On January 1, 1985, a small team from a Cambridge, Massachusetts startup launched the first internet domain called Symbolics.com.
Less than 40 years later, the internet has become the home of the wealthiest people of the Information Age.
If you’re curious about online marketing and earning money from rebuilding a dead website from scratch, domain investing may be right up your alley.
Investing in expired domains is a niche and largely undiscovered practice.
As post-pandemic habits turn e-commerce and online conferencing into multibillion-dollar industries, domain investors can get in on the ground floor of something significant.
In this article, you’ll learn how to buy expired domains, how to participate in GoDaddy auctions and other events from registration services, and the ins and outs of profitable domain name investing. We’ll start by defining a few terms.
The Domain Investor Glossary
Similar to other online industries, domain investors use unique terms that you’ll have to learn before you can navigate auctions and sales.
If you’re new to domain name ownership, Google page rankings, and online registries, here are a few words you’ll need to know.
What Is Domain Name Ownership?
You can’t truly own domain names. You can only rent them.
Domain names function like the real estate industry. There’s high demand for a few choice properties, and there are landlords and tenants.
Most domain names live inside registrar databases, like GoDaddy, Namecheap, and Namejet, and people only lease them by paying a monthly or annual fee.
Popular domain names such as github.com, Forbes.com, and even apple.com are all names that procurement agents rent indefinitely.
What Are Domain Auctions?
When a domain goes past its expiration date, it goes through a redemption period where the company or private individual who owns it can have a chance to renew it.
A high-value domain name will have a long queue of backorders, and registrars will sell them to buyers with the highest offer or the first bid, depending on their policy.
When a domain name has no buyers, it will go to auction. An auction typically lasts for one week, and the highest bids will come at the closing hours.
Registering a good expired domain at an auction can take months of practice and a stroke of good luck, but long-time investors will know how to spot one at a glance.
What Are Google Search Page Rankings?
According to research from Forbes, 75% of all search engine users don’t make it past the first page of Google results when looking for a product or service.
If you’re a business owner, only 25% of people will know about your existence when your website ends up on page two of a Google search, and even less when you’re on page three.
The best domains rank highly on search pages, and companies, influencers, and private individuals are willing to pay large sums to invest in one.
What Is Domain Investing?
Basic domain investing involves several steps:
- Buying or bidding for domain names at auctions and sales
- Optimizing them to rank higher on search results and generate organic traffic
- Selling them to a person or business entity who can invest in a sister website, landing page, or private blog
- Making profit to invest in your next domain name
Namecheap counted 11.1 million new domains registered in 2019, and demand is still growing steadily. Vetting and investing in expiring domains can be a viable business if you know what you’re doing.
How to Earn Money as a Domain Investor
There are hundreds of ways to earn cryptocurrency and cold cash from expired domains.
Much like investors in the financial industry, you can generate value by writing code, analyzing the marketplace, and advising people when to sell their domain name.
Timing the Domain Name Sales Market
Optimizing domains so you can sell them at a higher price is an innovative way of generating income, but it can take years, and there’s no telling which domains and industries will be popular after you finish. You can also create revenue by timing the market.
Much like real estate, the value of expired domains depends on their previous position before they went up for sale or to an auction.
Investors with capital to spare are always buying expired domains that have a high demand potential.
Reading Trends as Domains Expire
A domain name that you can pair with multiple top-level extensions with links to trustworthy sites, and that has all the right keywords, will always be attractive to any company or person who wants to expand their online presence.
However, you need to maintain a sharp sense of reading supply and demand so you can register and sell your expired domains for the best price.
For example, as millennials hit their prime home-buying years, there has been an increased demand for domain names that correlate to real estate marketplaces, decorators, and remodelers.
Investors who want to generate site traffic from urban centers and bedroom communities are looking for domain name owners who don’t want to renew their registrations.
Registered domains from Seattle, Greater Sydney, and New York suburbs have been selling like hotcakes, and investors who have been collecting these are creating revenue.
Make the Rules as You Sell
You can contact the actual owner of websites to make the first bid before their domain names expire.
As you register domains to build your collection, you can reach out to potential buyers, put expired domains in private and public auctions, and decide their lowest sale price.
The domain name sales market is ever-expanding and far-reaching. You can become an expert in timing domain prices for different industries and niches and generate hundreds of thousands of dollars in revenue.
If you can’t sell or auction your domain for a 40% to 50% profit after leasing costs, hold out and time the market better.
Publicize your domain’s information on the WHOIS database to let everyone know it’s trustworthy. List your domain on well-known registrars such as NameCheap and GoDaddy.
How to Find Income-Generating Expired Domains
Investing in expired domains is quickly becoming a popular strategy for companies and individuals who want long-term income.
You can find thousands of blog sites, magazines, and online resources to tell you which domains to buy.
However, if you want to buy domains that can generate income for your blog site, online marketplace, or sharing platform, signing up for an account on registration platforms and knowing how auctions work is only a tiny piece of the puzzle.
You have to train your nose to sniff out which domain trends will become popular.
Look for Shorter Domain Names
Shorter domain names can tell your audience about your products and services concisely. On the internet, your worst enemy is your audience’s attention span.
One-word domains like gold.com, blogspot.com, and shoes.com can generate more organic traffic than their counterparts with two to three-word names.
Buy Expired Domain Names with Multiple Extensions
The last three or so letters you see at the end of every website name are top-level domains or TLDs.
Top-level domains can be specific to a country, like .us, .mx, and .uk. Unique TLDs give domains a chance to stand out in a sea of .coms and .orgs, sometimes offering you a chance to be creative.
Websites like Inter.net, Last.fm, and Monetize.it are memorable examples of creative domain names that take advantage of their TLDs.
You can use an address with a creative TLD as your other website, driving customers from different locales to the same domain, preferably a company homepage.
Be careful when using TLDs, as some will have shorter and longer renew times, redemption cycles, and grace periods than others.
Research Your Domain’s Past
If the domain you want to buy was previously part of a private blogging network or any other blackhat scheme, it could be on the Google ban list, and it will never get first-page search rankings.
Use online resources such as the Wayback Machine to see a domain’s past content and reputation among search engines. Some services may require you to pay or create an account before you can use them.
Older domains will have higher trustworthiness ratings on search engines.
An advanced domain age could mean that its previous owners spent more time link building, which is the practice of linking domains to external websites that Google considers as more authoritative like ESPN, Wikipedia, and Forbes.
Make Your First Move
You can start domain investing with virtually no capital. Many SEO specialists and marketers have become experts at finding expiring domain names, buying them for a song, and selling them back to the marketplace for enormous profits.
You don’t need a university degree or expert programming skills to invest in an expired domain name and generate revenue.
Domain names are central to the identity of a brand, business, or non-profit organization.
In the smartphone age, it’s nearly impossible for any institution to expand locally and conduct business overseas without appropriate domain names.
Now that you know how to invest in powerful domains, it’s time to make your first investment. Get out there be the next innovator the internet needs.