Domain names market flourishing - are you ready for domaining?

According to Sedo, the Internet domain name auction company, the average domain name sale price has increased from £1,282 to £1,757 in just twelve months. Nora Nanayakkara, director of Business Development at Sedo, is quoted in the UK's Daily Telegraph saying,

"With the credit crunch many customers are looking to save money and are turning to the internet and price comparison sites. Buy buying up domain names – especially catchy names – companies are trying to garner the audience online that they have lost on the high street."

"Domain names have fared very well, compared with asset classes, especially property. They are a good investment for some people."

The cost of registering a domain name through Intrahost is merely £7.99, but Sedo specialise in the domain name "aftermarket" where existing domain names are bought, sold and auctioned.

The value of these domain names to businesses and investors (a practice known as domaining) depends on many, many factors, from the age of the domain, the number of letters in the domain, the TLD, right through to the sound, or visual appeal of the domain name (think, Bing, Google and Zing!)

Domains may have value because of a celebrity sharing the name (often called cybersquatting) or because of breaking news - within a couple of days of the death of Michael Jackson over 3400 domain names featuring the words "Michael" or "Jackson" were registered. Many would be by fans looking to create a tribute website but many would also be looking for domain names which may cash in on the singer's celebrity and early death.

Not all websites will be valued at over £100 let alone £1757 but if you do your homework and read around the topic of domaining money can still be made. The most valuable and competitive market is in the .com domain names, with over 85,000,000 registered.

The obvious, single-word .com domain names have long since been registered and now command top dollar prices, especially if commerce-related. The average value of domains sold are boosted by these occasional one-off sales such as candy.com ($3,000,000) and toys.com (5,100,000) which both occurred in the last year.

I will be bringing you an article featuring some of the top websites for getting inspiration for domain names next week but even without those you can still use your imagination and some simple rules to come up with ideas.

You can order your domain name with Intrahost; don't worry you don't have to create a website just because you bought a domain name as an investment (though it may enhance its value if you did). If you buy a domain name through Intrahost it will host a standard web page showing that your domain name is registered with them

Ready to give domaining (investment) a go?

Here are some basic rules: choose .com as a preference, then .org and then .net; keep it as short as poss (all two, three, and four-letter domains have gone), try to avoid hyphens and numbers. Search for your domain name here.

Don't worry if you can't fulfill all the above rules, I was offered £850 for a .co.uk domain name with three numbers in it. The value of a domain name, like the value of any commodity, is the price that someone else is willing to pay for it.

If you want a domain name for your business rather than investment and it is aimed at UK customers then choose .co.uk names as a preference. Remember you can own more than one domain name for your business and alter the records to have them all point to the same website.