For the Domain Developers Fund we have made a Quick study to create a new term, instead of GDP/Capita, we calculated GDP/Domain, which is the much more important number. We have found lots of data but for some TLD´s there was no way to find any stats, Greece, Nigeria, Thailand and Egypt are among them, so if you have data let me know and I will update the numbers.
Just a note:  .com includes the big generic TLDs such as .com,.net,.org,.biz and .info., also note that the numbers are in ´000
So what is the result ?
Number one on the list is Montenegro, a very small economy marketed its TLD very succesful and for each Domain registered there is a GDP of only 16.000 USD to be distributed. Saudi Arabia on the other Hand, who is very restrictive in registering Domains has 24 Mio USD of GDP/Domain to distribute. It also shows that Colombia, who is next on the list has a lot of potential when they start the launch of .co soon.
The other interesting rankings is the USA ccTLD: .us which is still waiting to be kissed awake and then there is a long list of promising ccTLD´s to look at: India, Mexico, Iran, Peru, Hong Kong, Singapore and Turkey and many smaller economies, at least for their top of the pop Domains.

COUNTRY TLD GDP (`000) DOMAINS GDP/DOM (`000)
Saudi Arabia Sa 369.000.000 15.000 24.600
Colombia CO 228.000.000 25.000 9.120
Trinidad and Tobago TT 20.000.000 2.200 9.091
United States US 14.250.000.000 1.620.423 8.794
Guatemala GT 37.000.000 7.000 5.286
El Salvador SV 21.000.000 4.100 5.122
European Union EU 16.000.000.000 3.180.000 5.031
Panama PA 24.000.000 4.800 5.000
Haiti HT 6.560.000 1.400 4.686
Dominican Republic Do 46.000.000 10.000 4.600
Japan JP 5.000.000.000 1.151.660 4.342
Peru PE 126.000.000 30.000 4.200
The Bahamas BS 7.340.000 2.000 3.670
Libya EC 60.000.000 17.000 3.529
Honduras HN 14.270.000 4.200 3.398
Bolivia BO 17.630.000 5.200 3.390
Barbados BB 3.600.000 1.100 3.273
Turkey TR 615.000.000 212.757 2.891
India IN 1.235.000.000 510.000 2.422
Costa Rica CR 29.000.000 12.000 2.417
Venezuela VE 337.000.000 145.761 2.312
Mexico MX 875.000.000 402.912 2.172
Iran IR 330.000.000 155.000 2.129
Malaysia MY 191.000.000 93.539 2.042
Paraguay PY 14.670.000 8.000 1.834
Uruguay UY 31.000.000 17.310 1.791
Singapore SG 177.000.000 107.890 1.641
France FR 2.675.000.000 1.673.224 1.599
Ireland IE 210.000.000 141.127 1.488
Nicaragua NI 6.150.000 4.700 1.309
Spain ES 1.464.000.000 1.205.713 1.214
Italy IT 2.118.000.000 1.814.888 1.167
Israel IL 194.000.000 167.000 1.162
Hong Kong HK 210.000.000 185.175 1.134
Guyana GY 2.000.000 1.900 1.053
Luxembourg LU 51.000.000 49.647 1.027
Finland FI 238.000.000 233.360 1.020
Canada CA 1.336.000.000 1.365.472 978
Taiwan TW 378.000.000 446.151 847
Norway NO 382.000.000 468.470 815
Brazil br 1.574.000.000 2.000.000 787
South Korea KR 832.000.000 1.071.529 776
Vietnam VN 92.000.000 121.300 758
Portugal PT 227.000.000 307.470 738
Slovenia SI 49.000.000 73.950 663
Australia AU 997.000.000 1.646.628 605
Chile CL 161.000.000 275.186 585
China CN 4.900.000.000 8.500.000 576
World COM… 58.000.000.000 112.000.000 518
Belgium BE 470.000.000 1.014.481 463
Sweden SE 405.000.000 938.387 432
Russia RU 1.229.000.000 2.850.000 431
Iceland IS 12.130.000 28.275 429
Slovakia SK 88.000.000 208.734 422
Austria AT 381.000.000 928.025 411
Cayman Islands KY 2.000.000 5.200 385
Grenada GD 615.000 1.600 384
Romania RO 161.000.000 434.194 371
Switzerland CH 494.000.000 1.381.198 358
Lithuania LT 37.000.000 112.469 329
New Zealand NZ 117.000.000 388.557 301
Denmark DK 309.000.000 1.042.303 296
Czech Republic CZ 194.000.000 661.234 293
Hungary HU 129.000.000 450.000 287
United Kingdom UK 2.183.000.000 8.289.784 263
Estonia EE 19.000.000 76.000 250
Germany DE 3.350.000.000 13.465.086 249
Poland PL 430.000.000 1.743.970 247
Netherlands NL 794.000.000 3.733.988 213
Argentina AR 310.000.000 1.850.000 168
Liechtenstein LI 5.000.000 60.000 83
Belize BZ 1.340.000 45.000 30
Montenegro ME 4.110.000 250.000 16








by: The Domain Developers Fund



http://www.ddf.lu





Estimating the value of domains is one of the keys to success in the domain market, with fancy domains ist easy, it’s a question of taste and feeling, with traffic domains it’s a calculation, but some of the biggest chances in Domains is in keywords connected to industries, especially in emerging TLD´s. So the main question is, how big is the industry and how great are the chances of an economy. One of the best tools to look at the growth of economies (besides good old Wikipedia)  is gapminder.com, a tool developed by the famous Hans Rosling, a frequent guest at TED. Gapminder is a statistical tool displaying key data from 200 countries worldwide over the past 50 to sometimes 100 years. Besides the growth of countries and their infrastructure status, the tools allows to track the growth of main industry sectors such as agriculture, education, communication etc. Some of the industries have a size of 1 to 5 Billion USD per year, yet their key word or words are not even registered. Now if you guess this one, its yours: The name of the top-traded commodity in the world is not registered in the country that produces every year about 60 Billion USD worth of this commodity.

Recently I followed a thread on Elliots Blog about which domains to invest in or rather not to invest into, finally the participants, including the Costelo brothers agreed that only domains with direct navigation are worth buying and keeping, otherwise you immediately have negative cashflow. So far so good, but I disagree, first because the past is the past and the future is the future and its all about predictions and its especially hard to predict into the future. Say you are buying a domain, whatever it might at 7 years revenue, the assumption we make today is that traffic is growing and that prices and effectivnes of advertising is rising: Now I am not sure about this, I have been in the advertising industry for almost 15 years and I have seen advertising prices only going in one direction: downwards. My assumption is that with more websites and more smartphones and so on, prices will drop, no matter how great your domain and your keyword might be. In the long run advertising for a keyword will become cheaper because more publishers will focus on it. In this case the evaluation of this domain goes from 7 year revenues to 12 and 20… and it is loosing value. So besides following the crowd and yes buying traffic domains, I buy lots of great sounding generic names in many ccTLD´s that eventually don’t have any traffic and if I look at my recent deals these have been the best deals I made. If the buyer is in a specific branch and he wants a great name he will go for a generic name, even the name is not a keyword, its great to remember and sounds important, and depending on the niche, there will only be 3 or 4 names he can choose from.

Now this is what most Domainers are looking at: get a dictionary word domain in a big TLD. Now there are several ways to do this and I will discuss some of them here. One that I will not discuss is the one by spending lots of money and buy one, depending on the word, it might cost you anywhere from 5000 USD to 10 Million USD and in some cases even more. The other way is to look out for those words that will hit the dictionary soon or have just been added, there are many sites on the web that discuss suggestions for new words and the dictionaries give information on the words that they will include in their next edition, some of them can have a great future. This is generally refered to as Neology, words that are just forming but have not hit mainstream yet. There a couple of places where to look for them,a fun way to look for new words is Literature, preferably science fiction, other areas are science, politics, popular culture and corporate language, the earlier you are in, the better to chances to register them. Typical examples of such new words are: glocalisation (1980s), Republicrat(1985), Islamophobia (1991 and the WordPress spell check knows it allre ), affluenza (1997), Saddlebacking (2009), webinar (2000s), blog (late 90s), frisbee (1980s),  and snowclone (2004).

How to find them ? lots of sites on the web are discussing new words, most of them without any connection to the domain space. But you could easily come up with your own word, think of any phenomena that has to be described, a sickness, a state of mind, a technology (that will work fastest), a political strategy and invent a new word for it, preferably a noun. Register the word and all connected Domains and then go to work, make a blog, write articles, use it in conversations, on YouTube, just anywhere you can, maybe you are working in PR or sales, smuggle it in the documents of your clients, use it in Banner and text ads,  it might take some  time but if you work on it, you can make it into the dictionary and your Domains will become expensive.

This is a tough question, I asked this many domainers on the recent Traffic conference in Las Vegas and most of them did not think about it.  As a Fund manager of a Domain Fund, I need to carefully evaluate if this is a threat or not. Let me share my thoughts with you, first the bad news: lots of traffic will be coming from online devices in the future, no doubt about this. perhaps in some years more than land based traffic, lots of more apps will come and what i could not believe that even data intensive and complicated applications can be run easily in an app, google.analytics is one of them, forex trading another one and programmers improve every day on this task. Another bad news is that people who are connecting from the iPhone, nexus and blackberrys or the top-advertising targets and therefore lots of advertising will end up in apps. Another good thing about apps is that finally you can ask for money for all of these little services and you don’t need to cover expenses and development costs  with advertising.

Now what are the good news ? first, there are only 150.000 apps now and 280 mio. websites, so it’s a different job arranging apps. in a store (and already now there are many double names in apples app store), sooner or later there will be a system in place to arrange even more apps. Probably domainholders will claim their names from app. developers in the same way that trademark holders claim their intellectual property from domain owners. Next Browsertechnology might change completely allowing browsers act like apps by just surfing to a domain that detects the device and sends the software on the fly, especially with growing speed in mobile networks. The fact that Apple has finally made micropayement possible for app-based services might also mean that the time is ready to see if users are ready to pay for services on desktops as well. And one more thing that makes me bullish for Domains is that there is another revolution waiting for the desktop computer and that is 3D.

Marshallindex.com and the Domain Developers Fund agreed today to work together in the analysis of data for the funds purchases. Marshallindex.com is a webservice delivering realtime data on the popularity of specific topics, names and words in online and offline media. With the help of this data DDF is now able to determine the popularity of words in daily media which is delivering a different aspect then the usual search-driven view of keyword popularity.

When the fund bought the Biorust.com graphic design forum back in august 2009, our first plan was a complete redesign of the site, restructuring of the services as well as adding new services already avaiilable within the DDF-network of sites. Now the first step is done and Biorust has a new look, next we will introduce new services to the users. Starting next week we will offer competitions among users giving away 3 apple ipads for the best submissions to the site. (www.biorust.com)

One of the key arguments for the acquisition of costly domain names and a key factors adding value to them, is direct navigation. As already mentioned above, direct navigation denotes the act of entering the name of a specific product or service in the web address field rather than searching for it through a search engine, say, “weather,com” for weather news, or “jewelers.com” for jewel shopping. Direct navigation usually stands the test, and because of the generally good outcome on one side, and increasingly complicated results the user is forced to put up with when using search engines on the other, direct search traffic grew 36% annually from 2002 to 2006 (Goldmann Sachs) and keeps growing strongly today. Those of us who might not even have considered using direct navigation up till now, may as well become zealous direct navigators tomorrow.

Yet another important argument for buying domains: the domain market is an inefficient one, hence huge price differences might occur depending on wether a domain is subjected to an auction or rather a deal with an individual or group holding special interest in that particular name. The auction of a domain like trainings.com (a domain owned by DDF) will address a rather professional audience composed mainly of people from the domain industry; the price reached will probably reflect the current market situation as well as a name value commonly agreed upon by domains investors and traders. The same auction will very likely offer many other domains suitable as investment, and, providing the participators with a great variety of names to choose from, the sheer number of buying opportunities will probably prevent any one name from surpassing a certain prize level.
There is a chance however that a domain will attract companies which find that particular name perfectly descriptive and therefore highly valuable for their businesses, as might be the case with trainings.com and leading enterprises in the training industry. Such a domain will in the following sell for thrice, five or even ten times as much as it would in a regular auction. By way of such strategies but also benefiting from a growing number of professional investors moving in, median transaction prices rose 110% between 2005 and 2009, according to a study by Goldmann Sachs. And here is a list of some of the most prominent domain deals that have been closed not too long ago:
Fund.com $9,999,950
Toys.com $5,100,000
Candy.com $3,000,000
Fly.com $1,760,000
Auction.com $1,700,000
DataRecovery.com $1,659,000
Kredit.de $1,169,175
Cruises.co.uk $1,099,798
Invest.com $1,015,000
Webcam.com $1,020,000
SkiResorts.com $850,000
Printer.com $800,000
Server.com $770,000
iReport.com $750,000
Casino.de $625,060
Jobs.ca $600,000
Affiliate.com $579,900
Talk.com $500,000

One very common assumption people make when it comes to domain marketing is that the great names in the field are already taken and that the good ones still available are too expensive to acquire. This observation is false. First, there are still many great names to be registered, especially if one does not confine oneself  to “.com”- domains exclusively but also considers other TLDs, say that of India. With India’s English speaking population being the second largest in the world, the country’s fast growing markets are without doubt among the most promising ones, which is, of course, also true for the domain name market. Also, many great names can still be bought at reasonable rates and since prices don’t but reflect a momentary situation, one must, especially given the rate at which the internet is growing and advertising expenditure is rising, acknowledge that the future of domains is going to be a bright one. There are further aspects we must account for when analyzing the developmental opportunities of the market.

Take people’s power of imagination: Once in the past something that had never happened before and surely up to that point had been thought impossible by the greater part of people in the world, suddenly became reality: Someone paid one million dollars for a domain. A dam was broken, and soon, other transactions of that or an even bigger scale were to follow. The same will be true for a good many of TLDs that are yet hardly appreciated : nobody is likely to pay one million dollars for a Chinese domain today, but hardly anybody would have done so for a German domain in 2003 either; once a breakthrough is achieved, it is very likely to drag the whole market along. One more example: in domain marketing as in real estate, there are numerous ways of turning property into a source of capital. With experience and expertise, the right tools and the right people, one will certainly excel in the industry. A domain that generates 100USD a year might be sold for 500USD; with the right handling though the very same domain can be adapted to achieve a 1000 USD profit  by another owner. This is just one example illustrating what treasures are still to be found on the domain market.

The Domain Investor

Domain Developers Fund

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