Increasing Domain Value Through Site Development
If you are a domain portfolio owner and your domains are just parked, your domain value will fluctuate according to some very basic algorithmic factors coupled with the impact of the economy and search trends. If you build your domains out into websites, you will have greater control over the increase in your domain value. While there is both a time and money investment in doing so, if the economy and search trends don’t have much impact on the particular domain you own, this is one way to increase the domain’s value much sooner.
Parked or Undeveloped Domains
Parked or undeveloped domain value is calculated by some the following factors:
- Age of domain
- Length of domain
- Domain authority (pertinent when the domain has been associated with back links built to it).
- Domain extension (.com domains tend to have a higher value, due to their popularity).
- Cost per click value of keywords.
- Brand potential – this value is more accurately assessed by a human than by an online domain calculator.
- Search volume for keywords in domain
When it comes to economic conditions or market trends, the variables are specific to certain types of domains. There may not be much fluctuation in the value of a gardening domain, for instance, as a technological one which could be impacted by advancements in development.
Building a Website
When you build a domain out into a website, you extend past the limited search volume for the keywords contained in the domain to related keywords and possibly thousands of long tail keyword variations. So, even from the very beginning of the site development, you can increase the search potential and resulting traffic to the domain.
But, building a website out offers additional, valuable opportunities:
- Increase in back link count to the domain, elevating the domain authority
- Development of domain as a brand
- Monetization potential of domain – is it best used an informational type of website or a storefront?
- Number of email subscribers.
Calculating the Sale Price
When it comes time to selling a website, all of the above factors impact the domain value. Typically, a website can sell for anywhere from 24 -36 months of its monthly income. If a site earns $2,000/month, the sale price would range from $48,000 – $72,000. Informational website will go for less than those offering stores – closer to 18 months’ worth of income. Information websites are often limited to earning income from affiliate programs and pay per click ads.
While the end result – the sale price – is discussed here, naturally the earning potential of the domain over the course of its existence as a website is much higher than monetization through domain parking.
- License: Creative Commons image source
Theresa Happe works with Afternic.com, where you will find thousands of domain names for sale in every niche and price range.