December 23, 2010, 10:52 AM

A big problem for e-retailers with a relatively simple solution

Many consumers mis-type domain names, and retailers should own domains those consumers often land on.

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Many consumers misspell a retailer’s name when trying to navigate directly to the retailer’s web site. In fact, common misspellings of the domains of 25 top retailers lead more than 90 million visitors each year to web sites with addresses slightly different from those of major retailers, says consulting firm FairWinds Partners.

The most extreme case is the site Khols.com, a misspelled version of Kohls.com, that receives over 10 million visits annually, FairWinds says. Visitors to Khols.com see a blank page. But many common misspellings of the sites of major retailers lead to pages operated by companies unrelated to the retailer that seek to make money from that misguided traffic. FairWinds calls this practice typosquatting.

Those pages often host paid search ads, and search engines may place ads for the legitimate retailer on those pages. If a consumer clicks on the ad, the retailer is paying a click fee for traffic it would otherwise have received for free if it owned the domain and could redirect consumers for free, according to a recent report by FairWinds, which consults on Internet domain name and trademark issues.

FairWinds identified 2,675 domain names that receive traffic from one-character misspellings of the domain names of the 25 major retailers it studied. The good news for retailers is that only 25 of those domains accounted for 71.3% of the more than 90 million visits diverted from legitimate sites by typos.

That suggests retailers need only gain ownership of a relatively small number of domain names to capture much of the typo-diverted traffic. “With the right analytics, they can identify the most common typos that garner the most traffic, and focus their efforts on recovering those domains,” FairWinds says in its report. “Most of the Internet retailers in our study could cut their levels of lost traffic in half with only a handful of strategic recoveries.”

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