Frager Factor

Thursday, May 29, 2008

Flashback 2000: Grant; Others Cash in on Need For Names

"I'd like to be a fly in the wall in history class in 100 years when someone tries to make sense of all this.'"
~~ Jake Winebaum ($7.5 Million Buyers of Business.com in 2000)
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The Madison Avenue Approach
"Creating Demand for Your Domain Name"

I'm often asked the question, "How do I know if my domain name has value?" My answer is always the same: "It's valuable if someone wants it. It's more valuable if someone wants it badly. And if that someone has deep pockets-well, it's time to break out the champagne." The object, then, is to create demand, and that's where the fun begins. After all, the goal is not to be the most voracious alligator in the swamp, sucking up every combination of characters up to and including 63. The goal is to make a profit on your name by helping someone else make a profit by using your name. How? There are as many ways to create demand, as there are creative people to dream them up.

Rob Grant, a HitDomains.com "preferred client", is the perfect example of someone who has used his marketing skills brilliantly to carve out a niche in the domain name industry. A licensed real estate broker in New York who spent 6 years working on Madison Avenue, Rob has blended his experiences in both fields to create an ingenious business model that clearly demonstrates the power and potential of domain names. Enter the name RealEstateDirectory.com in your browser and have a look. This site is the nucleus of a huge global network of real estate domain names linked to the central site. Once the site is fully developed, visitors have only to click on a place anywhere in the world to buy or sell real estate (a thought with a 9.0 Richter scale rating in the traditional real estate community.)

Rob also uses his business acumen and creative flair to boost the value of his own and other people's domain names by creating templates that showcase these names. For example, he took the name Marathons.com and created a dynamic "web page at a glance" using photos, fonts, colors and copy, all carefully selected to portray a feeling of grace in motion. Check out www.Marathons.com for details. In the appendix you will find several professionally designed templates that you are welcome to use or adapt in order to create a "Madison Avenue" showcase for your own name.


From MSNBC

But there's another phenomenon contributing to the frenzied name-game of musical chairs as well: Internet start-ups change so fast in response to the fluid marketplace that they often outrun their original identities.

In fact the larger trend today is toward highly general and recognizable names that help describe a service on first hearing. Remember the dot COM is always going to be around. The concern is that businesses name is going to be 'business."

Its tempting admitted the 28 year old Lee, referring to the $38 million offer he received for cool.com, a domain assure he registered and acquired for $70 five years ago when he was a college. He rebuffs offers because he's dedicated to building the URL into a business he hopes one day to be worth far more. "The opportunities for using such a brand for marketing and a long-term business strategy are a lot more compelling. Long term we have an opportunity to develop a global brand that is a force to be reckoned with.


From INTERNET NEWS

Most people have heard the old cliché that asks what's in a name, which implies that, something should be recognized for what it is - not for what it is called.

Buying a domain name is like buying a property, a house.

Attractive domains aren't always so obvious. Some of the best are ones many would never expect people to remember.

FROM THE MIAMI HERALD

Domain names are owned by people who had the foresight the rest of the world didn't

"Everyone thought I was crazy," said one speculator, "but I feel they are like good real estate. They're only going up in value."

Said a California venture capitalist, "we probably start 15 to 20 brand new companies a year, and every one needs a domain name, and we of course, want a good one.

I've never thought of this stuff as 'just a name," said Monte Cahn, the 35-year old founder of Hit Domains (a company with an impressive track record of selling high-end domains). Sometimes I think of it as a lottery ticket. Other times it's virtual property. There's nothing else you can turn on and instantly be worldwide."

FROM THE LA TIMES

In the dot-com world recognition is everything. Companies use their domains as ways to describe their businesses. But most of the best descriptions have already been snapped up.

What's in a name. Everything. Companies like Pasadena-based Idealab will pay $1 million for names that can significantly reduce the coist of advertising a new website. Idealab agreed to pay the South pacific island nation Tuvalu $50 million in royalties over the next decade for rights to e-mail and web addresses ending in "TV," the country code assigned to Tuvalu. Idealab hopes to resell addresses for hundreds of millions and perhaps billions of dollars. The timing of their IPO with this announcement is no coincidence and proves what's in a name.

From CNN

A high-profile Internet venture capital fund made World Wide Web history by paying a stunning $7.5 million for the domain name "business.com." Some called the deal absurd.
But others argued that a cool million- poor seven- is a small price to pay for an instantly recognizable presence on the Internet.

One expert argued that 7.5million for bsuienss.com is a bargain compared to the $50-100million others are spending to build a brand online.

The men who bought business.com understand. The original founder of Earthlink and former marketing executive of Disney know what it takes, and costs to make a name for yourself.

Generic domains that are easy to remember and can be quickly converted into a brand are key. Simplicity- most experts' agree- is what makes a domain a good bet.

MORE FROM INTERNET NEWS

Says the Coca-Cola marketing guru, Names are supposed to communicate who you are. Whether its online o along a grocery store aisle, 'names are supposed to communicate who you are. The right online brand name can dramatically increase the value of the web site. In the real world, 59% of coca cola CO's market value-- $111 billion-is driven by the value of being the world's best known-brand, according to a study by Interbrand, a New York-based corporate identity firm.

Your brand name is your 800 number, your address, your marketing call to action, and if consumers can't remember how to spell it, or the name is too generic, its going to make a hie difference," said Jake Winebaum, the former Disney Executive and co-founder of eCompanioes in Santa Monica, the incubator who paid $7.5 million for business.com.

In defending the $7.5 million price, Winebaum says "It's the equivalent of what some people paid for a few Superbowl commercials. But what do they have after the game is over? With business.com, 85% of the branding is done."

We're in what I call the Paleolithic era in online naming," one expert said. "I'd like to be a fly in the wall in history class in 100 years when someone tries to make sense of all this.'

Lee Iaccocca

Lee Iacocca knows the value of a solid name in the online marketing world. The former automotive industry executive sells electronic bikes at his ebike.com web site. Why isn't he using LeeIacocca.com? "I found out that some kid in Texas already owns it-owns me,' Iacocca said. "Its tough to get the attention of the public without an easily identifiable marketing tool.'

All that about e or I before the name

Some of those people are so fixated on trying to get e- or - I into their name that they don't stop to think about what a name should mean. said Zyman the former Coca-Cola marketing guru. More than 70,000 names have been bought by people who bought into vowels. What they didn't see is that names beginning with "e" or 'I", or such tech-sounding words a "net" and 'micro" could grow dull over time. Saying that you're part of the Internet could date you the way people think of lime-green carpet from the 70's or Amtrak or greyhound. Pretty soon it will be understood that everyone does business on the Internet

From Yahoo Finance

Re cinema.com up for auction "Finally, streaming technology is here and will provide the purchaser of cinema.com the ability to utilize the name as the Internet's first real-time movie channel, likely a billion dollar business.

From channelseven.com

I think a domain name is extremely important at this point," says Dr. Robert Passikoff, founder of Brand Keys, a New York based brand loyalty consultantcy and research company. "We're at a state where a company has to do more of the communication work than it will down the road. There are clear comm8nication issues with a name and what it represents, in terms of the value of what's being established.

Passikoff also believes that brand insight-what drives the category, what is most important to the customer-is more important to branding than simply relying on creatives.

Also From channelseven.com

A search engine that launched itself with the name miningco.com (thinking it could be the next Yahoo or Amazon without understanding the very special technological circumstances that made those names successful as oddballs), recently had to spend $10million to rebrand itself as About.com.

From Wired

Even with their own reputation, Nordstrom is using the name shoesonline and backing it with a $17 million ad campaign to launch "the worlds largest online shoe store."

And from Silicon Alley News a concern

Whelan is more confidant that dot-com domains will remain worth paying for: "Dot-com will always be by far the most prestigious. The earliest pioneers of the Internet will always cling onto their dot-coms."

A more daunting question is whether or not the companies shelling out big bucks for domain names want to compete in an open market like Afternic.com. Domain name sales have generally been back-alley deals: the parties conduct their negotiations secretly, and often anonymously. Back when About.com was MiningCo.com, the company set up shell companies to acquire some 3,000 URLs containing the word about. Vault.com spent four months embroiled in what co-CEO H.S. Hamadeh calls "very long, very expensive, underground negotiations" to obtain its URL. Companies may not be willing to conduct such sensitive business in a relatively open--and competitive--market like Afternic.com

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About The Author: Owen Frager is an Internet marketing expert ready to help take your company to the next level.

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