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China Trademark 50 provides clues for domain investing

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Kassey Lee examines more data about what domains Chinese companies choose.

Magnifying glass over Chinese flag

When running a business, we need to know our customers in order to provide the right products to them. This is also true when selling domains to end users in China.

For that purpose, I have studied the top 100 internet companies in China and Fortune China 100 companies. Today, we’ll look at “China Trademark 50” published by World Trademark Review, which lists companies in China holding the most trademarks. These companies are leaders in corporate China and therefore can show us the overall domain preference of Chinese companies.

Below is the list. Because two companies are foreign (Disney and Sanrio) and 10 companies could not be found, that leaves 38 companies on the list which are meaningful for our analysis.

RankCompanyDomain
1Tencent Tencent.com
2Jingdong JD.com
3Alibaba Alibaba.com
4Huawei Huawei.com
5Baidu Baidu.com
6Alpha GroupgdAlpha.com
74399.com4399.com
8Yili GroupYili.com
9GeelyGeely.com
10Xiaomi Xiaomi.com
11China Central TelevisionCCTV.com
12ANT (Alipay)Alipay.com
13XindeyuanXindeyuan.com
14BytedanceBytedance.com
15Wisdom GroupYoujiazhenhao.cn
16VivoVivo.com
17MideaMidea.com
18Jialan GroupJala.com.cn
19Didi DidiChuxing.com
20Gongchi(not found)
21Gree Gree.com
22Sheng Interest(not found)
23Ping AnPingAn.com
24Weiyu(not found)
25Saiyo (not found)
26Mengniu Mengniu.com
27Durian TechnologyLiuliankeji.com
28QiyiQiyi.com
29Dajia (Kuaishou)Kuaishou.com
30Luzhou Luzhou.com
31Caigang(not found)
32YoukuYouku.com
33Oppo Oppo.com
34Baolans(not found)
35Yuanqi ForestYuanqiSenlin.com
36Three FastMeituan.com
37First Automobile WorksFAW.com
38SF ExpressSF-Express.com
39Gestalt Health(not found)
40YangheYangheGlobal.com
41Great Wall Motors GWM-global.com
42JiumuJomooGroup.com
43Jiezhi(not found)
44GomeGome.com.cn
45Disney (USA)Disney.com (USA)
46Xiao Dan Sister Network(not found)
47Townsend Pijian(not found)
48Sanrio (Japan)Sanrio.com (Japan)
49SinopharmSinopharm.com
50China UnicomChinaUnicom.com

Here are the results. 92% use .com and only 8% use .cn domains. No other extensions are involved. The median length of the names (excluding extension) is 6 characters and the majority (84%) are 10 characters or less.

29% of the domains are not brand-matching. For example, Great Wall Motors is known as GWM but its corporate domain is GWM-global.com, not GWM .com (developed). Another example is Alpha using gdAlpha.com, not Alpha .com (developed). An opportunity arises if you happen to own the upgrades for non-brand-matching domains.

Pinyin domains are most popular at 46%, followed by English-based domains at 35%. One company uses a numeric domain (4399.com), and three companies prefer acronyms: JD.com, FAW.com, and CCTV.com.

The fact that 10 out of the 50 companies could not be located is very telling. It shows that many Chinese companies still do not understand the importance of domains and making them visible in the digital world.

In short, invest in short Pinyin/English-based .com domains for end users in China.

Some English-based domains used by Chinese companies in recent news

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Chinese companies often use English domain names.

Image with the words "English domains in China"

Many investors have the misconception that Chinese companies use only Pinyin domains. On the contrary, I come across English-based domains regularly when reading Chinese news. Here are 10 Chinese startups I picked up from financial news just in June.

Brand Business Funding Domain
Airdoc AI-based medical care Series D Airdoc.com
Honor Trends Blood inventory control Series A HonorTrends.com
xCharge Electric car charging Series B xCharge.com
Lady Penguin Wine Series A LadyPenguin.com
dCarer Digital health care Series C dCarer.com
EcoFlow Eco power supply Series B EcoFlow.com
GenePoint Bio material storage Series C GenePoint.com
ChemExpress Chemical reagents IPO ChemExpress.com
Best Covered Alzheimer treatment Series A BestCovered.com
GensKey Genetic testing Series C+ GensKey.com

What can we learn from these domains? (1) .com (2) Brand-matching.

This means that if you invest in English-based .com domains, you still have a chance to sell to Chinese end users. Just make sure your domains are listed at a marketplace with retail outlets in China.

Also, if you see a domain not matching its Chinese brand, there is a possibility that the company will upgrade to its brand-matching .com.

The problem with selling .org domains to Chinese entities

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Have a .org domain targeted to the Chinese market? Read on.

Do you own .org domains intended for Chinese buyers, such as Pinyin domains? If so, you should be aware of restrictions and trends that make aftermarket sales unlikely.

The chart below indicates the total number of .org domains registered in China over the last 15 years, according to China Internet Network Information Center (CNNIC). You can see a consistent decline in recent years, which fell to 146,000 domains in 2020. This number is really tiny when compared with the 19 million .cn domains registered in the same year.

Chart showing decline in .org domains in China

There are several reasons this might be the case.

First, website operators in China need a license, and the government doesn’t issue licenses for .org domains.

If you visit Aliyun (Alibaba subsidiary), the largest domain registrar in China, you may find the following notice on its .org domain registration page.

.org域名暂无法进行网站备案，请先注册进行保护

The notice says that you can register your desired .org domain, but currently, you can’t apply for an ICP license to build and operate a website on the domain in China.

Obviously, this means registrars in China don’t push/promote .org domains heavily, and Chinese businesses and non-profits will steer clear of these domains.

Second, it isn’t easy to become a non-profit organization in China. As I have said earlier in another article, in recent years, the Chinese government has been very strict in confirming non-profit organization status. While .org is open to any type of registrant, it is a preferred extension for non-profits.

Finally, .org registry Public Interest Registry began focusing on quality over quantity of registrations a few years ago, so cheap promos for domain investors are out.

These issues, primarily the ICP issue, mean that .org domains held for sale specifically for the Chinese market are probably an unwise investment.

How important are .cn domains to Chinese companies?

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Kassey Lee examines if big Chinese companies care about .cn domain names.

Image of hanging lanterns with Chinese letters and .CN

Many investors may assume that .cn is the preferred extension of Chinese companies for their domestic market. However, the result of my recent study may surprise you.

I picked the top 100 Chinese companies from the 2019 Fortune China 500 list (in Chinese), then used Baidu to find their corporate domains (the flagship domain representing a company). For a corporate domain not using .cn, I also checked the status of the .cn domain.

Here’s the result of my study.

Usage of .cn Count
As corporate domain 25
Developed 12
Forward to .com 4
Not resolve 48
For sale 7
Others 4

Among the top 100 companies, only 25 of them actually use .cn in their corporate domain. In other words, when you search for a company in Baidu, you’ll see its .cn domain name, which is used to serve the domestic market.

Twelve companies use .com in their corporate domain but the corresponding .cn domain is also operating. This practice can catch all visitors, regardless of whether they visit the .com or .cn domain. Although four companies have chosen not to develop their .cn domain, at least they forward visitors to the corresponding .com domain, which is also a good practice.

A whopping 48 .cn domains do not resolve, and some of them may be owned by third parties. Surprisingly, seven .cn domains are still for sale, suggesting the relevant companies are not interested in securing these important digital assets (at least, at the price they are offered). Finally, four .cn domains are likely owned by someone not related to the companies.

Putting all of them together, this is what I see: almost 60% of the top companies in China do not own or develop their matching .cn domain. So, .cn domains are not very important to Chinese companies. It’s still a .com world.

Domains plunged 18% in China last year

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Registered domains in China fell last year.

The latest report published by the China Internet Network Information Center (CNNIC) does not paint a rosy picture about demand for domains in China.

In 2020, the total number of domains registered in China fell from 51 million down to 42 million, and it occurred at a time when many businesses were moving to the digital world in order to combat Covid-19.

Look at the chart below. It shows domains registered in China over the last 20 years.

Chart showing number of Chinese domains registered

Compare the 42 million domains registered with the 4.4 million websites in China and we may conclude that investors are the largest holders of domains. This assumption may explain the three dips you can see in the chart: 2010-2011, 2017-2018, and 2020.

In 2007, a boom started when lots of investors were lured by aggressive pricing of $1 (or even less) to register .cn domains. However, the Chinese government changed its rules in 2010 and required owners of .cn domains to submit their identification information, such as a photo and ID. This upset a lot of investors, particularly those outside China. As a result, they simply dropped their .cn domains, causing the dip between 2010 and 2011.

In 2015, people got excited about Chip domains as a new investment theme that treated “Chinese premium” domains as very valuable. The bubble then burst, causing the dip between 2017 and 2018.

In early 2020, Covid-19 hit China and many Chinese investors became nervous about the domain market. The impact was felt almost across the board, causing large drops in .cn, .com, and other domains. As Covid-19 is not over yet, I don’t expect this situation to improve anytime soon. It may be worth comparing this to demand for domains in worldwide, which soared during Covid-19 as businesses got online.

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