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Three Steps to Domain Name Reselling

Posted on 3.13.2012

Where there is uncertainty, there is risk. And when there is risk, there is also the potential for reward.

The state of the domain name industry might be in flux, but those positioned to capitalize on the uncertainty in the market are the ones who will fare the best — particularly on the Web and as it relates to selling domain names.

Domain name reselling is the practice of wholesaling domain names. Resellers partner with existing registrars that, for a varying annual fee, offer the opportunity to sell domain names to their own customers at a base price plus the reseller’s own marked-up price.

While most consumers are content to use popular registrars (review WM’s list of Top 50 Domain Registrars and Hosting Providers on page 16), a substantial opportunity remains present for those skilled at selling or simply positioned well to add domain name sales to their existing software or service offerings. The prospect might be appealing, but there’s much virtual and real-world work that needs to be done to make the investment profitable. Here are three essential steps that anyone considering the practice should follow:

Conduct Viability Studies

Selling domains is not a project that any Web professional should undertake if they have not conducted the necessary viability studies. Not only is it important to know if existing clients or the aligned audience is showing demand, but whether the amount of time required to manage the effort — which can be extreme in some cases — will ever result in a reasonable profit. For example, if a designer services 100 clients and each has two domains, you’ll likely be profiting less than one thousand dollars. The question to ask is whether the investment is worth it from the perspective of your time.

Explore the Vendor Landscape

There are a handful of viable vendors to consider in the domain reseller solution provider space. Go- Daddy’s reseller program is easily one of the most popular but there are several other very strong product offerings such as OpenSRS.com from Tucows, ResellerClub from Directi, Network Solutions’ SRSplus, and eNom. Cost is an important factor in your evaluation of the vendor landscape, but you should also analyze the supplementary services that can be provided such as website hosting (and site building), SSL certifications and email. Also consider the actual interface that you will present to users and that you will use to manage and administrate domain names and related services.

Develop Cross-selling Expertise

Those who are skilled at selling and cross-selling are in the best position for success as domain resellers. For example, Web design and search marketing firms might want to consider offering domain name portfolio management as an additional service to their clients. Software-as-a-Service (SaaS) vendors that offer white label or private label solutions are also well-positioned to resell domain names. The provider of a blogging platform, for instance, should know that a segment of users will be drawn towards using their own domain names, and the platforms that offer domain names are best positioned to generate revenue from this interest and demand.

Domain names are an important variable in the pursuit of success in the digital ecosystem as they act as the face of the brand. Offering this important element is a real value-add for both new and existing users and carries the potential to be financially rewarding for domain name resellers.

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