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Color.com now used by a health tech startup

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This shows how versatile a great brandable domain is.

Screenshot of a Facebook ad for Color showing a woman holding a nasal swab

Once used for a photo sharing app, Color.com is now home to a health tech startup. Image from a Facebook ad.

I was scrolling through Facebook today when I came across a familiar domain name: color.com.

GoDaddy brokered the sale of color.com for $350,000 in 2011. A photo-sharing app company with $41 million in funding bought the domain to help promote the app. Unfortunately, the business didn’t work out.

But great brandable domains can be used for just about any type of business, and color.com certainly fits that category.

The new owner is a distributed healthcare and clinical testing company called Color. It has raised $278 million in funding with the latest round valuing the company at $1.5 billion.

Color was founded in 2015 and appears to have acquired the domain name around that time.

How long does it take to sell a brandable domain name?

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Usually a very long time.

Image of computer with brand written on it indicating someone creating a brand

Brandable domain names are an interesting domain investment. I’d split brandable into two buckets:

  1. One word dictionary domain names that can be used as a brand unrelated to the dictionary meaning. Examples are colors, animal names, as well as verbs and other nouns.
  2. Made up words and two+ word combos.

It can take a while to sell either of these two to an end user. And while the first category can be sold to other domain investors, the market for reselling brandables is more limited.

In BrandBucket’s most recent newsletter, the company disclosed how long domains were listed on its service before they sold.

For the most recent month, the median listing time of domains that sold was 29 months. The shortest was 33 days and the longest was over 10 years.

Think about that. This is the time it took for domains to sell, but only a minuscule fraction of the domains on BrandBucket ever sell. And BrandBucket screens out the bad domains, too.

Brandable domains, specifically made up words and keyword combos are tricky. It’s nearly impossible to do outside marketing to end users.

Should businesses use a brandable name or a descriptive one?

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The debate continues and both sides have good points.

For as long as I’ve been in the domain investor community there’s been a debate about what the best type of domain name is for a new company.

Is it a category-defining domain name such as RunningShoes.com? Or is a unique domain that can be branded, such as Amazon.com, better?

Some people say brandable domains are always better. I think depends.

One of my most enlightening interviews this year was with Seth Newman, CEO of BIGNAME Commerce. His company owns Envelopes.com, Folders.com and Bags.com.

Clearly, he’s a believer in category-killer domains. But there’s a catch. He thinks these names make sense only for product categories that people don’t shop for by brand.

People generally don’t think about brands when they search for envelopes. Jeans are another matter; you probably have a favorite brand you usually purchase and that’s how you begin your search. So Envelopes.com is a great name for an envelopes company. Jeans.com is a good name for a jeans seller but it doesn’t have the same benefit.

There are also problems with having the top level domain be part of your brand, and if you are a company like Envelopes.com, then .com is a big part of your brand. The problem is that third-party seller sites like Amazon won’t let your brand have a domain in it. So you have to come up with a new brand on these sites because you don’t want to call yourself just “Envelopes”.

Another problem with category-defining names like these is that your category might change. If Amazon.com started as Books.com, it probably would have had to change its name. (Books.com is owned by Barns & Noble.)

My favorite domains for brands are ones that conjure up an image and are memorable. BlueApron.com is a good example. Apron=cooking.

It’s worth noting, however, that BlueApron has spent a rediculous amount of money on branding and advertising. Not everyone can. Still, even for a small company, something like BlueApron.com may be better than FoodKits.com.

And note that these brandable descriptions are made up of real words, not ones that are made up and difficult to spell.

 

BrandBucket sold 801 domain names for $2.4 million in 2015

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801 domain names found homes through BrandBucket last year.

brandbucketBrandable domain name marketplace BrandBucket sold 801 domain names last year for a total of $2.4 million, the company announced today. That’s an average of $3,000 per domain sold.

The company lists over 27,000 brandable domain names for sale, ranging from two-word domains (DropHatch.com, ShareReady.com) to made up words (Rycky.com, Vouchza.com).

Each domain name in the marketplace includes a logo.

BrandBucket adds a 30% consignment fee to the seller’s asking price, plus a charge for the logo. It also charges a $10 listing fee.

This means the company probably brought in about $750,000 in revenue last year, assuming all domain sales were for third-party listers.

Brandable domain names can be difficult to sell, but BrandBucket does a good job pulling together quality brandable inventory at fair prices. This, combined with requiring clients forward their domains to landing pages, helped the company turn 3% 5% of its inventory last year.

[This story was updated to reflect a sell-through rate of 5% based on the average number of domains BrandBucket had listed for sale last year (16,000).]

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