Domain name registration strategies in focus
This is an Insight article, written by a selected partner as part of WTR's co-published content. Read more on Insight
Corporate domain name management companies are often asked the question: “What does an optimal portfolio look like?” There is no single right answer to this question, as a domain name portfolio depends on a number of factors, such as appetite for risk, budget, ability to manage and creative thinking.
Corporate domain name management companies are often asked the question: “What does an optimal portfolio look like?” There is no single right answer to this question, as a domain name portfolio (like an investment portfolio) depends on a number of factors, such as appetite for risk, budget, ability to manage and creative thinking. Most organisations err on the side of caution when it comes to protecting their online identity; as a consequence, domain name portfolios have tended to grow rather than shrink over time.
SEO strategy, appetite for risk and budget
Until 2013, organisations had to deal with the release of only one or two new generic top-level domains (TLDs) every year, such as ‘.asia’, ‘.eu’, ‘.mobi’ and ‘.xxx’. It became relatively easy for brand owners to decide whether they needed the latest new domain and the addition of one or two TLDs provided no major cause for alarm. However, over time, other factors have added complexity to the decision regarding whether to maintain or reduce portfolios.
Search engine optimisation (SEO) fads come and go based on what is perceived as best practice and on formal changes, such as Google’s Penguin and Panda updates. These changes tend to result in SEO experts recommending new domain name registrations in order to take advantage of the latest updates. To hyphenate or not to hyphenate, for instance, is a question that has been asked and answered a thousand times over – yet a closer look at most domain name portfolios will show a fair number of hyphenated names still being used.
Another consideration is the corporate appetite for risk. How far will an organisation go to protect its online digital assets from attack by a typosquatter? We all have brains that sometimes translate what we see into what we want to see, and this is what drives typosquatting. A ‘1’ can look like an ‘l’, a ‘5’ looks like an ‘s’ and ‘0’ easily replaces an ‘o’. Thus, one can readily see ‘www.close.com’ rather than ‘www.c105e.com’. The dilemma that organisations face is in judging how far to take their defensive strategies. Even if a company name is just five characters long, the potential for protecting against a single-character mistype runs into thousands of registrations and significant cost.
All domain names are not created equal, meaning that registration cost and criteria vary widely between jurisdictions. While the most popular TLDs – such as ‘.com’, ‘.net’, ‘.uk’ and ‘.de’ – are available without any registration restrictions, organisations seeking a presence in countries such as Norway, Bulgaria and Estonia must provide proof of their local operations. In other instances, registration is possible only if trademark or company formation documentation is provided. In the most extreme case – that of ‘.aq’, which represents Antarctica – proof is required that the registrant carries out scientific research in the most remote place on earth.
Understanding the registration landscape
Few organisations take the time to understand the registration landscape with regard to their keywords and trademarks. While it may not be vital to register every keyword in every one of the 300-plus TLDs, understanding where they are registered and (more importantly) by whom is paramount. A good starting point is to create a risk matrix, highlighting which domain names could prove problematic now or in the future. This allows for a strategic registration policy to be established and enforced across the organisation.
Understanding exactly which domain names are held by the organisation outside of the core domain name portfolio is also key to developing a strategic understanding of what is being used and how. Over the years, various departments and individuals may have bought domain names ad hoc, using the company’s (or their own) details but with a host of different registrars. Pulling all of these registrations together is a sensible step towards ensuring that an organisation has a holistic view of all keywords across all TLDs.
Few organisations have a formalised strategy to determine which domain names are registered or renewed, in which jurisdictions and by whom. The creation of a formalised document not only ensures that each stakeholder understands his or her role in the domain name process, but also provides a guideline for how the organisation should handle issues such as domain name disputes, acquisition of digital assets and internal sign-off. This in turn leads to a control on costs and the use of intellectual property.
Expansion of the domain name space
As if managing registrations in approximately 300 TLDs were not enough work for brand owners, in 2011 the Internet Corporation for Assigned Names and Numbers (ICANN) announced that it would further liberalise the domain name space. Judging that the domain name space had become stale, it introduced the new TLD expansion in order to promote innovation, more choice and increased security for the whole industry, as well as the opportunity for brand owners to own their own slice of the Internet.
The plans to increase and liberalise the domain name space were first suggested more than five years beforehand, but significant debate through the multi-stakeholder model that ICANN operates was necessary before the programme was ratified. During that period, both brand owners and governments raised a number of concerns regarding rights protection mechanisms for trademarks and recognised establishments and organisations. The primary problem was that companies simply would not have the resources to register their key terms in every single new gTLD.
In January 2012 the window for applications was opened for a limited period and a diverse range of organisations applied for over 1,200 new gTLDs. When the application results were announced in London in June 2012, many brand owners must have been shaking their heads in dismay at the sheer number of new gTLDs that would be introduced over the next few years and would thus require either proactive or defensive registration. The eventual number of applications took most industry insiders by surprise, with over 800 brand owners taking the opportunity to grab their own slice of the Internet, as well as over 600 generic, geographic and internationalised domain names – from ‘.hot’ to ‘.cool’, ‘.black’ to ‘.blue’, ‘.london’ to ‘.sydney’ and ‘.rocks’ to ‘.sucks’.
A number of new registries and organisations set up to take advantage of the new programme understood the concerns of brand owners, which now had to develop new domain name registration strategies. They began to develop products that would provide protection for core digital assets and allow organisations to choose proactively the best registration strategy to implement.
ICANN made the first move, announcing the creation of the Trademark Clearinghouse, a central database of trademarks which provides an early-warning system in case of potentially infringing registrations and ensures that brand owners get first refusal on registering their marks in each open new TLD.
To complement this rights protection mechanism, a small number of registries created a product that has become an essential part of any organisation’s domain name strategy. Donuts was the major registry behind the creation of the Domains Protected Marks List (DPML), which allows brand owners to block their trademarks (and variants thereof) for five years in a single action. Rightside Registry and Minds + Machines followed suit, meaning that nearly 60% of all potential open TLDs are now covered by this new product, which provides a cost-effective, robust and easy-to-manage defensive strategy.
Finally, the introduction of Uniform Rapid Suspension (URS) – a fast, low-cost IP infringement resolution process – means that where domain name infringements do occur, organisations can remove any potential brand and reputational infringements quickly and efficiently, as opposed to having to use the costly, cumbersome and ultimately time-consuming Uniform Domain Name Dispute Resolution Policy. However, a successful URS case will only remove the domain name from an infringer’s control, not transfer ownership back to the rightful owner.
Adapting to the new gTLD programme
The new gTLD programme is now over 18 months old, so its impact on traditional domain name registration strategies can be assessed. It was always going to be impractical and prohibitively expensive for any organisation to register its key terms, brands, trademarks and most frequently used keywords in every new gTLD. Not that this stopped some organisations in the first few weeks. Amazon and Flickr, for instance, registered in gTLDs such as ‘.singles’, ‘.estate’ and ‘.plumbing’ for no other apparent purpose than because they could. Fortunately, others soon saw the value in the DPML rights protection mechanism and used that instead.
The most sensible approach for an organisation to take is to look holistically at both the opportunities and the threats. For example, what do the new gTLDs offer for its brands, customers, markets and products, today and in the future? Conversely, what risks does it need to mitigate? A starting point is to divide the available or open gTLDs into vertical sectors and then assess their importance for an organisation. For example, a company working within the financial services sector would be interested in new gTLDs such as ‘.investments’, ‘.mortgage’, ‘.cash’ or even ‘.bank’. For the first time ever, organisations can use both the left and right sides of the dot to create internet addresses that are memorable, meaningful and relevant – the three key pillars of Google’s search rankings.
However, few organisations have invested the time or resources in defining the opportunities and risks that the new programme delivers. At the very least, they should look in detail at which new gTLDs will become part of our everyday digital life – especially those that have relevance to the industry in which they operate. The advantages of the new programme can be exploited by creating a simple registration strategy, choosing the new gTLDs that have the most relevance to the business and defining which names could cause the most problems should they fall into the wrong hands (eg, ‘.sale’, ‘.institute’ or ‘.web’ could give a cybersquatter some elements of credibility to the legitimacy of a brand).
While some debate remains regarding the nature of the right domain name registration strategy, there is no doubt that certain strategies are wrong. One wrong strategy is simply to do nothing different. The list of major global brands which have been infringed under the new gTLD programme should act as a warning for any company that is re-examining its domain name registration strategy – especially with so many new rights protection mechanisms in place. The cost of recovering domain names that have been registered by cybersquatters far outweighs the cost of implementing a simple rights protection mechanism or registration strategy.
However, domain name protection is not only about the monetary cost. Brand and reputational damage starts from the moment that a domain name is registered by an unauthorised third party. This cost can be hard to measure; however, as Warren Buffet once said: “It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you’ll do things differently.” This should be the key message for all brand owners that have not yet reviewed their domain name registration strategy.
Opportunities for consolidation and growth
Every organisation will have a different approach to its domain name strategy. Research suggests that between 10% and 15% of domain name registrations within most organisations’ portfolios offer no value to their online brand at all. These may be domain names representing brands or products that have long since disappeared, multi-hyphenated names, registrations in fad TLDs such as ‘.tel’ or ‘.mobi’, or simply domain names that do not resolve to live websites. Before dipping a toe in the world of the new gTLDs, it is worth reviewing the existing portfolio and carrying out a spring clean in order to make room for some of the exciting gTLDs that the future holds.
The key takeaway here is that every organisation needs a strategy which is clearly documented and understood by all stakeholders in the business. Unfortunately, as yet too few companies have taken this step, which means that they are currently investing unnecessary cash, time and resources into trying to manage domain name portfolios that do not fit the current requirements of the organisation or match the SEO criteria. Only with a clear understanding of what they have now and what they will need in the future can organisations optimise their online presence and take advantage of all the opportunities for consolidation and growth that are available to them.