gTLD Statistics and Business Implications Q4 2015

gTLD Statistics and Business Implications Q4 2015 presentation is now available

The associated article can be found on CircleID

Top Level Domain Statistics and Business Implications Q4 2015 Overview

  • Average prices were based on prices at the end of September retrieved from 101domain, eNom, GoDaddy and United Domains.  If a TLD was not found on any of these sources websites, an alternative source was used
  • Average number of registrations per day is 46
  • Top 25 TLDs account for almost half of revenues and registration volumes
  • Number of TLDs that will exceed ICANN’s minimum yearly fee is 24
  • Largest group of TLDs are in the $27.50 to $30 retail price range
  • Average revenue of all gTLDs within the dataset is $482k
  • Average retail prices ($31.62 to $91.27) within each tier differ yet the median price difference is minimal ($28.74 to $31.74)
  • Tier 2 & Tier 4 are the only tiers with a moderate correlation between price and volume
  • Based on today’s data, 75% of TLDs are projected to operate at a loss for the next year, conservatively

Insights from gTLD Statistics and Business Implications Q4 2015

Tier 1:  Trailblazers – A strong pack of leading TLDs who continue to grow the gap over the other three tiers 

  • Price is not propelling the volume, the caliber of the TLD is reflecting that registrants will choose and pay for a meaningful, relevant TLD

    Business Implications Q4 2015

    Gap from Tier 1 and all other TLD tiers is growing!

  • Projected yearly volume has increased quarter-over-quarter
  •  Average and median revenues consistently increased throughout 2015 and the only group to increase in Q4 with an average increase of ~50% and median of 20%
  •  Overall strong registration volume along with price (higher average and median retail price in Tier 1)
  •  Portfolio companies are least likely to be in Tier 1
  •  Surmise:  Strong TLDs are understood by registrants and/or have promoted the TLD so registrants recognize it.  This tier will continue to grow and will receive the biggest (and most deserved) benefits from industry growth.

Tier 2:  Path Finders – Finding their way

  • Price is a factor in driving volume with a ‘moderate’ correlation
  •  Question is, can it be offset with increased promotions to become a T1 and get past the price hurdle?
  •  As a group, the length of the TLD in average number of characters is 6.0 (up from 5.6 in T1)
  •  Similar TLDs are more likely to be in tier 2 with over 2/3 having a higher volume at a lower retail price i.e. .accountant/.accountants, .gift/.gifts, .market/.markets
  •  66% of similar TLDs with a shorter length will have a higher registration volume i.e. .gift/.gifts, .review/.reviews, .market/.markets
  •  Average volume is almost the same as in Q3 with the average & median revenues declining 13% & 11% respectively

Tier 3:  Campers – Niche groups of TLDs

  • Niche TLD Registry’s appear to have projected the lower volume and have offset it with a higher price.  Average retail price in T3 is $83.82
  •  14 Q3 Tier 4 TLDs moved to Tier 3 including .tennis, .lgbt, .physio, .irish, .alsace, .saarland, .football, .Taipei, .auction, .garden, .cymru, .vote, .ngo, .how – with 85% having a higher Tier 4 price – these TLDs did not reduce price to increase volume (price decrease 0.7% $0.24)
  •  Registration volumes has decreased over Q3
  •  Average retail prices declined by 22% along with median retail prices at 11% yet have higher than average and median retail prices over Tier 2 and Tier 4
  •  Portfolio companies have the largest number of TLDs in Tier 3

Tier 4:  Hikers – Determining a pathway up!

  • Low daily volumes and retail registration prices
  • Lowest average retail price of $31.62 & median price of $28.74 with a moderate price to volume correlation
  •  A few clusters of TLDs:
    • Political:  .democrat, .republican, (lower than average T4 prices) and .voto, .voting (higher than average T4 prices) yet vote has moved into Tier 3
    • Military:  .army, .navy, .airforce (lower than average prices in T4)
  •  Registration volume has decreased over Q3 along with average retail prices
  •  Biggest tier jumpers from Q3 to Q4 are from Tier 4 to Tier 2:  .plus, .jewelry, .style and .show
  •  48% of IDNs are in Tier 4 (38% in Tier 1, 10% in Tier 2 and 5% in Tier 3)

gTLD Business Implications Q4 2015 and the road ahead

  • Average volumes begin to grow even with the increased number of TLDs
  •  Revenues & Volumes continue to increase
  •  Tier 1 Trailblazers continue to increase the gap from Tier 2 in revenues and registration volumes
  •  Tiers 2 to 4 will have difficulty increasing volumes with some of the bigger new gTLDs still to come
  •  Volume of premium domain name sales will increase but the prices will remain consistent
  •  75% of TLDs will be operating at a loss for the next year with the current volumes & prices
  •  Moving in the right direction with Q4 having the biggest jump since the launch of new gTLDs
  •  Still need to build a bigger bridge to the outside world

Please do not hesitate to contact us for any questions, insight or items to consider for future analysis.

 

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