Updated: March 4, 2024
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You are starting your business. Congratulations. There are some i’s that need to be dotted and t’s crossed. One of them is securing a domain name for your business. You know you need to do this because you are savvy. You know the importance of technology for your business. You have done your due diligence when it comes to choosing your business name. You have, right? If you haven’t, you can check out our article on how to choose a business name wisely. Now you need to purchase a domain name for your business. It is the first step before you even think about a website.
For entrepreneurs who are not in the tech space, this can all seem overwhelming. Hang in there. A lot of domains go for a couple of dollars. You may think that if there is any mistake you make, for a couple of dollars, you can always get a new one. If you choose this path, you will end up undoing your work. This article can help you avoid some of those mistakes.
What is a Domain Name?
A domain name is your online business address. It is how people will access your website. It is a lot like a physical address because people who have it will find you. If someone enters your domain name into their search bar, the browser will find its way to your website. Each domain name can only host one website. We started using domain names because they were easier to remember than numbers (IP addresses). So when you buy a domain name, you map it to one IP address and that IP address points to the computer that hosts the website.
Note: it is possible to have two different domains pointing to the same IP address. These domains will show the same content. If you have two domain names: examplea.com and exampleb.com, you can point them to the same server. Businesses often do this when they want to prevent people from using similar sounding domain names. They protect their brand integrity this way. The strategy is to buy up all the domains that sound like yours. It prevents having to sue people for trademark violations. They can’t violate your trademark if they can't own all the domain names.
Other businesses will change their names along the way. They will point the old domain name to the new website because it already had existing users. Just for fun, try searching relentless.com and see what I mean.
What About Extensions?
An extension is what comes after the first dot on the right of the domain name. The most common extensions you will come across are .com, .org and .net. The official term is Top Level Domains (TLD) but we will call them domain extensions. The current list maintained by the Internet Assigned Numbers Authority (IANA) has over 1500 domain extensions.
The domain names before the extension can be the same as long as the extension is not. One business can own example.com and another can own example.biz. If this is the case with a domain name that you are considering, make sure you are not about to commit a trademark violation.
There are various types of extensions that you will come across. They are divided across two lines. Those that are industry specific and those that are location specific. Lawyers can use a .attorney or .associates extension with their name while banks can have a .banks extension. Such extensions may have restrictions though. The domain registry may screen those applying to use the extension to prevent fraud.
Geographic extensions are more common. We refer to them as country code top level domains. You have probably come across a domain that ends with a .uk for the United Kingdom or .ca for Canada. Some locations like London also have an extension, in this case .london. Some of these countries and locations will have restrictions like requiring buyers to be residents. Consider using a country code top level domain if your business serves one country. It will help your users know who your specific market is.
The effect of your choice on search engine optimization should not bother you. Google doesn’t favor websites because of keywords in the domain name. It has stated previously that the domain extension (TLD) is not a ranking factor. However, the perception you create should concern you. Though Google does not care, your choice of name and extension may sway your customers and readers. Google will show you on the results page and then users decide if they will click. Those with a better choice of name and extension may experience a higher click through rate.
What is a Subdomain?
A subdomain comes before your domain name. It can be anything. Examples you have come across are the ‘blog’ in ‘blog.example.com’ and ‘www’ in ‘www.example.com’. The difference between a subdomain and a TLD is that you own all possible subdomains that you can attach to your domain. Subdomains are free to create. Your domain name provider can help you set this up once you have bought a domain from them. This usually entails the creation of CNAME records.
The ‘www’ subdomain will usually point to the same information as the domain. That is, ‘www.example.com’ will usually be the same as ‘example.com’. Other subdomains will have a specific purpose such as hosting a blog or different language section of the main website. It mainly depends on the owners and what they would like to use the subdomain for. Search engine guidelines prefer having subfolders than subdomains. ‘example.com/blog/’ is preferable to ‘blog.example.com’.
Premium Domains
Once you start browsing for domain names, you will come across premium domain names. The prices are higher than average; we are talking thousands of dollars in price. What makes a domain premium is how catchy and short the domain name is. The owner of the premium domain could have bought it earlier expecting to sell it for a higher price later on. It could also be a domain registrar that has identified a domain name as premium.
Premium domains have no magic behind them. They will not bring customers marching through your doors if you offer no value. Search engines are also indifferent to the name of the domain. It is not a ranking factor.
So why the price? It is more of a demand and supply situation. There are people who are willing to pay a higher price for the kind of domain names that are in short supply. There are owners who are willing to part with them for a higher price. The reasons for wanting a premium domain are personal to a company or individual. Some domain names offer particular companies a brand advantage. Individuals may speculate that they can sell it at a higher price.
Aged Domains
Some domain names have premium prices because they are aged. An aged domain is one that the owner has been putting to use. The domain therefore has an established presence on the internet. An aged domain will likely have other websites linking to it due to being online longer than a newly registered domain name. Links to a website are a ranking factor and you may want a shortcut.
You may want to buy an aged domain instead of going through a gruesome journey building a website’s reputation from scratch. You inherit reputation and continue building upon it. Premium domains may help with branding purposes but an aged domain may have tangible value like an existing traffic flow from websites linking to it.
If only it was as simple as taking over an older domain name. Google regularly crawls and unless you retain the links as they are, the crawlers will notice a change. You may take down some pages that other websites have linked to and this is also noticeable. You may create new content but it is a problem if they have no relation to previous content. An aged domain, if not well handled, could end up making your webpages fall in rankings.
Some aged domains already have a bad reputation with search engines. The owners could have been using the website for shady practices. Google could now be trying to drive users away from such websites. You could be buying a lemon. We advise you to take a look at the wayback machine before making a purchase. If the website has been around for a while the wayback machine could be having a snapshot of how the website looked. You could use that to decide if it meets your standards.
Renewal Fees
When we say buying a domain name, the right term would be more of leasing a domain. The standard duration across domain name sellers is a year. You renew your registration of the domain name every year. A year ends on the same day and month of the following year. Your domain name will stop functioning if you don’t renew on time. Your vendor may give you a couple of weeks to pay. If you fail to pay within that period, the vendor will put it up for sale.
Caution! Before you buy your domain, please confirm the renewal fees and if you are comfortable with it. There are vendors who will initially offer you a discounted registration fee. After the year is up, the renewal fee shoots up and often without your knowledge. Since they have your payment details, you end up paying a higher price than you would have liked.
Hosting - A String Attached
The cost of a domain is but the first of a series of costs you will experience if you intend to have a website. Whether yours is an ecommerce or blog website, you will pay for hosting. Hosting is the computer/server on which your website runs. The only way to avoid it is to run your website on your own servers: a higher capital expense.
Hosting allows you to pay for what you use only. There are many hosting options which you can choose from depending on your needs. You can scale your hosting needs as your business grows. The flexibility allows small businesses to have a place to start without breaking the bank.
Next Steps
Now that you have gotten to this point, the natural next steps are looking at the vendors of domains and the whole purchase process. We go in depth into the process of purchasing a domain. We advise on how to go about it.
