In 2015, for many investors, Domain Investment turned from a part time hobby to a hot and trendy occupation. The domain business became a viable, serious and noble business.  The image of domain investors positively improved. The red-hot domain market has drawn the attention of both newcomers and legendary investors (some of  whom had retired or semi retired for a few years before the current boom brought them back).

Looking ahead to 2016, there are several things to consider:

• The devaluation of China’s Yuan could have a major impact on the secondary market. If the USD/CNY exchange rate keeps growing, it will increase the difficulty of Chinese buyers to buy domains from overseas.  

George Hong in his new Xiamen, China office.

Tessa Holcomb
Co-Founder & CEO, Igloo.com

It would be impossible to talk about trends in the Domaining world in 2015 without addressing the staggering growth in China. Servicing this market, successfully, can be challenging but the Igloo team rose the occasion trading traditional email for QQ and WeChat and adopting the CST (China Standard Time) time zone! It was great to be part of the first DOMAINfest Asia, feel the buzz first hand and even transact one of our biggest sales of the year while there!  

While the industry was in a frenzy over the Chinese market and their acquisition of specific non-generic domains, what became apparent to me was the number of opportunities being left on the table within the startup and small business communities. As an industry we took a step back in 2015 from educating these markets. Looking ahead to 2016, we need to re-invest more time and resources in these areas for sustainable growth.  

While it’s difficult to predict how much longer the Chinese Market will prevail, we do recognize that it will level off in time. With this in mind, we are looking to 2016 as the time to grow and educate more end users. We will be making our presence known in new venues both locally and globally. 

Working with startups and top-rated business schools will be a more pointed focus, as we need to concentrate not on the whims of singular markets, but on expanding our core market. Over the past year we have spoken at several startup events where the majority of the founders either didn’t know there was a secondary market for the domains they wanted, or weren’t aware they could work with a broker to help them acquire a domain name that is already owned and/or being used. 

Igloo has continued to see more clients from the startup sector coming back for their exact match .com domain as they benefit from additional rounds of funding. We have also seen a rise in the acquisition of additional intellectual property assets including trademarks, patents and social media handles and expect this trend to both continue and grow.   

With GoDaddy’s acquisitions of Marchex's Archeo and Berkens’ Worldwide Media domain portfolios, to Freelancer.com acquiring Escrow.com and Flippa acquiring Domain Holdings, consolidations, acquisitions and selling off of major portfolios were a trend in 2015 that I don’t see slowing down anytime soon. New companies, brokerages and marketplaces (including our own) were launched giving investors more options to trade in the secondary market across all price points. We’re seeing a renewed interest in top tier generic domain names and January is already off to a great start. If you’ve been holding on for the right time to sell yours, I’d highly consider 2016 as your year. 

Alan Dunn
Managing Director, NameCorp.com

There is no doubt in my mind that China was the biggest story of 2015 and will continue to be in 2016. The amount of activity to a single group of buyers is unprecedented in this industry and, in many ways, resemble the mid-nineties for domain name acquisitions. The second most important story was GoDaddy's acquisition of the Marchex and MostWantedDomains portfolios. Both of these events (China and GoDaddy) have accelerated domain name investing into mainstream media which was a huge step for the industry overall.

2016 will be a fun year. I believe we will ultimately see new highs from Chinese investors (with a couple ups and downs along the way) and more large acquisitions in the domain portfolio space. I also think we are due for one or two companies to disrupt the space. Some will be innovative (like Uniregistry is doing this with the marketplace) and others will be financially driven which may result in higher costs for domainers (consolidation of drop auctions for example). The industry is maturing now with corporate money arriving so change is inevitable at some point. Overall, I believe 2016 will be an incredible year for the industry as a whole - and especially for owners of high-quality short domain names.

Tracy Fogarty
CEO & Founder, eNaming.com

After a very successful stint with DomainHoldings.com, broker Tracy Fogarty opened her own shop at eNaming.com and quickly began posting high dollar sales that turned up often on our weekly domain sales charts. With respect to the most dominant factor in the domain market last year, she made it unanimous.

The most significant event of 2015 was of course China. We've seen an unprecedented demand for short .com domains as well as numeric domain names. While there are a few theories why it happened I've yet to see one I'm fully comfortable with.

Looking ahead, eNaming focuses on domain names as utility. While traders will trade, we're driven by fulfilling the demand of business owners first. Our main challenge is to continue to educate the domain buyers. We believe that for business owners, the correct valuation of domain names must integrate their business objectives, budgets, vision, and a plan. Domain names are direct marketing tools and in the hand of talented marketers can create and be the catalyst of change, growth, and profits.

Sedo CEO Tobias Flaitz

There are four visibly significant trends over the course of the last year:

(1) The growth of .com domain names has proven that this is still the most sought after type of domain with average sales values peaking in the past 12 months and other data backing its position as the solid king of TLDs. Established markets as well as growing markets such as China, India and other Asian markets have demonstrated a continued upward demand for .com further supporting .com’s reign and success among other names.

(2) China‘s successful market surge was an anticipated event but it still stunned many in regards to how quickly it became the number one country globally for domains purchased by Chinese buyers.

(3) In general Registries, Registrars as well as marketplaces like Sedo benefited from a growing demand in domain names after a challenging interim development in 2014. There is a clear trend towards a potential renaissance period for domain names which are again being sought after in conjunction with effective online marketing.

(4) New gTLDs finally started to gain traction in 2015 and are not only seeing demand from the domain industry but there has also been a significant uptake in awareness outside the domain industry. This has led to overall interest expanding along with diversifying of the audience base all guided by marketing activities and initiatives of new gTLD registries (i.e. in collaboration with Sedo).

New gTLDs continue to make an impact even with .com’s steady lead within the domain name market. 2015 was significant for investors as well as for end users in utilizing even more new names that came onto the market. Sedo’s registry partners like .Club and others such as .Ski are positive examples of how marketing is essential to create awareness for the new names. Bigger players like Donuts, StartingDot as well as those focused on one TLD alike have benefited from our mutually beneficial partnerships. Back in 2014, Sedo started a program to support the registries with and in 2015 we greatly expanded our efforts by scaling larger and collaborating at even more events. The Sedo gTLD-topped frozen yogurt concept captivated the attention of visitors at events such as SXSW and dmexco where larger groups of end user and multipliers representing big brands, startups and marketing and advertising agencies could be addressed. Continued and additional promotional efforts like this are crucial in the sustainability of the new gTLDs.  

The Sedo team, led by CEO Tobias Flaitz (standing at center), along with some of their registry partners, celebrate a successful 2015 dmexco show last September in Cologne, Germany. 

A reflection on the past year would not be complete without the mention of China and their surge in the purchasing of domain names especially in the latter part of 2015. This made a dramatic impact on the domain industry and secondary market sales. Sedo saw a spike of around 43% of transactions involving buyers and sellers in China. Demand is being driven because Chinese investors are looking for investment alternatives such as domains after downtrends of both the stock and real estate markets. Numeric and shorter domain names are especially appealing to these investors and Sedo had many sales pull in upwards of five and even six figures: Give.com ($500,000), PAX.com ($200,000), 1905.com ($57,000), etc. It should be noted that these are a sampling of high grossing sales of short character names and are not all-encompassing of top sales in this category. This nevertheless was a strong area for new sales and one we’ll maintain and grow upon during 2016.  

Many industry news outlets consistently covered the increase over the past year of BuyNow sales and the trend toward fixed-price domain names. This pricing method creates an easy and accessible path to purchase, potentially converting interest in particular names to sales quicker than negotiations drawn out over a longer period. This doesn’t overshadow negotiable or Make Offer sales as a perfectly viable method for domain sales. While we’re discussing the accessibility of domains and service, it bears mentioning the gravitation of customers towards apps or social networks to access information. Even with the increase of the use and presence of these channels very rampant in today’s world, it is our belief that businesses will not use these as their primary delivery method for goods and services.  

Sedo’s core business has a long history of success among our domain parking services and this year was no different. 2015 saw monetization as a continued valuable revenue source for domain owners and the link of parking and trading activities supported domain sales across the board.

Paul Nicks
Sr. Director, Aftermarket, GoDaddy.com

2015 in domains was all about the Chinese market. We saw a huge uptick in domain investment in the region, which is something we hadn’t seen before. Chinese investment in numeric domain names as well as domains with just a few significant letters skyrocketed last year, and this looks set to continue. There’s an overall increase in domain brokering between America and China and the question on my mind as we head into 2016 is whether or not Chinese domainers will continue to see domains as a more stable investment vehicle, and diversify their investments accordingly (possibly expanding into keyword-rich English-language words and phrases), given the current state of the Chinese economy. 

This year at GoDaddy, and across the domain industry more broadly, we’re really interested in everything mobile. Given that the domain aftermarket is very time sensitive and competitive, 

it’s essential that investors are able to participate in auctions from anywhere at any time, so I think we’ll continue to see domain investment go increasingly mobile. Last week we announced The Domain Investor app, our first mobile app dedicated specifically to investors, and other domain aftermarkets are putting out their own mobile apps as well. Overall, I think domaining will grow in mobile this year, whether through apps or a responsive, integrated, consolidated mobile experience to help get domainers off their desktops. 

Mike Mann

In 2015 Chinese investors went in heavy for short .Com domain names that met their specific criteria. In general, super premium .Com domains held their long term value all around. Those who have invested in alternative gTLDs (i.e., not .Com), other than the best of the best, have taken undue risk, given the virtually limitless expanding gTLD space which continues to dilute its predominantly valueless assets over and over, while .Com valuations rise.

For example, DomainMarket.com has 250,000 of the world’s best quality and best priced, contextual .Com domains for immediate sale and transfer, as a long term safe alternative to the alternatives.

On one hand folks may believe new domains devalue .Com to some degree, but in fact that is only true for the ones of questionable value in the first place. The best .Coms increase in true value over time, regardless of their sale prices in this confusing, illiquid market space. .Com will keep rising due to scarcity, more internet users worldwide, smarter branding, marketing and domaining experts; and because the gTLD alternatives can’t distinguish themselves; 

they drive additional awareness, traffic and value to the corresponding .Com domains. (Especially if anyone ever uses the alternatives in commerce, as opposed to just rampant speculation currently. Right now only a miniscule percentage of global web sites use the new style domains.)

On average, the smartest marketing people in the US were hired by the biggest companies in the US. And every single Fortune 500 company uses a .Com domain, likely many .Com domains. None are foolish enough to use alternatives that could confuse their customers, or drive value and traffic to the corresponding .Com. 

Presumably Chinese knowledge, and worldwide knowledge of branding and investing experts will expand in 2016, and possibly cause additional .Com niches to spike in sales volume and pricing. (likely two word category killers, which have largely been overlooked so far).

Moreover, I believe the current global stock market crisis may drive fresh investors to try alternative assets like .Com domains; but we also find the overall drain in wealth to be a negative. Therefore, we believe the “market crash” is a net neutral to the domain investing environment.

Mike Mann speaking at the 2011 T.R.A.F.F.I.C. East conference in Florida.

There is no, and never will be any, reason for consumers to risk the cost or bad branding of alternative domains, except if they can get one of the very best at a very low cost as a means of testing only, something like “golf.club” or “abc.xyz” (which they may still find confuse people and drive value to GolfClub.com and AbcXyz.com.) So any way you slice it expect no long term profits for end user investors and branders in alternative domains except in rare circumstances. Possibly some of the registries and registrars themselves may have a hit with short term launches of the better gTLDs, like pending ones .web, .blog or .commerce.

But again, since they all constantly dilute each other but drive more value to .Com, they will overwhelmingly fail to make long term profits. Fewer and fewer alternatives will get registered on average over time, and the majority of those which are unused in commerce, that were purchased for speculative purposes, will ultimately not be renewed and will be deleted over the next few years. Also fewer new gTLDs will be launched overall as some of the others become documented failures.

.Com is, was, and will always be king. Remember this before you lose your ass. Also only invest in the very best .Com at the very lowest prices. Every other strategy is too risky for all but a handful of people in the world who happen to have a very special trading edge and skill set, plus a lot of investment capital and tolerance for risk.