What’s a Good Domain Investment?

One of the first questions I had when I first started domaining is what type or kind of domains are good investment? Now, if you look at domain investing, what drives its values to sell high is the fact that domains are easy to remember, as well as, it is a targeted keyword domain (Good for SEO). So how do you assess whether the domain is a good investment or not?…

… You can’t just choose cool words to invest in, just like in real estate, just because the street name sounds cool doesn’t mean that it is high value. Remember this is investing, you got to think of the end user, if it was yourself or someone else, you have to think will it be useful to them? Will it be valuable in their eyes?

– Good Domain Investments –

Just like real estate, domains can be appraised and valued but the problem is that the value of the domain relies on how much the buyer thinks or is prepared to pay for it. So there’s inconsistency in the market, there’s no uniform value therefore its not the best to use. What you could use though is another calculation, just like in commercial lots, they assess foot and car traffic, population etc. In domains, it is thru SEO and is calculated like so:

[Global Searches (gTLD)] OR [Local Searches (if ccTLD)] DIVIDED [total exact search results (considered competitors)]

I’ve used global searches for gTLD as it ranks well on the global search market, while ccTLD is limited to (normally) to local searches (Country based). The total exact search results are the results when you type the keyword in google with Quotes “” (Example: “Used cars”) and if you look on the top part you’ll see how many available websites there are that match the keyword (normally in the thousands). The minimum number for a domain to be considered a good domain investment is 0.2 (1 search to 5 competitors ratio). So what you’d want to happen is to have less competitors and more searches, just like in commercial properties, have less competitors but high demand in the area.

I’ve used this model in for my domain investments and it has worked for me. Getting one result alone isn’t enough, like if you got a high number of searches there could be a high number of competitors which could make you work hard for SEO. Remember end users want these domains for SEO purposes first before anything else. So before you do start investing into domains, make sure to do your maths.

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