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Business in the Age of the New gTLDs

Posted in Domain Names, Guest Bloggers, Search Engines, Technology

– Mark Skoultchi, Catchword Brand Name Development

As you may have heard, the Internet is undergoing a growth spurt of unprecedented proportions. Over 1000 new global top level domains (gTLDs) are in the midst of launching, so in addition to familiar extensions like .com, .org, and .net, expect to start seeing .nyc, .company, .nike, and .golf. And, of course, about 1000 more.

A gTLD Crash Course: Crash now, don’t crash later.

Anyone can apply for a website at a new gTLD, except the branded ones like .nike or .sony. But, buyer beware, the individuals or companies who own the gTLDs can charge however much they want for domains employing their extensions. For example, registering www.xyz.luxury will cost you $600/year, though inversely www.luxury.xyz will cost you under $10/year.

The new extensions all have a “sunrise” period, during which owners of existing trademarks can pre-register domains corresponding to their trademarks before the general public. This is to prevent somebody from getting to Spam.food before Hormel does, for example.

Following the sunrise period is the pre-registration period. This is a length of time before the gTLDs go live when there are no restrictions on who can apply for a domain. If there are multiple applicants for the same domain, some gTLD owners have promised to give it to the first applicant, while others will let them bid against each other in an auction. Though the start and end dates for the sunrise and pre-registration periods are different for all the gTLDs, many registrars allow you to create customized watch-lists for your gTLDs of interest.

How will people react to 1000 new gTLDs?

Though only time will tell, the Internet’s growing pains should be minimal. The new gTLDs will be as searchable as any other website is now, and because Google itself has applied for over 100 new gTLDs there’s a good chance the search giant will be tweaking its algorithms to account for the new extensions. Furthermore, internet users are already growing accustomed to .com alternatives. In recent years we’ve seen an increase in usage of country top level domains like .co, .ly, and .me (not to mention .net and .biz). Though it won’t happen overnight, consumers will similarly come to accept the most used new gTLDs as well.

The other indication that many of these gTLDs will attract significant usage is that, quite simply, the internet is getting more and more crowded. Barring an apocalypse, internet usage worldwide will increase dramatically in the coming decades, and businesses and individuals will be forced to turn to the new gTLDs for their own slice of the web.

Inevitably, though, not all new gTLDs will succeed. Shorter extensions that have clearly implied communities or industries will see the highest demand, like .health, .law, .and .book, but vaguer extensions lacking robust communities or user groups might fall by the wayside—extensions like .gripe, .blue, and .boo. Furthermore, there are many extensions that overlap with each other. With the release of .pics, .photo, .photos, and .photography, it is likely that one or two of these will become the default and the others will fade away. Same with .dating and .singles, .fish and .fishing…you get the idea.

The BIG companies and their gTLDs

Some companies with new gTLDs surely have grander plans for them than just selling domains to interested buyers. To enhance internet book sales, Amazon might allow authors who sell through them to build out websites for their books at a .book address, where customers could go to read interviews, find book tour dates, watch book trailers, and of course, buy books. Nike, on the other hand, might build out sites like soccer.nike or Jordans.nike to give shoppers direct access to products or brands. It’s even possible that Nike could give loyal customers personalized .nike sites where they could shop, customize clothing, build out their wardrobe, and share pictures of them dunking, etc. And what will Google do with their myriad of new extensions? Of course, only time will tell.

Using a .com domain vs. a new gTLD

The question for technology managers, entrepreneurs, and new businesses is this: When launching a web presence, should you choose a .com domain or a new gTLD? Well, as you might expect, the answer is complicated, so let’s go through a few scenarios.

Small businesses

You’re starting a small business—a salon, a garage, or, for the purpose of this example, a café. (And because all good stories need details, your name is Joe.) You do some research and find that your choices for a domain are JoesCafeNYC.com, JoesCafe.nyc or JoesNYC.cafe. Which should you choose?

First of all, you can never go wrong with a .com domain, assuming it’s not too long or cumbersome. These three options are fine in that regard, and in fact JoesCafeNYC.com isn’t really any longer than JoesCafe.nyc because “.com” is the default and therefore implied (much like the .00 in “small coffee, $2” that will surely be on the chalkboard). Everyone is comfortable with the .com extension, so if you find a decent .com address, there’s no downside to using it, and you won’t have to worry about any confusion arising from the launch of the new gTLDs.

That being said, the benefit to URLs like JoesCafe.nyc and JoesNYC.cafe is that they are more targeted and personalized than the .com since they are specific to a region or industry, respectively. And, this can be a good thing. For example, a .nyc extension suggests a site for the Joe’s café in NYC (and not the one in Vegas or London). But by the same token, if you plan to expand to other cities or into other fields, using a new gTLD might be restrictive. If your café becomes a bar or if you expand beyond New York City, you’ll have to switch URLs and re-educate your customers.

Conclusion: For small businesses, the risks of adopting a new gTLD are lower. Register the .com if you can, but go with a gTLD if it’s much more elegant or logical and your expansion plans are limited.

Tech companies/start-ups

On the other hand, say you are a food start-up called Gobblin that does a lot of business online. You could buy Gobblin.com for $8,000 dollars, or you could register Gobblin.food for $35. Which should you choose?

Because exact .com domains are the gold standard and the norm, Gobblin.com feels high-end and much more established than Gobblin.food. For names that wouldn’t sound prestigious or large-scale either way—take Joe’s options for his café—it matters less, but if you need your brand to evince trust and prestige, a bona fide .com domain is key. Having a .com domain is like having a storefront on Main St. downtown rather than a side street or dead end—forking over the extra dough for a good location is well worth it.

Furthermore, if you don’t use a .com, you have to deal with educating your customers as to which of the 1000+ gTLDs you are using. A tricky task, considering there will likely be many logical options. Would Gobblin best be served by .food? Or for that matter, .kitchen or .eat? And if you are an e-commerce company or attract new business online, the need for a memorable URL is paramount. Website memorability is crucial to retain customers, and any googling your customers do to find you can lead to distractions or ads for other places to buy whatever you are selling.

Conclusion: If you are an e-commerce company or any other business looking to come across as successful and prestigious, adopting a new gTLD is risky—the .com domain is still king!

Established companies

If you are an established company looking to rebrand, it may be tempting to pursue a new gTLD—after all, in crowded industries it’s hard to come up with a name that is both available as a trademark and as a .com domain. However, established companies absolutely need the .com TLD. The .com connotes trust and importance, and moving to a gTLD would be a step in the wrong direction for an already successful company. You will confuse customers who will already be adapting to the rebranding and lose traffic from customers used to finding your website at a .com address.

Finally, if you are a business with a .com domain and no intention of changing, should you register some new gTLDs just in case? Well, it’s a judgment call. Here at Catchword, we’ve applied for catchword.agency, naming.agency, and a few others. Who knows, maybe in a decade or two when the whole world is online, the .com extension might not be the default and it will be good to have those domains in our back pocket. We wouldn’t go crazy and get naming.plumbing, but it can’t hurt to invest in the strongest gTLD options related to your business.

Conclusion: Established companies must have the .com, and should probably register and hold relevant gTLDs.

To summarize, the Internet is changing in a very fundamental way. Though not all the gTLDs will survive, the existence of the new extensions means that all business owners need to understand and consider them as a business asset. The appropriateness of a new gTLD for your company will depend on many things, including the nature, size and age of your business, as well as your plans for growth, both geographically and in terms of your business focus. A small, mom and pop shop with a limited geographic range might be perfectly well served by a local gTLD such as .nyc, while a large, established, multinational company looking to rebrand probably needs the credibility and cache conveyed by a .com. But whatever your situation, brace yourself—you’re about to enter a new age of the Internet.