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Cognitive biases applied to domain names
By Tatiana Bonneau access_time 14 min read

A cognitive bias by definition is a systematic error in thinking that affects how we judge the information we receive, and so the decisions we make as a result. We have that ability to create our own subjective reality based on our perception of the information input from the world around us. It is usually as a result of our brains trying to simplify information processing and a lot of those mechanisms have helped us survive over the years. 

Today we live in a relatively safe world, with access to a lot of information. It is as easy to create and spread information as it is to get access to consume it. Which means that in many cases most of those cognitive biases are no longer needed to survive, and in some they can actually be detrimental. They can drive us to jump to conclusions without objectively analyzing all the information available. We often end up making decisions without having weighted realistically all the options. 

If you go over a list of cognitive biases, I am pretty sure you will spot at least few that you fall victim to on daily basis, in your professional or personal life. I spotted quite a few when applying those to my daily conversations with entrepreneurs about domain names. Let’s go over them and see if you can recognize some.


Anchoring

This cognitive bias describes the tendency to rely too heavily on the first piece of information that we receive (“anchor”) when making decisions. So by now, 30 years since the birth of the internet, we have all come to register a domain ourselves, or know of someone who has. And the price is usually about $10. And that’s about all the average person knows about domain names, with many not even making the difference between a domain name and a website. And that’s totally ok.

When you are running a business, however, things change a little bit. A domain name is no longer just a domain name. If you are building a brand online (which even the local boutique cheesemaker here does, because we are in 2021) a domain name is no longer just a domain name, it is a strategic brand asset. So be aware of the anchoring bias and don’t shoot down opportunities or worse – take risks with your brand, without objectively weighing all the pros and cons.

Sunk cost fallacy

The sunk cost fallacy by definition is the “tendency to continue an endeavor once an investment in money, effort, or time has been made” (Arkes and Blumer, 1985, p. 124). In simpler terms, it means that we make decisions that are irrational and can lead to inferior outcomes by being focused on our past investments instead of our present and future costs and benefits. 

This is something I encounter often when discussing domain names with entrepreneurs. « We have been doing things this way, it has worked for us ». You have built your brand on a name that is not optimal and are now committing yourself, your team and investors, to a decision that was maybe right at the time, but is no longer in your company’s best interests.


Since 2000, 52% of companies in the Fortune 500 have either gone bankrupt, been acquired, or ceased to exist.

Harvard Business Review

Even at that level, you either evolve and adapt, or you cease to exist. Regardless of past investments, at least try to make choices objectively, based on the information you have today because things nowadays change quicker than ever before.

Confirmation bias

Even before the internet we were prone to look for information that confirms our existing beliefs and ways. Today this is even easier to do. I’ll give you a funny example. 

When I got my dog (a doberman), I really wanted to get him a coat. We live in Nice, it doesn’t even get cold here but hey, imagine how cute he would be! So there I was, running to my husband going « Look! They all have coats! », sticking my phone with pages of images of dobermans in coats in his face. « Darling, you typed “doberman coat” in Google ». Yep, I did. Didn’t even occur to me how ridiculous that is. This is an extreme and funny example, but we do that all the time and the internet is making it so easy to back any idea or conviction you have. Not only that, we are surrounded in our bubbles with tailored search results and targeted information. 

Now assuming your business is a bit more important than my doberman’s coat, when making decisions about what is the best domain name for it, try to be objective and at least explore viewpoints that are opposing to your current views. Why not? In the worst case if you come out the other side still sure you are making the right choice – then great, you know that really is the best choice because you explored objectively all the options. 

Belief perseverance

This is also known as “The Backfire Effect” and is actually fascinating. You would think that when presented with facts and evidence that challenges their beliefs people, being intelligent and rational beings, would take that information and adjust their beliefs. Turns out not only that is not true, but in fact when people encounter evidence that should cause them to doubt their beliefs, it often strengthens their support for their original stance. 

An easy example is politics – have you tried showing some negative information to family or friends about their preferred political candidate? It can be a fact, it can be even the candidate in question themselves saying it or even agreeing to it. Doesn’t matter what it is and how it is presented, you will likely see them digging their heels in. Here comes another bias – the Dunning-Kruger Effect – illustrated with Don Henley’s quote “The more I know, the less I understand”.  Simply put, the more you know about a topic, the more you realize there is more to know. As a result, an expert is usually a lot less confident than someone who is just scratching the surface of that topic, or even more – someone who just has opinions on it but not much knowledge. Combine the two biases and consider that person is shut to the world, no amount of evidence will ever make them change their mind. You can just hope for their sake they are right in what they’re thinking. Now and in the future, as time goes and the world evolves around them.

Let’s apply that to brands and domains. What are the beliefs you hold about premium domains? What are they based on? When did they form? When was the last time you fact checked them? What is your personal experience with premium domains? What is other people’s experience? What is the history of domain names? What do your competitors do? You may go through the exercise of questioning yourself on that and conclude you don’t need a premium domain for your brand. And that is totally ok. Many global brands started this way and rebranded later on. Or maybe you just don’t need one at all, at any stage of your brand’s development. Whatever the outcome is – it can only be a better one if you judge objectively.

Declinism

If you are over 30 years old this will speak to you. You know when your parents and grandparents were going « music was better when I was young » and then you catch yourself saying the very same thing? « Oh the youth of today, we used to be so much [put any superlative here] than they are now »…heard yourself saying that? Come on, even just in your head. I still believe it’s true but that’s another story. Declinism is remembering the past as better than it was while feeling like the present is worse than it likely is, and expecting that the future is going to be even worse. 

This is probably one that is really easy to relate to and understand – the past is over, we can’t change it so it makes a lot of sense keeping the best of it, even if we sprinkle it with a bit of lies or stretch the truth a tiny bit. Who wants to look at the past and feel bad about the choices they made? And the future is unknown so it makes today much easier if we can imagine it brighter. And today? Well, today is where we are, where we have the responsibility to make choices and taking that responsibility is heavy – make a choice and it will be your fault if it doesn’t work out. So today is bad too, hard, negative, pretty doomed really, so if I don’t make it it’s not my fault. It’s today that’s bad.

Back to your brand and domain name – you are doing just fine without it! You got what was cheap and available and things have been great. Today is not a good day to make decisions about better domain names, you don’t need that, your brand doesn’t need that, your customers don’t need that, your business partners and investors don’t need that. You know they don’t, it’s 100% true (just google it!). And the future? The future is so uncertain and going the way things are, will you even have a business next year? What’s the point investing in this brand if you may not? Nope, it’s all doomed, forget that, you know what, they were better back in the days without the internet and actually go take that website down. Who needs that anyway.

Availability bias

Very simply put the Availability bias is when we tend to think that examples of something that come easily to mind are reliable and representative of the whole. Sharks or spiders are victims to that one – in reality more people are killed each year by flying champagne corks than by sharks and spiders. But you don’t hear about that on the news. So when your brain is searching for information about sharks and spiders, Jaws and Black widows come to mind and bang, you are convinced those are the most evil creatures in existence. 

What was the last piece of information you consumed about premium domain names? Or domain names at all? You’ve probably overheard the IT guys discussing something on the topic in technical jargon and phased out. Or got some flashy offer from a hosting provider in your mailbox and caught something about free domains with your hosting just before you hit “spam”. 

Making decisions about your business and its future is important and getting the right domain name will have a direct effect on your brand. Try to get a more objective perspective by running some numbers internally and doing some research instead of jumping to conclusions based on what is easily available as information.


But to hear the Harmons explain it, buying angel.com was the cheaper option by far. “Anything that doesn’t pass the stress test ends up being more expensive, not less,” Jeff said. “There’s a question, every time you share it!” Neal cut in. “‘That’s a URL?’ And as soon as you have a question in your head, there’s confusion.” They ran the numbers on trying to imprint an.gl or angel.studio in the world’s heads, and decided $2 million was a bargain by comparison. It was .com or bust.

Neal and Jeff Harmon, founders Angel.com for Portal

Spotlight effect

This is the tendency for us to think that others are observing us more closely than they actually are. That likely takes you back to your teen years when you thought the world is totally going to stop and stare at the stain you have on your shirt, the stupid thing you said three weeks ago or the shoes your mom got you that are out of fashion. You probably think you are over that, but it is very much here today.

What will my employees say if they see I invested so much cash in a domain name? What about my investors? What will our audience think of it? While you can’t tell for sure what the answer to this will be, you can think of how will a better domain affect everyone. Will it make it easier for your team members to do their job? Will your marketing be more effective? Will a domain name upgrade boost the confidence in your brand? If you decide that the answer to those is yes, then there are creative ways to not only present the investment to everyone, but make them feel part of it and get some really good PR out of the whole thing. Just ask the team at Sumo.com.

Should you invest in a premium domain name? I don’t know. I don’t know your brand, your problems and aspirations, your vision for its future. What I do know though is that if you are in the driving seat for your business, every decision is hard to make and comes with a lot of responsibility. Don’t be blinded by « what will they say ». Yes, it’s hard, that’s why you are a leader and not everyone is.


All the biases above are based on experiences over hundreds years, some even more. They have come to exist generally for good reasons – it would be very hard, if not impossible, to make all the choices we have to make on daily basis, if we try to collect and evaluate new information for each one of them, every time we are facing a decision to make. We would simply not have the time. 

Those biases affect us in our personal lives and it is good to be aware of them, especially when making important decisions. Same applies to business and in our case – domain names. So I am not going to sugar-coat this – it really doesn’t matter what I think, or what you think. And the overwhelming evidence, be it feedback from entrepreneurs who take their domains seriously, or research on thousands of successful brands and their naming choices, all points to one thing – having a .com domain name exactly matching your brand does have a direct positive effect on your business. It is not a silver bullet and if your idea is not great or your team can’t execute on it, even the best domain name is likely not going to save you. But if you do have a business that is solid, a premium domain name can certainly fast-track it to success, improve your marketing efforts and make your clients’ life easier. 

I hope the above moves you even a tiny bit closer to making better choices about your brand. If you feel I can help further do feel free to reach out, I am always glad to talk about naming, domain names and doberman coats.

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