Sale to data recovery firm is biggest of the year.
[Updated 9:49AM CST] ESS Data Recovery has purchased the domain name DataRecovery.com for $1.659 million, confirms company President Ben Carmitchel.
The sale marks the biggest reported sale of the year and shows the promise of a targeted, generic domain name.
The seller is competitor Associated Computers, Inc. of Minnesota. Carmitchel confirmed that the transfer took place on February 1, 2008.
In a phone interview this morning, Carmitchel said he’s been working on buying the domain for a long time.
“I’ve been working on it for 5 or 6 years,” said Carmitchel. “I’ve known [the previous owner] for a long time. He wanted to sell it but he wouldn’t let it go for chump change.”
Although the domain wasn’t cheap, it is already proving its value. “To us it’s definitely worth that amount and it has already proven its worth,” said Carmitchel. “We’ve already had a lot of direct traffic.”
The company used to spend $10,000-$12,000 a month on pay-per-click, but found it difficult to get a good return. The Google Adwords Traffic Estimator Tool has an estimated $13.83 – $20.74 per click to be in positions 1-3 for the term “data recovery”, with a total cost of $3,820 – $7,210 per day.
But it’s not just customer lead generation that makes up the domain’s value. It’s the name recognition and simplicity.
“Our customers will be able to easily recognize us,” explained Carmitchel. “We can tell them ‘just go to datarecovery.com’ rather than e-s-s-data-recovery. It makes the whole process a lot smoother for the customer.”
The company took out a loan to pay for the all cash transaction that did not involve any transfer of customers or business from the prior owner. When comparing the loan payments to the increased business, Carmitchel said the return on investment is easy to prove.
ESS Data Recovery provides data recovery services. The company has 23 employees.