As the ultimate marketing tool, the domain name is one of the most important aspects of online business. A short, memorable domain name can add credibility, increase the mobility of your internet presence and act as a brand-building tool.
Companies with the resources to do so will often purchase other domain names as a defensive move to reduce competition. The proven success of the well-chosen domain name has led to increasing value for URLs with relevance, ranging in the millions for some. Take a look at some of the most expensive web domains to date.
The private exchange of Diamond.com from Odimo Inc. to online jewelry retailer Ice.com went for $7.5 million. This 2006 purchase included only the domain name and associated intellectual property. Ice.com handed over another $2 million to Odimo for its jewelry inventory. Venture capital group Ignition Partners assisted Ice.com in its promise to continue serving customers with high-quality jewelry selection for any budget. The Diamond.com URL is currently inactive.
Originally sold in a bankruptcy court proceeding for $1.25 million in 2009, Toys.com was quickly snatched up by Toys R Us in a court-ordered re-auction for $5.1 million. The initial auction was poorly attended, showing how domain name auction selling prices can vastly differ depending on who is in attendance. The right name matched with the right bidder makes for higher value and, therefore, an increased selling price. Toys.com now takes you directly to the Toys R Us website.
Previously belonging to the American Farm Bureau Federation, the FB.com domain was purchased by social media giant Facebook for $8.5 million in 2010. The American Farm Bureau Federation now uses FB.org. When Facebook purchased Facebook.com back in August 2005, it cost a measly $200,000. The FB.com URL will redirect you to the Facebook.com website. Facebook employee email addresses also share the FB.com name.
In an all-cash deal, the company Fund.com purchased its namesake domain in 2008 for $9,999,950. The deal was brokered by Clek Media. Many people did not believe the story to be true and searched for evidence, but it was validated when DomainState.com member George Kirikos found the SEC report.
Fund.com was founded by Jason Galanis as a fund and risk management company in 2007. Since its inception, the company had no revenues or operating subsidiary. Shortly after the purchase of URL Fund.com, the company was forced to declare most of its financials unreliable due to a damaged business deal in 2009. It currently has no web presence.
The story of Hotels.com is a prime example of how an exact match domain name can advance the success of a brand. The domain name Hotels.com was purchased in 2001 for $11 million according to company president David Roche. The company quickly rose to the top of the online market, and Roche owes much of this success to the web domain. A few years ago, Hotels.com was acquired by USA Interactive for $1.1 billion, making the original $11 million domain price tag a steal.
Nations Luxury Transportation, LLC (Nations) bought up PrivateJet.com in February 2012 for $31.18 million. Nations, from leading intellectual property holding company Don’t Look Media Group, uses the domain to cater to the luxury aviation industry.
In 2013, HomeAway Founder and CEO Brian Sharples authorized the purchase of VacationRentals.com for $35 million. Although the site had been very active prior to the acquisition, Sharples explained that the main reason he bought VacationRentals.com was to keep the website URL away from competitor Expedia.
Purchased by Quinstreet for $35.6 million, Insurance.com was acquired by the company as a media asset. Quinstreet did not buy the insurance agency previously run under the domain, nor did it lay off any employees from that agency. The media asset acquisition company wishes to build on the existing Insurance.com platform, knowing this domain is the main reason for the success of its previously held company. Quinstreet expected to return 20–30% for the acquisition of the domain.
For a total of $90 million, LasVegas.com was bought by Vegas.com in the most expensive domain name purchase to date. A $12 million one-time payment was made upon the agreement in 2005, and monthly payments are to be made in increasing amounts until the $90 million is fully paid. If all payments are made according to schedule, the full amount will be paid by June 30, 2040. At this time, the seller will transfer the domain to Vegas.com for full ownership.
The right web domain matched with the right company can cause its value to skyrocket. There can be an unhappy ending for companies that do not properly plan for such a large acquisition, but many see their business thrive as a result. For those who don’t have millions to spend on a domain for their sites, this list still acts as a reminder of how valuable a well-formulated domain name really is.
For help in brainstorming domain names, you can contact an Imagine Monkey representative who will reach out to you by email or phone.