The AOP Buyer Power Score is a content offering created in partnership with ProcurementIQ that rates the balance of power between buyers and sellers for a particular spend category.
Today we are reviewing Internet Domain Names.
The Buyer Power Score for Internet Domain Names is -0.3 on a scale of -5 to 5, with -5 signifying low buyer power and 5 meaning high buyer power. The more power a buyer has the greater leverage they have to get lower prices and better contract terms.
The fact that Internet Domain Names are scored with a ‘Buy Later’ rating may not be as interesting as the information ProcurementIQ provides in support of that recommendation. According to their report, the number of .com and .net domain name registrations increased by 5.0% in Q4 2021. This demand is driving up costs.
Perhaps driven by the startup boom resulting from ‘the Great Resignation,’ this data suggests that entrepreneurship is alive and well – at least online.
How to Use this Information
This report covers Internet Domain Names as well as their secondary market. Suppliers in this market also often provide web hosting and related IT solutions and services.
Businesses and consumers have become accustomed to demand spikes and supply shortages in general goods and services, but digital purchases have typically been exempt. This information on Internet Domain Names is a reminder that any product or service associated with larger societal trends – including the great recession – may be more scarce and/or more expensive in the short term. Planning ahead to ensure demand is met and service level expectations are clearly documented will serve procurement well.
We have partnered with ProcurementIQ to dig into their treasure trove of over 1,000 indirect category intelligence reports, with new insights every Friday. To dig deeper into the Internet Domain Name report, click here.