There are many misconceptions about domaining. By those individuals contemplating getting into selling domains, and especially by those who want to buy a domain for their business.
Misconception #1: Domainers are cybersquatters.
Cybersquating is illegal. Domaining is a legitimate business that even large domain registrars participate in. Cybersquating is holding a unique company or brand name domain (that usually is trademarked) hostage as a ransom for a large sum of money or to divert traffic that is monetized. Domaining, on the other hand, is a business where sellers register generic domains in good faith that can be used for future businesses or for advertising. These domains do not infringe on registered trademarks or copyrights.
Misconception #2: Domaining is easy money.
The fact is that domaining takes hard work to make it work. There usually is a learning curve. Patience, perseverance, and salesmanship are important qualities for success.
Misconception #3: I don’t need a professional sales website.
First impressions are everything. A good first impression will cause people who are interested in what you offer to want to learn more. The next step is building trust and a relationship. A professional website is important to these ends. If you want to do real business, forget free site builders and free @gmail email address. You need a good domain and a professional sales website to get in the door.
Misconception #4: New generic top-level domains is the next goldmine.
Some new generic top-level domains have potential, clear end-use and value. That depends on whether the left side of the dot matches perfectly with the right. But those are very few and most already have premium pricing (even for renewals). By and large, these new top-level domains will never command the aftermarket sales of dot com domains. With the confusing array of available ngTLD’s, only makes .com stand out even more.
Misconception #5: The more domains I own, the more I will sell.
This is like playing the lottery. You can own a thousand garbage domains and not sell any. On the other hand, you can own a handful of high quality domains and make good money.
Misconception #6: I can make money by parking domains.
Parking domains is not what it used to be. You can make enough for some beer or coffee but not real money. Only a small percentage of very high premium domains make money with parking. But even that is peanuts compared to what they could make if a real business is built on them.
Misconception #7: A domain is worth what someone is willing to pay for it.
If you have a good quality domain, you can find a lot of people that may be willing to pay $100 for it. But is that really its worth? The right buyer may be willing to pay $1000 or $10,000 for it, or more. You have to learn the value of the domains you own and get them in front of the right buyers.
Misconception #8: I can charge whatever I want for a domain.
Every domain has a ceiling value based on market, branding potential, domain quality, and end-use. If you overprice then it becomes increasingly difficult, or even impossible, to sell.
Misconception #9: If I register a business name, no one else can use the perfect match domain of that business name.
It would have to be a very unique business name. If your business name is generic, like San Diego Real Estate (with an LLC or INC after it) then anyone can use the generic domain name sandiegorealestate.com (without the LLC or INC after it).
Even if your business name is so unique that it would not make any sense for anyone else to own the domain for it, you should consider getting the generic domain that matches the business service/product. For example, if your business name is “Unique Name Realty” that sells real estate in San Diego, then owning and redirecting sandiegorealestate.com would get you more leads and sales.
Misconception #10: A domain name doesn’t matter to the success of a business.
A domain name can hurt or help a business. That’s why Facebook forked out a lot of money to acquire Facebook.com. Before that, they were using TheFacebook.com. For the same reason, Jeff Bezos acquired Amazon.com rather than using the less expensive AmazonMarket.com or AmazonStore.com.
Memorable domains that don’t confuse others will attract more new leads and repeat customers.