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Domain Name ManagementBasic terms of the New gTLDsMarketing

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10 Good reasons for the New gTLDs

 

Introduction

The news agency CNN announced : “The largest-ever expansion of the Internet’s naming system is coming … “. On “Reveal Day”, the 13th of June 2012 a list of 1930 applications for the new generic Top Level Domains was released. This initiative by ICANN, the regulator of the domain name system of the internet, should introduce more innovation and competition to the existing extensions like .COM, .ORG and .NET. Applications come from online-visionaries with .AMAZON, .GOOGLE and .APPLE as well as from world-renowned industrial and service brands with .BMW, .DELOITTE and .DHL. Additionally, many cities applied like .LONDON, .BOSTON, .TOKYO and .PARIS and private investors go for .ART, .LTD and .MED. and many others.

Though exact timing hinges on various parameters difficult to assess, it is rather safe to assume that the first new TLDs will be launched in 2013. The first ones will be the IDN-TLDs (Internationalized Domain Names). These are extensions in non-latin script which most probably will be launched in August / September 2013 with e.g. .москва (Moskau in Cyrillic) or 點看, the transliteration of .COM in Chinese script.

Through the following months and years – very probably until 2015 – the other endings will be launched. It is expected that the number of new endings will surpass 1000. This can result in a four-fold potential enlargement of the current Domain Name System of the internet and must be compared to today`s only 22 generic TLDs with the likes of .COM, .ORG plus 295 country specific TLDs like .DE, .NL und .CO.UK.

From numerous meetings with clients and prospects it appears that mostly companies specialized in online services fathom the importance of the new gTLD launch and its consequences for their business. Indeed, most brand owners seem to lack concrete information as to what is at stake for them. When informed about the new gTLDs there are nearly always two reactions : 1) „Why is it important for my business ?“ 2) The second reaction is being overwhelmed by the sheer number of new endings and the seeming complexity of the subject. This very often results in inaction.

This paper will try to contribute to clarifying both questions. Firstly, concrete reasons will be outlined – using real-life examples – as to why the new gTLDs could be of interest to one’s business. The first 6 reasons will pertain to Marketing and will highlight the chances of this new development. It will also show the risk of inaction by showing the opportunities foregone. The other 4 reasons will focus on the often neglected brand protection and the associated (social) cost of this development for brand owners / trademark holders who have to engage additional means to protect their intellectual property – alas, independent if they profit from the new gTLDs or not. (In our complementary article (“6 steps ...”) you will find the recommendations on best practice tips and solutions – a guide on “how to” and “what first”. But in order to build on the opportunities and minimize the risks one first has to understand them.) Secondly, the case will be made that the issue can be greatly simplified. One step further : it can be argued that for every significant brand the 1398 potential future extensions can be filtered down to a handful or two in which it is really important to register domains. The following headers can thus also be understood as systematic checklist to take stock of a company‘s needs.

Marketing

Decisions in the field of Marketing need to be based on Return-on-Investment. This typically ensues problems of measurement. A categorization of approaches is a valuable first step :

  • 1) Industry, Product and Service Domains : The magic words on the internet are speed and simplicity. This translates into „intuitive search“ when it comes to be found on the internet – primarily via Search Engines like Google. In the jungle of information offers we will see those solutions succeed which are simple and direct. Ideally corresponding to this request are so-called „speaking“ or „self-descriptive domains“. They are often called Keyword Domains. Keywords in the domain name are just one of the criteria to reach the all-important upper ranks of the search engines , albeit a very important one. In the case of Industry Domains, a special kind of Keyword Domain, they offer the information seeker not only the name of the company but also explain the industry this company is in. This is e.g. very instructive where the industry connection is not so obvious (e.g. Schultz-Myers.LAW) or where the same brand equity is leveraged in different industries like in BMW.CAR and BMW.MOTORCYCLES. Another special category of Keyword Domains allow to integrate search-relevant names for the service or the product into the domain name itself e.g. DENNEMEYER.TRADEMARK or MERCEDES.TIRES. These Product and Service Domains are also very well suited for the use in focused marketing campaigns as they allow an elegant integration of Online and Offline Marketing as it is easy to prove in any radio or TV jingle mentioning a website. Last not least : Be sure to take a long-term view and also consider product developments, new market entries, social or sponsoring activities and future acquisitions.
  • 2) Non-Latin Script (IDN) and Foreign Language Domains : If your business goes global a very first step in Marketing is to align your messages with the requirements of foreign languages and scripts. If a non-latin character script is used in a targeted market , the IDN-TLDs (non-latin script domains) have to be considered. The comfortability of accessing the Domain Name System of the internet entirely in their native script is an obvious virtue. This is not least due to the fact that e.g. Chinese users can stop to tediously change their keyboard function if they want to type in latin-script domain names. But Language does not stop with the IDN-TLDs of which we counted 43 Keyword Domains. eBrand Services conducted an analysis covering about 90% of world wide internet users with their spoken languages. The results show that for the relevant 630 Keyword Domains there are 528 TLDs understood by English speaking internet users. Interestingly, many terms are also understood in more than one language whereas some are proprietary. We compiled the following relevant statistics (integrated in our search tools) : Understood by Spanish speaking internet users are 90 keyword domains, Portuguese 91, French 163, Italian 95, German 147, Dutch 109, Swedish 88, Danish 109, Russian 77 and Mandarin 102 (for a Chinese speaking frequent internet user who can read latin-script). Thus, it makes sense to cross-check Keyword TLDs for language reach and fine-tune the segment approach.
  • 3) Generic Keyword Domains - Bigger Choice : There is a group of generic Top Level Domains which leverage popular terms for ecommerce, the internet and online sales – here called Generic Keyword Domains. Wheras the popular extensions .COM,.ORG and .NET – among others - are relatively overcrowded and keyword domains are hardly available. These new generic TLDs with the likes of .WEB, .SHOP, .SITE, .NEWS or .BLOG improve the chances to register domain names which are shorter, more search-relevant, more self-descriptive. This argument Pro gTLDs is the most popular. Interestingly, there are many, albeit less well-known, existing extensions which still give ample opportunity to register domains. The lack of domain names in itself is not the problem – the lack of domain names in popular extensions is. The core question therefore is which of the new generic extensions will become relevant and popular. This in turn will depend on their marketing budgets, launch timing and the perceived value of their business model. Despite all this uncertainty – the popular ones will have to be reckoned with and also improve the chances for shorter and better memorable domain names. That this can be done has been shown by .CO, a TLD launched only recently. Having invested heavily in marketing they were a surprise success in the Domain Market. Companies used that chance as evidenced by Overstock.com now known as O.CO. This development has to be closely monitored.
  • 4) Geographical Domains : One of the most important trends on the internet is the so-called „localisation“. The search engines – led by Google – give more and more importance to geographical nearness to the user and give preference to search results, which for the user are more easily reachable. For example : To a user in Boston, locally identified by Google via her IP-Adress, an AUTO-LEASING.BOSTON will be shown – all other things being equal – at a higher search rank than AUTO-LEASING.COM. This is important when one bears in mind that the potential consumer reach of a city TLD like .TOKYO, .NYC or .LONDON is bigger than many countries, has exceptionally high buying power as well as trendsetting potential and a very concentrated base of business clients. Furthermore, corporate customers should consider the coming new TLDs of the great international metropoles in the lines of „global player, local actor“. For example DENNEMEYER.MADRID, DENNEMEYER.PARIS and DENNEMEYER.MOSCOW will better define international presence and signal local competence than the same name with the corresponding country code TLDs .ES, .FR or .RU. Above that, some industries will want to register Geo TLDs for brand strategy reasons. For them it will make sense to align their brand with selected City TLDs e.g. the cosmetic industry might want to choose .PARIS or .COLOGNE, a German beer producer might want to position his brand with .BAYERN, where supposedly the best beer in Germany is brewed or Whiskey producers might choose .SCOT. Finally, the well-documented trend towards people identifying themselves more and more with their region (counterbalancing globalization and its perceived loss of identity) should be taken into consideration. Therefore, not only consumer goods companies should have a serious look at the new Regio TLDs like .QUEBEC, .VLAANDEREN, .EUS (Euskadie = bask country) or .ARAB.
  • 5) Other Keyword Domains - Improved Segment Focusing : Online-Marketing is a very efficient tool when it comes to personalisation and better targeting towards your customer segments. The new internet extensions improve on that. The new gTLDs will allow a targeted approach filtering customers by leisure groups (.ART, .FOOTBALL, etc.), by family status and age layers (.DAD, .FAMILY, .KIDS etc.) ; educational and professonal background (.DOCTOR, .MED, .ARCHITECT, . MBA etc.), values shared and peer groups (.ECO, .GREEN, .VIP, .RICH, .DEMOCRAT) and much more. In B2B-Marketing the above mentioned industry as well as product and service TLDs can be used with this aim. But also Title-TLDs (.PHD, .CEO) and Org-TLDs like .INC or .LTD can play an important role here.
  • 6) Restricted Domains - New Business Models : The declared mission of the new gTLD programme is increased competition and innovation. The cornerstone of innovation is the relative freedom of the applicants to design their own policies for their future TLDs. Whereas 70% of the ca. 633 Keyword Domains have chosen to be open for the general public. Interestingly, only 30% have chosen to introduce special elligibility criteria thus restricting more or less severely access to their extension. Among these are a row of future TLD operators (registries) who have announced new approaches, which makes registering domain names with them recommendable for the companies in question. For example : If an insurance company wants to register their brand under .INSURANCE or .VERSICHERUNG (German for „insurance“), they need to prove to the TLD operator that the company is authorized and has the appropriate licenses to work as an insurer. Having acquired such a domain – a company could then use it as official seal, granting it to their representatives and agents (e.g. AGENT.AXA.INSURANCE). A special verification process coupled to the registration of a domain name establishes an effective authentification of the registrant simply by using a domain name. This is the concept of several new gTLDs especially designating certain industries and professional groups e.g. .BANK, .BANQUE, .ARCHITECT, .MED. In contrast, companies applying for brand TLDs („dotbrands“) like .AMAZON will restrict usage only for their own pupose and that of their affiliates. This chance for companies to have their own island of secure name space on the internet has attracted many applicants. For example, Canon has alluded to give purchasers of their cameras a domain which will give access to value-added services storing and managing pictures via a built-in Wifi access thus creating opportuinites for cross-selling and locking in the client. This window of opportunity is closed until the announced second wave of applications will be possible. We do not expect this to happen before 2016 – most probably even later. Nevertheless, nothing prevents companies to reinvent the use of domain names with new opportunities as e.g. ACER.HELP, iPHONE.WIKI or PORSCHE.CONSULTING.

Brand Protection

Complementing the marketing perspective it is highly recommendable to analyze the new gTLD initiative in the light of brand protection. In the final analysis it could lead to similar decisions. Nevertheless, it should be treated as a separate issue in its own right.

  • 7) Matching Geo-TLDs and Trademarks : 63 applications run under the ICANN-category „geographic“, which ensues special requirements in the application process. Among them are : .NYC, .NRW oder .AFRICA. Another 25 so-called Culture-TLDs do not fall under this category, but still have an important geographical reference e.g. .IRISH, .SWISS oder .RUHR. It is widely known that a protected trademark in one trademark class and or jurisdiction cannot prevent the registration of the same name or confusingly similar name under another class or another jurisdiction. This insight even weighs heavier on a global scale. Even though defensive registrations should be handled very selectively, it is clearly recommended for the most important new gTLDs designating countries, important regions or cities. As a rule of thumb those Geo-TLDs should be considered for defensive registrations which correspond to Country Code TLDs (e.g. .DE, .CO.UK, ...) and under which – after careful analysis – the decision was already taken to protect one`s brands with defensive registrations. If for example the United Kingdom is important for brand protection and thus the decision had been taken to register one’s brand under .CO.UK it should be considered to at least to register with .LONDON and even with .SCOTS and .WALES or even its synonym in Welsh language .CYMRU (given that the eligibility criteria apply).
  • 8) .COM-Aspirants and Keyword-Domains : There are many well-documented cases where companies have underestimated the importance of protecting their brands under.COM or .ORG in the past. This proved to be a very costly error. The question has to be asked if this could repeat itself with the new gTLDs. Alas, it is not easy to gauge the potential threat to your brands and it is also not recomendable to defensively register all of them. Here are the facts : Alone 73 Top Level Domains try to position themselves as the next alternative .COM. They are „generic“ meaning that they do not have an industrial, serice, product or any other focus and are non-restricted i.e. domain names can be registered by anyone for anything (within the framework of ICANN rules and the general law). Another 39 TLDs can be seen to compete or complement .ORG – with many being non-restricted like .PARTNERS, .HOLDING, .GROUP. With others certain eligibility criteria have to be met in order to register a domain name with them like .GMBH, .SRL or .LLP. Under the category „Online-Sales“ one can summarize 56 non-restricted TLDs like .DEALS, .DISCOUNTS or .BUY. Clearly, not all of these TLDs will be successful and draw the search traffic they are aiming at. Nonetheless, some of these extensions will prove to have „mass appeal“ i.e. they will become very important and not to be missed. This begs the question : Which ? The generic IDN-TLDs – above all the transliteration of .com, .org or .net in Arabic, Chinese, Corean, Cyrillic, Japanese and other scripts are an obvious recommendation (see above). Within the group of latin-script TLDs it is more difficult. Building on expert forecasts and the first results of so-called „pre-registrations“ .WEB, .APP, .SHOP, .BLOG, .SITE, .FREE and .NEWS seem to have very good prospects. Unfortunately, the situation is far from clear yet. Firstly, all of the above mentioned have more than one applicant ; e.g. .APP started with 13 applicants and only one will prevail. This results into possible delays in launching. It also reamins unclear who of the applicants will make the race and who can register a domain. E.g. in the case of .NEWS one of the 7 applicants, Amazon, is announcing to restrict admission. Other parameters influencing the possible success of a TLD are opposing parties („GAC Early warnings) and evaluation results of the application, the financial situation of the applicant and marketing budgets, prirotiztion draw numbers and sequence of similar TLD launches, chaning trends on the internet and changes in perceived value-added etc. Without complicating the situation further the message is rather simple : trademark holders need to come up with a watch list of potentially important generic TLDs and either set up an internal evaluator team or ask external experts to support them.
  • 9) Building and Retaining Brand Value : Trademark protection is important but has to be seen in connection with the overarching strategic goal of building brand equity and retaining it. A seemingly good legal decision aiming for risk minimization is all too often based on existing trademarks. This might be too limited as there is a complementing need to carefully consider longterm brand positioning and draw on future plans. For example, planned acquisitions or product developments to diversify into new regional markets or industries can produce the need to consider new Geo TLDs or Keyword TLDs which do not seem obvious just looking at the current trademarks. Core brand associations and brand mantras should also be taken into account. For example brand experts of McDonalds with their mantra „I`m lovin` it“ could also consider registering MCDONALDS.LOVE. Sponsoring commitments can also tip the point of opting for one of the various Sports or Leisure TLDs be it REDBULL.RACING or ROLEX.GOLF. Lastly, a more strategic outlook is needed to evaluate the risk of Keyword Domains whose operators try to establish a TLD reserved for their puposes. Thus, e.g. in the case of .CARINSURANCE the applicant „Allstate Fire and Casualty Insurance Company” (AFCIC) states : „The registry will be closed to registrants who do not have a formal, written agreement from AFCIC or an affiliate of AFCIC, specifically allowing the registration of a second-level domain name in the .CARINSURANCE gTLD registry”. This company could be trying to dominate the most search-relevant keyword for a very important part of the international insurance industry. This surely merits further analysis to object against it via ICANN processes or the resources of general law and generally to monitor and in case be prepared for such a bold move in most important business media available : the internet.
  • 10) Reputation-Endangering TLDs : Serious nuisance for Trademark-Holder and Companies in general are caused by TLDs, which simply through their descriptive character and the values associated therewith become incompatible with company goals. These are per definition e.g. .WTF (acronym for „What the Fuck“) or .SUCKS. Contrary to their mission statements in the application texts experts have alluded that the business model heavily leans on perceived earnings through so-called „blocking“ which are fees paid for not appearing under this TLD. The last word has not been said here as the above mentioned have received an official warning from the governement adisory council (a body within ICANN). Equally problematic for those companies who do not want to be associated are the 4 TLDs in the category „Adult“ (.SEX, ,SEXY, .PORN, .ADULT). A less apparent reputational risk is posed by a number of so-called Social TLDs which at first sight seem unproblematic. But this turns as soon as they are malintendendly used or put out of context. This can result into reputational damages for public figures or important representatives of a company. Drawing on examples in the poilital field just think of Socialdemocrat.RICH, or Politician.RIP.

Resume : This paradim shift on the internet will not happen without delays and problems. This is not only due to its technical complexity but also due to the consensus-oriented, multi-stakeholder approach of ICANN. Whereas the latter is politically a clear strength, administratively it is an invevitable timing risk. Yet, it is clear that the new gTLDs will come – starting in 2013. Contrary to versatile and fashionable internet trends such as the rush of numerous brands to invest in the newest social media service, new gTLDs are there to stay and will impact every business no matter their area. There is an important risk of dilution of brands’ reputation and valuable marks, if they remain idle during the gTLD launches. The new gTLDs expansion should be approached as a de facto (compulsory) expansion of businesses current markets. And as such require a careful analysis and definition of market penetration and protection strategies. Inside of the companies different departments should be involved : Marketing, IT, Legal, PR, Strategy and Controlling. Neither registering whatever can be afforded nor totally abstaining from this development is the right choice. Rather a middle of the road approach is recommended thoughtfully establishing a limited list of domains to be registered per brand, a watchlist for those which cannot be decided yet and or pose a threat to the company. This should be complemented by registering the important trademarks in the Trademark Clearinghouse (a Must !) and the complementing usage of professional monitoring tools. Periodical checks for importance in local Search Engine Ranking and Traffic should carried out to see if the decisions need to be corrected. Due to the complexity of the matter and the interests at stake it is highly advisable to engage in a well-structured process which we will expand on in our complementary white paper „6 steps ...“. It should be taken into consideration to ask for support by domain experts and IP-specialists who are focusing on taylor-made corporate solutions. eBrand Services offer „one-stop-shop“ solutions for companies drawing on their proprietary tools and specialized databanks and their network of group companies and partners.

eBrand Services offer on new gTLDs for corporate clients :

  • Newgtldtool.com : Our custom designed intelligent database enables you to quickly browse, filter and sort all 1930 of the applications. This tool is free of charge for our clients and filtering results are downloadable for future use.
  • Trademark Clearinghouse : We offer full service and assistance in registering your trademark in the Trademark Clearinghouse – the central protection mechanism for trademark holders for the global new gTLD program. Let our domain and IP specialists trustfully handle the registration of your trademarks for you. Our proprietary platform makes the processing of a multitude of trademarks manageable, efficient and transparent. Additionally, our partnership with well-reputed law firms throughout Europe enables us to handle unique cases.
  • Other Rights Protection Mechanisms : eBrand Services has designed a series of defensive approaches to protect your trademark rights. The aim is to guide you through the various rights protection mechanisms and provide a customized approach to your intellectual property situation. As our client, we can assist you at every stage of the new gTLD program, during the objection window (until 13th of March 2013) and thereafter (UDRP, URS).
  • Domain Recovery : we are specialists in domain recovery and domain purchases for corporate clients.
  • Registration of new gTLDs : eBrand Services will offer launch services and registrations for all accessible new GeoTLDs and Keyword TLDs. Over the course of the next two years, this list is anticipated to surpass 500 new gTLDs. Please send us your ‘Expression of Interest’ list for defined domain names under the new gTLD name spaces. We are also happy to establish a watchlist to monitor the progress of special interest TLDs and ensure that no deadlines or important information is missed.
  • Portfolio consulting : we customize domain strategies for brand protection and for online marketing purposes, paying special consideration to the anticipated impact of the new gTLD program. We will assist you in minimizing the time, effort and cost associated with the new gTLD launch and will ensure you capitalize on key opportunities, make better investments and utilize those investments to their full potential.
  • Monitoring : Comparative to previous TLD launches, the protection mechanisms in place for trademark holders for the new gTLD program are significantly more comprehensive, albeit still inherently limited in time and scope. eBrand has teamed up with the number one monitoring specialist of the domain market to develop the necessary tools to expand monitoring capabilities for an unlimited period. This extends monitoring capabilities to encompass misspellings of brand names (“typos”) and combined names not currently covered. A well-devised monitoring strategy is the key to brand protection and policing.

Our value proposition for new gTLD-registries :

Several of our customers have opted to operate their own gTLD. Through our involvement in the new gTLD applications, and in conjunction with our corporate partners, we offer a full package of services for new gTLD registries. Including, but not limited to, our own registrar package - a platform solution for new gTLD registries that facilitates the management of registrations according to desired policy restrictions. Furthermore, this includes Technical Consulting (TMCH Plug-in, DNSSEC, IPv6, registry SLA-monitoring) and support on contractual and administrative matters ; namely, registry-registrar relations. Please consult our experts for more information.

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