I’ve written about Starbucks on the blog before. They’ve been going through some tough times of late, as they struggle to regain some of the unbelievable growth and sales momentum they’ve enjoyed over the past few years.
Starbucks is a great company to watch when it comes to marketing. After all, this is a coffee shop that has built a brand and reputation around experience and has convinced customers that it’s worth paying $3 for a cup of coffee when the donut shop down the street sells it for $1.25.
Today the AP has a story about how Starbucks is offering grande drinks (that’s the large size, by the way) for $2 in the afternoon. The catch is that customers have to show a receipt for a beverage purchase in the morning to qualify for that special pricing.
The net result should be an increase in sales in the afternoon, along with a possible increase in sales in the morning. Regular morning Starbucks customers will be more able to justify that afternoon pick-me-up if it’s “only” $2. Regular afternoon drinkers might just stop in on the way to the office as well, to take advantage of the special pricing in the afternoon.
Now let’s translate that into the hosting or ISP business. Customers who buy a .com domain name and hosting from you are probably willing to spend a bit more money if you present the offer to them in a way that makes it seem like a good idea. Some customers, especially small business, would respond to an offer to add the .net and .biz extensions if you offer to redirect them automatically. You don’t even have to do it at the same time as the initial sale. Follow-up a few weeks later and tell the customer that you noticed they bought a .com and ask them if they knew the .net/.biz/.info was also available.
Use words like “protect your brand” or “make your business easy to find online” to make the point that registering the .net or .info version is worthwhile. And of course, don’t offer those extra domains at the same price as the .com you gave them with the hosting plan. Take advantage of things like our ongoing .info promotion to make more money. Each of those additional domains renews yearly, and once registered, the customer will be less likely to let them drop, meaning more sales revenues for you.
Another way to drive sales is through multiple domains. Once customers get started with something like a blog, you can use their experience to drive more sales. Offer them additional domains, with email campaigns that encourage them to get their friends and family domain names “before it’s too late.” Customers might be willing to add more domain names for their kids or spouse if you make it super easy to do so. You might also want to experiment with offering incentives to your current customers when they bring new customers in. For example, give them a month of hosting for free if they bring you a new customer who buys a domain name and a hosting plan.
It’s often easy to overlook your existing customers as a source of further revenue. Starbucks does a really good job at increasing average revenue per customer and creating brand ambassadors – people who sing the praises of Starbucks to friends and family. And with their latest campaign, they’re even improving their image when it comes to value. Customers spend more money each day, and think they are saving at the same time.
Think about your current customers when your considering ways to grow your business. You might find that you’ve been overlooking a potential source of revenue right in your own customer list.
A couple of news items of note this week demonstrate the continued growth in the domain name industry. First, .ES, the ccTLD for Spain, crossed the one million registrations mark recently. The Registry relaxed rules for ownership of .ES a couple of years back leading to a dramatic rise in the number of registrations. The .ES Registry operator has some stats that show the uptick in domain registrations.
Meanwhile, according to Verisign’s latest Domain Industry Brief, domain registrations continue to rise in the first quarter of 2008. The report shows a 26% increase year over year, and a 6% increase over Q4 2007. In total, Verisign reports over 162 million domains across all TLDs.
The report also shows impressive growth among ccTLDs. As a group, they showed 33% growth in the past year. Verisign atributes the growth to special promotions run by the various ccTLD registries, including .ES which has been offering free domains to Spanish youth.
We’ve been ramping up our efforts around Registry promotions at Tucows lately. We’re trying to make sure that resellers are aware of any special pricing that has been offered to us (that we in turn pass on to our resellers). Check the current list and you’ll note that .MOBI has just been added with special promotional pricing beginning on July 8th, 2008.
I remember when I was a kid going into those touristy shops. Up by the checkout they would have all sorts of personalized items for sale – license plates, mugs, keychains. With a name like James, it was pretty much a given that I could find “myself” in the display. Nevertheless, it was still fun to undertake the hunt and kind of exciting when I did locate my name.
Now, let’s counter that with what is going on these days out on the Internet.
I’ve noticed a real upswing lately in chatter about online identity and personal brand lately. There’s the upcoming launch of the .me domain extension next month, the continuing trend to establishing personal identity online through social networking sites like Facebook, MySpace and LinkedIn, and the ongoing growth of blogs and other forms of personal micro-publishing platforms like Twitter and Tumblr.
And just this week, it was revealed that computer maker Apple had purchased the domain name me.com and was rumoured to be rolling out a replacement for its .mac hosting and email service under the me.com domain.
But in contrast to the physical world, where that “James’ Mug” is widely available, online, james.com is long gone. Even koole.com was already registered by the time I checked to see if I could snag it a few years back. Imagine how the Smiths and Jones of the world feel.
In the physical world, when it comes to personalization, popularity breeds availability. The chances of finding a mug with an uncommon name on it? Zero. The same mug with Smith? 100%.
In the domain name space, the opposite holds true. The more common your name, the less likely it is that you’ll be able to own it as a domain.
It’s too bad, considering that name-based domains are especially compelling when you start thinking about the idea of rolling up all your various existences online, or building an online personal brand.
With that problem in mind, earlier this year we launched the Tucows Personal Names Service to our resellers through our wholesale channel.
Personal Names is built on the large portfolio of surname-based domain names that we own. Because we have control of that block of names, we can then turn around and offer up subdomains, effectively sharing these desirable surnames amongst many users.
It allows resellers to offer that “personalized mug” that users are after when they seek out a domain name. Imagine the thrill when they put their name in that search box expecting to get a “sorry, not available” message and instead are greeted with the invitation to “Buy it now!”
ISPCON Spring 2008 is underway in Chicago. This morning, Elliot Noss, CEO and President, Tucows, took to the stage to deliver his keynote address titled, “Why You and Lowfat Lattes are Google’s Worst Nightmare.”
Snead writes, “What Elliot talked about, that strikes me as true, based on those of my clients who are successful, is that successful Internet businesses are high touch, and that people will pay to have their problems go away.”
For the benefit of those not in Chicago for ISPCON, or for those at the show who want to have another listen, we recorded the keynote it in its entirety.
Recently, ISP-Planet’s Alex Goldman had a chat with Rohan Jayasekera, Director, Tucows Email Service.
In the article, posted today, Rohan explains our philosophy in creating and running the Tucows Email Service. He also points to some of the features and benefits that make our hosted email solution a sensible choice for service providers.
If you’re in Chicago this week for ISPCON Spring 2008, drop by booth 114 for a chat and to see the Tucows Email Service first hand. And you can hear more of what Rohan and other industry experts think about the future of email on Wednesday, May 14th, at 8:45 AM in Room 9. Rohan will be participating in a panel discussion, “Who Should Be Running Your Email?”
After much deliberation and consultation (in other words, in true Canadian fashion), the Canadian Internet Registration Authority (CIRA) has announced that WHOIS Privacy will go into effect on .ca domain names beginning June 10th, 2008.
The CIRA approach to WHOIS privacy is quite interesting and demonstrates a clear desire to protect the privacy of Registrants. There is full information on the new policies at the CIRA website.
Geist goes on to suggest that CIRA is now in a global leadership position on the issue of registrant privacy. Geist writes, “With more than a million Canadian domain name registrations, the resolution of the whois issue ensures that the Canadian domain name space is set for continued growth as it now features a “privacy advantage” over other domains struggling to strike a similar compromise.”
What makes the CIRA policy different is that WHOIS privacy is enabled by default for individual domain owners. Registrants have to specifically opt-out with CIRA to have their information displayed. In contrast, the registration information for corporate domain holders is shown by default, however, they can opt-out and hide the information in what CIRA calls special circumstances.
As you would expect, we’ll be fully complying with the new policies. We’ll have more on how things will work from both a Registrar and from the Reseller perspective soon.
Starbucks has a new deal where if you pay for purchases with a registered Starbucks card, you can take advantage of a bunch of different rewards. The perks range from free flavour shots in espresso drinks to unlimited refills of coffee as long as you stay in the store.
At first blush, it would seem that the net result of this reward program would be a decrease in sales, and a decrease in revenue. So why would Starbucks do it?
I realized exactly why today as I bought my morning coffee.
One of the nicest perks is the free drink with the purchase of one pound of ground coffee. We needed coffee at home, so I decided to buy a pound of coffee and score a free drink. I don’t often buy coffee from the Starbucks store because we can buy it at the local grocery store instead. So today, Starbucks took in $14 in revenue from me instead of $3.50. That’s a nice increase and all they had to do was give me a free coffee.
The unlimited refills deal works the same way. If I sit in Starbucks for a half an hour and drink a cup of coffee, I’ll have left $1.55 behind. But if they refill that coffee twice, chances are I’ll probably buy one of their new (and very yummy) donuts to go with that coffee. Net result, I’ll leave behind $3.50 instead and they take in double the revenue for the meagre expense of refilling my cup twice.
Coffee is a commodity product. Starbucks used to be able to charge more for that cup because it offered a premium coffee, and a unique experience. But now a good cup of coffee can be found in a multitude of places (including McDonald’s) and the experience is no longer unique. Starbucks has to think different to win in a crowded and competitive marketplace.
On the Internet, the story is similar. Hosting, email and online services are regularly offered for free, or nearly free. The quality of the experience is similar regardless of the price the consumer pays and so the consumer quickly looks to low price as a determining factor when choosing a service provider.
Like Starbucks, providers of Internet services have to explore new and different ways to stand out and offer alternatives that will act as a catalyst to increase revenues.
Offer free web services and users will look at your revenue generating ads. Offer a free domain name and users will pay for hosting. Offer a free blog and users will pay for a Personal Names domain that points to it. Offer hosting extras in exchange for a yearly prepayment or a long-term contract. Offer unlimited domains on a single hosting package and users will buy more domains. Offer a starter package for free and users will graduate into a paid plan.
Some creative thinking can easily translate into increased revenues and better, more loyal customers. Think about it next time you order that tall bold.
ISPCON Spring 2008 is less than a month away. That means there’s only a few days left to take advantage of free exhibits and events passes.
If you are planning to attend ISPCON, head over to their website to sign up today. The free exhibits and events pass offer only lasts through April 18th. Also of note, the price for conference and one-day passes also goes up after April 18th as well.
Tucows will be at ISPCON again this spring. Elliot Noss, Tucows CEO and President will offer up his thoughts in a keynote address on Wednesday, May 14th. Elliot will explain “Why YOU and lowfat lattes are Google’s Worst Nightmare.”
In addition, Rohan Jayasekera, Director, Tucows Email Service, will be participating in a panel discussion. That session, “Who Should Be Running Your Email,” is scheduled for the Wednesday, May 14th, but check the ISPCON conference schedule for the official word on times and for information about the other sessions.
Seth Godin has an interesting post over at his blog today in which he debates the question, “Drop the dot?” as in, can we get rid of the dot com when talking about websites.
Godin says no, because saying dot com is easy to say – just four letters, two syllables – and pretty much leaves it at that. But let’s weigh the possibilities:
Yes, drop it
On the “Yes, forget the dot com” side, there’s the Google angle. Type the brand into Google, and it will find it for you. There have been a couple of stories floating around the Internet of late that talk about companies in Japan doing just that, and displaying their brand in a search box instead of showing a URL.
No, it’s not that simple
On the “No way, you need the dot com” side, there’s the Google angle as well. Relying on Google keywords puts a lot of power into the hands of Google (or Microsoft or Yahoo, depending on which search engine you choose). What if your brand isn’t number one?
It turns out that Google is pretty much perfect when it comes to brand searches. I tried dozens and the first result was always what I expected it to be.
Next argument: what about all the other domain suffixes? The American Cancer Society uses cancer.org for its website and doesn’t own cancer.com. Whitehouse.gov is another classic example — whitehouse.com is a political news website (and famously, it used to be a porn site).
The American Cancer Society is the number one Google result when you search for cancer. And a search for whitehouse returns whitehouse.gov first.
To some, Google is the Internet
I think the question really comes down to how people are using the Internet. Do people pay attention to domain names at all, or is it assumed that a company can be found at [brandname] plus dot com? Or are users now skipping the address bar and directly typing names into Google?
Recently pizza.com sold at auction for $2.6 million. It was suggested that Pizza Hut, Papa John’s or Dominos should buy the name. But when users want pizza, and they go to the Internet and type pizza into the search bar, what do they see? PizzaHut.com, followed by PapaJohns.com, followed by Dominos.com. Just what is that $2.6 million buying you and do you need it?
Maybe the dot com is superfluous after all. Thoughts?
If you’re interested in an excellent discussion around domain name law, then have a listen to the latest episode of This Week in Law. In a one-hour audio podcast, host Denise Howell and friends take on a variety of domain name-related legal topics from domain name tasting, to website takedowns.
Links to some background information on the topics discussed can be found in the show’s del.icio.us feed.
The panel is quite excellent: Moderator Denise Howell blogs regularly for ZDNet about technology and the law. Marty Schwimmer is a blogger and well-regarded expert in trademark law. Bret Fausett runs the excellent icann.Blog. Cathy Kirkman is a lawyer and blogger practicing in the Bay area. Lastly, Colette Vogele is a lawyer, blogger specializing in intellectual property issues related to technology, new media and the arts.
I remember when I was a kid going into those touristy shops. Up by the checkout they would have all sorts of personalized items for sale – license plates, mugs, keychains. With a name like James, it was pretty much a given that I could find “myself” in the display. Nevertheless, it was still fun to undertake the hunt and kind of exciting when I did locate my name.
In the domain name space, the opposite holds true. The more common your name, the less likely it is that you’ll be able to own it as a domain.
ISPCON Spring 2008 is underway in Chicago. This morning, Elliot Noss, CEO and President, Tucows, took to the stage to deliver his keynote address titled, “Why You and Lowfat Lattes are Google’s Worst Nightmare.”
The CIRA approach to WHOIS privacy is quite interesting and demonstrates a clear desire to protect the privacy of Registrants. There is 
I realized exactly why today as I bought my morning coffee.
It turns out that Google is pretty much perfect when it comes to brand searches. I tried dozens and the first result was always what I expected it to be.
If you’re interested in an excellent discussion around domain name law, then have a listen to the latest episode of