When people first hear about domain investing, even experienced marketers, they often cringe…

• Some think it means buying trademark and typo terms to get “accidental” visitors looking for a different site. (It’s not.)

• Some believe domains have little monetary value, and are instead traded on intrinsic characteristics like “cuteness” or scarcity. (That’s only true with crappy domains. LOL!)

• And some are still convinced, despite reams of data to the contrary, that a domain name doesn’t matter, reckoning JiggyPop.org is just as good as Hotels.com, provided the site’s content is the same.

Balderdash, I tell you! Listen, at one time I thought those things too, but thankfully, I discovered a more startling truth, and that is…

The amazing power of words!

Words are not to be taken lightly in the domain business, they the basis of language and of communication within our society.

Discount, budget, wholesale, inexpensive, and cheap all mean essentially the same thing in the dictionary, but when they are placed in front of a word like cars, they mean different things to different people.

And when they are searched or typed in, the motivations can vary dramatically; do they want to buy a car, rent a car, look at prices, or simply look at pictures? Each type of action is very different, and thus, the value of a Web site visitor is largely determined by their intent.

Made up words may be cute, but they never have the power of real words, without a LOT of branding. For example, which domain name is most valuable on a strict valuation basis? (Experienced domainers will know the answer right away.)

a) Google.com

b) CellPhones.com

If you said Google.com, which is the obvious answer to a layman, you would in fact be wrong. Here’s why… Ignore Google.com the “brand” for a moment, and think of “google” as a keyword.

Repeat after me, when you own the domain name, you own the keyword!

That’s the main takeaway from today’s lesson… when you own the keyword domain, you permanently lock up the direct navigation for that term, for as long as you pay the $10 a year registration fee.

Back to our example… I have several domains like Google.com, all super fun-to-say and quite memorable, but with no real dictionary definition. None get more than a few visitors a month - accidental, random traffic, at best. And since “google” doesn’t historically mean anything, there’s almost no way to monetize a name like the without millions and millions of dollars worth of branding, and years of reputation building.

At best, a domain like Google.com - but with no existing name recognition - might earn a few dollars a year in click revenue and sell for a few thousand at auction to an interested end-user.

But what if you owned CellPhones.com? How many visitors would you get then, and what might they be looking for?

Welcome to the wonderful world of type-in traffic, also known as direct navigation. Based on established type-in click-through metrics for the domain industry, and my own personal experience, a domain like CellPhones.com probably gets between…

Read Part 2 of this article here.

Respectfully Submitted,

Smash Masterson