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Domain Flipping: How to Domain

Updated on February 25, 2011

Domain Flipping

Flipping a domain may make you rich or simply drive you nuts. Many entrepreneurs have launched web sites and training programs purporting to teach aspiring speculators how to cash in on a perceived demand for specific domain names.

What is Domain Flipping?

Flipping is the process of purchasing something for the purpose of quickly reselling it at a higher price. Houses get flipped: ambitious real estate moguls snap up run-down properties, slather on a coat of paint, lay down sod, scare away the termites, and list the dwelling as For Sale By Owner. The entire process may take as little as a week or as long as 6 months.

Domains can also be flipped. Flipping real estate presents many more risks and typically requires more financial wherewithal than domain flipping. For that reason, domain flipping has sprung up as a cottage industry that can purportedly be executed from your parent's basement while dressed in pajamas. Since the entire transaction can be handled electronically, sellers and buyers do not need to actually 'meet' and 'talk'. Meeting and talking typify most business transactions throughout history, but current Internet trends indicate that some would-be entrepreneurs would prefer minimal amounts of human contact. We may elect to blame the school systems, but certainly more research is required.

Flip your domains for fun and profit.
Flip your domains for fun and profit.

Why is Domain Flipping Profitable?

Studious flippers observe and predict Internet trends in order to assign potential value to domains. Social, cultural, political, athletic, and entertainment trends tend to ebb and flow: a seemingly innocuous domain name may suddenly skyrocket in value based on a national news story or a quick mention on Wheel of Fortune. To that end, speculators expecting to profit from domain flipping attempt to identify short phrases, usually 3 words or less, that can be translated into domain names.

Registering these valuable names presents no problem and offers very little financial resistance. Domain name registration typically costs anywhere from $7 to 30 dollars per year. Precise costs are a function of the TLD (Top Level Domain) and the particular registrar offering the service. Everyone pays the same amount, unless the registration service of choice adds additional services or fees.

What is a TLD?

TLD is an acronym for Top Level Domain, which is the 2 or three letter abbreviation appended to the end of every domain name. By far, the most popular TLD is "com". The vast majority of Internet users will recall a domain name with a .com TLD as opposed to .org, .net, .ca, or any of the many tlds currently in use. Any domain with any TLD can be flipped: don't limit yourself to .com names. Keep in mind that a .ca (Canada) domain name may be more attractive to buyers in Canada but less interesting to potential customers in Australia. Every domain TLD is accessible from anywhere on the Internet (unless a particular government practices Internet censoring), but some TLDs are more memorable than others.

Why is Domain Flipping Profitable?

Imagine a world where no domain names have been registered. You, as a domain flipper, can select any name and any TLD, immediately register it, and immediately offer it for sale.

What domain names would you select?

Obviously, you'd favor short and simple names that reflect wildly popular words or phrases. Domain flipping is an exercise in the KISS process: Keep It Simple, Stupid. These domain names would have a very high chance of popping up in search engine results and a very high chance of being entered as search phrases in the major search engines. A valuable domain name needs both of these attributes.

For better or worse, the current market is not as welcoming. Virtually every obvious choice has already been registered. For example, should you want to register the domain name business.com, be prepared to pay well into 7 figures for the right to own the name. Someone already thought of it.

Are all the good domain names taken?

Given that business.com is already registered, we must get creative. Internet geniuses and semantic engineers understand that appending and prepending simple words to the desired domain name may provide some value. We may derive such potentially desirable names as:

  • MyBusiness.com,
  • BusinessOnline.com,
  • MyInternetBusiness.com, or
  • MyInternetBusinessOnline.com.

The list continues forever.

How do you get started?

Getting started is very simple. Risks are low.

  1. Identify an unregistered domain name that may have value.
  2. Register the domain name.
  3. Wait for offers to roll in.

Step 3 is certainly the most stressful, but given than your financial investment may be as little as 30 dollars, take a deep breath and go outside to work in th

How do you stimulate offers?

Registering a domain name is sufficient to get yourself started in the domain flipping business, but every good entrepreneur should be willing to work a little harder to get the word out. A simple but effective trick is to publish a single page web site on your domain. Advertise your willingness to flip the domain name and put up a few Google ads at the same time. If the domain name doesn't sell right away, you may make a few dollars from click-throughs.

How do you register a domain name?

Many domain flippers use GoDaddy.com as their registrar. Keep in mind that you are shopping for a registrar soley on price and ease of use. They are all selling the same thing. No registrar does anything differently than any of the others. All domain name registrations end up in the same Internet-wide database.

Hot Tip

If you plan to put up a web page, you will need a hosting service as well as a registrar. It is strongly recommended that you use the same company for both services. Certainly you can register with one company and host with another completely different company, but you may encounter some logistical problems that can be easily avoided by consolidating your accounts in one place. Your domain flipping effort should not be affected by your choice of companies for either service. Once flipped, the domain can be easily transferred to the new owner or left to percolate with the current registrar and/or hosting service.

Comments

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    • drbj profile image

      drbj and sherry 

      7 years ago from south Florida

      nicomp - thanks for the edification. I thought domains were the remains of dough left over when making holes in doughnuts.

    • Pearldiver profile image

      Rob Welsh 

      7 years ago from Tomorrow - In Words & NZ Time.

      Thanks for letting the cat out of the bag before I had flipped my first 1000 domains! Oh well, competition is good, drives up the prices and boosts stock values.. Good advice.. Thanks for creating new buying interest... Take Care. Up and up.

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