An Introduction To Investing In .co.uk Domains

By on May 9, 2011

This is a guest post by longtime domain investor Gary Taylor.

The .co.uk domain name aftermarket is extremely active. In Q4 2010, .co.uk had a higher average sales price than both the .net and .org extensions, quadrupling in value from just $523 in Q1 of 2010 to $2,030 by the end of the year.

The extension is maintaining strength in 2011, currently holding three of the top ten ccTLD positions on the year to date domain sales charts on DNJournal.

If you are new to the UK domain name market here’s a little bit of background about the .co.uk extension and how you can get in on the action.

Nominet UK is the .uk domain name registry in the United Kingdom. It was founded by Dr Willie Black and five others in 1996. There are around 9 million registered .co.uk domain names to date. Nominet publishes a comprehensive annual domain industry report which was featured on DotSauce last year. You can view the 2010 Nominet Annual Report here. (PDF)

How To Invest In .co.uk

There are a number of ways you can get into the .co.uk market and successfully make money. Which way you do it depends on your preferences as an investor. Here are some routes your can explore and some resources to help you along the way.

Hand Registration

The simplest form of domain name investing is registering a domain name from a UK registrar such as DomainMonster.com or 123-Reg.co.uk. Here are some key indicators to help you choose a quality name, which you are likely to be able to resell for a decent amount or develop into something which earns you revenue.

Check Google’s Keyword Estimator on Local UK Exact setting to determine how many searches there are for that term each month. Anything over 4,400 and you are on to a winner. Another good indicator is CPC value. Make sure you will be earning more than £1 per click at a bear minimum; any thing less than that and you’ll be left with diddlysquat by the time Google takes their cut.

DomainPrices.co.uk is one of the longest running databases of .co.uk domain names sales and is good for market research. Pay no attention to the likes of Estibot or any other appraisal tools, they are highly inaccurate more often than not. There are still some great .coms which can be hand registered and with six times the amount of .coms in the world than .co.uk domains, there is plenty of opportunity to go at in the UK market.

Aftermarket

There are some UK specific auction sites where sales tend to be much faster for selling and achieving better prices than major marketplaces like Sedo.

AcornDomains.co.uk is the de facto UK domain name forum and a huge resource of information for new and experienced domain name investors.

DomainLore.co.uk is a simple but effective auction site to buy and sell domains quickly and easily. There are many opportunities on these sites too for finding undervalued domain names that portfolio owners are looking to get rid of to fund other purchases.

I would recommend registering on both websites. Bargains can be found and a savvy investor can make a good profit buying at the right price and flipping the domains. A recent example of this would be the sale of TVS.co.uk which the previous owner bought for $1,500 in 2007 and sold last year for $75,000.

Drop Catching

Drop catching is the art of querying the Nominet Whois database lots of times just as a domain name is about to expire in the hope that you are first to “catch” it as its suspended indicator turns back to available. Drop catching is quite a bit different in the UK compared to the US in the fact that pretty much anyone can register as a member of Nominet for a small annual fee and directly query their database to catch domains whereas ICANN accreditation is significantly more difficult.

Drop catching directly through Nominet requires the domainer to have a script written in pretty much whatever programming language you are comfortable with, which can not just query the Nominet database, but input selected domains to scan during a 24 period and then if one becomes available, send a request to register the domain name.

If you are not confident going through the whole process of becoming a member of Nominet, having a script written and monitoring it yourself, then you can simply back order .co.uk domain through many of the UK registrars for a small fee and save yourself the hassle. Just this weekend I caught Cartagena.co.uk, a Spanish and Columbian holiday resort which I intend to sell straight away.

Domain Development

Be a category killer i.e. WeddingPlanner.co.uk

The .co.uk is also a great market for domain development. Finding your own niche is crucial for this and a savvy investor will have a selection of category killer domain names that they are developing either for long term revenue or for a quick sale once traffic and rankings in the search engines have been achieved. When I say “category killer” I mean market-leading domain names, ones that are generic and can “own” a niche.

I have been collecting dog breed domain names over the last 6 months and own a good selection which I am currently developing to drive traffic to a larger dog insurance website once I have finished building it. One of the sites, Rottweilers.co.uk, now gets over 5,000 visitors per month and the way it is built can now easily be rolled out across the other dog breed domain names I have.

Once you have control of your niche in the UK the returns can by rewarding. A significant example of this was MoneySupermarket.com’s purchase of nine UK financial services domains for an initial £4.6m.

I cannot stress enough that having a strategy for your domain name purchases is important. If your business strategy to develop .co.uk domain names, rather than trade them on the aftermarket, then a great tip is to check out places where you can buy existing websites on a good domain name. There are many UK businesses which are going out of business due to the financial climate and a good domain investor can take advantage of this and snap up an aged domain with good authority and existing content for a relatively small investment.

There is no denying that .co.uk is a great domain extension to invest in. Whichever method you choose to become involved with there is certainly still a large amount of opportunity within the UK domain name market.

[Header image by Flickr user Trey Ratcliff.]

What do you think about .co.uk domain names? Please leave a comment below and consider sharing this introduction to investing in .co.uk.

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About Gary Taylor

Gary is an avid domainer who has been active since 2002 and has been a guest speaker at conferences including ThinkVisibility. His blog at 3ac.co.uk is dedicated to domain names and online marketing. Gary is also the Director of One Result Ltd., a leading West Midlands web and mobile solutions company that specializes in iPhone and iPad app development, website development and online marketing.