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This post outlines location factors that make the online world not as flat as some have claimed. I then outline the impact of these factors on the demand for new gTLDs.
Domain names can signal geography by means of country-code Top Level Domains (ccTLDs) and new generic TLDs (gTLDs).
Location is back in the spotlight for reasons laid out by Professor David R. Bell of the Wharton School in his recent book, Location Is (Still) Everything: The Surprising Influence of the Real World on How We Search, Shop, and Sell in the Virtual One. For domain names, the effect boils down to three key words: adjacency, isolation, and resistance.
Adjacency is the direct proximity of customers to each other. Neighbors tend to flock to the same online and off-line businesses.
Isolation is when a consumer wants a product that isn’t available locally. There’s Professor Bell himself, a New Zealander who lives in Philadelphia and reports being unable to find Vegemite. Consumers in a situation like that make up a demand niche.
Resistance refers to the effect on consumers when they consider a long trip. The larger the distance to the store, the less likely people are to shop there. That’s why signaling local presence has value.
For anybody trying to market new gTLDs, these factors can:
1. Help improve demand predictions for new geographical gTLDs and guide registries/registrars in identifying valuable potential customers and assessing the value of each location component to these customers.
2. Assist registries in choosing among alternative representations of a location. For example, do the most valuable customers recognize .mtl or .montreal?
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