Domains4Dummies

Domain names are valuable because they are memorable and advertisers want folks to remember their company or product name.

Consequently, companies are often willing to pay big money for distinctive and easily memorable names. Vodka.com just sold for $3 million (and sex.com is just about beyond price!)

You can buy a domain name for under $10 pa. So if you choose the right one you could be rich in a hurry!

Domains are also valuable for their existing traffic. This kind of traffic comprises :

a) "type in" queries to search engines which match to the domain name

b) "typo" queries arising from mistyped queries on well known names (eg Gooogle.com or Googel.com) - this kind of "passing off" can get you sued big time so don't go there

c) "legacy" traffic following links to domain names whose original owner has gone out of business or otherwise allowed their domain registration to lapse

This kind of traffic based value is "money in the bank" to investors, so domain names with existing traffic are always in strong demand.