Web domain sale represents a real business opportunity
All businesses should pay attention to the host of web domains about to go on sale, writes Emma Barnett.
At first glance the topic of internet domain names might not appear to be the most important issue for business to worry about. However, as digital becomes an increasingly important part of individual’s and companies’ identities, it is often how people direct others to the work they do.
On June 20 the Internet Corporation of Assigned Names and Numbers (stick with me here), the non-profit group which controls the internet domain name system, is holding an event in Singapore to announce its final guidelines on a new host of web addresses which will allow companies to purchase URLs ending in their brand name. For instance the clothing company Gap could buy the ending ‘.gap’ instead of ‘www.gap.com’.
The issue of buying a relevant web address has become one of frustration for both individuals and companies alike, which, coming later to the web party than the early adopters, have found that they can not buy the web URL of choice. It has often already been taken by someone else – who they then have to pay exorbitant amounts of cash to in order to reclaim themselves online. Such ‘cyber squatters’ will regularly not give up their internet spot and cannot be easily contacted.
This is why ICANN’s proposals, to essentially open up a new online market-place, where new address are available for those brands and individual who have lost their identity online in the first and second wave of the web, could be significant.
For instance, the fact that even the mighty Apple does not own iPad.com but could now potentially own all websites ending in .Apple, should its submission be successful, is something the technology titan will surely at least want to consider.
ICANN is the body appointed by the US government to oversee internet addresses. In 2004, ICANN decided that new top level domains would either be ICANN-controlled ‘generic’ domains or ‘sponsored’ domains run by a private organisation for the benefit of a specific online community.
The organisation recently made headlines of a slightly fruity variety, as part of this very initiative to allow new web address endings, by approvingthe controversial .xxx domain after six years of consideration.
The decision has been a contentious one with strong disagreements between those in favour of the domain and those opposed to it. Some in the “adult content” industry are worried that the .xxx domain will ghettoise their content but anti-pornography groups opposed the decision too, arguing that it would make adult sites more visible.
In a statement ICANN said: “This decision represents a difficult, careful balance, weighing the extensive community advice both for and against the registry agreement.”
Any company or individual wanting to access these new web endings will only have a limited period to do so and will need to weigh up their options. Domain name registration is an expensive process laden with pros and cons.
Theo Hnarakis, chief executive of Melbourne IT DBS, a digital branding consultancy which advises companies on such matters, argues that brands need to take this opportunity seriously.
“We expect the application process to start in early November and it will only be open for 60 days. After that, the process will be closed for another three years so companies need to think about this hard and fast.”
Hnarakis told me that companies who were serious about their brand being digitally represented needed to consider the option as it is important for businesses to be trusted and easily findable online.
“These new domain names represent an amazing opportunity for companies to really stamp their brand online, instead of having to take on URLs which don’t have their exact brand title in. It’s an issue of trust online and this could be a good way for some companies to reclaim their brand.”
Cannon, Hitachi and UNICEF have all said that they plan to apply for their respective brand URL endings.
However, the downsides of the system is that certainly for a while, as search engines catch up, the sites will not be easily findable and the new addresses will not be understood or known by consumers – who are very familiar with the current .com or .co.uk system.
Hnarakis advises companies which are successful in their bids to keep up both their current web address and new one, redirecting them to one another in order to give consumers time to adjust to the change. People are just as much creatures of habit online as they are off.
There is also the laborious nature of the application process itself. Just to apply, which involves filling out a lengthy document, is £180,000 and even then ICANN can refuse the application.
The stakes are high and every company will have to decide whether it’s worth it for them.
But web identities are increasingly how businesses are judged and attract new custom. A new study by Regus, a provider of business services, found that 41pc of UK companies were successfully winning new customers through social networking activity.
Celia Donne, regional director at Regus, said: “As businesses emerge from the downturn they are increasingly reconsidering pre-recession working practices and opting for more flexible, competitive strategies.
“Among these, the use of business social media is proving extremely successful and suited to the fast pace of recovery. Particularly in the UK where one in three social network users are a fan, follower or friend of a company page or profile, firms should expect to see an increasing proportion of marketing budget being destined to this activity.”
Consequently as more companies direct new customers to their sites via services like Facebook, it is important they are well sign-posted and clearly branded. Arguably this is what this new generation of web URLs are offering businesses – the chance to own their space online, like they do in real life. This ‘city’ of newly created web addresses is going to be filled with the next wave of early adopters and forward-thinking players.
It pays to be informed and even though the topic matter sounds decidedly lacking in importance – the outcome could be transformative.