Frager Factor

Wednesday, January 30, 2013

Truncation Rules While Euro and Cloud Demand Dot Com: more leverage for the insurgent outsider than ever before in history



What a great feeling to see all these domain names finally find great uses. As Seth Godin puts it, "Industries are being remade and there's more leverage for the insurgent outsider than ever before in history.
The status quo is taking a beating, there's no question about it. That's what makes it a revolution.
People have started social movements, built billion dollar companies, toppled dictators, found new jobs, learned new skills and generally made a ruckus."
And it all starts here with a NAME. So why build a brand when you can buy one?
Or fix one?
GiftCard.com,  $4 million truncation-motivated purchase that sets the record for how much someone will pay to fix  broken brand. In this case they are multi-millionaires on day one the investment pays back. It's Christmas you know. Ads on TV and check your list off done.

Patience, time and circumstance say Rick Schwartz and here is a prime example.

Put that in your Estibot pipe and smoke it.

TRUNCATION rules again as #1 reason to buy

Before: 
1-800-GIFTCARD.COM

After: 
GIFTCARD.COM

Before: 
OnAPP.com/cdn

After: 
CDN.net

Any questions?
The reason for big END USER spending on a domain is to brand something new or to fix a brand that's broken. Example of the ladder is when Horror Freaks Media acquired BestHorrorMovies.com for a simple redirect to Best-Horror-Movies.com. It's that simple. And most of the prospects for these sales continue to hide in plain sight- just Google variations on the names you already own.

Though this set a record for .net and LLL truncation, and is higher than the ASP of $5OK for most end-user truncation-motivated acquisitions (known to some as domain-shortening), it is not even close to the traction records being set by such a sales as:

GoDuDu.com, pays over a million to truncate to DuDu.com

How much more proof do you need than Airline Norwegian.no paying $770K to Marchex simply to step up to Norwegian.com.

In promoting the value of truncation in domains, we've talked about something called the radio test. I've been taking that to the next level with something I call the SIRI test. Ask SIRI for TUMLBR and see what she says?

Could that be why they bellied up to the bar and went for Tumbler?

Why Box.net suddenly had to be rebranded Box.com?


Or why Meet.ME was worth $450K to MeetMe.com?

Or driving another mid-five figure DNS November sale, East Rest is a luxury bedding product sold by direct response TV ads. The call-to-action had been MyEasyRest.com. They spent mid figures to upgrade toEasyRest.com.

Like TerraCloud.com, a sale reported on Facebook last night by broker Bruce Tedeschi. Another example of a REASON TO BUY having nothing to do with bot appraisals or search or PPC but rather a simple application to truncate and existing brand TerraCloudInc.com (IE. Fix a brand that's broken ahead of the SIRI revolution). This prospects has been crying out for attention in Google results which is the first place to look when valuing a name, not Alexa as was described earlier today "If You Cite Compete Or Alexa For Anything Besides Making Fun Of Them, You’re A Moron.”

In order for the "truncation-based" sale of Aquajoy.Co.Uk to Aquajoy Water Gardens Ltd (previously www.aquajoy.org.uk) and PlasticShredder.com to Jordon Reduction Solutions! REAL people doing REAL business on Great Domains! SunriseBoatRVStorage.com now has an easier marketing job with iStorage.com (and if they ever don't want it, what a great Apple Cloud name!)

In other DNS sales news, TRUNCATION rules again as #1 reason to buy:  Congratulations to Sai Pola; nice to see YOUR name back in the spotlight with the sale of  FutureProcessing.com  to truncate Future-Processing.com; YourPostOffice.com (again truncation for YourPostOffice.Co.UK); and many others recently sold via the DNS platform. 

Congratulations to Frank Schilling on the mid five-figure truncation-motivated sale of Carus.com to CarusPBS.com of Finland.

Carus is any example of another Cloud Computing application domain that, like all the best Cloud names, doesn't need nor have the name "cloud" as part of its string. FilesAnywhere.comConstantContact.comBox.comDesk.com are other cases in point.

Congratulations also go to Frank on the sales of HighRiseWindows.com to fix the SIRI-imminent problem at HiRiseWindows.com

Smart. I reckon there are thousands of other sales made simply to truncate the name and drop the “my.” And now Afternic DLS will help connect these kind of branding problems with solutions as never before. 

Andrew has started sharing deeper news on who is buying what. And this is very useful and appreciated.

And Accidental Domainer (whom we sourced for this piece) has been running a series that goes further still, analyzing sales years after they were reported as just a name and a number. No wonder it's his most popular feature.

Today, as a guy who tends to see patterns and make connections that others don't consider, I'd like to share what I learned from the sales showcases on Accidental Domainer.

Most sales that end up being used by real people for real applications confirm what I've been saying all along: The main reason end users buy a name is to build a new brand or fix a brand that's broken. 

The buyers of Frank Schilling's brandable gem, WaterStreet.com, have been revealed. True to the course of our reporting, this near 6-figure sale was a BARGAIN BASEMENT brandable bought for TRUNCATION of Water Street Healthcare Partners (www.wshp.com and previously aaipharma.com).

Water Street Healthcare Partners is a leading private equity firm focused exclusively on health care. With more than $1 billion of capital under management, Water Street is one of the most active investors in the health care industry. The firm has a strong record of building market-leading companies across key growth sectors in health care. It has partnered with some of the world's leading health care companies on its investments including: Johnson & Johnson, Medtronic and Smith & Nephew. Water Street's team is comprised of industry executives and private equity professionals with decades of experience investing in and operating global health care businesses. The firm is headquartered in Chicago.

For the latter, the motivation is always about TRUNCATION- getting the name to say what your prospect is thinking.  

Examples: Minus.com $115,000- Brian WICK SETS THE TRUNCATION BAR!

  • At the time of the sale, DN Journal gave some additional background, “Owning Minus.com turned out to be a big plus for Denver-based domain investor Brian Wick. He just banked $115,000 for the domain in a private transaction. Wick said the name was purchased by a math education business with a presence in both the U.S. and Japan.”
  • That turned out to be a nice little story which the buyers likely believed would help their negotiating position — the domain was actually an upgrade from Min.us.
  • The file sharing site announced $1 million in funding shortly after the domain acquisition, and the developed site now has an Alexa ranking near 1,500.

. Republic.eu for $26,240
  • Domain redirects to Republic.co.uk, “Republic is the UK’s leading branded fashion retailer.
Republic

DJE.com for $46,080
  • Owned by “Dr. Jens Ehrhardt Kapital AG”
  • Appears to have been an upgrade from DJE.de
  • The DJE Kapital AG is one of the leading independent wealth and asset managers in German-speaking Europe.
DJE
Stempel.com for $35,000
  • Developed. Stempel.com is the German term for ‘stamp’ or ‘punch’.
  • Owned by “FAHRION GmbH”
  • Was an upgrade from inferior domains and extensions, such as Stempel-Bestsellen.net and StempelPool.de.
 stempel
Ramba.com for $25,000
  • Ramba.com is an upgrade from their prior RambaEnergy.com.
  • “Ramba Energy entered the energy sector in 2008 with the goal of becoming a significant oil and gas exploration and production company in Indonesia. Now, shortly after embarking on this journey, the company has a growing portfolio of oil and natural gas assets in Indonesia and is already seeing the benefits of its actions.”
Ramba


AHA.com might be used by Harmon's AHA which is actually a revolution in web browser built to be used while driving. 

If so it's a simple TRUNCATION from AHARadio.com to AHA.com for $125K same as these AFW guys thought their truncation was worth,.

Cool idea and like most ideas that spring up 10-25 years later, one totally off the radar of the investor and the domain's canned appraised assumed value. Real user. Real Need.

Other Truncation or Ero cctd to .com switch strategies as reported by Accidental Domainer, Domain Name Wire and here include:

To stem traffic leakage, it was worth $12,500 to the owners of Endodoncia.org to step up to Endodoncia.com

At $20-50 it was well worth it for  Werbeagentur to add .com to its roster of cctlds 
French radio station SNCF steps up from .fr redirect to .com $10-20K

Integrity Research & Consultancy, which operates online at IntegrityResearch.co.uk, bought IntegrityResearch.com for $2,000

The owner of Kitchencouture.net upgraded to .com for $2,500.

Fashion store Jollia.fr went global with Jollia.com for $1,573.

The owner of GlobalBrains.co.jp went global with GlobalBrains.com for $2,388. 

Amira Foods (India) Ltd. bought AmiraFood.com for $1,495. It owns the plural version already.

Camden County Technical Schools paid $2,188 for its acronym ccts.org.
Pacific Pillows bought another domain: Pillows.co for $3,000.

Flip Flop Shops bought the singular version of its domain, FlipFlopShop.com, for $4,500.

The owner of CarPool.com bought CarePool.com for 5,000 EUR. 

Trainer.ly paid $1,000 for Trainerly.com.

Expressions of Time, a clock store that owns ClockShoppes.com, smartly purchased ClockShops.com for $5,500.

Event production company All Phases Event Group shortened its URL from AllPhasesEG.com to Allphases.com for $4,500.

The owners of TalkLive.com (which appears to be affiliated with National A-1) bought TalkLive.co.uk for $1,000.

The owner of g2Play.net upgraded to g2Play.com for $800.

App company Echoboom AppsEchoboom.com for $4,500. It forwards it to is existing web address, Echoboom.se.

Sign company Sign Expo NYC bought ExpoSign.com for $1,600. Its web site is SignExpoNYC.com.

The owner of ArtofItalyPlastering.com bought the shorter ArtofItaly.com domain name for $2,488.

Global Evisions Solutions, Inc., which owns Evisions.com, bought Evisions.net for $1,617.

Another case of a .com owner buying the .net: Newcomb Broadcasting Corporation, which operates the Christian radio station WFAX and owns WFAX.com, paid $1,477 for WFAX.net.

Farm Bureau Management Corp bought IAFB.org for $1,677. The Iowa Farm Bureau, which is connected, owns IFBF.org.

The owner of junglejuicebar.fi went global with JungleJuiceBar.com at $1,195.

SendMoney.co.uk for $29,500 -- Redirects to the developed SendMoney.com

Luxuryvillas.com -- another .co.uk redirecting to .com

Accesspay.co.uk to redirect to AccessPay.com for $10,000

Irish IT consulting and managed services company Version 1 bought Version1.co.uk for 1,250 GBP. It already owns Version1.com.

From DiscShop.de to redirect to DiscShop.com for $10,000

A Georgia remodeling company bought the domain matching its name, AllStarRemodeling.com, for $1,000.

Menara Travel, a UK tour operator focused on Morocco, bought DiscoverMorocco.com for $1,000.

ED World, which owns LEDworld.nl, bought LEDWorld.co.uk for 700 EUR.

A Tokyo company changed its name to Money Forward and bought MoneyForward.com for $1,795.

Video company Highline Studios, which owns HighlineStudioS.com, bought the singular HighlineStudio.com for $1,000.

CouponPages.com protected itself by purchasing CouponPage.com (singular) for $725. 

Cloud company Cooperative Computing upgraded from .net to .com with CooperativeComputing.com for $1,600. $1,000 to get the .com of your .net is a great deal.

Another example is when Horror Freaks Media acquired BestHorrorMovies.com for a simple redirect to Best-Horror-Movies.com. It's that simple. And most of the prospects for these sales continue to hide in plain sight- just Google variations on the names you already own.

In the case of another near 6-figure sale in the lucrative Entertainment Industry, Cinetic Rights Management acquired FilmBuffs.com simply to redirect as a truncation to FilmBuffsOnline.com. I guess like many people all they wanted for Christmas was a SIRI-ready domain. (when asked on a private forum what name Domainers would want for Christmas, they almost universally answered 'my own' so it's not surprising).

Acquired by Fortune 100 BASF, Astora.com is an upgrade from Astora.de. “As one of Europe’s largest gas storage operators we focus on a secure supply of natural gas for our customers.”

and... the Fashion industry is moving in domain directions:

For $20K, HYJ.com is the home of a Chinese men’s clothier. Another example of truncation: they previously resided on haiyijia.com, which doesn’t exactly roll off the tongue in English or Chinese 

London clothing company Charli bought Charli.com for $2,888 to complement its Charli.co.uk domain.

And with simple "truncation-based" rationale, and up to 50 large to Messrs. Schilling Izabellondon.com is now Izabel.com.

In other news... French company DIOT, which owns DIOT.fr, went global with DIOT.com for $3,250.

Ditto with Major Security GmbH, which paid $1,000 to upgrade from MajorSecurity.net to MajorSecurity.com. 

Not owning the .com of your domain can be a security issue, so this was a good buy.

DayUse Hotels, not to be confused with HourlyUse hotels (but could be used for the same thing), bought DayUse.com for $3,000.

Whethetr it's losing a plural or the CCTLD, it's all about runcation baby! As discussed in a prior post, welcome to the gilded age of domain truncation. Truncation rules again as the most popular end user reason to buy.

So-- Forget those tired old Estibot and CPC scores. End users only want clear, easy to find brands that are future-ready for the next digital generation, a time when typing will be as hard to remember as a pay phone booth and a horse-driven carriage.

You can't speak a hyphen and any character in a brand that can't be spoken is a liability that must be removed while dwindling supplies of suitable domain replacements are still available at all. In this respect Mr. Pick got a great buy because only 10% of the aftermarket inventory is considered to be of any future value at all.



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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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