How to Do Cost and Benefit Analysis of Domain Investments

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Are you planning to venture into domain investments? Have you been confused as to what cost is involved in keeping your domain name business intact? Here are my few tips that will assist you to make profits when buying and selling domain names.

Domain Name Registration Cost

For one year rental period, you will always pay $10 or less when you want to register a brand new domain. The cost of registration depends on which registrar you are using, whether a registrar is doing promotion thereby offering discount, whether there is coupon code that you can use as a registrant to reduce the usual cost and so forth.

For example, if you register ten (10) domain names on the same day for $9.25 each, it means you will pay $92.50 now and $92.50 for renewal fee in a year’s time to keep your portfolio running. However, you may get bulk registration discount on that anyway.

Meanwhile, your cost of acquisition will increase to $30 or more for each successful acquisition from drop services if you are following the route of grabbing expired domain names. As you can see, buying junk bestdomainportfolio is not the way to go because it will quickly add up to a hefty sum when the time of renewal comes.

Building Website and Web Hosting

Except you are lucky to register type-in traffic domain, you will need to build a website with quality content and then drive traffic to it in order to increase the commercial value of the site. Building a professional looking website will cost you about $100 when you go to popular web design forums.

Also, taking out web hosting package will cost you about $5 a month, i.e. $60 in a year to keep your site visible online.

What about writing quality articles which you will upload to your blog or website? You will part with $5 per article in outsourcing if you expect high quality content. That will translate to $150 for 30 unique articles you outsource.

Remember too that listing your virtual real estate at auctions will cost you more in terms of listing fee, success fee, escrow fee, etc.

Profit Calculation

From the above analysis, it is not actually cheap flipping domain names considering the cut-throat competition you will face when trying to sell off. Again your website has to be professionally built with brand-able premium name and good content to guarantee quick cash sale.

Otherwise, you will be amused how much bidders will offer you to buy your web property. I have seen bids as low as $10-$30 per fully functional website. That is a potential loss if you ask me considering registration cost, cost of building site and content, web hosting fee and the time spent to ensure everything run smoothly.

The big question you should be asking me is whether or not there is real money to be made in flipping domain names and/or websites? In one word, YES! Definitely! If you understand how domain name business works and with as little as $10 you can start your domain investments profitably.

 

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