December 24, 2004

Domain name game not as simple as many thought

Trying to find a new business name? It?s not as easy as it used to be because these days you need a matching domain name.

But there?s a common mistake made by companies looking for domain names, a problem that has led to literally billions of dollars of lost venture capital investment over the last few years.

It might seem obvious that when you create a company name these days, you should pick something descriptive and get a descriptive domain name to match. Selling diamonds? You need Diamonds.com. Selling insurance? You need Insurance.com. Toys? You need Toys.com. Of course these days simple one-word domains are next to impossible to get unless you are willing to spend millions to buy them. So perhaps you need VeryCheapDiamonds.com, InsuranceQuotes.com or OnlineToys.com.

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It seems obvious, doesn?t it? In fact, so obvious that venture capitalists invested literally billions of dollars into generic-name companies. A simple common name must be powerful … if someone?s looking for insurance, they?ll go to the Insurance.com, won?t they?

But obvious is not always correct. In fact, such names break one of the most basic rules of branding: Strong brands are almost always based on nongeneric names, and the last few years of Internet history bears this out. Companies based on generic-name companies have mostly got nowhere.

Think of the largest brand names. The world?s top 75 brand names have a ?brand value? of somewhere around a trillion dollars ? and none of them are generic names. Names like Coca-Cola, Microsoft, Disney, Gillette, Sony and so on … none are names like Cola, Computer Software, Cartoons, Razors, Electronics. Sure, they may be derived from proper names (Coca-Cola and Microsoft are obvious examples), but they?re still distinctive enough to not sound generic.
So how about all those generic domain names that were so valuable in the early days of the Internet? Did any become brand names? What?s the leading brand in online auctions? eBay, of course.

Type Auctions.com into a browser, and you?ll find that it isn?t even used for an auction site ? it leads to a CNET ?clearance center.? How about Diamonds.com? It?s still a diamond store, but there are probably eight other diamond stores with more Web-site traffic (the brand leader is actually BlueNile.com). What is the leading job-search Web site? Not Jobs.com ? it?s Monster.com. (In fact Monster.com bought out Jobs.com and uses it as a ?doorway? into Monster.com.)

What is the brand leader in general online sales, the Internet?s ?department store?? Almost everyone?s heard of Amazon.com, and while Buy.com is still in business, it?s nowhere near being a strong brand. How about the brand leaders in search engines? Google and Yahoo!, of course. SearchEngine.com has a search engine, but virtually nobody uses it.

Why should this be? Why are generic names no good? Well, for one thing, it?s too easy for a competitor to dilute your brand. Let?s say you sell cars, or sell leads to car dealerships, and you were early enough to grab the domain name Cars.com. What?s to stop competitors grabbing eCars.com, CarsDirect.com, CarOrder.com, CarTalk.com, SuperCars.com, iCars.com, WebCars.com, and any one of hundreds of others? Nothing ? in fact all these are existing domains.

If you have a unique, nongeneric term, this can?t happen to you. The owner of Cars.com hasn?t the slightest hope of stopping people using other car-related company and domain names, while the owner of a unique brand name will drag you into court if you use a name that?s similar. (Want to test this? The domain name ibay.com is for sale for $10,000. If you set up an online auction company using that name, how long do you think it will take eBay?s lawyers to contact you?)

Another problem is that generic terms are too familiar to stick in people?s minds. Because the term is so general, people have difficulty remembering the term. Was it Cars.com or eCars.com? Or CarsDirect.com? It was something with cars in it, but what? Edmunds.com is a much stronger brand name, because once people know the name they won?t get it mixed up with anything else.
Billions of dollars have been spent on failed generic-name domains. It?s interesting to visit these domain names and see what happened. Some are still in business, but struggling; others point to another site entirely, having been bought out long ago. Some still are used, but are owned by another, stronger brand. Names like Food.com (sold to the Food Network), InternetDiamonds.com (bought and turned into BlueNile.com), Loans.com (bought by Bank of America), Women.com (sold to iVillage.com), RealEstate.com (bought by LendingTree) … it?s a long list.

The simple fact is, generic names don?t make strong brand names. But there?s good news: You don?t have to beat yourself up anymore just because you can?t get the ?perfect? (that is, generic) domain name. Now you?ve been freed from the tyranny of the generic, you can widen your search and look for a unique company name for which registering a domain name will be easy.

Peter Kent is the author of ?Search Engine Optimization for Dummies? and many other computer- and Internet-related books. For more information, see www.iChannelServices.com.

Trying to find a new business name? It?s not as easy as it used to be because these days you need a matching domain name.

But there?s a common mistake made by companies looking for domain names, a problem that has led to literally billions of dollars of lost venture capital investment over the last few years.

It might seem obvious that when you create a company name these days, you should pick something descriptive and get a descriptive domain name to match. Selling diamonds? You need Diamonds.com. Selling insurance? You need Insurance.com. Toys? You need Toys.com. Of course these days simple…

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