Out with the old, in with the new – says the proverb, and also say domain registrars. Out with the new, in with the old – say the majority of domainers, or at least that seems to be the case as of now. But what are the reasons behind this seemingly paradoxical market trend – i.e. the fact that the appearance of new domain extensions has strengthened the status of .com as a mostly surefire investment, driving domain brokers away from relatively freshly registered gTLDs?
It’s hard to pinpoint the exact reasons as there are so many grey areas and the market trends are often dictated by the big players, but it is safe to say that domainers are mistrustful of new gTLDs – unlike domain registrars, who have been registering new gTLDs as if there was no tomorrow. Leading the way with more than 6 million registered domains is .xyz, once declared the extension to soon overtake .com. According to data gathered from w3techs.com, the overtaking that some have envisioned will be considered wishful thinking at best for the foreseeable future.
Although .xyz is the sixth most registered gTLD in the world and the sixth most registered new gTLD clocking in at over 6 million domains, only a fracture of all websites, 0.2 percent end in .xyz. First on that list, to nobody’s surprise, is .com with a 47.7 percent share, which is an approximately 2 percent drop compared to stats from a year ago (May 2016), but it’s still an insurmountable lead. Second on that list is the Russian ccTLD .ru with 5.1 percent, third is .org with 4.9, not lagging far behind in fourth place is .net with 4.5, while rounding out the top five is another ccTLD, the German .de with 3.0 percent.
The data cited above clearly shows that no matter how enthusiastic registrars have been about new gTLDs – with prime examples being, besides .xyz, .top, .loan, .wang, .win, .club, .vip, .online, .site, and .bld, the extensions which now comprise the top 10 of new gTLDs in terms of the number of registered domains -, domainers are reluctant to join in on the craze, and instead stick to what they know works – .com, that is. Perhaps registrars had the Chinese market in mind when they had high hopes for new gTLDs, and to a certain extent, they were right, but the top CHIPs are still three letter and four letter .coms.
Another aspect of this market trend is that throughout the years, end users have gotten accustomed to .com extensions, making it easier for domainers to make a profit off of .coms even if a given domain name seems to have less value on the surface. Moreover, knowing the number of online scams, it is only natural that end users are more suspicious of websites with new gTLD extensions, and the current superstar .xyz has become synonymous with scam for many of these end users.
Unless opting for a new gTLD serves a thoroughly defined, specific goal and it does indeed work from a marketing standpoint without being forced, and, last not least, the domain extension is harmonious with the website’s content or with the brand name – i.e. about.me, youtu.be, location-specific extensions referring to the given city/country/region, brand-specific extension etc. –, in light of the market trends and the current approach of domainers, it’s much safer to choose .com as it’s more likely that someone looking to buy a domain will prefer .com over new gTLDs probably 9 times out of 10 – even though, despite common belief, Google’s search engine does not favor conventional gTLDs over new gTLDs.
Speaking of specific goals and marketing, what about the much-awaited new gTLDs such as .music and .app, which were also thought of as the second comings of .com? Ever since Google purchased .app in March 2015 for $25 million, nothing has really happened, and .music has become a hotbed of mind-numbingly complicated legal wars, so it’s going to be a while before these extensions hit the market. And if and when they hit the market, looking at current trends, they won’t make much difference in the short term and will certainly not be able to drive domainers away from .coms.
So, what’s the conclusion? The conclusion is that you should keep an open mind and keep your eyes open on new gTLDs and that your goal should be finding the right balance between new gTLDs, so to say old gTLDs, and ccTLDs in your domain portfolio. Some domainers go as far as advising on the trashing of new gTLDs. There are domainers who’d much rather have low-value ccTLDs than any new gTLD. Others take a more conservative, more even-keeled stance and use their common sense to determine which new gTLDs are worth keeping or purchasing and which are completely useless. To each their own, but you can never know what tomorrow will bring. Maybe the .xyz bubble will blow up in the faces of registrars, but maybe new gTLDs will start chipping away at the insurmountable lead of .com, and domainers sticking with new gTLDs are in for a huge payday in a decade or so. We have no crystal ball to tell what the future holds, but the present is crystal clear: .com still reigns supreme, and the uncertainty surrounding new gTLDs further strengthens its reign.
Very nice write-up.
We don’t have a crystal ball that we definitely have history is a guide. There was the 1st wave of new TLDs back in the aughts. From 2000 and 2010 we had all kinds of new TLDs like . mobi, .biz, .info, .travel, .pro, etc…… They all failed. Why should today’s new TLDs experience a different fate? What’s different now than back then? .TV was used basically as a new TLD. I’d argue that there’s not a single new TLD that even comes close to this one, yet .TV although marginally successful, has not been successful for 95% of domain investors. You just have to carry too much inventory at too high a renewal cost and the .TV turnover rate is not high enough to sustain a business model.
I’d like to point out that you missed one big Achilles’ heel of new TLDs : Any goodwill established in a new TLD, the marketing and advertising done, social pushes, will most likely help build the .com rival to whatever TLD site is being developed. So basically, just go ahead and lop off something like 35% of your traffic because you will be giving it for free to a .com owner because of traffic leakage to that extension. Every domain investor knows that a .com will suck the life out of alternative extensions. They know this because they can see the traffic they are getting for free from developed sites in alternative extensions.
I’ve been doing this now for 22 years, since August 1995. Traffic is my specialty, not sales. Build out an alternative new TLD at your own peril. Can you build a site that makes money, and is “successful” on a new TLD? Yes. However, you will always be giving a part of that success to a .com owner who gets it for free. Just think about that for a second. 🙂