It's
no secret the domain name real estate market is hot, catching up to and quickly
surpassing the 800 vanity number market due to its legal status. Note recent
sales:
800 vanity number sales, though often illicit, are in the same ballpark:
1 800 TICKETS: $1M plus 6% stock; 800-i-TRAVEL: stock valued at $1,648,500; 1
800 COMPUTER (along with computer.com): $500,000. And so on.
GreatDomains.com
says the average price of domains sold on its site is $14,500. That's low-end
for an "average" vanity number, but not entirely incomparable.
So
you've got a domain name. Maybe its not one short word (witness
ForSaleByOwners.com above - there are valuable exceptions to the one-word
gospel.)
Logic, and battle-worn folks, will tell that its worth what someone is
willing to pay - and what the seller is willing to accept. But theoretically
speaking, you ask - what's it worth?
The closest model for valuating domain names is 800 vanity numbers. Setting the differences aside (vanities overlay 7 digits with 3,000+ alpha permutations, and are captive to different regulatory and trademark schemes), 800 vanity numbers can be informally valued (since buy/sell is illegal per FCC 4/97 ruling, the vanity not officially an asset) a number of ways.
Certainly this brand model of static
value to measurably increased interactive value, can be applied to brand domain
names, as well as generics for products and services that have high appeal and
broad market/mind share.
Can 800-modeled elevated response and
recall be attributed to the branded dot com? By all appearances, yes.
In interviews I conducted a number of
years ago, Prodigy Internet revealed a 25% greater response, longer recall, and
significantly increased customer retention, when testing its 800 PRODIGY vanity
number against an 800 numeric in a mainstream television campaign.
Operations managers reported that 800
PRODIGY provided an ease of use and access of service that well exceeded the
initial response, extending the sale into a customer.
1 800 JEEP EAGLE, rolled out during a
Super Bowl, revealed increased response, and an elevated caliber of respondent,
both more inclined, and more financially qualified, to buy -- plus a 50%
conversion rate: within 12 months of the initial call to 1 800 JEEP EAGLE, 50%
of callers bought either a Jeep Eagle or comparable vehicle.
That's
an incredibly high conversion rate on a very high-priced item. Bally's Health
and Fitness' call center manager raved that their 1 800 WORKOUT and 1 800
FITNESS callers "were raising their hands, asking to buy."
Apparently
the value of consumers actively semantically asserting the inherent "I
WANT" demand in 1 800 PRODIGY, 1 800 WORKOUT, and 1 800 JEEP EAGLE, far
exceeds the more tentative consumer behavior experienced when provided weaker
response and access vehicles.
So 800
number brand names, recognized vernacular, and calls to action trigger an
elevated response and a pronounced buying behavior. They attract more callers,
who are more qualified by both desire, and ability, to buy.
I'm not
aware of any studies done attributing increased sales, conversion, or retention,
specifically to dot com's. But like the 800 vanity, called, dialed, clicked or
keyed.
Common
sense dictates that the pronounced assertive "I WANT" behavior, its
benefits and value, would apply to the vernacularly dominant (brand, generic and
call to action) domain name too.
Judith Oppenheimer is
President of ICB Inc., purveyor of accurate 800 & Dot Com News,
Intelligence, Analysis, Consulting. http://icbtollfree.com/,
http://1800theexpert.com/
Copyright 2000 ICB Inc. All Rights Reserved.