by Greg Zuckerman | February 15 2017

How Pillows.com Saved a Fortune in Marketing Costs by Upgrading to a Premium Domain

At Cheap Domains, we often talk about the benefits of registering a short, memorable, keyword-focused domain name: It’s a smart investment—and if you're in the position to acquire a premium domain that makes sense for your business objectives, then the high cost can easily be outweighed by the ROI.

But what do the benefits of purchasing such a domain actually look like in a real-world scenario?

We recently chatted with Craig Clark, CEO of an e-commerce retailer formerly known as Pacific Pillows, about their acquisition of Pillows.com.

Prior to purchasing Pillows.com in 2011, Pacific Pillows was already an established online destination for pillows and luxury bedding. But the company was looking for ways to lower customer acquisition costs and also increase its retention rates. "Pacific Pillows" wasn't memorable enough to bring back some customers. Also, some visitors were mixing up the company with one of its vendors, Pacific Coast, a pillow manufacturer.

Craig and his team had already experimented with other domains in the past, such as downpillows.com. But it decided to stretch its budget to acquire a high-value, exact-match domains: Pillows.com.

The effects were virtually immediate. By 2012, the company had rebranded its site around the name Pillows.com and its marketing metrics were improving across the board. Most notably, it was acquiring customers for a much lower cost (saving a ton on marketing), retaining more customers, increasing its organic traffic, generating more response from other advertising media (such as radio) and building its brand recognition at sponsored events.

What's more, the domain also helped solidify the company's reputation as the experts in pillows, helping it successfully compete against companies like Amazon and Bed Bath & Beyond.

Check out the full interview below to see how they did it:

----------- 1) How long were you operating your site, PacificPillows.com before acquiring Pillows.com?
Since 2004. From 2004 to 2011.

2) When did you decide to begin the process of acquiring Pillows.com?
Started thinking about the concept in 2010. The acquisition was early 2011, we went through the holiday season and then did the branding change in march 2012 after the holiday season, which was also when the home goods winter rush starting rapping up. So, we purchased the name in early 2011 and made the URL switch in 2012. We acquired it and did not want to mess with it during 4th quarter. Home goods and bedding have a heavier season when its colder outside so we wanted to slow down till it got warmer in spring, and that’s when we did the domain migration.

3) What was your background or knowledge regarding domain names and their value?
We hand registered PacificPillows.com. We’ve messed around with purchasing domain names throughout our entire history, we’ve bought names like downpillows.com, Pillows.net, Homeland.com, Sheet.com, which is currently directed to the sheet category at Pillows.com. We have a few category relevant stuff. Were definitely not experts on the topic, but had familiarity.

4) Once you acquired Pillows.com, did you immediately redirect your formally operating site, Pacific Pillows, to Pillows.com?
Yes, we still redirected PacificPillows.com to Pillows.com because we wanted to maximize our natural search traffic and make sure there was not a big drop off, and to capture any old links that are directed to our sites. We wanted to leave that continuity in place for our customers who had bookmarks for PacificPillows.com.

5) After acquiring the domain, what efforts did you take to rebrand your company?
We kept the brand and feel generally the same for our returning customers, and slowly through the end of 2012 and 2013 we dropped our association with Pacific Pillows all together.

6) Did you know the value or importance of owning a premium exact match domain and what impact it could have on your business? What was your reasoning behind acquiring the domain?
Intuitively, marketing wise, two things are going on. The first I would call the Cocktail Party test. One would say “Hey, who do you work for?” And I would say PacificPillows.com. There is not a high likelihood that they will remember that name. They are going to know it’s something with pillows, but they might mistake it for pacific coast pillows, which is one of our manufacturers. But, if I say I work for Pillows.com, there is a high chance they will remember that, and even if they screw up and search Pillow.com, were still in good shape, as we own that name too. That’s the number one reason. It’s actually a brand, where Pacific Pillows was just a URL in terms of quality. But Pillows.com, people remember that, it works for networking, works at the cocktail party, works when we're talking to vendors. It gives us more credibility.

7) Do you currently use Google Adwords? Have you noticed a change in your click through rates, conversions, or a reduced cost in using Adwords?
Yes. That is our best-paid use of advertisement. Between the rebranding, the economy improving from 2012 to now, and a general growth of the company, we’ve been very successful. I don’t have metrics In front of me to specifically answer your question, but we have a lower cost per acquisition then we did in 2011 and the domain is certainly part of it. You get increase keyword relevant keyword searches and an increase in credibility from the consumer.

8) How long did it take to see an impact on your company’s revenue, growth, and sales? How long did it take for the name to pay itself back?
Once we switched names, we thought it would take the rate of searches back to what it was with our previous name to be at least 3 months, but we were back on the same rate of searches in 45 days. In 2012, we saw 25% growth, attributable to the economy growing plus the brand improving. And that growth continued. We saw a big growth with our repeat customers. We had an average return of repeat customers of over 200% from where it originally was and that was definitely attributable to the brand. When you're Pacific Pillows, you can stumble across a bunch of pillow sites, but when your pillows.com, it's pretty clear that there is only one pillows.com. The name also helps with more traditional marketing such as radio advertising. You can get so much more retention on radio advertising with a name like pillows.com rather than Pacific Pillows.

9) What kind of assumptions do consumers make about your company? For example, have you noticed any differences in the way consumers or returning clients view your company? Do you think your clients view your company as the best, biggest, oldest, or one of the most established retailers in the industry?
We have credibility. We know what we're doing. We're Pillows.com. We have people turning to us as the experts. And that’s very important. You have someone like Amazon.com who does a great job at giving people many pillows options, outsources, reviews, etc. But where we compete is we offer that personalized experience where you can get custom advice. Pillows are a very personalized thing. You can have a pillow with great quality material, but it won't fit a consumers sleep patterns. Some of the top reviews on Amazon for certain pillows simply won’t work for some consumers. Certain pillows don’t fit individuals' body styles. We offer that experience both throughout our website where we have a lot of detailed information and we have consultations over the phone or chat. We're not necessarily the oldest, but I think we are just the best in the niche we're in, which is the key to our business model. It's how we compete with mass marketers like Bath and Beyond. You can have an expert on pillows in our customer care, while Bed Bath and Beyond may have a college student that generally knows the main policies of the store, but not necessary the ins and outs of pillows.

10) Has the domain helped you generate more leads and traffic?
Yes, but more importantly it’s just the brand recognition. We sponsor events, and people are a lot more likely to remember pillows.com compared to Pacific Pillows.

11) Have your marketing efforts been reduced through the acquisition of the domain? Are you able to spend more money in other places?
We definitely looked at the acquirement of the name as a big marketing investment. I would call it more of a capital purchase. We easily got our return for what we paid for the name very quickly. I would not say we reduced our marketing budget, but we just increased our sales, which allowed us to more efficiently spend our dollars.

12) Do you think an exact match domain works for all business situations?
Yes, I think there are two sides to it. The efficiency side of it, which directly impacts you on search engine results, Adwords, and then the brand component. Every business cares about creating an amazing brand and selling propositions about what keeps a company's brand and business strategy unique. It is a competitive advantage to have a solid brand. Other people can sell pillows, but no one can come in and be pillows.com. I run into people where I introduce myself and say I own Pillows.com, and they say, “Wow, we shop there.”

13) How has the acquisition of Pillows.com help with your SEO efforts? Were you ranking higher on search engines like Google?
Yeah, our SEO is significantly better prior to acquiring the domain. We're in the best shape we’ve been in SEO wise in a long time, while many other companies have certainly seen an SEO drop-off.

14) Many say, while premium domain names can be expensive, it’s a worthwhile investment. “People should consider building their businesses around domain names. Relating it back to the retail world, like a store location. Having a premium domain name is the equivalent of buying the best shop on the best street with the best foot traffic.” Would you agree with this statement or have any thoughts about it?
I think there are slight differences between domains and real estate. Real estate or a location is a finite location, where a brand transverses physical presence. I think your brand and relationship with customers is slightly more important than your location, because that’s what brings people back. If you’re an Ecommerce company, having a top premium category killer domain is critical, as it could take a medium size ecommerce company to the next level. I agree with the statement, just think the brand is the critical and the key.

15) What would advice would you give to a business owner who is contemplating spending a large amount on a premium domain name?”
A premium category killer domain name is worth a 6-figure-plus price. There’s a finite existence of EMD domains that are credible and recognizable with the public. Other category killer domains like Diapers.com have done us a lot of favor in gaining so much brand recognition. You have to think about it like an investment in your brand versus a capital purchase. It’s a marketing expenditure that you’re getting immediate ROI tracking on. It’s giving your brand credibility and building your brand. If you’re an online company with a mediocre name, giving people something that is easy to remember will allow for repeat customers, who will also make the right referral to their friends.

When we were PacificPillows.com, people would always end up at pacificcoast.com, which is a manufacturer that we buy from. We would often have customers trying to send returns to us when they are actual customers of pacific coast. That does not happen anymore.