Is buying a .brand domain worth it? Nine questions to ask before you bid for .yourcompany

In three months Icann will accept applications for new top-level domains. Are you ready?
Written by Natasha Lomas, Contributor

In three months Icann will accept applications for new top-level domains. Are you ready?

At the start of next year, the internet's primary governing body, Icann, will be accepting applications for new top-level domains (TLDs).

From January next year, companies and organisations will be able to apply for their very own .brand name.

Domain names

Icann will accept applications for new gTLDs in 2012Photo: Widjaya Ivan

The expansion of TLDs will allow almost anything to become a domain - opening the door to .category domain names such as .car or .shop, as well as company-specific TLDs, such as .McDonalds or .NatWest.

Companies wanting to register for their own TLD have between 12 January and 12 April 2012 to apply with Icann.

With just a few months left before the generic TLD (gTLD) bidding process kicks off, what questions should businesses be asking now?

1. Do you really need to get your .brand?

You shelled out to get your .com or .co.uk some time ago and your customers are now familiar with where to find you online. Do you really want to stump up at least $185,000 - the initial application fee for a gTLD - to make your online presence a whole lot more complex?

Large corporates are less likely to have concerns about the fee - it's a drop in the ocean of their marketing budgets - but smaller companies will need to consider the ROI for getting hold of a .brand.

Supporters of the new TLDs argue that the potential SEO benefits of domain names such as laptop.hitachi - or best.laptop - will justify the expense of buying the gTLD.

However, search engines do not publicise their algorithms and like to keep moving the goalposts to avoid businesses manipulating them - so the hope of better SEO is a fickle mistress to bank on.

You should also weigh up the costs, not just in applying for and getting a gTLD - at least $185,000 per application, although rejected applications can expect a partial refund. Icann notes that applicants are also applying to "create and operate a registry business supporting the internet's domain name system", adding that this "involves a number of significant responsibilities".

The costs of maintaining and running that registry - or outsourcing those responsibilities to a suitable third party - also need to be factored into your thinking.

2. Can you get the .brand you want?

Does your brand name include numerals? Is your brand name two letters long? Bad luck HP, bad luck 3 - Icann isn't allowing TLDs shorter than three letters while numerals, hyphens and special characters are also a no-no.

If your brand falls foul of Icann's rules you're going to need to come up with an alternative .brand to bid for and that means factoring in all the considerations that fashioning any new brand entails.

Other issues preventing you from getting your chosen .brand could include other companies that share your brand name or have a very similar brand name also bidding for it.

Ask whether they are in a position to bid for your .brand and, if they do bid, who is likely to win? Icann has a series of rules governing how it will award the new TLDs in so-called 'contention' situations, so it's time to get familiar with the rules to try to work out your chances of winning any bidding wars.

There are other issues too. Country names are off-limits so if your brand name includes a country you're likely to be out of luck. Also, if your brand name is also a generic term - 'apple', say - you need to be aware that Icann's rules make it more likely you would lose out to a bid from an organisation wanting to set up an open community based around that term - apple growers, for example.

A theoretical scenario might run like this: the US Apple Association puts in a bid to set up .apple, hoping to establish a TLD for all US apple growers. There's an obvious conflict with Apple Inc but Icann's application evaluation rules would favour the community site, over the closed corporate site. That's not to say it's game over for Apple's .brand dreams - assuming they have any...

...such disputes can of course be settled outside the Icann process - by, say, paying other organisations not to bid for a coveted .brand.

Whatever the issues attached to your .brand, you should start evaluating them now.

3. Should you bid for your .brand or a .category? Or both?

Category gTLDs such as .laptop or .car are likely to have a lot of search cachet - being easily understood by consumers but also potentially SEO-friendly. Should you therefore be going after a relevant .category to draw in the biggest pool of punters? Or is having a .brand enough? A behemoth such as Coca Cola is unlikely to want .sugaredwater, but plenty of electronics makers would give their eye teeth for .laptop or .tablet. Which terms make the most sense for your business?

Of course, just because a term makes sense for your business doesn't mean you'll win it. Other businesses and organisations might well have their own business case for a generic .category. So, again, you need to get to know the ins and outs of Icann's evaluation procedures to ensure you have a decent chance of winning - and therefore ascertain whether it's worthwhile bidding. There's no point in bidding for a .category if you're almost certain not to win it.

4. What are your rivals planning to do?

If you're not convinced about the value of owning a particular .category or your own .brand, what about a scenario where one of your rivals owns that .category or creates their own .brand? What are the implications for your business? That scenario might make a defensive bid for a strategic .category, say, an imperative for your business - or at least an important consideration.

However, you're not going to have the luxury of knowing exactly who's bidding for what until after the bidding has closed. Bids will only be published by Icann after they have all been received so you're going to have to pre-emptively evaluate various possible scenarios and draw up strategies for each. So far only a handful of companies have announced they intend to bid for a gTLD - including Canon, Deloitte and Hitachi.

5. Should you bid for .names of your flagship products or services?

Flagship products can be sub-brands in their own right - a company such as Apple could bid for .iphone and .ipad, for instance - so businesses need to consider which of their products or services might merit having a stand-alone .name and which of those stand-alone .names would offer a significant benefit for their business in owning and controlling.

Of course, owning the .name of every product or service you produce is unlikely to be practical - or desirable - unless you make a handful of very well known products or services. Too many .names could get unwieldy to manage and potentially confusing for your customers. Plus you need to consider cost - Icann's basic fee of $185,000 is per application so that might concentrate your thinking on how many applications you can realistically file.

Another limiting factor is the number of gTLDs that can be delegated per year - currently set at 1,000 by Icann.

There is likely to be a second round of bidding for another 1,000 gTLDs after the 2012 round, but when exactly that would take place is unclear.

Digital consultancy Melbourne IT, which advises companies on the gTLD process, believes a second round will not take place before 2015 - so for the foreseeable future there appears to be only a limited window of opportunity to put together gTLD bids.

6. How will you educate consumers about your new .brand identity and avoid confusion?

Shelling out for and maintaining a .brand is all very well but you need to be thinking about what happens after that too. How will you get the message across about your new online home? In other words, will you need to market it? Marketing a .brand may be something that can just be added into existing marketing budgets but it's another factor to consider.

Another possible issue is customer confusion. The new TLD system is a change to the existing web order and has the potential to disrupt how people think about navigating the web. Advocates suggest it will ultimately...

...improve web navigation - making it simpler and more intuitive to find what people are looking for. But in the short term, it's going to increase the complexity of the web world and that might mean you're saddled with a customer services overhead.

7. What happens to your existing website?

Applying for and getting a .brand name might seem like an end in itself but it's likely to be the start of a lot more work.

Web domain

You'll need to consider how your .brand site will exist alongside your .com site and what it will offerImage: Shutterstock

Your .com site will probably carry on alongside your .brand site but you need to consider what your .brand site will offer - and how it's going to be structured.

The new TLDs allow for an essentially infinite number of sub-domains to sit alongside them. For example, an eatery could create menu.cafe, openingtimes.cafe, offers.cafe, contactus.cafe and so on.

This opens up the possibility of creating a new web structure - based around a series of .brand pages that consumers frequently search for, rather than the traditional model of a homepage which the user navigates to, clicks around and performs searches to find what they're looking for.

How that might change web design remains to be seen.

8. Should you object to a rival's .application? Or apply to keep a .name from being registered by a rival?

Icann allows formal objections to be made for four reasons:

  1. The applied-for .name is "confusingly similar" to an existing TLD or a new TLD applied for in the same round of applications.
  2. The applied-for TLD infringes the existing legal rights of the objector.
  3. On public interest grounds - such as the .name is contrary to "generally accepted legal norms of morality and public order".
  4. There is substantial opposition from a significant portion of a community strongly associated with the applied for .name - apple growers with the word 'apple', say.

Objections must be filed during the formal objections filing period but it pays to consider objections ahead of time. If it's feasible to make an objection to a specific .word, that might help shape your thinking about whether to bid for that .word yourself.

You should also be aware that Icann is not planning to notify companies of potential trademark infringements - rather the onus is on companies to check the list of gTLDs once it is published and then raise any objections via Icann's formal procedure.

If you're hoping to apply for a .name to reserve it or prevent a rival from getting hold of it, you're out of luck. Icann stipulates it expects all gTLDs to be operational and "delegated" within one year of a registry agreement being signed, and it does not accept reservations or pre-registrations.

9. When will your shiny new .brand actually work?

New .names could be up and running by the start of 2013 but there is no timeframe for exactly when the gTLDs will be up and running.

In its gTLD application guidebook, Icann notes that just because you get your shiny new .brand name, there's no guarantee it will "immediately function throughout the internet". Icann warns it's likely network operators will not immediately support new TLDs, and goes on to add: "Successful applicants may find themselves expending considerable efforts working with providers to achieve acceptance of their new top-level domain" - so it's caveat emptor.

Also, that marketing blitz you were planning to tell all your customers about your shiny new .brand? It probably needs to wait until you can be sure all your customers are able to access that .brand.

Editorial standards