Just as we’ve limited land on earth, similarly there’s a limited number of domain names. The number of possible combinations of NN.com (TWO NUMBER).Com is 100, for NNN 3number.com it’s 1000, for 3 letter.com it’s 17,576 and so on. Now you can compare this with the number of companies in the world, that could potentially be interested in acquiring them.
Now, if any company in the world that require a short domain name for their brand, have to buy it from the previous owner only. A point to be mentioned here is that all above types of domains were registered long back so you have to buy them from the previous owners only. Now they can ask you whatever price they want for it. It is the same as real estate where you can’t set a price for the land which a person doesn’t want to sell and the same time you can ask for a piece of land at a bargain price, if you know that the seller is desperate.
What are Chinese domains?
This rarity of domain names and the idea that they can be used as Investment assets was popularized in China too. Considering their unique dialect & culture, they preferred to buy short domain names that have a meaning in Chinese language. Now, with a population of 1.38 billion people and a huge number of companies to follow, the demand for a unique name increased. This created a bullish market for domainers around the world and they started to buy short domain names especially ones that do not have a,e,i,o,u & v or letter domain names that do not contain 0 or 4. These type of domains referred as Chinese Premium domains or Chips. The extensions that Chinese people like is mostly the .COM, .CN , .CC but there are some governmental policies & politics involved that changes the distribution of Investors interest in extensions. .COM & .CN are strong because. CN is Chinese Local Extension & .COM is for all those companies that have a global presence. The rest of the extensions are specific to the end-users needs and likeability.
People in 2015, became so bullish of buying this kind of names that when the renewal of those domains came, they could not afford it. Many people lost a lot of money but many of them made money too.
In present scenario. there still lies a value of pure letter containing domains that don’t have vowels or v and number patterns that don’t have 0 or 4. Domains with only numbers and also patterns is higher if they don’t have 0 or 4. The number domains are important because, in Chinese tradition, certain numbers are believed by some to be auspicious (吉利) or inauspicious (不利) based on the Chinese word that the number name sounds similar to. Domains containing patterned 8’s are most valuable and ones that have random numbers with 0 or 4 are the least. For example, the number 1688 sound like “A li Ba Ba” and hence Alibaba had purchased that domain and are still using it as their website beside Alibaba.com
Where can I buy Chinese Domains and Where to sell?
Now for someone to actually make money from Chinese domains, he definitely needs to buy & sell them! But I would strictly advise that you should not start investing in them right away. After doing preliminary research, you can head over to big auction platforms or exchanges both in Western countries and China that include GoDaddy.com, Sedo.com, Afternic.com , 4.cn, ename.com, 62.com, yumi.com and so on.
Here you will find that in the Chinese market, these domains are now being traded as stocks. (Visit 1618.com , Chaomi.cc to know more) They have the data of daily trades, the trade volume, and an estimated current market price. This industry is not as big as our traditional stock market but certainly big enough for investors interest.
I advise doing your due diligence in estimating the potential cost of domain name and the current price at which it is for sale. Buy low & sell high is the simple thing that you need to follow.
With every passing day, the demand for domain names is increasing due to more and more companies being formed and start-ups coming up. Hence it is rightly said by Rick Schwartz, one of the oldest & biggest investors of domain names that “Domain names are valuable and will rise in value faster than any other commodity known to mankind”. With the advent of new GTLDs, there might be some changes in the minds of end-users which would impact the prices. Overall it’s definitely an interesting space for those who like to invest in new opportunities.
That ends our discussion on Chinese domains. Hope you have got something from this. If you have any question or suggestion do comment below and I will try to answer them. Stay tuned for more.