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When starting a business, every dollar counts. So, when we’re asked, “How much are you willing to pay for a domain?,” many of us are probably tempted to answer, “As little as possible.” (Some of us might even recall googling “how to get a free domain” when we were creating a website for the first time.)
But for others, a domain name might be worth more than you’d think. Some are willing to spend hundreds, if not thousands, of dollars a year on the right domain for their brand.
To get to the bottom of it, we asked several business owners what makes a domain worth a higher price. Below are their top reasons.
Brand recognition
“We pay more than $100 a year for certain domain names, but only when they hold a strategic edge,” says Alan Carr, creative director at Webpop Design, a design agency based in London. “The question is never about price alone—it’s about whether the domain strengthens visibility, credibility or long-term positioning. When a name aligns with branding and market perception, it can carry more weight than any marketing campaign.”
Cyrus Partow, CEO of ShipTheDeal, similarly notes, “I found that investing $250 a year in ShipTheDeal.com was worth every penny since it perfectly matches our brand and instantly tells visitors what we do. After trying cheaper alternatives with hyphens and longer names that confused customers, I realized a clean, memorable domain actually saves money in marketing and builds more trust with shoppers.”
“I've noticed our domain name actually becomes a conversation starter at networking events and helps potential sellers remember us,” says founder Shannon Beatty about her business House Buying Girls. “HouseBuyingGirls.com costs us $150 annually, and it helps us stand out in the male-dominated real estate investing space.”
Adam Garcia, founder of The Stock Dork, pays upwards of $2,500 a year for his premium domain. “TheStockDork.com is a memorable, quirky domain that helps us stand out in the crowded financial advice space and makes our brand more approachable for new investors. Last year alone, our domain name helped drive over 100,000 organic visits, since people actually remember and type it directly, rather than having to search for us on Google.”
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Brand credibility
According to Hilary Schultz, owner of Bright Bid Homes, “BrightBidHomes.com costs us about $200 annually, and while it seemed steep at first, having a catchy, memorable domain has been crucial for our word-of-mouth referrals. When comparing it to our monthly marketing budget and the value of even one closed deal, the domain cost is actually quite minimal for the professional image and trust it helps build with potential clients.”
Chief marketing officer of Penfriend, Tim Hanson, shares similar sentiments: “Penfriend.ai costs significantly more than a standard .com domain because it's a .ai TLD. In our case, it was a no-brainer because we're an AI company, and having that .ai extension instantly communicates what we do…Our simple value calculation goes like this: If having a .ai domain helps close even one enterprise deal faster by adding legitimacy (which it has), it's paid for itself many times over. Sometimes the ‘expensive’ option is actually the cheapest when you look at the bigger picture of what you're trying to achieve.”
Email credibility
“I shell out over $100 yearly for domains without flinching,” states InboxArmy CEO, Scott Cohen. “While securing domains for InboxArmy, I never settled for clunky or forgettable options. A clean, professional URL radiates credibility, which is especially crucial to email marketing where trust determines whether messages land or die. I watch businesses cut corners with hyphenated domains or weird extensions, then scramble when they lose traffic to the obvious .com version.”
“Sure, I'd skip the premium if the domain won't impact trust or sales. But most people don't grasp a domain's worth until poor choices cost them business. And frankly, I'd rather invest early than regret it later,” he adds.
SEO benefits
“Over time, AI-centric SEO, generative search optimization and evolving search dynamics will make domain names even more valuable. A generic name like ‘SEO Wizard’ or ‘SEO Rockstar’ won't cut it anymore,” states Bhavik Sarkhedi, founder of Ohh My Brand. Bhavik spends between $250 to $350 on domains for his businesses, which all flaunt unique names (like 'Dad of Ad' and ‘Taletel’ to name a few).
“You need a name that commands attention. Both my domains already rank well with minimal backlinks, proving their potential. Assessing a domain's true value today is difficult, but the long-term outlook is that clear-strong domain names will matter more than ever,” he notes.
“Justifying over $100 for a domain annually can be worth it in certain cases,” says another founder, Cache Merrill who started software company Zibtek. “I have purchased premium domains for projects where brand equity and SEO were fundamental…For example, we once bought a short, keyword domain for a SaaS product, and the direct traffic alone was able to lower the customer acquisition cost.”
“In my experience, businesses that rely heavily on search-driven customers often find the investment well worth it,” further adds Stefan Van der Vlag, AI expert and founder of Clepher. “I believe in investing wisely in your online presence by choosing a premium keyword domain. This can save money in the long run by reducing the need for constant paid advertisements and increasing website visibility.”
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Local SEO
When it comes to SEO, a clear and specific domain name can make it easier for local businesses to get found online.
Case in point: “A strong domain name matters in the legal industry,” says Justin Lovely, owner of the Lovely Law Firm Injury Lawyers. “If a premium domain contains high-intent keywords—like "[City]InjuryLawyer.com"—it can boost search rankings, increase trust and drive organic leads. When potential clients search for representation, they click on what feels authoritative and local.”
That said, “some businesses overpay for domains that add no real value. If the name is too long, hard to spell or unrelated to a practice area, it won't generate leads…The real test is whether the domain contributes to signed cases. If it doesn't, a standard domain at a fraction of the cost may be just as effective,” says Justin.
Jessica Henderson, founder of Sell My House Fast Houston TX, echoes this belief. “I started with a basic $12 domain name but quickly realized I needed something more memorable for our Houston market, so I now pay about $85 annually.
“After switching to SellMyHouseFastHouston.com, we've seen better organic search results and clients mention finding us more easily through Google. Though I considered fancier domains costing $200 or more, I've found our current mid-range domain strikes the perfect balance between professionalism and cost-effectiveness for our local business.”
Bundled services
“Some business owners might pay more [for their domains because of the] inclusion of bundled services,” states senior link building analyst at Mavlers, Kumar Abhinav. “Certain domain registrars offer packages with added security (like WHOIS privacy protection), premium DNS services, SSL certificates or website-building tools. While these extras can increase the annual cost, they offer value in terms of convenience, security and performance. For businesses handling sensitive data or relying heavily on online transactions, these features are crucial.
“Ultimately, the value of paying a premium for a domain comes down to ROI…for smaller businesses or startups, it's essential to balance the cost with current needs and budget constraints.”
Existing domain authority
“Why beg for authority when you can inherit it?” asks Milosz Krasinski, international SEO consultant and owner of Chilli Fruit Web Consulting.
“Paying [for a premium domain] isn't just about owning a name, but about stepping into existing authority instead of fighting for scraps. If I can pick up a domain that already has trust, backlinks and history, I'm not starting at zero. I'm walking into a space where search engines already see value.
“I've grabbed domains with links from sites that I'd never land through cold outreach, and that alone saves months of effort…A strong domain means I can skip the slow climb, push quality content and rank faster. It's just working smarter.
“When I size up a domain, I don't just skim DR or traffic. I dig deep—who owned it, who linked to it and did Google ever slap it down? A domain isn't just a URL. If it's got the right domain history and weight, it's a business asset—and those don't come cheap.”
Long-term brand value
“It cannot be expressed in numeric value, but I would say that the name of our domain is at least 5% of our brand value,” estimates Kacper Rafalski, demand generation team leader at Netguru.
He elaborates that “companies tend to become victims of their own success, as the pricing for the domain increases with the popularity of their website.
“Being an established company, with a big reputation in Europe, the pricing on our domain has seen an increase over the last few years. We've missed the chance to expand the plan for more years and had to renew it from scratch, and all of a sudden the pricing went to around $110 per year.
“If we were a smaller company, we probably would have been encouraged to look for a new domain, but the costs of change and potential traffic loss weren't worth it. The value of our domain is purely from the branding perspective. We could move the whole content, redirect all the SEO value and links we have, but the branding is what makes the domain name important to us.”
Learn more about how to redirect a domain.
Competitiveness and future-proofing
“I pay $125 per year for my domain AllFilters.com, which is absolutely worth it because I believe that investing in a premium domain is important for brand protection and future-proofing. Owning a high-quality, easy-to-remember domain…prevents competitors from taking similar names and diluting my market presence,” says Shu Saito, CEO and founder of All Filters.
“Another benefit has been the increased partnership opportunities. Since the domain directly reflects what we offer, it makes collaborations with other companies or influencers in the filtration industry smoother,” Shu adds.
Similarly, Alan from Webpop Design states, “Assessing value goes beyond instinct. We analyze search relevance, direct traffic potential and resale history to determine if a domain holds long-term worth. Some investments age like fine wine, gaining traction with time, while others serve a specific campaign before being retired. The real measure comes from performance, if the domain consistently brings in the right audience or positions the brand ahead of competitors, the investment speaks for itself.”
On another note, “investing in a premium domain reduces the risk of phishing, cybersquatting and brand confusion, which can damage customer trust and impact revenue,” says Rob Gold, VP of marketing communications at Intermedia, a cloud communication company. “This was a top priority for us, considering the line of work we do.”
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Domain name trends you won’t want to ignore
So, when is a premium domain worth the extra cash?
To be clear, a premium domain isn’t for everyone. As Natalia Lavrenenko, UGC and marketing manager at Rathly, points out, “Keeping domain expenses [low] lets funds go towards other growth projects.”
Manager director at Insurance Panda, James Shaffer, also warns against purchasing a premium domain just because it’s trendy or as a substitute for a name that’s already taken. “If the .com is taken and you’re paying extra for a .biz, .info or some other odd extension, you’re probably losing traffic to the ‘real’ owner.”
To properly assess the value of a domain, think about factors like brandability, memorability, credibility, organic authority and/or resale value. Or, as James puts it, “If a domain is driving business, justifying the cost is easy. If it’s just sitting there, you might be better off cutting your losses.”