Can the New gTLD’s Have a Domino Collapse? You Betcha! I’ll Show you How. Part 2

Mornng Folks!!

Just a couple of weeks ago I made a post stating that a blog post was not complete without comments. I think my blog post yesterday about a possible collapse of the gTLD's illustrates exactly what I meant. The post and conversation grabbed the attention of Frank Schilling and others and I think we are having a very healthy conversation and debate in the comment section.

It is unfiltered and real and I think you will find it most interesting. I invite other gTLD folks to join the discussion. Believe me, we all want to know what you see and why. We want to get our heads around it in light of the history we have already seen and been part of and our wallets sometimes lighter because of it.

That's what this is all about folks. Respectful debate. A sale can not be made until ALL objections are addressed. So a tip of the hat to Frank for understanding that and not fearing it like so many others will make the mistake of doing.

Rick Schwartz

 



4 thoughts on “Can the New gTLD’s Have a Domino Collapse? You Betcha! I’ll Show you How. Part 2

  1. Jay

    i consider myself a “new domainer” , started last year, let some domains drop kept a few good ones and adding a few here and there. i hate the fact that there are going to be .this and .that added to this great industry. but the more i think about it the more i see they aren’t going to be a threat to “domaining” because dotcom is a major highway with great billboards seen by millions and .whatever is like a yard sign in the boondocks. thanks rick for giving a damn. you could easily stop giving your insight which is priceless and keep your success stories to yourself but to a guy like me who is listening , it matters. thanks again and have a great day. p.s. i watched a video of you saying yellow page categories were good to get so i bought Washaterias.com for $2.14 i am going to keep it for a long time and who knows it might be worth a pretty penny to someone someday.

    Reply
  2. Patrick Hipskind

    I think Frank made a great point, “If everybody and their uncle built sites in .hotels and .lawyer and people visited those sites and blogged about them then those namespaces would become more relevant in search engines.” It sure would be nice to have a crystal ball that tells me as a domain name investor what handful of extensions that may actually happen in within the next 5 years or so.

    You Rick made a great point and one that I see as a critical issue that must be decided upon by major stakeholders of a corporation. If a company has multiple websites, if it invests in domain names in different gTLDs and develops those names into websites – will that splinter the traffic, add to the marketing budget, and increase the overall cost of the workforce? And if it does, how will that impact the bottom line for the organization and its margins. If it improves the bottom line, as a CEO I would be all in for using multiple websites within numerous gTLDs.

    Reply
    1. Rick Schwartz

      Patrick,
      Correct. It depends whether it will contract their business or expand it.
      And that is the point of the post. What happens if the first few that are rolled out don’t do well or are marketed poorly or those that embrace them lose money?

      I think Frank’s expectations of 10-15 years is more relaistic than those that think it will be any quicker. I think those folks could be greatly disappointed and may not have the staying power needed.

      Reply
  3. David Eliason

    Interesting discussion.
    Here’s my take on it. Advertisers will drive their extensions home. They will open up the concept through constant bombardment of their .brand. This will be highly effective for Trademark names that represent brand identity.

    However, they are fighting for memory and attention space. Short brands and extremely well known medium brands will be highly favored for simple memory reasons.

    There will be attempts to concentrate areas like .lawyers, .hotels and so forth. These major keywords will succeed or fail depending on how successfully and aggressively they are able to get people to sign up for their services. The more successful will eventually aggregate a huge number of services under their umbrella and they will be forced to differentiate. Effectively, at the end of the day this will be similar in impact to services like G’s places for business. They will also be directly competing with search engines that have a strong interest in maintaining dominance in that sphere.

    The upshot of this is that ultimately many businesses will most likely do parallel advertising presence using conventional domain names or try and dominate the internal search, rankings, and positioning inside one of those keyword extensions. Alternately they will simply list there and continue to develop outside of that network. This will largely be a factor of the companies web presence and how successful they are at reaching prominence. If they have a difficult time being seen on .hotels, they certainly will concentrate on outside development.

    Different companies will make different choices, and the degree of that split and how well the keyword extensions handle internal diversity will determine the outcome. It is a reasonably safe bet that companies with high internet marketing budgets will succeed the best on these new extensions and tend to crowd out smaller competitors over time. Much as in the forest, the greater trees will gather most of the spotlight and upstarts will have a harder time competing for the spotlight.

    Implications of this.

    Smaller aggressive businesses will concentrate on the broader niche availabilities of general search, at least after time. They want to create their own brand identities and distinguish themselves from larger competitors.

    Aside from very large category domains and TM brand identity domains of large companies with huge multimedia budgets, the remaining prospective buyers will have to fight within an expanding, but nonetheless conventional namespace.

    The winners it the gtld expansions as it serves “regular” businesses will be those that have well constructed, widely applicable branding. The after the dot value will be entirely in branding. Frank’s example of outdoor.gardens is a great way to illustrate this. It makes sense as a brand. It is also just as accurate that .gardens is a very limited subset of global commercial application. Words that stand a good chance are things that make sense to the widest number of commercial entities. .Shop, .Store (not as good as .shop due to length but still very descriptive and perhaps controlled by a different entity), .Buy and names that are intrinsic to many searches are good candidates for success.

    Other candidates for success are some well chosen local character native language domains in their native script (idn type extensions), which will do well particularly in larger regional markets.

    That leaves the remaining subset, keyword domains with fairly limited scope.
    These will have the problem of having a very limited set of strong brandable strong keyword combos. Outside of the top tiers of these, the rest is garbage without some absolutely amazing promotional work for the extension (which will be harder as the big advertisers will tend to create their own namespace in addition to maintaining their .com basis)

    While there are unlimited domain extensions possible, the price point is going to limit the adoption of the weaker domains. If the keyword has limited utility as an extension and not so many good combos, they will tend to become dead extensions. Large businesses will get their global extension and Mid size businesses will probably push their own web presence.

    Many of the mediocre extensions will die on the vine, with maybe a handful of stellar examples of branding and a bunch of non-interest and a medium number of non-entity non-competitive sites. Those that aren’t spamming will move to whichever extensions emerge as the most widely adopted. This will further damage extensions that are relatively weak. The side effect here is that big companies advertising on their exclusive extensions and big media budgets will rapidly bring awareness to the possibility of using ANY domain space, that its not just a .com game anymore. This in itself will create a fair amount of dilution. Most of these players will be entry level companies trying to be edgy with their branding, many will fail due to lack of development budget, but the long term effect will be erosion.

    Despite this, companies will be forced to maintain a parallel .com space, and it will naturally retain some exclusivity. If you don’t have a damn good brand name (also requiring an affordable, non-exclusive, and likely to stay viable) extension its back to step one. Get a good keyword. Get authenticity. This authenticity will come from what is established (.com clearly fulfills that) and what becomes established (there will be a small number of winners, but most extensions just won’t cut it, I think).

    The really interesting factor here is that will be intriguing to watch is how the cctld market will be affected. This has a strong chance of being very positive in the larger and more economically robust regions.

    If dot.whatever gets a fast start and good foothold in the mass consciousness or they get spammed out in endless and increasingly cheap iterations by ICANN local extensions might make a serious resurgence due to the specificity of their markets.

    So anyhow. The upshot.

    1. DotComs of the premium variety will remain rare and valuable, extreme top tier names will be in direct competition with the matching broad generics extension. Just the same they should hold their own as they represent an opportunity to compete on almost even footing with their competitors en masse.
    Ultra premiums will see a resurgance of value.

    2. Medium-High grade .coms. These will have wind under their sails as they will still provide strong branding and differentiation. Their value will likely diminish somewhat, but com will retain some prestige value.

    3. low grade keyword niche .coms, these will have their uses but will suffer severe dilution effects as they are easily interchangeable with many of the new gtlds and higher tier names will be available in other extensions (which will have increased recognition if they have effective brand positioning value)

    4. Second wave extensions (current globals except .com) these will get hit hard. Better choices will be available and most companies have invested their premium development in .com or desire the .com. Many will likely see greener pastures. New companies will have a wide array of branding choices, they’ve had time to make their mark and had marginal success. These extensions will benefit strictly on the basis of their branding relevance and have to compete with the new globals for establishing second tier relevance. I do not really see good things for most of these extensions although they should have some short range trust advantages over the upstart domains simply as a search engine factor and minor name recognition.

    5. CCTLDs. That’s up to the search engines algos. Could fare very very well or extremely badly. Those with limited internal markets are probably not much good unless they have secondary meaning.

    6. IDNs. Country name extensions in native languages with premium keywords have very good potentials for local markets. These will supplant cctlds for many regions.

    Spaces which get developed aggressively will be those owned by Amazon and Google. They will do well. Undoubtedly Google will wholeheartedly endorse any extensions they have a vested interest in. Whatever is strong that they give out free and early will become a key namespace, particularly if its commercially oriented.

    Going to be a big shakeup, a few winners, a lot of losers and some very bright stars surrounded by nothingness (branding is very important, and most extensions will produce at least a few with high potentials.

    Ha, if you made it through that then you should at least have something to think about.

    Reply

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