You don’t need to be the next Google to start making money online. Thousands of people are generating income by investing in domain names. They do this by buying, selling, holding, or developing domains to increase their value.
Domain names are the internet’s real estate, replacing land with virtual property. Like real world property, domain names can be bought and sold for profit, generate residual income, and developed to increase their value.
Buying and Selling Domains
Buying a good domain name and selling it over time is a common way for domain investors to turn a profit. Most good .com names are already registered and the ones that aren’t have to be developed from the ground up.
If you are looking into domains that are currently registered, you have a few options to consider:
Domain Marketplace/Auctions: A domain marketplace is where other domain owners list their domains for sale. They can be purchased through an offer/counter offer system or by competing with other buyers through an auction. Our Expired Domain Auction is a good place to start.
Domain Broker: If you find a domain name you like, you can hire a domain broker to try and secure it for you. Why would you do this? One, you can keep your identity confidential to avoid seller price inflation. Two, you can save time by not having to deal with negotiating prices and figuring out payment. Three, you can leverage the expertise of a broker to make sure that you’re paying a fair amount for the domain.
Contacting the Owner Directly: You can cut out the middle man by contacting the owner of the desired domain directly. To find the owner’s contact information, you’ll need to do a whois lookup.
Most recognizable and generic domains for the most popular tlds (.com, .net, .org) are likely to be registered. If you want to register a new domain with the intention of selling later, be prepared to put in a lot of time and effort into developing the domain. Any domain name has the potential to be valuable. One way to create value in a domain name is by adding useful content to the site to attract traffic.
Holding Domains: Parking for Profit
Many domain investors own hundreds and even thousands of domain names. They keep these domains and monetize them by placing PPC ads (ie Google AdSense) on them and collecting the profits. This strategy, known commonly as parked domain monetization, relies on domains that get type-in traffic. Type-in traffic describes the behavior of users typing a domain name directly in the browser’s address bar to get to a website instead of using a search engine.
A more time consuming but potentially rewarding way to profit from your domains is to create full featured websites around them. Obviously this takes much more effort since adding value to a domain involves many steps compared to a buy/sell or parking strategy. Adding value to a domain may include things like market research, content creation, and product development depending on what you want to do. In addition to the business side of developing a domain, you’ll also need to handle the technical requirements of maintaining a website. However, there are numerous resources online (open source software, outsourcing, etc) that make this much more manageable for the less technically inclined.
There is a world of opportunity out there in domain investment. Only now are people starting to recognize the value of a good domain name. Whether you are buying and selling, parking, or developing, investing in domains is a great way to generate income online. It’s never too late to get started!