Next Steps for End User Domain Name Registrations
In light of the above, it should now be clear that while many Internet domain names don’t accrue this kind of value, some do, or perhaps could. So, for the corporate client who’s looking to gain some defensive or offensive advantage, what steps should be taken when searching for a deo domain name?
First, monitor trends in your industries and stay on top of them. Plan in advance for contingencies. Set up internal protocols regarding domain name registrations, and establish procedures that go “outside” standard circumstances in order to move quickly when necessary.
Also, learn more about acquiring domain names. Learn about online domain name sales outlets and domain registrars: how they work, and what’s needed to get a domain in each system. Some companies that register domain names also assist sellers in selling and buyers in buying them. Some of these registrars have “brokers” available, like a real estate broker, to help interested parties locate and obtain names.
In addition, in recent years, live domain name auctions have been put together to help facilitate transactions in a “face-to-face” environment (though some of these events also now allow “cyber-bidding”). There are several online auction platforms where domain names are sold through a limited-schedule auction. Finally, some buyers and sellers contact each other directly to initiate discussion about a transaction.
If ConAgra had not procured the peanutbutterrecall.com name in an initial registration, even if the domain name were available in the “aftermarket,” (which it may not have been), the selling price would likely have been much higher than the registration fee ConAgra paid, and the acquisition process would have been more complicated.
Expert Domain Name Commentary and Discussion
As you can see, when considering the scope of a recall or other very public scenario, including new product launches, etc., the magnitude of the situation can quickly outpace conventional discussions of domain name earnings and monetization opportunities. Having explored the facts of the voluntary peanut butter recall, we now wish to discuss more broadly the deeper value issues.
It is easy to make the case that ConAgra was wise to have registered this domain name for the cost of a basic domain registration for their registrar. But what if this domain had been on the aftermarket? What kind of price would have been found to be “acceptable” to a company who perceived the deeper values associated with the domain name and would have still allowed the decision to be called a wise one?
As for a domain owner who may have had this name in his or her portfolio, what selling price would have been put forward, and how would the owner have arrived at such a price? At what price would the owner have been accused of selling out “too cheaply?” Again, it is beyond the scope of this article to answer specific value questions, but they should be asked.
However, in order to develop some depth of perspective on the matter, Penguin SES contacted a few Internet experts, including Brian A. Hall, attorney with Traverse Legal; Bill Hartzer, Search Engine Marketing Manager with Vizion Interactive; and Mark Stedelbauer, an ebusiness professional, to get their input concerning ConAgra’s domain name registration.
We also interviewed noted author and Wall Street Journal reporter David Kesmodel. Kesmodel was not able to comment directly on the specifics of the ConAgra situation because of potential conflicts of interest. He did, however, share general domain industry insights.
Domain Name Registration and Value
Brian Hall pointed out that, “the domain name market is a first-come-first-served market. Unless we are dealing with a case of cybersquatting,” he said, “the registration and use, or nonuse for that matter, is entirely within the purview of the domain registrant. That said, it is entirely possible that ConAgra made a strategic decision and procured this defensive registration in order to avoid bad press.”
Bill Hartzer said he thinks that overall, the domain name registration was a good move on ConAgra’s part, but he gives the company more benefit of the doubt when it comes to the issue of redirection. “I think it was a good idea for them to register that domain name. Not only was it a good decision, I suggest that other companies in a similar situation (e.g., a company that would be potentially subject to a recall at some point) should register domain names as a strategic offensive move,” Hartzer said.
Hartzer stated that companies have to be in a competitive mode when it comes to staying ahead of the curve. “As we can see, there were others who were looking to purchase similar domain names. There are other types of domains that a company should own, which includes domain names like companynamesucks.com and companynamestinks.com, and so forth. These are good public relations and reputation management moves for companies.” Hartzer added that when it came to redirecting the URL, “…most likely it was just the failure of the company’s IT department to redirect it. I wouldn’t look too much more into that. Certainly it would have been a good move to redirect that domain name with a 301 Permanent Redirect to the section of their site that talks about recalls.”
From an archival and historical perspective, Hartzer pointed out that there are benefits of using the redirect method as compared to developing a separate site. “As for actually using the domain name, I would have recommended that it only be used as a redirect and content not be put up on the domain name. This way, for SEO value and other reputation management purposes the links from media and other references would go to the company’s web site and not that domain name.”
Stedelbauer, on the other hand, saw the registration and non-use as more intentional. “It would be my conclusion that ConAgra registered the domain as a defensive measure to ensure know one else could use the domain against ConAgra. While no one would criticize the rights of a company to offensively and defensively protect itself and its interests, the question becomes - when is it ok to pull such defensive maneuvers as this, and when, if ever, is it not ok?”
On the topic of defensive and offensive registrations of generic domain names, David Kesmodel shared that this practice has been around for quite some time, and that can sometimes be hard to tell who’s playing defense and who’s playing offence. One example that Kesmodel cited are the “sucks sites.” He said that companies got wise about people registering “xyzcorpsucks.com” in order to use such names with negative comments about the company involved. “So, some companies have gone out and registered a lot of negative terms around their products that relate to their product or their business.” Kesmodel said that it is even common practice for presidential contenders to initiate this kind of defensive registration.
He added, however, that, “…often it’s not clear if the registration is defensive or not. One example, was in the mid ‘90s. Proctor and Gamble, the multinational consumer products giant acquired hundreds of names that other people may have gotten…. The reason for getting those was to gain a market advantage, but it’s not clear that they were worried about it from a defensive perspective,” Kesmodel noted that P&G’s position appeared to be more offensive.
Kesmodel said that in general recall situation there are advantages to having a related recall domain name. “It’s a way of controlling the message that the particular company wants to make. If you’re a company that is having to recall products you sold to consumers, getting a name like that -- well, for one thing, it could be a way to get people to go to your site … and get the info they need to make the recall work effectively,” he said. “So, if you’re a company that’s had a recall, and consumers are confused… it might be easier for your company to have a dedicated Web site for that, and maybe link to that Web site from your own, main corporate Web site,” he said.
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