Should You Buy a Branded Domain Names?

Should you build niche sites that target branded keywords in the domain? I've been meaning to address this topic for a long time.  I've been asked by several people whether or not buying domains with brand name keywords in it is a good idea.  For example, homedepotcoupons.com is an example of a branded domain.  Home Depot is a well known brand; so is it okay to use their name in your domain?

For a long time I never bought a single branded domain.  Then about a year ago, I decided to give it a shot.  After all, there are TONS of keyword opportunities in this arena.  Just take any brand and add the word “coupon” or “review” and its likely a keyword phrase that gets a decent amount of searches (depending on how big the brand is).

And better yet, these are often easy to rank for keywords.  Many times the brands themselves are not optimized for these keywords.  So, in the past year, I've ranked very well (including several #1 spots) for branded keywords.  However, there is a BIG downside – and to me its just no longer worth the risk.  You will have to decide for yourself.

The Downside of Buying Branded Domains

The big downside?  You can get a Cease and Desist request and be forced to hand over the domain at any time.  Ouch!

So, if you have any sort of brand name in your domain, you can be asked or even forced, to transfer or delete the domain or be threatened with legal action.  So, if you were earning anything from that site, you can kiss those earnings goodbye.

As mentioned, I only started buying branded domains about a year ago.  But I've probably already received a dozen requests to remove domains that I have purchased.  I've readily complied, and overall, it hasn't been a big deal as far as handing over the domains.  Here is the typical process when the company's legal counsel asks you to stop using a domain name:

1. You get an email OR letter in the mail with lots of threatening and scary legal jargon basically saying that they own the rights to the brand name and you need to stop using it at once.
2. The letter or email requests you to delete the domain or transfer it to their domain registration account
3. You delete or transfer the domain to them.
4. Once the domain has been removed or transferred, you simply email them to say its done.
5. They respond with a thank you or you never hear from them again.
6. That's it.

Example of a Cease and Desist Letter

So, the cease and desist letter can sound scary, but from my experience the process is fairly painless.  Here is an email that I got yesterday from the legal counsel for Southwest Airlines asking me to stop using a domain (I removed certain parts of the letter like domain name and other details:

SOUTHWEST AIRLINES CO.

Raghu Seshadri
Attorney

General Counsel Department
P.O. ————
Dallas, TX 75235-1611
PHONE: (214) 7——–
FAX:  (214) 7——-
E-mail: [email protected]———

20-Aug-2012

Re: Registration of “southwest——.com” as a Domain Name
Dear ——— LLC:

Southwest Airlines Co. and/or its affiliates (“Southwest”) is the owner of the well-known trademark and trade name SOUTHWEST.  As you are no doubt aware, SOUTHWEST is a trademark used to identify products, services, activities and events related to Southwest.

You have registered, without Southwest‘s permission or authorization, the domain name ‘southwest——–.com'.  The Domain Name incorporates the famous SOUTHWEST mark and suggests Southwest‘s sponsorship or endorsement of your website.

In view of Southwest‘s rights to the trademark SOUTHWEST, we ask that you immediately discontinue any and all use of the Domain Name.

In light of the foregoing, please be advised that should you fail to immediately discontinue such use, Southwest will vigorously pursue all remedies and actions available, including, but not limited to, injunctive relief, and Southwest will seek recoupment of all expenses associated with such actions, including attorneys’ fees and costs.  Of course, Southwest would prefer to not be forced to take such measures, however, if it is so compelled, then Southwest will protect its interests to the fullest extent of the law.  Finally, please be advised that Southwest will continue to monitor such improper activities, and if you continue, in any way, to use Southwest’s intellectual property, Southwest will immediately institute all legal remedies available to it.

Should you require additional information or wish to further discuss this issue, please do not hesitate to contact the undersigned.

As soon as I received this email, I went into my Godaddy account and deleted the domain.  I responded to the email that the domain had been deleted.  Now the process is over.

As scary as this email sounds, this is actually one of the more tame ones.  I've received overnight packages requiring my signature that had dozens of pages of legal jargon and copies of legal precedence cases that made it sound like I was in big trouble if I didn't co-operate immediately.  Of course, I did cooperate – but some of these legal counsel people really go overboard.  A simple email would suffice!

Anyway, after being through the process several times, I've decided its NOT worth buying branded domains!  I can't in good conscience recommend that anyone buy a domain name with a brand name in it.  The risk is just too great of losing that domain.  And although very slight, there still is the chance that an over-ambitious legal counsel could decide to pursue real legal action.  That's not something that anyone in this business wants to deal with.

So, at this point, I am letting all my branded names expire and will not be renewing them.  Sure this closes the door on lots of keyword opportunities, but it also closes the door on lots of negative consequences.

I will also point out that you never know when you will be asked to take down your domain.  I've been contacted within a couple of weeks of registering a domain. Or like the request I received yesterday from Southwest Airlines, I had owned the domain for about 10 months.  So, even if you think you are “in the clear” after a few months – that may not be entirely true.

Alternatives to Using Brand Name Domains

If you still want to target keywords that include brand names like “Red Robin Coupons” or whatever, you still can!  Why not just create a unique domain name like: MrHawsCoupons.com or FunkyMonkeyReviews (hopefully you can come up with something better than this)?  So, your domain may not include a specific keyword, but then each of the pages CAN target branded or non-branded keywords.  You can title your page: Home Depot Coupons, or Red Robin Discount all you want without fear of receiving a cease and desist letter.  The legal issue arises when you buy the domain – just mentioning a brand on your site is no reason to be targeted by a legal counsel.

Sure you might not get the boost that having a keyword in the domain would give you, but in this way you can still target lots of branded keywords all on one site (one keyword per post).  And you can do so without the fear of getting a scary sounding letter asking you to remove your domain.

What Do You Think?

So, I tested the waters the past year of buying branded domains.  I was able to rank for lots of keywords, but I was also asked by lots of companies to take my domains down.  For me, its just not worth the risk anymore – there are plenty of other keywords that I can target.  What are you thoughts on the subject?  Will you still be targeting branded keywords?  If you have any experience in this area, I would love to hear your comments!