Buying and Selling Domains – How the Business of Names Can Help You Earn Profits

November 24, 2011 by  Filed under: Domain 

Who would have thought that money could be made from names? With the advent of the Internet, industry regulars slowly realized the gold mine sitting literally under their fingertips in the form of domain names. These days, buying and selling domains has become a real business, with some highly sought-after names selling for five-digit figures. The domain name ClearDay.com, for example, reportedly sold for $60,000 while Mercury.com made a lot more — $700,000. Think there’s a market out there for your domain name? Here’s how you, too, can make money from a name:

Find domains that you can sell later on.

Generally, people who buy or ‘grab’ domain names don’t really have industry-specific monikers in mind. If you like jewelry, for example, you don’t have to stick to buying domains such as PreciousGems4U.com or SparklingJewelries.net. You can pretty much pick any name that strikes your fancy and then buy it.

However, paying for names that won’t sell later will considerably drill a hole in your pocket if you’re not careful. You could buy dozens of names for a small fee but if you’re not going to use them or can’t sell them later, what’s the point of grabbing them, right?

Do a search on domains that have a potential or those that have shown some sort of following in the past few months. Use the Alexa toolbar to find out which domains or sites are these. Look for names that have registered a minimum of 1,500 to 2,000 hits 30 to 60 days prior to your search. If you’re willing to pay more, look for domains that have registered five-figure hits because that’s an assurance that these domains already have a strong following. You can either sell the domains back to their former owners or have interested parties bid on them. Either way, you’ll profit from your efforts.

Automatically bid on domains.

You can’t always spend hours online searching for domains to buy. Try online grabbing systems that let you automatically bid on domains you’re interested in. Sites such as Pool.com and Snapnames.com are just two of these sites. You’ll pay them a fee if they successfully grab the name on your behalf.

Get your domain name listed.

Before you can sell your domain, you have to be registered. That’s how you can be ‘legally’ recognized. Getting the name registered also bestows upon you the right to claim it and if you so wish, sell it later.

Registering a domain name may be done for a limited period of time, usually as short as 12 months to as long as 10 years. Beyond the chosen period, the registration expires and you can choose to renew it and continue to claim ownership over it. Or, you can choose not to; at which point the domain name will be made available to another buyer. This is where you can sell the domain.

Register a potentially valuable domain.

Many people scour popular shows and events to try to find out which personalities, events or gadgets are developing a following. If you’ve been watching shows such as American Idol, for example, and you check out sites that register domains, you’ll find a few that are familiar. This is because some people will try to register a name of some rising star who will potentially become famous enough to want to build his own website someday. Since his name is already registered, he will want to buy it back and thus earn the investor a nice profit.

If you don’t mind speculating, this may be a good route to take. Just remember, though that it can go either way in which the domain name gets sold or it gets ignored.

Build traffic to your domain.

If you want to take this route and build your domain from scratch, prepare to work. If you have a domain name that you created by yourself or bought, you need to make it valuable to potential investors. Offer high quality content, build a reputation, link up with quality sites, allow your visitors to interact using your website. Once you start appearing on major search engines’ radar and gain a good following, you raise the value of your website and your domain. When the time is ripe, you can then sell that domain for a nice, fat profit.

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