The Benefits of Investing in Premium Domains: How to Maximize Your Sales Potential

Businessman pressing an .com concept button.

Have you ever heard of premium domain names? Most established domain investors are acquiring this kind of domain, regardless of their purchase value. But what are premium domain names, and why are they paying a higher price for these names? Is buying premium domain names worth their price? Will it increase the profitability of the investment?

What is a premium domain?

Premium domain names are domains that have been previously registered. They are superior domain names that investors often acquire for reselling. Most businesses invest in these domains to increase their website visitor traffic. This reason alone makes them one of the domain owner’s prime assets.

What are the qualities of a premium domain?

There are several indications that point to a premium domain. It is short and brief, brandable, contains keywords, and has credible and popular TLDs (top-level domain). A TLD is an extension we see on URLs, like “.com”, “.net”, “and .org”. Often, premium domains have the “.com” TLD. Let us discuss these qualities further.

1. Short and Brief

Premium domains are usually short-termed names that are memorable. If businesses aim to have their websites searchable, they do not need their potential customers to remember a long sequence of terms or a series of characters to visit their URLs. They need to have their web pages easy to recall and find. Overly long domain names and complex URLs with punctuation marks, like hyphens, would only make their page uninteresting and forgettable. Premium domain names often stick to one to two words or just two to four characters.

2. Brandable

Since premium domain names are memorable, as discussed above, the amount of traffic it gains can lead to the credibility of the business. This helps the business build its brand integrity. Most buyers of premium domains, select names closely related to their niche or industry.

For example, for a business offering event planning services, “” would be a good domain name for their page. It is directly related to what services they are offering.

Business owners prefer relevant domain names for their web pages. Such domains would most likely be typed by more potential clients on their search boxes than other specific and complex URLs. This will lead them to increase their web visitor traffic, which may later lead to more sales. More web traffic and sales means an increase in brand authority as well.

3. Contains Keywords

If business owners want their page on top of the search results, they usually use SEO (search engine optimization) in their webpage content. But what if their domain itself, contains the keywords?

The use of SEO in premium domain names secures their website on the top placement of search engine results. As expected, premium domain names with the exact keywords that users type on their search engines, are usually more expensive.

4. Good TLD

Premium domains usually use credible TLDs. Usually, domain names of this type use “.com” or a ccTLD (country code top-level domain) like “.us”, “.au”, etc. Premium domain names with TLDs are often targeted for a specific country. These TLDs are already considered credible, which adds integrity to the URL as well. However, not all domain names with these TLDs are considered to be premium. It still depends on the SLD (second-level domain), the terms or characters to the left of the TLD. Having a credible TLD is just one characteristic of a premium domain name.

What are the advantages of a premium domain name investment?

1. Value Appreciation

Unlike generic domain names, which are lower in value, and are slower to sell, premium domain names increase in value over time and can easily be sold without too much waiting. These domain names are already registered but have the qualities most business owners want for their websites. Their uniqueness and the difficulty in owning one, make their value appreciate over the years. Just like any other business, high demand with a low supply increases the value of premium domain names.

2. Minimal cost, High ROI (return on investment)

Investors may have purchased premium domain names at a high price but holding them while waiting for potential buyers only cost them minimal annual renewal fees. And as stated earlier, it increases value over time, making them more valuable over the years while holding them.

3. Steady Cash Flow

Premium domain investors have the benefit of earning while waiting for the right buyer. They have the option to either lease or park the domain name. Leasing the premium domain name means they can have these domains rented out and have an even cash flow while delaying the sale until they find their best buyer. Parking the premium domain name, on the other hand, is having your premium name active, indicating it is for sale, and generating income with advertisements.

4. Credibility

Owning premium domain names builds credibility in the domain investment business. Having these high-quality domain names in their portfolio displays their knowledge and achievement in the business. It improves their status in the industry. Having credibility and authority in this field would lead to repeat buyers, or even new buyers who heard about their portfolio.

How much is a premium domain?

Premium domain names can cost tens to thousands to millions of dollars. This usually depends on the appeal of the certain domain to the industry. Imagine having one of the high-valued domain names that increase its worth over time. was reportedly sold for $345,000,000.

Where to purchase premium domain names?

1.   Domain Name Marketplaces

Domain name marketplaces mostly list generic domain names. However, you can also find premium domain names in them. It is in marketplaces that a seller lists domain names for a certain price or put it up to invite offers from buyers.

Investors can also join domain name forums to gather more information on the latest marketing trends, and up-to-date business ideas. Trading domain names may also happen in forums.

2.   Domain Name Registrars

Domain name registrars are companies that are authorized by ICANN (Internet Corporation for Assigned Names and Numbers) to sell domain names. ICANN manages the IP address space allocation and other technical aspects of the domains.

Domain registrars also use auctions to maximize the value of these domain names. There are several registrars out there. Investors just need to be cautious about choosing the right registrar to buy domain names from.

One registrar may offer a different process than another registrar. They should also look into the ease of transfer offered and the additional services included in their purchase. Add-ons may include domain privacy and protection, domain parking, email hosting, etc.

Prices vary among different registrars as well. Some may have higher renewal fees than others. Although they have a lower price on the first purchase, renewal fees may increase in the succeeding periods. The length of the registration period should also be looked into. Registrars may vary, from a minimum of  1-year registration to a higher period. It is also vital that they review the expiration policies to avoid losing their investment.

Selecting Premium Domains

In selecting premium domain names, investors must not be impulsive in buying names because of their face value. They should take into consideration some bearings that may affect their investment. Premium domains they intend to buy should not be associated with any registered trademark. This is to prevent the possibility of losing them in the long run. Since most premium domains were previously owned or registered, investors should check the historical records of the domain name. They should not have any bad reputation, like malicious intent use, email spamming, malware virus spreading, being blacklisted, etc. WHOIS lookup is a tool they can use for checking. Although some information is kept private in this tool, contact numbers or email addresses are usually indicated.

The use of domain name brokers is advantageous as well. Domain name brokers are very knowledgeable in the domain name industry. They understand domain valuation and are better in negotiations. By the time they are considered to be established brokers, they already have a network of relationships with buyers and sellers. The process of acquiring premium domain names using brokers would also protect the investors anonymity.


Domain investors own a number of generic domain names, which is not a bad idea as well. However, the value of these generic domains is unstable. Aside from the fact that they produce lower profits, they are slower to sell. There is no excitement within the market in purchasing them. There are several reasons why domain investors should acquire premium domain names. Having premium domains in their portfolio will definitely maximize their sales potential. Aside from the fact that these names increase in value over time, they can also generate a steady cash flow while waiting for their best buyer. Owning premium domain names will help them establish a good standing in the domain investment industry as well. It will mark their status and authority in the domain business. Thus, potentially gaining both new and repeat buyers. The price they pay for the initial purchase and the minimal renewal fees definitely outweigh the good returns they will get in having to own and sell them. It is like sowing a seed in their garden, watching their tree grow as it gives them shade, all while waiting for their bountiful harvest.

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