While Americans are finalizing their shopping strategies for retail’s biggest day of the year, brands have been developing their own Black Friday marketing strategies with new generic top-level domains (gTLDs) such as .BLACKFRIDAY and .CHRISTMAS

How Many Brands Are Using New gTLDs for their Black Friday Marketing and Holiday Marketing Campaigns?

Uniregistry’s new gTLD has seen mild registration numbers so far (11,069), but for top retailers, protecting their trademarks in this string, along with Uniregistry’s .CHRISTMAS (13,380 registrations to date) could provide some holiday peace of mind.

To check how the top 100 online retailers, as ranked by Internet Retailer, have adopted these new strings, FairWinds checked their brand names in both .BLACKFRIDAY and .CHRISTMAS and found some interesting results.

Of the publication’s top 100 retailers:

  • Only 17 have registered their brand names in .BLACKFRIDAY, and only 14 have registered their brand names in .CHRISTMAS.
  • 9 of the 17 brands who have registered in .BLACKFRIDAY and .CHRISTMAS are among Internet Retailer’s top 20 online retailers
  • 8 and 4 brands that rank between 21-100 on the Internet Retailer list have registered in .BLACKFRIDAY and .CHRISTMAS, respectively

Luckily for brands, very few third parties have registered these names either, and the pages that are registered (JCPenney.BLACKFRIDAY or Gilt.CHRISTMAS) either resolve to parked pages or don’t resolve at all. Brands might be losing out on a small number of potential visitors by not registering in these gTLDs, but at least there is no damaging or infringing content to worry about. However, it is important to note, it still possible for third parties to send emails (such as phishing scams) from these domain names, which is why consumers should always scrutinize emails coming from unfamiliar addresses.

Why Brands Should Consider Using New gTLDs for their Black Friday Marketing and Holiday Marketing Campaigns

A simple solution for brands is to register important trademarks in .BLACKFRIDAY and .CHRISTMAS and have the page point to the brand’s existing shopping homepage. This takes minimal effort on brands’ part, may boost Black Friday marketing and holiday marketing traffic to a brands’ online content, and keeps the domain names out of the hands of potential scammers. A number of top retailers, including Costco, Target, and Macy’s have taken this approach.

Amazon’s Black Friday Marketing Technique

If brands want an example of how to utilize these registrations, they should look right to the top of the list: Amazon, the reigning king of online retail, is the only brand to have its .BLACKFRIDAY and .CHRISTMAS registrations redirect to seasonal content.

By directing visitors to these specific gTLDs to content that is fresh and relevant, Amazon is succeeding in two ways: protecting itself against third-party registrants and adding potential shoppers.

While it is unlikely that hordes of visitors are typing Amazon.BLACKFRIDAY into their browsers, even by adding some traffic, Amazon is driving potential sales. The company is also establishing itself as a first mover in a way that has no negative consequences for its brand.

There is still plenty of time for brands to follow Amazon’s lead by registering one of the mostly available .BLACKFRIDAY or .CHRISTMAS names and putting up simple, relevant content. It’s an easy fix to curtail cybersquatting and increase traffic. Can you think of a better holiday gift for online retailers?

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A number of Western brands, most recently American bulk retailer Costco, have forayed into China’s e-commerce market via Alibaba’s B2C platform Tmall. As the parent company of both Tmall and C2C platform Taobao, Alibaba has become the dominant player in China’s e-commerce landscape, having captured some 80% of that market and, as of 2013, commanding an annual revenue of $240 billion (greater than those of eBay and Amazon combined).

To perhaps state the obvious, Tmall is now a very appealing way for a foreign company to engage in e-commerce in China, at least initially. It is cheap—cutting out the costs associated with a brick-and-mortar store—and relatively safe, since Western brands can use Tmall’s trusted, “localized”[i] website to foster brand recognition among Chinese consumers, while simultaneously learning the ins and outs of this notoriously challenging market.

Handling the Challenges of Online Sales

Generally still new to online shopping (with the Internet having only reached 50% penetration rate in the country), Chinese consumers are, nonetheless, very aware of the prevalence of counterfeit goods online. As explained in the Economist, they “worried (quite rationally) that online firms were fraudsters, or that their credit cards would be abused, or that purchases would get swapped for counterfeits during shipment.”

Part of the appeal for Western brands, such as Costco, in using Alibaba’s Tmall platform and associated applications, is that these have been designed to directly assuage such fears. Notable examples of this strategy include:

  • Alipay — The company’s escrow payment service, according to one its chief architects, “is really about trust.” Alipay’s escrow model enables money to be passed from consumer to Alibaba and only released to the seller upon satisfaction of customer;
  • Etao — This Alibaba-owned vertical price comparison website yields search results across Alibaba’s TaoBao and Tmall sites and, in a move that enhances transparency, also includes listings on competitor e-commerce sites, such as JD.com;
  • Returns policy — In a country where products are normally sold as final sale only, Alibaba guarantees customer satisfaction by requiring merchants using Tmall to comply with its trust-inspiring 7-day return policy, a guarantee that existed prior to it being required by China’s recently amended consumer protection law;
  • Customer service — Tmall customers have come to expect highly responsive customer service around the clock, especially via live chat;
  • Social media integration – China’s online shoppers are, according to Nielsen and BCG, “the most social in the world,” with consumers both seeking out personal recommendations, as well as writing and reading online product reviews en masse. In recognition of this, Tmall is now smartly integrated with Sina Weibo and Alipay, enabling customers to make purchases directly from the social media app.

The Government’s Impact on E-Commerce in China

Alibaba, while not a state-owned company, has risen in tandem with the Chinese government’s efforts to rebalance the country’s economy from a manufacturing economy to a consumption-based one.[ii] Aside from the local cultural and business savvy of Alibaba, Western companies’ partnerships with Tmall ought also be understood in the context of Beijing’s push of e-commerce in China through state economic planning, national Internet access goals, and linguistic localization stipulations for domain names.

In recent years, the Chinese government has announced its intention to double the value of national e-commerce sales to nearly $3 trillion by the close of 2015 and to achieve full nationwide broadband coverage by 2020. Meanwhile, the Chinese government has espoused substantive support for ICANN’s new gTLD program, having registered some 10,000 Internationalized Domain Names (IDNs) and is now requiring that all Chinese government websites use fully Chinese web addresses.

Looking Ahead to the Future of e-Commerce in China

While Chinese government support for expanding the country’s domestic e-consumer base—from macroeconomic to technological planning to digital literacy efforts—is evident, it remains to be seen how Chinese consumer habits will evolve and companies, foreign and domestic, will respond to these initiatives.

Costco and others have recently embraced Tmall as the foundation of their China market entry strategy, but, in time, these brands will presumably move to a stand-alone storefront, whether virtual only or, less likely, a traditional brick-and-mortar outpost, if only to gain greater oversight of their online business and consumer relationship management. It will be interesting to see when and how they take advantage of the opportunity the new IDNs represent as dedicated, branded, “localized” spaces to sell independently to Chinese consumers.


[i] Localization, as used by marketers to highlight the idiosyncrasies of Chinese e-commerce, is an interesting topic that merits another blog post—forthcoming.

[ii] According to Bloomberg BusinessWeek, “Alibaba has almost single-handedly turned China into the world’s second-largest e-commerce market.”

Back in 2011, if you asked most major brands what a gTLD, the RySG, GAC, or even ICANN was, most would not have been able to make much sense of the acronyms.

Now, those who are in the process of launching their own .BRAND and/or .GENERIC gTLD have gotten up to speed on that alphabet soup. However, staying up to speed on ICANN policies and fulfilling the obligations of the Registry Agreement will be ongoing commitments for all new Registry Operators.

Before New gTLDs & .BRANDs

Until a short time ago, the Internet Corporation for Assigned Names and Numbers (ICANN) was an organization that was not on most brands’ radar.

Brands may have heard about ICANN when learning that they had to worry about trademark protection in a new top-level domain (TLD) like .XXX. With the approval of the New gTLD Program and the opening of the application period in January 2012, though, that all changed.

Now, with their own .BRAND application(s), many brands quickly became immersed (at times to their dismay) in the world of ICANN and domain names.

The Application Process

Brands especially found themselves having to climb a steep learning curve to quickly handle the demands of ICANN during the application process, including:

  • Addressing the “one size fits all” requirements in the Applicant Guidebook
  • Providing personal information on Officer and Board members and submitting these individuals to background checks by ICANN
  • Meeting financial requirements not geared towards strategic corporations such as providing financial statements and acquiring unconditional Letters of Credit
  • Completing these tasks within three months’ time

Some brands may have sighed in relief after their applications were in, thinking that all the work was behind them.

However, brands are now recognizing that they cannot just forget about ICANN once their .BRAND (or .GENERIC) launches.

Ensuring Compliance with the Registry Agreement

Following the application period, brands understood that some input and work would be needed in order to develop and launch a .BRAND or .GENERIC TLD. However, the nuanced obligations of a Registry Operator and the direct and ongoing impact the Registry Agreement and ICANN policies would have on these same brands was never as well understood.

While it would be impossible to catalog every way that ICANN policies, developments, and activities of supporting organizations and advisory committees directly or indirectly influence and affect Registry Operators and their contractual obligations, below are a few key areas of the Registry Agreement that are currently affecting brands (and really, all Registry Operators).

  1. Altering the Registry Agreement: Article 7.7

While each applicant executes its own Registry Agreement for each gTLD, Article 7.7 of the Registry Agreement permits the ICANN CEO or the Chair of the Registries Stakeholder Group (RySG) to initiate a process to amend the Registry Agreement once per year. While this process is time consuming, involves negotiations, a public comment period, and an approval by both parties (the RySG and the ICANN Board), once approved, the amendment to the Registry Agreement will become effective for all Registry Operators 60 days after ICANN provides notice.
All Registry Operators are given the opportunity to participate and comment on the proposed amendments, as well as vote on the Proposed Revisions. However, .BRANDs should be aware of these provisions and follow relevant developments closely, since all registries will be affected by these modifications to the Registry Agreement – whether or not they choose to participate in the ICANN process.

  1. How Will the Public Interest Commitments be Interpreted: Specification 11

In July 2013, ICANN published an updated version of the Registry Agreement, which included Specification 11, the Public Interest Commitments in response to the Governmental Advisory Committee’s (GAC) Safeguard Advice.

Much has already been said about the addition of the specification, which was approved over a year after the close of the gTLD application period. Specification 11 adds obligations for registries such as the requirement to only use 2013 accredited registrars, prohibits closed generic gTLDs, and requires Registry Operators to conduct periodic technical analyses to assess whether any security threats, such as malware of phishing, are present in the gTLD, in addition to other obligations.

However, most, if not all, Registry Operators still feel a great sense of uncertainty around how this Specification will be enforced since different parties can interpret the obligations included in the specification differently.

For example, section 3b of Specification 11 requires periodic technical analysis to assess security threats in the gTLD. Based on conversations to date, it is clear that ICANN and Registry Operators interpret this provision differently – there is even disagreement among different Registry Operators. To this day, the question of how ICANN Compliance intends to interpret and enforce this requirement remains.

This will affect all Registry Operators, including brands, especially if an across-the-board standard is required of all registries. Given that Specification 11 does not relate to critical registry functions that back-end registry services providers are responsible for, it also may require brands to leverage their back-end provider for an additional service, or use another third-party provider.

  1. Providing Public Zone File Access: Specification 4

As required by Specification 4 of the Registry Agreement, all Registry Operators must provide third-party access to the registry’s zone file data.

While a Registry Operator can do this on its own or through a Centralized Zone Data Access Provider (CZDA Provider), the Registry Operator must enter into an agreement with any Internet user that is found to be qualified. This will allow the individual the ability to download the zone file data once every twenty-four hours. Access can be denied if the user does not provide the required credentials and/or if the Registry Operator reasonably believes that the user will use the data for unlawful purposes or any use prohibited under Section 2.1.5.

While a .BRAND’s back-end provider will be responsible for providing the registry’s zone file data, it will be the responsibility of the Registry Operator to review and approve users for access.

Despite being straightforward and simple, this is an ongoing task that the brand will be responsible for and will continue throughout the life of the TLD.

Conclusion

Though these requirements are a bit all over the map, these three examples demonstrate how all Registry Operators, including those with a .BRAND, face multiple ongoing responsibilities. Registry Operators will all be affected by ICANN developments and policy decisions, as well as the activities within ICANN stakeholder groups.

Most brands recognized that operating a gTLD, even a .BRAND, would be more involved than launching and operating a single domain name. However, as brands have discovered through the application, evaluation, and delegation processes to date, there is more running a compliant gTLD than outsourcing the critical registry and data escrow functions.

While the recent focus of the New gTLD Program has been centered around contention sets, auctions, and contracting, it isn’t too early for Registry Operators (especially brand owners) to start thinking about Registry Onboarding.

What is Registry Onboarding?

According to the process laid out by ICANN, Registry Onboarding takes place after the execution of the Registry Agreement, and before Delegation of the gTLD into the root (when the gTLD becomes a “live” gTLD). As a prerequisite for Delegation, the Registry Onboarding process consists of syncing the Registry Operator with ICANN to ensure smooth ongoing operations. It includes important steps such as completing Pre-Delegation Testing, establishing emergency points of contact with ICANN, and registering with the Trademark Clearinghouse.

What’s the timeframe?

Officially, the Registry Operator must complete the Registry Onboarding process within 12 months of signing the Registry Agreement. However, the Registry Operator could tackle multiple tasks simultaneously, and it may be able to complete the entire onboarding process in 8 weeks or less with proper preparation.

What do brand owners need to know?

It’s important to make sure arrangements with your back-end provider are clear and that you have a process in place, especially if you want to move quickly through the onboarding process. Here are a few key considerations new Registry Operators should keep in mind as they move through the process.

First, the Registry Operator should connect with the back-end registry service provider to review responsibilities and coordinate communication with ICANN. While ICANN provides instructions in the Welcome Kit for New gTLD Registry Operators, the delineation between the Registry Operator’s responsibility and the back-end’s responsibility is not always clear.

The Registry Operator should also establish clear internal points of contact and responsibilities. Unlike previous phases of the New gTLD Process, the onboarding process will require the Registry Operator to manage two communication portals with ICANN – the Customer Service Center (CSC) Portal and the Global Domains Division (GDD) Portal. Moreover, 22 points of contact must be provided to ICANN during onboarding. One individual may take on multiple responsibilities, but the Registry Operator should ensure that it is fully aware of the expectations.

Finally, the Registry Operator’s contract with the back-end may include additional fees for onboarding services. Therefore, it is important to review the relationship with the back-end registry service provider to ensure that there are no surprises.

What’s next?

Registry Onboarding serves as a basis of the operational relationship between the Registry Operator and ICANN. Once this step is completed, the Registry Operator will be able to proceed to the TLD Launch phase, and eventually to general registration and use.

We’ve dipped into the alphabet soup of Internet governance meetings, and now it’s time to cover the whole new set of acronyms cropping up in news feeds this week.

These acronyms are coming out of ICANN 51, the Internet Corporation for Assigned Names and Numbers’ (ICANN) public meeting being held in Los Angeles this week. There are three of these meetings a year, and a variety of stakeholders – Internet users, businesses, policy makers, government representatives – are meeting up in various combinations to take on pressing issues in the DNS (the Domain Name System.) The DNS translates the domain name you type into the corresponding IP address, and connects you to your desired website.

First, a little more on ICANN: ICANN is an internationally organized, non-profit corporation responsible for coordinating the technical services required for the ongoing operation of the Internet. As a private-public partnership, ICANN says it is dedicated to preserving the operational stability of the Internet; to promoting competition; to achieving broad representation of global Internet communities; and to developing policy appropriate to its mission through bottom-up, consensus-based processes.

So, what are some of the groups that comprise this bottom-up, consensus-based policy development process?

GNSO: The Generic Names Supporting Organization is one of the groups that helps coordinate global Internet policy at ICANN. It is responsible for creating policy applicable to generic top-level domains (gTLDs) and is comprised of four stakeholder groups (SG):

  • Commercial Stakeholder Group
    • Here you’ll find the Business Constituency (BC), Internet Service Providers (ISP Constituency), and Intellectual Property professionals (IP Constituency)
  • Non-Commercial Stakeholder Group
    • Non-Commercial users and non-profits
  • Registrars Stakeholder group
  • Registries Stakeholder group
    • Sometimes you’ll hear about the opinions of the “NTAG” – this is the New TLD Applicant Group, entities whose TLDs aren’t operational yet but who might be preparing to enter into the stakeholder group as full voting members once they operate those TLDs. In the mean time, the NTAG helps organize the voices of applicants.

You may also hear about “Advisory Committees” such as:

  • ALAC: The At-Large Advisory Committee is where you can find individual Internet users represented in the policy development process.
  • GAC: The Governmental Advisory Committee (GAC) is an advisory committee comprised of appointed representatives of national governments, multi-national governmental organizations and treaty organizations, and distinct economies. It advises the ICANN Board on matters of concern to governments. The GAC operates as a forum for the discussion of government interests and concerns, including consumer interests. As an ICANN advisory committee, the GAC has no legal authority to act but it does report its findings and recommendations to the ICANN Board.
  • SSAC: The Security and Stability Advisory Committee advises the community on – you guessed it – the security and stability of the Internet as it pertains to technical matters of operation, registration, and administration.

There’s plenty more to ICANN, but knowing how different stakeholders group together can help give you a bigger picture of how the multistakeholder model works. For more acronyms and definitions visit beyondthedot.org – a great resource to point folks to for a reference on the world of ICANN and new gTLDs.

The Alphabet Soup

shutterstock_37478005Next week, the World Congress on Information Technology (WCIT) will provide a gathering place for business, media, academics, policymakers, technology professionals, and organizations in Guadalajara, Mexico. The conference brings this diverse community in information and communication technology together in order to provide a “proper platform for the industry, policy makers and academy to show their peers, how ICT innovations are helping them to create new alternatives for a challenging world” – a discussion platform rather than a meeting that ends with policy or regulation decisions.

This may be a little confusing because there also exists the World Conference on International Telecommunications (WCIT), the United Nation (UN)-led initiative that sometimes makes the news.

In the alphabet soup of meetings that may have come across your radar, you may have also seen the following: The Internet Governance Forum (IGF), which met in Istanbul, Turkey in early September, and the International Telecommunications Union (ITU) Plenipotentiary Conference to be held in Busan, South Korea from October 20 to November 7 – sometimes just called the “Plenipot”. These two meetings are associated with the UN in different ways: IGF gathers various parts of the Internet community for discussion through a UN mandate. According to its fact sheet (found here), there is no “negotiated outcome” (in other words, it produces no immediate policy or treaty), but rather it “informs and inspires those with policy-making power in both the public and private sectors.” The Plenipot, on the other hand, is convened as an official meeting of the UN’s ITU. This event, held every four years, covers “issues that require international cooperation following technological development, pending global issues, international agendas in telecommunications, and follow-up measures for major summit-level conferences”.

And, of course, there’s ICANN 51, the Internet Corporation for Assigned Names and Numbers’ (ICANN) own public meeting, which will be held in Los Angeles from October 12 to October 16. ICANN’s public meetings, which take place three times a year, gather the Internet community to contribute to policies on domain name management that have far-reaching effects on businesses from an IT, marketing, and legal perspective.

What does it spell out?

All of these organizations help comprise a complex Internet governance ecosystem with their various mandates, not to mention their overlapping constituencies. For example, you’re likely to see ICANN officials not only at the ICANN meeting, but also at the WCIT meeting in Guadalajara next week. You’re likely to see some national governments represented at each of the meetings listed above.

While it may seem difficult to keep track of it all, understanding how these different organizations fit together in the larger puzzle of Internet governance and how their activities impact things like Internet policy and how commerce is conducted online is crucial for well-informed brand owners.

The upcoming ICANN 51 meeting can be a place to start, especially if you are a company with a presence in the U.S. and have concerns about the time and resources that will have to be dedicated to getting involved in Internet governance. Most meetings related to Internet structure and governance are held around the world in rotating locations that can be difficult to attend due to time and travel budget constraints. However, with ICANN 51 in Los Angeles, it can be an opportunity to get your feet wet, go to sessions, participate in some of the after-hours discussions, and get up to speed on major policy decisions that affect brands’ digital strategy decisions.

Many organizations have opportunities to work on issues remotely, for example, by participating on working groups and submitting public comments. However, with much work done on-the-ground at these meetings, seeing one for yourself at least once can help demystify the dynamics at play.

If you decide to head to LA, we’ll see you there – otherwise, stay tuned for updates from ICANN 51 in October.

Bids

On September 11, 2014, ICANN released an updated Auction Schedule for all remaining contention sets – a situation where more than one organization applied for the same gTLD. The outcome of these ICANN Auctions affects not only the new gTLD applicants involved, but also brand owners looking to register in new gTLDs.

Because of past delays, today’s auction will be the first to settle multiple contention sets in a single round: .BUY, .TECH, and .VIP. All of these strings have multiple applicants and Google and Donuts are featured in all three. It is also the first ICANN Auction for a Latin alphabet string. Thus far, the only contention set resolved by ICANN Auction has been a Chinese IDN, which Beijing Tele-info Network Technology Co., Ltd. won out over Afilias.

The .BUY contention set in particular is a good example of how an auction winner can have a major impact on whether or not a brand owner decides to register in a new gTLD.

The .BUY contention set is between Donuts, Amazon, Google, and Famous Four Media. If Donuts were to win .BUY, brand owners concerned with defensive registrations who have purchased the Donuts DPML Block would be able to breathe easy, as the Block would cover this string. If Famous Four Media wins the contention set, most brand owners will have to proactively register domains in the string to protect their trademarks. Another scenario is if Amazon wins the auction. In its application, Amazon proposed to operate .BUY as not fully open; however, the exact registration policy has not been released. Some brand owners may be able to register in an Amazon-owned .BUY while others may not. This could have significant implications for brands’ online strategies.

As a reminder, the ICANN Auction is the resolution method of last resort. In some cases, applicants involved in a contention set have reached private deals to reach a resolution. Sometimes, especially when the applicants involved have applied for multiple gTLDs, an applicant will give up one string in exchange for keeping another. While the details of these private settlements are not made public, many of the applicants involved in the contention sets up for Auction today have been party to such settlements.

In other instances, these settlements involve paying out the “losing” applicant or applicants for sums that range from the thousands to millions of dollars.

Will the ICANN Auctions result in similar string prices? Or, will holding out for an ICANN Auction lower the sticker price? Further, will the outcome of these ICANN Auctions cause other applicants in contention sets to change course, either in favor of ICANN Auctions or against? We’ll find out soon enough!

The auction began today at 9 AM, but how long it will go is anybody’s guess – the auction is an ascending-clock model, which means that bidders must match the minimum bid for each unit of time in order to move on to the next round. The longer more than one bidder is willing to stay in the auction, the longer it will take to reach a conclusion.