give it serious attention. You'll save yourself headaches and subsequent project agony.
• Be prepared to pay for a good domain. It's highly unlikely you'll find a great domain name these days for less than $10,000, and it could cost much more.
• Consider leasing a domain. If you find a good domain that you can't afford, you can lease it for a few years with the option to purchase it at any time. Let's say you're starting a website to sell boats online, and the owner of boats.com wants $100,000 for it. You can't afford it right now. However, the owner is willing to charge you $5,000 per year to lease the name and reserves the right to purchase it at any time within the next three years for $100,000. You might be willing to do this because you expect that within the next three years, you'll sell tens of millions of dollars' worth of boats, making your business worth tens of millions of dollars. In that case, spending $100,000 to purchase the domain wouldn't be a big deal. But if you don't sell boats online, you don't need the name, and it's not worth that much to you.
• Consider investing capital instead of cash. Many owners of popular domains have the idea that their domains will soon be worth millions. And who knows, they might be right. Therefore, it's very difficult to convince them to sell their domains. First of all, you should know that a good domain, which is a perfect fit for your company, can be worth millions. If you have a promising company (for example, foursquare, when it acquired foursquare.com), you can invest some capital in the domain.

Finding and purchasing a domain is a huge headache. This is a crucial issue, especially for e-commerce startups, such as online stores.

Don't waste money on domains thoughtlessly, but it's important to understand the importance of a good domain for your business. Remember, a name is something that will last a long time. So, "as you name your boat, so it will float."