4 Rules For New Domain Investors

The process of buying and selling (or flipping) domain names is an exciting venture. People dive into this industry with hopes of buying low and selling high. For some it’s like guessing the winning combination on the next Powerball jackpot. Look around online and in different domain forums and you’ll find plenty of stories from people who paid $8 for a domain 10 or 15 years ago and sold today for thousands (or even tens of thousands) of dollars. Of course, that leads more and more people to wonder, “How can I do that?”

Well, the ocean is big and although your likelihood of cashing in on the motherlode isn’t very high, lots of people have success in this industry and you can too! Listed below are four rules every new domain investor should follow when getting started. If you can come up with some money to invest, a solid business plan/strategy and remain disciplined, then there is no reason you shouldn’t be able to make it as a domainer too.

Quality over Quantity – Domains are pretty cheap so if you want to, you can hand register over 1,000 domains for less than $10,000. Would that make you confident and happy? Most people just starting out as a domain investor make the mistake of hand registering worthless domains. For example, lots of people thought they would make it big by hand registering as many five letter domains as they could afford. Needless to say, practically all of them ended up learning a pretty expensive lesson. If you want to invest $10,000, buy a handful of good domains that will inherent value will always be in demand.

Stay Away from Over-Hyped Extensions – Don’t start investing in any new domain extension without doing some research first. Dot mobi domains are one of the best examples: people have initially paid a lot of money for them but as time went by, these domains started losing more and more value for one reason: the fundamentals just aren’t there, dot mobi is an extension which has been over-hyped and nothing more. What’s the golden rule of thumb? .COM is king.

Sell to End Users – You should go out and purchase several good domains for affordable prices using domain auctions and then aim to sell (or flip) them for 10-20 times more by selling them to end users. Buy domains through auctions, sell them to end users: this is a strategy which works for quite a few people. A lot of the time you will have to explain why domains are valuable in the first place, so you need to understand that being patient is extremely important. Even if it seems that some of the questions end users usually ask are ridiculous, don’t lose your temper and calmly guide them through the process. A lot of times, an end users who does initially not understand why you ask for so much will end up reaching for his wallet after understanding why the domain name is valuable.

Take Advantage of Type-In Traffic – Most decent domain names will have at least a little bit of type-in traffic. Don’t just let them sit there and do nothing, parking your domains and whenever possible, use a for sale landing page so anyone who visits it will know the domain is available to purchase. Most parking companies (and even several domain registrars) will offer something like this and it’s definitely worth it.