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How to Become a Domainer

How to Become a Domainer

After a furious bidding war between six determined companies, it was Toys ‘R’ Us who emerged the victor in a telephone auction in February 2009. Their prize? The coveted domain name Toys.com which cost them a hefty $5.1 million dollars. But considering that the domain name could potentially generate 10 times that amount in revenue just from the web traffic it attracts, it is certain the retail giant considers the purchase of the domain a bargain.

Stories of domain names that sell for outrageous sums of money can be found all over the internet sending many online money makers flocking to domain registrars with the hopes of finding the next hot domain name that will earn them a seven-figure return on their investment. While it is possible to make money reselling domain names, the chances of getting a multimillion dollar offer for one are very slim.

With a little hard work and a sharp eye for domain names, however, it is possible to build a lucrative business as a Domainer.
What is a Domainer?

A Domainer, alternatively Domain Name Speculator or Domain Name Investor, is a person who identifies potentially profitable domain names, registers them and then resells them at a considerable markup. The domain speculation industry evolved side by side with the domain name system since its creation in the early eighties and has become a multimillion dollar industry.

Anyone can become a Domainer but earning a profit from it does require hard work and a little bit of skill. The first thing you need to do is educate yourself about the domain name industry. It is important that you understand the difference between the various types of domain extensions (.com, .net etc) available and what makes one type of domain name more attractive than another.

Pick a Good Domain Name

Of all the Top Level Domains (TLDs), .com is valued more than the others. Not only is it the most common extension, it has also managed to capture considerable mind share in the marketplace. When people think about a website, they naturally assume the site’s extension will end in .com because that is what they have come to expect in their time on the internet. Therefore .com domains will generally earn you more money than other domain extensions.

Another important factor that affects the value of a domain name is how generic the name is. Generic words like cards, travel, pizza are more valuable than those with unique or specific names. These types of domain names garner a lot of type-in traffic from web surfers which, in turn, makes them attractive to big name players who want to capture those users looking for that particular product.

It will help you immensely to find a few reliable sources of information about domains that will teach you the intricacies of picking the right domain name.

Choose a Market

Once you feel you have learned enough about choosing good domain names, it is then time to start investing. There are two types of domain markets you can deal in, Primary or Secondary Domain Speculation. Primary Domain Speculation is the purchase and resale of domain names that has never been registered before. Secondary Domain Speculation is refer to domain names that have been (or currently are) registered and are being released back into the name pool.

Primary Domains are the cheapest and easiest to get started with and as a new Domainer it is recommended that you start with those. Secondary Domain Speculation is a very competitive field and you should until after you have had some experience with buying and selling domains before jumping into that pool.

Start Registering Domains

Getting started in the Primary Domain market is as simple as choosing a domain registrar and registering your domain names. You want to pick a registrar that offers discounts on domains purchased in bulk. However, understand that cheaper is not always better. You want to work with a company that is solid and with good customer support in place to help you when you need it.

To prevent yourself from overspending, you should set a monthly budget. You can start with a $100 and then increase the limit as your business and confidence grows. Setting a budget will also force you to think carefully about the domains you get to ensure you are not throwing money away on names with little value.

Sell Your Domains

Once you have acquired your domain names, you can start selling them right away. Here are a few ways you can do this:

1. List them at Sedo.com and other domain auction sites

2. Advertise what you have available in webmaster forums and communities

3. Setup a website listing your portfolio with a contact form

4. Put up a splash page on the domain advertising its availability

5. Make contact with other Domainers who may be interested in adding your domains to their portfolios

You want to employ a variety of selling options to maximize your chances of making a sale.

Legalities – Cybersquatting and Trademark Infringement

One of the things you want to avoid, at all costs, is infringing on the trademark of others. Registering a domain name that includes trademarked words for the intent of making money is called Cybersquatting. It is illegal and could result in being sued by the trademark holder. At the very least, you will be forced by the domain registrar to hand over your domain to the offended party. Stick to generic words and phrases and you will be just fine.

Buying and selling domains can potentially be a lucrative way to earn money online. You may never sell a domain for seven figures but if you take the time to learn the industry and work hard, you can end up with a business that provides you with a steady flow of profits for years to come.

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