August 18, 2018 (Sat)
Why do Chinese companies like acronym domains?
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China is the largest owner of liquid domains according to the quarterly market report by GGRG.com. These are very short .com domains such as LL (letter-letter), NN (number-number), and LN (letter-number) .com which can be sold at any time because of a large pool of ready buyers. In this article, I'll focus on the acronym (letters) domains. So, why do Chinese companies like acronym domains? I think there are at least two reasons.
In China, many consumers still visit a website directly by specifying its domain. However, domains are mostly expressed in Pinyin words which are often longer than the original Chinese characters. Compare, for example, "Kuang Shan An Quan" with "矿山安全", a mine safety website which now uses the acronym domain KSAQ.com. So, acronym domains such as KSAQ.com are convenient to use for audience inside China.
When a company goes global, pronunciation and length of its brand/domain may become an issue, and acronym domains solve this problem. Look at the example of Da Jiang Innovations (大疆创新科技), a drone startup founded by Frank Wang in 2006 from his college dorm room using the domain DJI-innovations.com. In 2013, Wang invested $300,000 to acquire DJI.com and then rebranded itself simply as DJI. Today, DJI is a global brand in consumer drones. So, acronym domains such as DJI.com are helpful when Chinese companies go global.
Because acronym domains can serve audiences both inside and outside China, their demand will continue to rise. In particular, LL and LLL .com domains will remain highly sought after.
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