5 Mar2013

On the Performance of Premium Domain Names on Lean Domain Search

Posted by Matt Mazur (@mhmazur)

At the end of November 2012 I partnered with Sedo to include premium domain names in the Lean Domain Search search results.

Premium domain names — shown in orange below — have been displayed above the available search results so that you can consider them when making a decision on which domain name to buy for your website:

After three months of displaying premium domain names, here are the affiliate commission results:

To sum it up:

  • 751 people have clicked on one of the "Buy Now With Sedo" buttons.
  • Of those 751 visitors, 13 created a Sedo account indicating that they were serious about purchasing a premium domain name.
  • Of those 13 people who created an account, 0 completed a purchase.

Interestingly, I did get credit for two domain name transfers to the tune of €52 (about $68).

It's worth noting that I filtered the domain names I received via Sedo's search API to ensure that the quality of the domains was up to par. For example, if a user searched for "task" and the API returned taskhhh it wouldn't be displayed on Lean Domain Search because hhh is not one of the suffixes that it recognizes. Domains like taskblog and taskhub would have been displayed because blog and hub are recognized suffixes. My point is that the quality of the domain names was good but still there were no takers.

Why is this? It's an interesting question.

Given that people using Lean Domain Search are actively looking for a domain name you'd expect that at least some would like the premium domain names enough to buy one (after all, they are by definition supposed to be of higher quality than the available ones).

I have three theories:

1. The type of people who use an available domain name generator are not the type of people who want to pay for a premium domain name.

Lean Domain Search is extremely popular among the startup crowd. Maybe startup founders are more tech savvy and therefore more likely to use a domain name generator and therefore less likely to pay for a premium domain name. Or maybe they're more frugal because they're on a startup budget.

2. When displayed next to quality available domain names, the premium domain name prices don't look quite so good.

TaskTime is a good domain name, but is it really worth $15,000 more than a domain name like TaskStyle? If you're only comparing premium domain names it's easier to convince yourself that an expensive domain name is worth it. But when you have a choice between a $15,000 premium domain name and a $9.99 available one, it's less likely you're going to buy the premium one.

3. There simply wasn't a large enough sample size.

GoDaddy also partners with Sedo to display premium domain names in their search results:

And I've heard from several domain name investors that it does result in sales. But maybe the the reason they receive sales from GoDaddy and not Lean Domain Search is simply a matter of size. If Lean Domain Search gets 40,000 searches per month and GoDaddy gets 40,000 per day then obviously GoDaddy is going to generate more sales.

Because the premium domain names have not resulted in any sales and because it significantly slows down the search process (Lean Domain Search has to make two queries to Sedo's API for every search, one for domains that begin with your search term and one for domains that end with your search term), I've decided to remove premium domain names from Lean Domain Search result pages.

When the results are removed in a few days Lean Domain Search will be significantly faster for new queries to the point where I might even be able to Ajaxify the results down the road (where you see results as you type).

If you do feel strongly about this one way or the other — or if you have any thoughts on why the premium domain names aren't performing — I'd love to hear them in the comments below.

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