How ConAgra played it smart by registering PeanutButterRecall.com, and lessons for other companies.
[Editor’s note: Tim Morse, President and CEO of Penguin Search Engine Services, recently investigated defensive domain registrations. He became interested in the topic after discovering that food company ConAgra (NYSE: CAG) registered the domain PeanutButterRecall.com in the wake of the 2007 peanut butter recall but never used the domain. On Morse’s blog you can read the entire 7 part story, but I have worked to excerpt portions of his article that readers will find particularly interesting.]
by Tim Morse, Penguin Search Engine Services
ConAgra Foods registered the domain name “peanutbutterrecall.com” on February 15, 2007, just one day after both ConAgra and the FDA published press releases on their respective Web sites about the voluntary recall of peanut butter produced by ConAgra.
It’s not surprising to learn that ConAgra Foods registered this URL. The company is a leading producer of packaged foods and manufactures peanut butter, among other things. In addition, ConAgra’s peanut butter brands were being voluntarily recalled in February 2007.
But what may be surprising is that the URL itself does not resolve (as of the date of this publication), and never has resolved to a Web page of any kind. It has also, apparently, never been redirected to any Web page. Was this a good move on ConAgra’s part? What advantages or consequences might the company experienced in their handling of the domain name?
In order to learn more about the registration and use of the peanutbutterrecall.com domain, Penguin SES contacted ConAgra. In response to an email inquiry dated August 25, 2008, Ms. Stephanie Childs, director of corporate communication, ConAgra Foods, stated that the acquisition of the URL was initially undertaken to provide the company options for their communication strategies:
“In regards to www.peanutbutterrecall.com, ConAgra Foods purchased that particular URL while considering the best avenues for providing consumers with pertinent information regarding our voluntary peanut butter recall announced in February 2007.
“We subsequently made the decision that the best way to provide consumers with information online was to continue to provide information through www.conagrafoods.com, which consumers were already using and was referenced widely in the media, in addition to the other communication outlets (e.g. toll-free number, media coverage, etc.) we were utilizing.â€
[See the complete article for more quotes from ConAgra.]
It is easy to make the case that ConAgra was wise to have registered this domain name for the cost of a basic domain registration for their registrar. But what if this domain had been on the aftermarket? What kind of price would have been found to be “acceptableâ€ to a company who perceived the deeper values associated with the domain name and would have still allowed the decision to be called a wise one?
As for a domain owner who may have had this name in his or her portfolio, what selling price would have been put forward, and how would the owner have arrived at such a price? At what price would the owner have been accused of selling out “too cheaply?â€ Again, it is beyond the scope of this article to answer specific value questions, but they should be asked.
However, in order to develop some depth of perspective on the matter, Penguin SES contacted a few Internet experts, including Brian A. Hall, attorney with Traverse Legal; Bill Hartzer, Search Engine Marketing Manager with Vizion Interactive; and Mark Stedelbauer, an ebusiness professional, to get their input concerning ConAgra’s domain name registration.
We also interviewed noted author and Wall Street Journal reporter David Kesmodel. Kesmodel was not able to comment directly on the specifics of the ConAgra situation because he currently covers the food and beverage industry for the Journal. He did, however, share general domain industry insights.
Brian Hall pointed out that, “the domain name market is a first-come-first-served market. Unless we are dealing with a case of cybersquatting,â€ he said, “the registration and use, or nonuse for that matter, is entirely within the purview of the domain registrant. That said, it is entirely possible that ConAgra made a strategic decision and procured this defensive registration in order to avoid bad press.â€
Bill Hartzer said he thinks that overall, the domain name registration was a good move on ConAgra’s part, but he gives the company more benefit of the doubt when it comes to the issue of redirection. “I think it was a good idea for them to register that domain name. Not only was it a good decision, I suggest that other companies in a similar situation (e.g., a company that would be potentially subject to a recall at some point) should register domain names as a strategic offensive move,â€ Hartzer said.
Hartzer stated that companies have to be in a competitive mode when it comes to staying ahead of the curve. “As we can see, there were others who were looking to purchase similar domain names. There are other types of domains that a company should own, which includes domain names like companynamesucks.com and companynamestinks.com, and so forth. These are good public relations and reputation management moves for companies.â€ Hartzer added that when it came to redirecting the URL, “â€¦most likely it was just the failure of the company’s IT department to redirect it. I wouldn’t look too much more into that. Certainly it would have been a good move to redirect that domain name with a 301 Permanent Redirect to the section of their site that talks about recalls.â€
On the topic of defensive and offensive registrations of generic domain names, David Kesmodel shared that this practice has been around for quite some time, and that can sometimes be hard to tell who’s playing defense and who’s playing offence. One example that Kesmodel cited are the “sucks sites.â€ He said that companies got wise about people registering “xyzcorpsucks.comâ€ in order to use such names with negative comments about the company involved. “So, some companies have gone out and registered a lot of negative terms around their products that relate to their product or their business.â€ Kesmodel said that it is even common practice for presidential contenders to initiate this kind of defensive registration.