Domain Name Flipping & Investing: Revenue Opportunities for 2013

by Jamie Simmerman · 10 comments

Domain names

Is there money in online business? Some say no. But a recent Business Insider article listed the top-selling domain name sales for 2012, with heading the list at an impressive $2,450,000. Second place went to at a cool million dollars. Apparently, the world of online personal finance management is booming, even in a down economy.

Some of the most expensive domain name sales of all time are:

  • for $1,500,000
  • for $1,500,000
  • for $1,500,000
  • for $1,525,000
  • for $1,750,000
  • for $2,100,000
  • for $3,000,000
  • for $3,000,000
  • for $4,900,000
  • for $5,100,000
  • for $7,000,000
  • for $9,500,000
  • for $13,000,000

From this list, one could gather that vices, and the financial services used to fund them, are very lucrative in the online world. Online shopping for toys, clothes, food, and sweets, and entertainment, such as computer equipment, gambling, and pornography are all high on this list. These industries generate so much revenue that they warrant astronomical price tags — just for their domain names.

Lower-market domain name trading can also turn a profit, even if you’re not an Internet guru. Clients have told me about their experiences purchasing a domain name, putting up a website, and selling the domain name in a year’s time with a 50-100% profit. While I personally haven’t tried domain flipping, it seems fairly straightforward: buy and hold a domain until it increases in value.

Some people choose to invest in the quality of a domain name by improving the SEO and marketing for that domain during their ownership, but this isn’t always necessary. In some cases, if you happen upon a domain name or a variant of a popular domain name that’s available, you can snatch it up for cheap and hold it until someone comes looking for it with cash in hand.

Many companies will purchase variants or common misspellings of their business domain name to gain the traffic that these domains could potentially direct to a competitor’s website. Others purchase multiple domain names for the same business in order to create a funnel that directs a large amount of visitors to a particular website.

This means more businesses are looking for ways to capitalize on domain names. If you happen to own a domain name that’s pulling traffic away from a business, that business may offer to buy the domain from you just to stop clients from looking for products and services elsewhere.

These days, the Internet is the go-to source for nearly everything from comparison shopping and product reviews, to dating and social interaction. With no slow-down in sight, it seems like online business is a wise investment for the smart entrepreneur.

What do you think of domain name flipping and investing as a source of income? Have you tried it, and if so, how did it go for you?

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{ read the comments below or add one }

  • TrueHusk says:

    I can’t remember a big domain name sale that occurred in 2007; being an Internet newbie, I thought this is a good get-rich-quick-scheme. The next step I took was find my dictionary and started looking for some new meaningful words to put together to birth a new premium domain, but to my surprise, all these names I was coming up with had already been taken. I was furious and very sad. That was how I ended my domain flipping career. I think it will be definitely worth it, mentioning this misconception too. What do you think?

  • ADO says:

    i really want to be successful in domaining but i don’t know how and where to start from, can i have somebody to guide me through?

  • Chandan@AdSense Expert says:

    Though I am quite successful with Google AdSense, domain flipping didn’t really work for me. But yes, domain flipping is a lucrative money making model for lot of marketers. Lot of good names are still unregistered which can be taken advantage of.

  • Simon de says:

    “ for $1,500,00”
    It should be $1,500,000 isn’t it ?
    Very impressive indeed…

  • Marbella says:

    You can always find great domain names that are available by using the long tail method and searching on Google Keyword Tool.

  • Emerging Technologies says:

    I’ve seen the real estate opportunities in domaining a few years back – a little too late to grab any substantial names for cheap….
    … However, I still figured out HOW to get involved with this industry on the cheap…. “Future Trend Domain Names”

    Knowing I couldn’t afford to pay the thousands of dollars a good domain name in the present market could fetch, I figured I would hand register and track domain drops of industries that were about five years out… Industries like Holographics, Telematics, Telepresence, Haptics and a few others.

    My research showed me that these markets were not a matter of ‘IF’ – but, ‘WHEN’.

    I have spent a nice amount of years studying, researching and pursuing these niches… and today?… Well, I can boast one of the top holographic domain portfolios anywhere in the world while some of the other sectors I have followed are maturing quite nicely.

    I now get inquiries on domain names a couple of times per week … Have sold a few but the others are mostly low offers – most likely from other domaines that are only just now discovering these trends.

    I have developed a few websites that are beginning to also generate nice income as well… For those wondering, parking is dead – my preferred method of revenue is lead generation… Data is one of the most valuable things in the world right now.

    I have finally made more money then originally spent, with a few hundred names already registered for multiple years out so the cost of renewals is also already taken care of for many of my names…. Everything that comes in now is all profit and judging by the inquiries, the maturity of these niches and the overall frequency of the terms being used all headed way up, this is looking like it is going to be a life changing decision that i made years back.

    The worlds largest means of research is staring at u right now – there’s millions of dollars just waiting to be made EVERY day…. U just need to lift some rocks to find it… No one said making money was going to be easy… But no one also said that u cant.

    Best of luck to u all.

  • Mike @ financialmemos says:

    There is of course money that can be made online. The costs are lower and the target groups wider. But it’s not easy money! People think that you can become rich in year and then relax for the rest of your life. That’s of course not true.

    On a serious note, domain flipping is a big business but I always had the impression that it lacks transparency. We don’t know who owns these domains. Let’s say for example that a TLD would become available today. I think that thousands of domains are registered before the TLD becomes available to the public from the registrars themselves.

  • Cherleen @ My Personal Finance Journey says:

    I believe that there is money on online business; otherwise, businessmen will not invest on websites and online marketing. I would like to try domain name flipping but I prefer to build my own website from scratch. I know it will take a lot of work and most of my time but I am enjoying it.

  • artesanatos says:

    Domain flipping can really be a very profitable business but nowadays it is just like finding a needle in a barn. There are professionals hunting everyday for those opportunities and big domain providers as soon a good deal is released they immediately register and resell it on auction for a very high price. I think the only way is start to realize that other domain extensions like .org, .net and .info can be good deals to have it in the future!

  • Anne says:

    My friend in San Francisco realized the potential of domain flipping years ago and has become a millionaire. I never thought much about it but I wish I had now. With a bit of creativity, it can still make decent money.

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