Buying And Selling Domains As A Lucrative Investment Opportunity

Business Objectives

Buying and selling domains is a lucrative investment opportunity that is very promising to generate good returns on investment. The world is shifting from analog to digital, meaning most businesses have shifted their operations online (Anderson et al., 2019). Thus the advancement of technology has enabled I.T. to be integrated with businesses. The target customers are small to medium enterprises that have an opportunity to expand their business operations to the next level. As the demand for many businesses arises to go global by shifting their operations online, the demand for buying and selling domains has also increased. This kind of investment will generate a lot of revenue and profits. Thus this idea is a viable business idea as most business enterprises need domains that can help them carry their business transactions online. Besides buying and selling domains, other services can be offered at an extra cost, such as the design of websites and web applications, Search Engine Optimization, and hosting of websites and web applications. These services act as an alternative income stream for the business, which is a good strategy for generating more revenue. Thousands of domains are being sold daily, and many are being bought; therefore, there is a high chance that the prices of these domains can be negotiated up to the point the domain is sold at a high price depending on how memorable it is, the spelling, the pronunciation and the extension it has.

For the first three years of operation, the business intends to achieve the following:

Sales revenue of 300,000 dollars in total will be generated from various income streams. The selling of domains will be the major income stream. Other services that come with the selling of domains include; web application and websites development, Search engine optimization, web hosting, cloud computing, and web security. These other services will also provide extra income to the business as most of the time, the selling of a domain can be done as a package that includes these additional services.

The estimated profits will be 225,000 dollars in total – The profits are estimated to be at 75% of the total revenue. This calculation is done based on the business’s operational costs, which will be low compared to the initial costs. Buying and selling domains does not require huge operational costs as most of the business activities can be managed remotely with a good internet connection. The operational costs will mainly be utilities such as water, electricity, phone, and rent bills. Therefore managing business operations will not require a lot of manpower as most of the activities will be automated, such as the generation of invoices sent to customers at the end of every month or year. Domains also are easy to maintain; therefore, the expenses will be minimal, and the profits will be high.

Value Creation

The buying and selling of domains have a lot of value to the customers. Most of them will benefit by increasing their customer base due to increased online activities such as business transactions. For instance, companies with online stores will benefit a lot as most traffic to their online stores will increase as many customers will be able to reach them online, and the demand for their products will increase. When making this comparison to a brick-and-mortar store, there is the aspect of geographic limitations, such as many people cannot access brick-and-mortar stores compared to the many people who will access online stores. Therefore, the value that will be generated to the customers is the Promise of getting traffic to their stores and reaching many customers globally. There is also the ease of carrying out smooth transactions online as most business operations are automated. For instance, in the case of companies that have online stores, there is no need to manually log which product was sold and how much it was worth. A system that deals with inventory management will be able to automate the process for the company indicating the numbers of orders they have and the deliveries they need to make. It will also manage the payments automatically for the company. The work that would have been done probably hundreds of employees is managed by a system online. Therefore, the business of buying and selling domains is in demand because of its benefits on the target business.

Domains are also a form in which businesses use to brand themselves online. Therefore the Promise of having a domain means the opportunity to build a good brand that will attract many customers and, in the long-run, market the business. The return on investment for the client businesses will be high, and therefore it is a guarantee that their businesses will be able to reach online markets and gain a good share of the online markets. Visitors’ perceptions will be strengthened through the Promise of purchasing a domain. The franchise values for the client businesses will be enhanced. Domains also enable the protection of rights for businesses. They have fundamental rights to create the content they desire and publish or license valuable content since it is now their intellectual property (Kraus et al., 2020). The domains also enable the clients to measure the success rates of their businesses using analytical tools that will inform them of how many visitors they visited their site, liked their product, or viewed their product. The domains also help the client business to gain a competitive advantage over other businesses. Domains also provide the opportunity for affiliation and the prospect of expanding partnerships with other businesses. The following is a customer value proposition canvas diagram that illustrates all the values that have been discussed in the context highlighting the key issues that are of great concern and bring value to the customers. 2

Value Capture

Value capture is the aspect of securing the profits or the benefits that have been highlighted in the value creation process (Lipset, 2018). The process of value capture requires good mechanisms that have been set in place to ensure that the creation of the values precedes that of the costs that are incurred in the process of realizing the value and that the surplus that arises from these values is equitably distributed to the concerned stakeholders (Thies et al., ). Thus the importance of the value capture is to show how the values that have been created are supposed to be shared between the customer and the service provider (Olanrewaju et al., 2020). Therefore the aspect of the business model is very important in capturing these values and indicating how the values are distributed between the customer and the provider. Based on the values that have been created in the value creation process, there is a need to align the value capture with the value creation process to ensure that different elements of the value capture and value creation process is appropriate and they relate to one another (Rippa and Secundo, 2019). The following is a business model canvas that captures the value of the customers: 3

The business model canvas provides a series of necessary activities to capture the value in the value creation process (Kwilinski et al.,  2019). It begins with the first activity, which involves developing ideas related to the web domains. These ideas majorly touch on an issue with domain names, the extension, the pronunciation, and other factors that make a domain of great value to the customers. The next activity is planning which ensures that the business is effective. The planning has to be done in advance to know which strategy will be used and what resources are needed to guarantee success (Morozova et al., 2019). After the planning, a prototype is developed, which is very important for testing an idea before it is fully implemented. This helps in reducing risks and unnecessary expenses. The good thing with a prototype design is that the original idea can be innovated, or an improved version can be created based on the strengths and weaknesses of the prototype (Wadhwani et al., 2020). Then there are other activities such as piloting which is a very important business perspective. It helps test the idea if it is working before fully implementing it but systematically implanting it in stages after one is successful (Ratten and Usmanij, 2021). The business model canvas is very important, too, that touches on the various activities that will be performed to ensure that the customers’ values are captured in the value creation process. The business model canvas for the business aligns with the value creation process as it brings out the activities that need to be done to capture the values which are going to be fairly shared between the customer and the provider. In this case, the business buys and sells domains to its customers.

The development plan of the business will focus on key major areas such as the market plan, the operational plan, the technical solution, and I.T. plan, the H.R. and organization plan, and finally, the financial plan.

Regarding the marketing plan, the target customers are small to medium business enterprises. The best way to reach them is through targeted advertising, which uses social media and Google ads, which provide various options for targeting these customers (Hsu et al., 2021). The options include targeting them based on their location, interests, and demographics with these ads. The price for the domains will be standardized with different packaging options ranging from a basic package offered at an estimated price of 300 dollars annually for domains with local extensions, and a premium package at an estimated price of 500 dollars for global domains. The domains will be offered at discounted rates for first-time customers at 20%, and a bonus package will be given to a customer who purchases above 5 domains on the go. These strategies are meant to promote the business and attract customers (Nambisan et al., 2019).

Regarding the operational plan, the business will be involved in various activities such as buying domains and selling them, which are the major activities of the business. Apart from the selling and buying these domains, their management will also be part of the business activity to ensure that all domains are up to date and functioning well. There will also be regular maintenance of the web servers to ensure that they function well. The management of customers’ orders will ensure that their request is processed on time. For instance, customer service will be running 24 hours a day to address any customer’s concerns and relay information or access feedback from the customers. There will also be a delivery of other services related to the domain, such as websites and web application development, web hosting, email management, web security, and cloud services. Specialization in offering extra services related to the domain increases credibility for the business. It shows innovation initiatives to the customers, which makes them more interested in the company’s services and products. Apart from that, it generates alternatives streams of income for the business.

Various aspects will be considered regarding the technology information plan, such as technology infrastructure, mode of data processing, and information technology activities. The business will adopt the latest technology to ensure that the service being offered is of high quality and that the customers are satisfied with the way their requests are being handled. To achieve this, the business will require customized hardware and software applications that will be developed purposefully to manage the domains that will be bought and sold. The business will also need a back system and a hot site in any disaster. The business will not be affected as the risks will be reduced. The backup systems also provide an opportunity for quick recovery in a disaster. Therefore risk mitigation strategies and a business continuity plan will be adopted as part of the technical information plan, which is very important in managing data, systems, and business operations. The type of data processing required for this business’s success is online data processing, as the business will be operating online in terms of handling and managing customers’ requests (Gupta et al., 2020).

In regards to a human resource plan, the first thing to consider is the organizational structure which is very important in determining how the business activities will be handled and how the strategies for the business will be executed (Garcez et al., 2022). The business structure will be a partnership. It is very important for the business to partner with telecommunication companies and internet service providers to reduce the costs of data rates and telecommunication. Partnering with hardware suppliers and manufacturers is also important as it helps the business get customized solutions to some of the resources it needs to run the business effectively. Other partners can include media that can either be print or social or T.V. media to help advertise the business. In terms of sourcing labor, the company will use internship programs as a recruitment strategy to get the top talents and ensure that the new employees adapt to the company culture during their internship. The employees will also be employed on a contract basis for easy adaptation to changes in management or if other factors play a role in employees’ skills and knowledge, such as changes in technology, which may demand an expert in the I.T. field.

The financial plan is a critical area of business functions as, without it, many business operations would come to a standstill. Therefore in starting and establishing the business, sufficient capital is needed to ensure a smooth running of business operations. For a start, the initial costs will be high due to the reason of purchasing equipment, setting up of data centers, and even hiring of employees and acquisition of other resources as well. However, as time goes by, the running costs will be reduced as the business will not have many expenses apart from the utilities which must be paid and taxes. Raising capital to start the business will require a loan or an investor to finance the business. The estimated starting capital will be $75,000, including all of the requirements mentioned in the initial costs. However, in terms of expanding the business to other geographical areas, there will be a need for financial support, which is vital in helping businesses expand. To raise the capital much faster, the company will use strategies such as selling shares reducing pricing rates.

The plan for the businesses will majorly focus on granting the business an opportunity to grow and beat its competitors. For instance, the future will be cropped with the entry of new players into the market, which might threaten the business’s operations in terms of the risks of losing market share. Therefore a critical evaluation of the entire plan is necessary for ensuring that these risk factors are mitigated for the business to thrive in the market (Boldureanu et al., 2020). It is also important to evaluate the changes in the customers’ needs. As a plan for all these issues, the business will use ensure that there is a feedback mechanism that will be used to collect data on market trends to enable the business to change with the demands in the market. The business plans alone are not sufficient to protect the business against its competitors or ensure that it is successful. There is a need to integrate data science with business operations. Therefore data analysis tools are very important in helping the business to understand customers’ needs by profiling them, their behavior, and even analyzing market patterns (Doern et al., 2019). Therefore for the future development and success of the business, data analysis will be integrated into the business. The use of A.I. will also help the business evolve with the changing demands of the customer by providing relevant insight into the business operations data regarding key trends and recommendations that are to be taken into consideration (Chowdhury et al., 2019).

The business is a viable idea as the feasibility study conducted on this business is viable. It focuses on all aspects of the business, such as the strategies for implementation, customer portfolio, and unique value proposition (Baker and Welter, 2020). If the startup never existed, the world would be worse off because many businesses would find it hard to reach more customers online. Therefore, the idea for this business is to enable other businesses to grow by reaching many target customers online from different parts of the world instantaneously. This business is a lucrative investment, and therefore investing in this business will guarantee a good return on investment. The competitive landscape is not that high, and the opportunities surrounding this business are many, as there is the potential to access many customers who need buying and selling domains. As technology advances, more emphasis is put on many businesses shifting their operations online as the world has gone digital (Berger et al., 2021). The shifting of many businesses online makes this business have a ready market of potential customers ready to purchase domains that they will use to run their businesses online. Therefore, this entrepreneurial opportunity is worth investing in as it is viable and very practical, and the chances of success are 99%. The business also has low risks and plenty of opportunities, making it even more worthy of investing in. 

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