Insights from 30,000+ Naming and Branding Projects

Understanding Premium Domains: What They Are And How To Budget For Them


Domains are a precious resource. In some sense, they are also a finite resource. Today, with 50 million companies starting every year, countless domains have been registered. As such, the value of a domain changes based upon the demand for it, creating two different kind of domains: non-premium and premium. Domains help set a solid foundation for your brand, so it is important to understand how they work as well as how much you are willing to invest in your domain.

A Little on Domains

When picking a name for your business, it is important that you consider your domain. The domain you select should align with your business name. It should also be easy to use and remember, as this is how people will find your business online.

However, strong domains have become a scarce resource, especially if you are seeking certain desirable brand name characteristics like shortness or containing powerful real English words. But how do domains work, and how do you know you can get a strong one?

To begin with, every domain must be registered. There are two types of domains: premium and non-premium.

Non-Premium Domains

Non-premium domains have not been claimed by businesses or resellers.Sites like GoDaddy, BlueHost, and Namecheap are registrars. At registrars, you can register domains that have not been claimed, making them non-premium because you are the first to claim them. Registering a new domain directly through a registrar usually costs between $6-15, with an upfront investment and a yearly renewal fee

But what if the name you want has been taken, and it is not in use? This is where premium domains come in.

Premium Domains

Essentially, premium domains are domains that have already been registered at a registrar by someone, a domainer or domain investor, who is intending to resell the URL for a profit. It is almost like someone who purchases property, hoping that the value will increase so they can sell it later and make a profit. The person re-selling the domain purchased it with the knowledge (or hope) that the domain they claimed will be coveted, and that whoever wants it will be willing to pay top dollar.

For example, the domain was reserved and then put on a domain marketplace for $1,199. It is a premium domain because it is short, it is made up of real words, and it is easy to remember and spell. The domaine investor who thought of it first reserved it because they saw the value in it before the person who may have wanted to use it for a business did.

So how do you determine if you need a domain budget, and if so, what the budget should be?

At this point in the lifespan of the internet, if you want a short domain with standard words, it is very likely you will have to set up a domain budget for a premium domain. This is because most English words, especially short ones, have been bought up by people who anticipated the value of such domains and are reselling them. If you know your business requires such a url, you should calculate how much you are able to spend on a premium domain.

Here are some guidelines:


Highly coveted domains have the highest price tags. If you are looking to get a single english word such as, then you may be looking at costs of $60,000-$100,000 or more. This is because short, real words, like, are easily brandable and memorable. Take the baby care product The Honest Company. They snagged the easily memorable domain, which makes their name memorable and easy to search.


Very short domains and domains using powerful words are often priced from $3,000-$30,000. Names like Health Hero are short, memorable, and catchy, but original and offbeat enough that they are not registered in the same tier as single real words. A name like is another good option. As an abstract name, it is versatile and memorable. This budget rank offers a wide variety of name styles and options.  

$1000 – $3,000

Many premium domains fit into this price tier, and a domain budget of $2,000 will get you far. It will allow you to purchase a unique premium domain that is strong and memorable, but may include various styles such as intentional misspellings, add-ons, transmutations, or made up words. and are examples of solid names within this price point.


There are ways to get around premium domain costs:  

If you are open to very unique, longer names (e.g. Mechanical Turk or Dolce and Gabbana) , you can probably register your domain on your own, and then you do not need to consider premium domain fees. Or, if you are open to non .com endings such as .co, .io, .ly, or .me, you can avoid premium domains.

Another way to avoid premium domain costs, if they are not in your budget, is to put in add-ons such as or industry specific add-ons like (Tesla used for years),,, and the list goes on. This way, your domain is less likely to be taken because your name is more industry-specific, albeit longer.


When choosing a name for your business, considering your domain and domain budget will help you strengthen your business plan. You should consider how much you are willing to spend on your domain. How you make that decision is up to you, but you should look ahead and consider your needs and your budget. Be forward-thinking, just as you are in your naming process, and the right domain will come along.

About the author

Grant Polachek

Grant Polachek is the Director of Marketing at Squadhelp–transforming the way names are developed by combining an affordable agency-level brainstorming process with the unmatched creativity of “the crowd.”

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