MBPT Spotlight: What’s In A (Domain) Name? In New System, Plenty For Marketers

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NetNames, an online brand protection firm, recently released a broad-ranging study looking at trends that are currently reshaping the Web. Titled “Internet 2020: An Analysis of How New gTLDs Will Transform the Internet,” the study reflects the strategies of 400 business leaders and the opinions of some 6,000 Internet users in four countries—the U.S., the U.K., France and Germany—and looks at how the coming Web world of gTLDs (generic Top Level Domains) will factor into equations going forward.

There are currently over 271 million domain names registered worldwide. The majority of them are .com domains, which make up 114 million or 42% of the total. These .com Web addresses have been the main driver for the exponential growth of the Internet in the last 20 years, with other domains, such as .net, coming in a distant second (.net has just over 15 million registered users).

With so many domain names already registered, the Internet was running out of usable space and valuable domain names that are short, meaningful and relevant to website content has been shrinking rapidly over the past few years.

At the start of 2014, a new domain system was devised to fuel the Internet’s next phase of growth by providing additional choice and relevance to the expanding Internet user community of 2.6 billion people worldwide. Since then, a thousand or so new domain name suffixes—those gTLDs—have been applied for, and more than 600 of those applications have been for .Brands or suffix names such as .americanexpress, .chase, .allstate, .marriott, or .lamborgini.

The .Brand address is seen by many companies as a natural starting point for direct browser-based navigation, and will likely also be given the highest relevance in searches. With all these new domain extensions available, marketers can now get a domain name that specifically tells consumers what merchandise they sell or what type of business they are in.

The NetNames survey found that 92% of large companies in the U.S., Britain, France and Germany are planning to invest in new gTLDs or new domains over the next three years. Some 46% have already begun to invest in this area and the same percentage plans to follow suit.

More than one-third of the respondents (34%) believe the new domain system will lead to Internet users typing Web addresses directly into the browser. In the U.S. specifically, 51% of businesses believe that the Internet by 2020, once the new system has had time to settle in with users, will be quicker and easier to navigate

Among other findings, 85% of companies responding stated they’d be changing their online marketing investment, even though they will probably keep their current .com addresses for defensive purposes; and 89% of businesses across the four countries thought that the new .Brand gTLDs would make it easier for consumers to find their company website.

NetNames says the introduction of the new gTLDs will spark a dramatic fragmentation of the Internet. “Much as multichannel digital television fragmented TV viewing audiences and changed the economic model for TV advertising, the new Internet domain system will fragment Internet users into communities of interest with the new gTLDs,” the report says. This, of course, could create a very beneficial consumer-targeting situation because sites with specific interests could draw those consumers.

NetNames says CEOs believe a company’s biggest online investment is likely to be in new domain names aimed at specific communities of people such as .bank, .sport or .art. However, while 69% of CEOs felt this way, the percentage of marketing professionals who agreed with this was only 56%.

A majority of the consumers surveyed (59%) also believe that the new Web address endings will make it easier for them to find specific websites. Eight out of 10 people who shop online on a daily basis feel that the introduction of the new domain names will make them more likely to enter a company’s Web address into their Internet browser rather than using a search engine. That bit of data should motivate search engines to evolve their algorithms in favor of gTLDs to safeguard their valuable traffic and offer direct search within the URL bar, NetNames says.

In the report, Dan Schindler, cofounder and executive VP of sales & marketing at Donuts, an Internet domain name registry, says the introduction of gTLDs is “finally a chance for business, organizations and individuals to have a specific and relevant Internet identity that’s short, meaningful and relevant to their interests or the information they want to present to the world.”

Schindler adds that over half the world’s most valuable brands have applied for their own .Brand gTLDs.

“Instead of being made available to sale to the general public, these names will be operated by brands such as BMW, Nike and HSBC,” he says. “They will provide Internet users and brands with an added layer of security and brand authenticity, as well as short, memorable names like: www.3series.bmw or www.run.nike.”

Schindler adds that, “Savvy marketers and brand owners have already realized that now is the time to have a short, relevant, memorable meaningful new gTLD name and in addition, innovate, become a market leader, effectively reach consumers and protect Internet IP rights.”

The introduction of these new gTLDs in 2014 and beyond does present some problems for brands in the area of “cybersquatting” which NetNames describes as the practice of registering domain names that infringe on trademarks.

“Cases of cybersquatting have increased rapidly since the launch of the new gTLDs, with many global brands already falling victim to this practice,” the report says. Among them—IBM (ibm.ventures, ibm.guru), Burberry (Burberry.clothing), and Lufthansa (Lufthansa.com).

The report says in the face of threats such as this, 87% of business executives surveyed admitted that they would be worried to some degree about keeping their brand and trademarks protected with the introduction of the new domain system.

As for the Internet in the year 2020, the survey finds that although .com in domain names will remain popular, registrations for the new gTLDs will significantly overtake new registrations in .com and .net as those established domain names become saturated.

By 2020, Internet navigation will be much less reliant on search engines and users will use direct navigation much more frequently, particularly when wanting to reach marketers that have their own .Brand top-level domain.

And finally, marketers will be able to better target the audiences that want to buy their products most, since those consumers will be able to find them that much easier.

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