Tuesday, September 9, 2008

Category Killer, Category-defining, Generic, and Premium Domains.

This is my opinion and is based upon my experience and expectations when dealing in domain names. I would like you to share your feelings on the subject.

I see the term Category Killer and/or Category-defining used frequently and I am not sure everybody gets it or is on the same page. The same can be said about using the term “generic” to describe a domain name. Furthermore, just how big is the scale when determining a domain name to be “premium?” Here is what I feel…

In general terms and defined in Wikipedia: Category killer is a term used in marketing and strategic management to describe a product, service, brand, or company that has such a distinct sustainable competitive advantage that competing firms find it almost impossible to operate profitably in that industry. The existence of a category killer will eliminate almost all market entities, whether real or virtual. Many existing firms will leave the industry, thereby increasing the industry's concentration ratio.

One example used in Wikipedia is eBay. However, eBay is not a good example as it relates to the domain industry. Why? Because eBay is an established brand which was built with gobs of money. The word eBay (which is not really a word), in itself, does not directly reflect what business the company operates – online consumer auction house. However, eBay is a category killer because it virtually owns the online auction market. What eBay is not, a category-defining domain name.

A category-defining domain name in the online auction space would be Auction.com – because it describes exactly what type of business is likely to be operating there. The domain name itself is not necessarily a category killer. However, the chances of a category-defining domain name of becoming a category killer are greater than if one tries to corner the market with something like OnlineAuctionsbyMike.com. In other words, if you spend the same amount of money, the category-defining domain name is more likely to succeed.

Now as far as generic domain names go, and this is what I am asking for when inquiring about yours; a generic domain name is one word with meaning. Some may argue for two words, but in my opinion those are called “premium” domain names.

Some examples of generic domain names; some.com, examples.com, of.com, this.com, or.com, that.com.

Premium domain names start at the top of the scale and end in one of two places: 1) high traffic, with a consideration for quality, or 2) short, keyword rich domains. For example; a category-defining domain name is premium. A generic domain name is premium. A domain with steady convertible traffic is premium – This number may vary depending on the quality of traffic, but on the low end I would expect 100 unique visitors per day. Lastly, keyword-rich domains which are not three, four, five, and more words long. There are some good examples in the geo-domain sector; ChicagoDoctors.com, FloridaOrganics.com, etc. What must be taken into account is the quality of the keywords as it relates to conversion (ROI). Furthermore, how much can I expect to spend to draw in good traffic? (Development)

It will be debated, but in my opinion this is how I perceive the differences between category killer, category-defining, generic, and premium domains.

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