Future .AU Values - .com.au and .au

[DomainShield]

Another interesting point to consider on the value of this domain is the effect of removing the .com from the domain.

With the upcoming direct registrations and assuming recognition of prior rights for existing registrants (in whatever form that takes) we also need to consider the future value of mm.au.

Alison Coffa (Marketing Communications Coordinator, Ausregistry) wrote the following in the May 2016 edition of Behind the dot.
"With recent developments in the opening of direct .au
domain registrations at the second level, there could now
be an opportunity for Australian URL shorteners including
a short phrase and a .au extension. It would great to see
our Prime Minister use our country’s own extension with
something like ‘pm.au’"
https://www.ausregistry.com.au/wp-content/uploads/2016/05/SOTD_Final_Report_Issue_7.pdf

According to bit.ly you can "Drive CTR up to 34% with Branded Short Domains. Branded Short Domains replace the “bit.ly” in your links with your brand name, allowing you to take total control of your content."
https://bitly.com/pages/tour
They also include a link to a case study to back up this number.
https://bitly.com/pages/resources/c...ngagement-the-power-of-a-branded-short-domain

I am by no means an expert on social media so I wonder if a member with relevant experience might be able to shed some light on future opportunities for two and three letter .au domain, which domainers should keep in mind when considering a sale or purchase of a domain like this.

Anthony

 

[Bacon Farmer]

If they believed it themselves then why the long link > https://www.ausregistry.com.au/wp-content/uploads/2016/05/SOTD_Final_Report_Issue_7.pdf

 

[findtim]

the value of this domain is the effect of removing the .com from the domain.

we do no matter what the domain

Prime Minister use our country’s own extension with
something like ‘pm.au

someone just wasn't thinking and didn't do an obvious search for pm.com.au !
the domain goes to phillip morris cigarettes, can't see them stepping down for the pm.
tim

 

[DomainShield]

If they believed it themselves then why the long link > https://www.ausregistry.com.au/wp-content/uploads/2016/05/SOTD_Final_Report_Issue_7.pdf

I posted the long link for the benefit of future readers of the post because shortners designed for social media are not generally maintained as well as full links used in web linking because they are not generally owned by the domain registrant.

The shortened URL used by Ausregistry on social media was actually "http://ow.ly/j7Md3005J2o", Alison Coffa (Marketing Communications Coordinator, Ausregistry) is shortened (on twitter) to @AlisonClareC and Behind the Dot is hashtagged "#BehindtheDot".

This illustrates my point on increased value for short .au domains quite well because ow.ly as used by ausRegistry on Twitter (and other social media) does not seem to be owned by AusRegistry. This means that in the long term what they gain by using a short url (they get to put more words into the tweet) they are losing by not having a maintainable direct link to their content in the future.

What does this means for mm.au in the future?
Basically socially active companies, which are interested in maintaining Domain Authority (most modern companies) will increasingly in the future will be seeking to have control over their shortened links. This provides an interesting advantage for Directly Registered ccTLDs (.au, .uk, .nz etc) over gTLDs (.com, .org etc) and the new TLDs (.xyz, .ceo .physio etc). A little appreciated fact is that only country codes are allowed to be two characters long, all the other extensions are three letters or longer. This means that in the competitive and increasingly important world of social media and url shortning .com is not king and country codes like .ly are actually more desirable.
This brings me to the future benefit of owning a shortened URL and why Australian businesses are going to be more interested in buying LL.au domains. Socially active companies are going to start noticing that links in their tweets and posts from years gone by, which got copied, quoted and re-tweeted, are either no longer working or pointing somewhere else completely. The only way they can take control of their social media "link juice" is to take ownership of a sensible short domain name and running or leasing their own URL shortening software. We already know that Australian business have invested massively in .com.au and now they are going to have an option to utilize local domain names on their social media.

If I owned a few lll.com.au and ll.com.au domains I would be hooking up some software like http://yourls.org/ and then testing out leasing or providing free "local" url shortening services because 1) It is a potential revenue stream 2) It increases your visibility on social media when the links are used. 3) It gives you some insight into how short .au urls are being underutilised in social media. It can theoretically be as cost effective to setup and run as a parking service. I would also speculate that using the domain as an exact match for an active service you are providing is a great reason for owning the domain if someone tries to hijack the domain by lodging an eligibility complaint with auDA.

 

[snoopy]

The only way they can take control of their social media "link juice" is to take ownership of a sensible short domain name and running or leasing their own URL shortening software.

I don't think this is the logical outcome. Companies would still want mm.com.au because .com.au is a standard here. I think it is some very small fraction of that who would want the .au. So you've got a small enduser market for mm.com.au (one person estimated 3 potential buyers) and for mm.au you may have some small fraction of that. Could well be that none of the 3 will pay a premium and then the remaining market is domainers.

 

[DomainShield]

someone just wasn't thinking and didn't do an obvious search for pm.com.au !
the domain goes to phillip morris cigarettes, can't see them stepping down for the pm.
tim

It might be time to do another obvious search and do a whois on pm.gov.au. "Spoiler Alert" It is licensed to "Department of the Prime Minister and Cabinet". There is also a net.au. an org.au and even an id.au domain licensed to "Citizen/Resident Philip Muir" to consider when looking at this specific example.

Can I be so bold as to state that I reasonably expect some priority to be given to the handful of gov.au domains before com.au domains with regards to direct registration. This would not in theory affect the majority of current .com.au registrants. It would however be amusing for Phillip Morris to try to drum up public sympathy if they do not get first rights to pm.au.

 

[eBranding.com.au]

Can I be so bold as to state that I reasonably expect some priority to be given to the handful of gov.au domains before com.au domains with regards to direct registration.

I think that's a pretty reasonable assumption. I would be very surprised if they didn't give .gov.au first preference ahead of .com.au, .net.au etc.

 

[DomainShield]

I don't think this is the logical outcome. Companies would still want mm.com.au because .com.au is a standard here. I think it is some very small fraction of that who would want the .au. So you've got a small enduser market for mm.com.au (one person estimated 3 potential buyers) and for mm.au you may have some small fraction of that. Could well be that none of the 3 will pay a premium and then the remaining market is domainers.

I agree with you that the market size does not change but the estimation of what the existing parties would be willing to pay is changing.

Firstly there is added value to all .com.au domain names once the rights of the corresponding .au domain have been established, by the option of allowing companies to increase social media click through rates AND ability to maintain future changes to link locations. In theory LL.com.au domains should get the most increase due to almost halving their length from 9 characters to only 5 (even bit.ly is longer at 6 characters).

Secondly we all know that being approached by an interested party is always going to result in a higher sale price (regardless of valuation) and it holds that when .au becomes a reality in the future there is going to be some simultaneous discussion happening in almost every IT and Marketing department in Australia. This will lead to more whois searches (and browser hits) for existing domain names and the potential for more interest being shown in current .com.au domains. Excitingly it might also lead to multiple interested parties making offers in a similar time frame which is definitely to the advantage of a seller.

This is an important opportunity for sellers to become educated on who their potential suitors are (as has been done here) and also on why the parties are interested in the domain. It is crucial for a seller to be armed with this information in order to educate the buyers if necessary but at the very least to show that they understand it once the bargaining begins.

I'd be happy to predict that the value of an LL.com.au could be doubled right now and doubled again once the rights to the corresponding .au have been established. I'd say the average wholesale value of an LL.com.au has been about $2K over the past two years (ranging from $1.5K - $5K) I would predict that for the next two years the wholesale average will increase to $4K and after .au rights are secured the combined wholesale value will increase to $8K.
I am not an expert on the retail market but I would expect to see an increase in the number of completed LL.com.au sales over the next two years with uneducated sellers unexpectedly achieving their "buy now" prices and educated sellers achieving 75-90% of their target prices rather than (and I am guessing here) an estimated 50% of their target prices. I would estimate the current average target price of most sellers to currently be around $40K and their would probably sell for $20K. This "willing to sell for" price is what I expect to see increasing first due them receiving offers of multiple parties within months of one another.

 

[snoopy]

I agree with you that the market size does not change but the estimation of what the existing parties would be willing to pay is changing.

Firstly there is added value to all .com.au domain names once the rights of the corresponding .au domain have been established, by the option of allowing companies to increase social media click through rates AND ability to maintain future changes to link locations. In theory LL.com.au domains should get the most increase due to almost halving their length from 9 characters to only 5 (even bit.ly is longer at 6 characters).

Secondly we all know that being approached by an interested party is always going to result in a higher sale price (regardless of valuation) and it holds that when .au becomes a reality in the future there is going to be some simultaneous discussion happening in almost every IT and Marketing department in Australia. This will lead to more whois searches (and browser hits) for existing domain names and the potential for more interest being shown in current .com.au domains. Excitingly it might also lead to multiple interested parties making offers in a similar time frame which is definitely to the advantage of a seller.

This is an important opportunity for sellers to become educated on who their potential suitors are (as has been done here) and also on why the parties are interested in the domain. It is crucial for a seller to be armed with this information in order to educate the buyers if necessary but at the very least to show that they understand it once the bargaining begins.

I'd be happy to predict that the value of an LL.com.au could be doubled right now and doubled again once the rights to the corresponding .au have been established. I'd say the average wholesale value of an LL.com.au has been about $2K over the past two years (ranging from $1.5K - $5K) I would predict that for the next two years the wholesale average will increase to $4K and after .au rights are secured the combined wholesale value will increase to $8K.
I am not an expert on the retail market but I would expect to see an increase in the number of completed LL.com.au sales over the next two years with uneducated sellers unexpectedly achieving their "buy now" prices and educated sellers achieving 75-90% of their target prices rather than (and I am guessing here) an estimated 50% of their target prices. I would estimate the current average target price of most sellers to currently be around $40K and their would probably sell for $20K. This "willing to sell for" price is what I expect to see increasing first due them receiving offers of multiple parties within months of one another.

.com.au already has (I'd guess) 90%+ market share. ".au" isn't going to make it more attractive, it is possibly the most successful extension in terms of enduser usage outside of America's use of .com (.com.au sucks for speculation though because of the low population and AUDA red tape). This is a country dominated by .com.au when it comes to running a website. Many other countries have a split between 1/2 country codes and .com (e.g. Indian & China). People have no clear choice, that weakens the name space and results in lower prices because there is no standard. Some will opt for .com. I'd say the only place .com.au has to go in terms of usage in Australia is down.

For those with LL.com.au they'll double their holding costs for the same enduser market when .au comes in.

 

[Shane]

Whilst going from xx.com.au to xx.au definitely results in a more appealing domain, I agree with Snoopy in that I can't see it increasing prices for such domains.

Nuts.au is visually appealing to me, but I wouldn't have paid any more for the 'package' of nuts.com.au + nuts.au. To me it's still a single brand.

I think that's one of the major flaws in auDA's reasoning for direct registrations. Dropping the .com doesn't add to the real growth of domains or their individual value; it just adds to holding costs.

 

[DomainShield]

For those with LL.com.au they'll double their holding costs for the same enduser market when .au comes in.

I agree with you 100% but they way you worded that it sounded like a negative. In reality the holding costs for an LL.com.au represent 0.5% of the wholesale purchase price, doubling this to be 1% sounds like the deal of the century to me when it includes a second domain which is 40% shorter and at the same time will increase my existing assets visibility to potential buyers during the process.

 

[snoopy]

I agree with you 100% but they way you worded that it sounded like a negative. In reality the holding costs for an LL.com.au represent 0.5% of the wholesale purchase price, doubling this to be 1% sounds like the deal of the century to me when it includes a second domain which is 40% shorter and at the same time will increase my existing assets visibility to potential buyers during the process.

The key thing is they have "the same enduser market". I don't think they will have an asset that is any more viable, market demand will be the same, instead of .com.au it is .com.au/.au, two domain renewals for basically the same thing.

Personally I think .au will fail in the marketplace but if it doesn't that is where the real damage will be done to the namespace in my view because if it becomes fragmented between .com.au and .au companies will also start looking at .com like Indian and Chinese companies currently do.

 

[DomainShield]

Whilst going from xx.com.au to xx.au definitely results in a more appealing domain, I agree with Snoopy in that I can't see it increasing prices for such domains.

Nuts.au is visually appealing to me, but I wouldn't have paid any more for the 'package' of nuts.com.au + nuts.au. To me it's still a single brand.

I think that's one of the major flaws in auDA's reasoning for direct registrations. Dropping the .com doesn't add to the real growth of domains or their individual value; it just adds to holding costs.

Shane,
Thanks for contributing a real example from your business, I hope you don't mind me taking this a bit further in an effort to explain the benefit to your business of having access to nuts.au.

Your company tweeted the following about 2 hours ago "We'll let the experts argue over the benefits of activated nuts and seeds, but if you're into them, you can now... http://fb.me/2ud42DlCA"

What worries me about this is
1) Your social media team have just contributed to the growth of another countries ccTLD (.me belongs to Montenegro).
2) You have also contributed to the traffic and growth of facebook who are going to eventually (or are already) going to charge you for the privilege after you have contributed the traffic.

While licensing nuts.au is going to add $10 per year to your operating costs it has two benefits for you moving forward.
1) Your click through rate should increase by 34% according to bit.ly. Considering your costs relating to producing social media costs surely the $10 is insignificant? On the flip side surely a 34% increase in your click through rate is also going to result in more sales making the $10 expense into a substantial profit?
2) You are going to have control over your ever expanding list of url shortened in bound traffic. Do you remember how you may have started your first company using a bigpond email address and having it printed on business cards and written in peoples filofaxes? Remember the costs of lost contacts and having to print new business cards when you lost your bigpond address or wanted to change providers and telstra charged you more for your old email address than you used to pay for an internet connection? Well the same thing is going to happen to all the fb.me links they are going to point off to nowhere, or you have to pay for them or they could end up pointing to your competitors one day.

So in a nut shell the problem is not "nuts.com.au vs nuts.au" it is actually looking at "nuts.com.au vs fb.me".
This is where the big loss for both your brand and the .au extension.

Almost every socially active company in the world is experiencing the same bleeding of brand awareness and loss of control over domain authority and my hope is that all Australian businesses are going to learn from and benefit from the introduction of .au domains as we all need to take control of our social media, from the Prime Minister using aus.pm to AusRegistry using ow.ly to Nuts using fb.me.

 

[DomainShield]

The key thing is they have "the same enduser market". I don't think they will have an asset that is any more viable, market demand will be the same, instead of .com.au it is .com.au/.au, two domain renewals for basically the same thing.

Personally I think .au will fail in the marketplace but if it doesn't that is where the real damage will be done to the namespace in my view because if it becomes fragmented between .com.au and .au companies will also start looking at .com like Indian and Chinese companies currently do.

The .au market has already become massively fragmented and literally millions of links are no longer using .au. These millions of links and billions of clicks are not being resolved by America and .com either they are being handled by countries like Montenegro and Libya (.me, .ly). These country codes are being used by big brands like facebook (fb.me) and twitter (contributor to popularity of bit.ly urls).
The benefit of having access to .au as an extension is to give local brands an opportunity to use their own brand and their own country extension on social media to hopefully reduce the fragmentation and loss of traffic/control being caused fb.me, ow.ly and aus.pm

 

[Bacon Farmer]

In reality it's the same address for twice the cost.

It's like 1 Dumb Street Sydney NSW 2000 vs 1 Dumb Street Sydney 2000.
or
www.spin.com.au vs spin.com.au.

 

[findtim]

doubling this to be 1% sounds like the deal of the century to me

true for a significnt domain, but why inflict this on dubbodentist?

Your click through rate should increase by 34% according to bit.ly. Considering your costs relating to producing social media costs surely the $10 is insignificant? On the flip side surely a 34% increase in your click through rate is also going to result in more sales making the $10 expense into a substantial profit?

if its that significant then lets just dump the .com.au and not have the extra expense? why do we need both?
lets not ADD a .au, lets REPLACE totally the .com.au with the .au
seems to solve many issues IMO
someone PLEASE tell me why we need both? i think through domianshields multiple posts they have stated many good reasons to dump the .com.au
tim

 

[Scott7]

true for a significnt domain, but why inflict this on dubbodentist?

The other option is dubbo.dentist ... and this is your lucky day, Tim, because it's available to hand reg here for just $434.99 with a matching annual renewal fee

 

[snoopy]

lets not ADD a .au, lets REPLACE totally the .com.au with the .au
seems to solve many issues IMO
someone PLEASE tell me why we need both? i think through domianshields multiple posts they have stated many good reasons to dump the .com.au

Pongas et al aren't going to vote for that Tim. How does that solve the problem of AUDA and Ausregisty's revenue growth flattening?

For many years, the .au namespace grew rapidly with the uptake of the Internet and regular policy reviews, with domain name creates reaching a peak in FY12. Since then, annual domain name creates have begun to decline slowly as illustrated by the following chart showing domain name creates over the last seven financial years.

We believe that the time is right to open the .au namespace to direct registrations.......

(page 4)

https://www.auda.org.au/assets/pdf/sub-ausregistry17.pdf

 

[Bacon Farmer]

When you hit peak domain demand what do you do?

You divide the most popular domain address in two!

Next year they'll introduce .co.au because defensive registrations are a legitimate way of growing the industry.

 

[findtim]

Pongas et al aren't going to vote for that Tim

we aren't here to line their pockets