5 Reasons Why Some Domain Extensions Cost More

Ever tried to register a domain name? You might have noticed a difference in price for various domain extensions. Some of them are cheap while others require digging deeper into your pocket to get them.

Why do some domain extensions cost more? Is it because they have some magic in them? Or do some domain extensions enhance your SEO ranking than other?

To answer you, here are the five reasons:

  1. Domain registry price - When purchasing a domain name, you register it through a registrar like Shopify. The registrar is the mid-man or the retailer of a domain registry. Domain registries are the domain extension owners who set domain prices. To make a profit, the registrar adds a small amount to registries price. In return, as the domain buyer, you pay for the registry price and the registrar markup.
    As such, when the domain registry sets a higher price, the same will reflect on the amount you will pay for that domain. In simple terms, domain registrar is like the manufacturer. Just as you cannot buy goods directly from the manufacturer, the same way you cannot purchase a domain from a registry.
  1. Domain control body - Some of the generic TLDs have a fixed price. The price was set after a negotiation between the domain registry and ICANN (Internet Corporation for Assigned Numbers and Names). For this reason, domains ending with .com, .org, .net, as well as .biz and .info are inexpensive. The registrars cannot sell such domains beyond the agreed price.  
  1. Demand and supply - Domain extensions are like any other commodities. Their prices rely on the forces of demand and supply. When the demand for a particular domain extension is high, its price is also high and vice versa. As stated above, ICANN fixes some domain prices. However, the new TLDs rely on the demand and supply. Also, the owners of these extensions have the freedom of setting their preferred prices. That the reason why .com domains are cheaper compared to .news or .press.
  1. Support cost - Just like any other product or service, domain costs are different. Some domain extensions have more expenses than others. These domains require more support and configurations before they become operations. For instance, some domains require you to fulfill some conditions to change the nameserver. Others need external support due to the limited capacity of the owner. As such, the domain registries incur higher costs in developing them. In recovering the development costs, they pass it to the buyers through setting higher prices.
  1. Set restrictions and exclusivity - Some domain wholesalers create domain extensions for certain industries, brands or professions. For instance, .photography for photographers, .journalist for journalist, .apple, .attorney, among others are set aside for specific professions. For you to use such extensions, you have to meet certain conditions. For example, you must be a journalist to use the .journalist domain extension. As well, you have to pay a higher price to use them compared to other generic TLDS.

Bonus: Local currency

When you are purchasing a domain, you use local country currencies. As you know, currencies fluctuate due to inflation and other monetary policies. For this reason, some domain extensions and specifically country-code TLDS differ in their prices depending on the current value of local currency.

As you have noted, several reasons explain why some domain extensions cost more. Your domain name determines who you are in the virtual arena. The amount of cash you are willing to spend on the domain depends on your online branding goals. Also, if you perceive your domain will lead to better results, even if it will cost you more, go for it.    

Do you have questions or need more information?

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