Generic and Branded Domain Names in Corporate Marketing
How Brand Thinking Has Enslaved Corporate America on the Internet
We're currently developing a few of our health-related domain names. A colleague of mine in the pharmaceutical industry said she was speaking to a Pharma Company executive about health and medical-related domain names, and his opinion was that a premium health domain name such as Menopause.com should be worth about $10,000 to his company. He didn't understand why it would sell for well over $1 million. At least at his level, his focus was in finding a unique branded name.
I don't disagree that owning a unique brand is important. However, as diplomatically as possible, I told her that her pharma friend was being short-sighted if he truly believed that ownership of generic domain names had such little value. If he really understood his business as a whole, he should want to control the gateway to his category on the Internet, and not simply his own brand. After all, searching for health information online is one of the things consumers do most.
Without ownership of that gateway, these companies will be funneling money to the premium health domain owners for the rest of their lives.
At a recent Domain conference, a panel of Madison Avenue ad agency and marketing executives held a discussion about why major corporations had failed to register the generic keyword domain names that define their industries.
In the November edition of DNJournal, Ron Jackson reports about this panel discussion at the TRAFFIC East/Moniker domain name conference:
"Domain owners need to do everything they can to educate corporate leaders... "How is it that Hilton and Marriott and Westin and all of the rest couldn't figure out how many leads they would get from a domain like hotels.com? Instead of paying a million or two for a domain they now have to pay tens of millions (for leads) for the rest of their lives."
"Corporations have been trained to think in terms of "brands" for 200 years now. They view their brand as something with qualities that set it apart from generics, in fact they view brands as the exact opposite of a generic term."
"What we think they fail to understand is that a generic domain name reaches the consumer when they are thinking about buying something in a category, like an automobile, before they zero in on brands. Owning the generic domains, like Cars.com, could effectively make them the gatekeeper for the entire industry, allowing them to intercept the customer and send them to the brand they want before they go to a competitor "
For years, domain names have been bought and sold, either through direct contact and negotiations, or more recenlty via domain sale and auction marketplaces.
Many domain name investors list their domain names on secondary marketplace websites such as Sedo.com or Afternic.com. The vast majority of domain names are typos, trademark infringments, dashed-domains and 2nd-tier domains. Premium generic one-word domain names are extremely rare.
In the past we've approached corporations about premium top-level dot-com one-word domain names and have found little serious interest.
Today still, most of the big money offers we've received for domain names are from domain acquisition companies, which operate in the domain world similarly to REITs in the real estate world.
As evidenced by the relatively new presence of Madion Avenue advertising representatives at domain name conferences, things may begin to change. Staid corporations rely on their agencies for advice on matters of breaking trends and marketing saavy.
As the Internet continues to grow and corporate marketers become more aware how people search—or type-in their querries, premium domain name valuations will continue to rise.
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