One thing you’ll need if you want to a host a website online is a domain name. But how much should you pay for the privilege?
What is a domain name?
A domain name is a website address. For example, our domain name is https://webhostingprof.com/. Domain names were created to make IP addresses easier to remember and more accessible. IP addresses, with random numbers, like 191.421.814.019, aren’t easy to remember, are they? But a domain name like https://webhostingprof.com/ is!
What is the difference between a domain name and a website?
A lot of people think that a website and a domain name is the same thing. While they are linked, they are not the same.
When a domain is registered, you will get your website address, however, you do not get the website. You need to build your website.
- You can have a domain without having a website built.
- However, you cannot have a website without a domain.
How much will a domain name cost you?
The good news is that domain names are not expensive. They tend to cost anywhere from $5 to $20 per year. However, there are a number of different factors that dictate how much you are going to pay, for example, the sort of domain you want to register and which registrar you use. Different domain registration companies will offer different packages, so I always recommend shopping around for the best possible deal.
You need to use a domain name registrar to purchase your domain name. Registrars are basically businesses that manage the reservation of domain names. Add-on and upfront costs will differ from registrar to registrar. Many will offer you a cheaper deal for the first year and then the price will rise, so do keep this in mind.
Understanding the two main domain types
There two most common domain types are as follows:
- TLDs, which are Top-level domains
- ccTLDs, which are Country-code top-level domains
TLDs are those well-known extensions for domain names that you’re familiar with, like .net and .com.
ccTLDs are country-specific domain name extensions, like .ca or .uk.
TLDs are often preferred because people consider them trustworthy, as they are so well known. Think about it: when you forget a URL, do you just assume it ends in .com and type this in any case? I know I do!
Nevertheless, ccTLDs are also considered trustworthy because they give the website national legitimacy. However, I must point out that some people buy domain names for reasons unrelated to their national association. For example, .co is an extension commonly associated with businesses, yet it is actually the ccTLD for Colombia. Other examples include .tv, which is actually for Tuvalu, and .me, which is for Montenegro.
How much do TLDs and ccTLDs cost per year?
Prices are similar for TLDs and ccTLDs. It all depends on the registrar you use. I’ve gathered starting prices from some of the most common to give you a better understanding.
- TLD Price for .com – $12.95/year
- ccTLD Price for .us – $5.95/year
- TLD Price for .com – $0.99/year
- ccTLD Price for .us – $7.99/year
- TLD Price for .com – $8.88/year
- ccTLD Price for .us – $3.88/year
I must stress that these are introductory prices. Therefore, while the $0.99 from GoDaddy may seem mega cheap, the price is pretty much certain to shoot up in the second year. In fact, I was quoted over $18 for year two. Therefore, you need to look into the long-term costs as well and consider everything as a whole.
Domain registrars can be sneaky with those extra costs, so you do need to be mindful. Find out how long you’re going to be tied into the contract for. Some domain registrars may require you to pay the first year (with the introductory offer) and the second year (at the higher price) at once.
What factors impact the cost of a domain name?
As I have mentioned, the cost of a domain name does differ depending on a number of different factors, including the registrar you choose. Below, I am going to talk you through some of the factors and the role they play on domain name cost so you can get a better understanding of why quotes differ for domain names across the web.
The SEO-friendliness of the domain name
SEO plays a role in the cost of your domain. If a popular keyword is part of the URL, the price will increase. After all, it makes sense that popular keywords are going to be high in demand, which drives the cost up.
Any extra fees
You really do need to be mindful of any extra fees that could be added on to the overall cost. For example, some domain name registrars will charge you added renewal fees whenever your contract renews every year. This could be on top of a price increase that is likely to happen in the second year. Some domain registrars may try to sneak on some extra services at the checkout as well, so keep an eye out for this! Costs can easily mount up if you are not careful.
The demand for the domain name
One of the biggest factors in the price is demand. If the domain name is popular, the prices are going to go up! It’s the same for any product or service, right? Some domain names have sold for millions of dollars! Yes, you did read that right. Here are some of the most expensive domain names ever purchased:
- VacationRentals.com went for $35 million
- Insurance.com went for $35.6 million
- CarInsurance.com sold for $49.7 million
- LasVegas.com fetched in $90 million
- Business.com was purchased for a tidy $345 million!
The extension used also has an influence. Typically, you will pay more for a .com extension than you would for a .org, .net, or. edu extension, for example. This is simply because .com domains are popular – everyone wants them! You have to balance out your budget constraints with the potential lack of visibility that would come with an obscure extension.
The final factor that plays a big impact on the overall cost is the length of the contract. The longer the contract, the more expensive it will be, naturally. However, the cost per year can be lower when opting for a long-term contract upfront. If you intend to keep your domain name for as long as possible, it makes sense to go for one of the longer options.
Is it cheaper to get your domain name from your web host?
When signing up for a web host, you will have the option of purchasing a domain name as well. In fact, a lot of web hosts, like GoDaddy and HostGator, will provide you with a free domain name for the first year. This can be tempting, but you need to make sure it is actually going to be worth it overall.
In a lot of cases, getting your hosting and domain name from the same place will work out cheaper, but it really does depend on the specific company you select.
My advice: sit down and do the math! And, when I say do the math, make sure you look beyond the first year!
So, let’s say I wanted to purchase “iwantthisdomainname.com” – how much would it cost me to buy the domain name and web hosting?
I’ll start off by purchasing them separately. This domain would cost me $8.88 per year if I were to buy it on NameCheap.com.
I then purchase Economy web hosting from GoDaddy, which costs $5.99 per month, equating to $71.88 per year.
So the total for one year is $80.76 ($8.88 + $71.88). For two years, the cost is $161.52. For three years, the cost is $242.28.
Now, what if I were to opt for the domain name and hosting package from GoDaddy?
Well, for the first year, the domain name is free, so it’s only going to cost me the $71.88 for both. However, in the second year, I need to pay for the domain name, which will be added onto my package.
By searching on GoDaddy.com, I can see that “iwantthisdomainname.com” would cost me $18.17 for the year.
If you look at the photo below, you will see the domain costs $13.17 for the first year (which would be free with hosting), yet it costs $18.17 in the second year – see what I mean about those pesky price increases!
So, if I were to purchase hosting and a domain name via GoDaddy, the first-year cost is $71.88. For two years, the cost is $161.93 – this is $71.88 for the first year and $90.05 for the second year ($71.88 + $18.17).
This means that while buying both hosting and a domain name from GoDaddy would be cheaper in the first year, it’s actually $0.41 more expensive in the second year.
$0.41, not a big deal, right? However, the increase will get more each year, as the domain name cost is more expensive at GoDaddy. So, in the third year, you will pay $251.98 in total, which is now $9.70 more expensive than purchasing your domain and hosting package separately.
This shows why it is so important to sit down and do the math over an extended period of time. In some cases, going for a grouped package may well be cheaper, but this is not always the case.
So there you have it: an insight into domain name charges and why they vary. I hope this has helped you to understand the different options available to you and why shopping around is vital.