Domain parking is the process of registering a domain name and placing it on hold. Simply put, many Web hosting companies and resellers will allow consumers to "park" an Internet domain by adding the consumer's domain name to its domain name service (DNS) servers to act as the authority for the domain.

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Such a service accommodates customers who only need to register and secure their domains without having an active homepage yet in place. Many consumers appreciate domain parking. The latest estimates predict that over 40,000 names/month are currently being registered. With that in mind, parking a domain name guarantees that when a consumer is ready to build their Web site, their name will be ready.

Increasingly, people are registering .com, .net, and .org domain names to prevent others from using their business name. Because a consumer does not need to have a Web site or e-mail address associated with their domain in order to register it, domain parking has emerged as an extremely popular option. Most consumers can "park" their domain names free-of-charge with a Web host or reseller, once they have registered them for a nominal fee from an established domain registrar.

Domain parking however does not only benefit consumers. Resellers can make use of domain parking for marketing and sales purposes. Domain parking is an excellent marketing tool because it allows Web hosting companies and resellers to propagate their brand identity.

Most hosting companies will provide a free "under construction" page to registered domains that are not in operation. Usually this under construction page will feature a Web host or reseller's logo, brand identity and hyperlinks to information about their service offerings. In effect, domain parking serves as another method to advertise your business.

If thousands of consumers elect to park their domains with your reseller operation, then you are creating thousands of separate, individual advertisements. Under construction pages usually propagate in search engines. Further, under construction pages also receive a varying rate of type-in traffic. For this reason, domain parking is a very appealing product to offer consumers.

Domain parking can also provide a potential revenue stream for resellers. Many established registrars will offer Web hosting companies and resellers financial incentives for reselling domain names on their behalf. With many of these registrars, it is possible to utilise automated scripting technologies to quickly register a client's domain name and have them parked on your domain name server. Once the domain is registered, many domain registrars will provide the reseller with a discount if they purchase the domain up front for the consumer, or with a small referral fee. If a Web hosting reseller is registering and parking thousands of domain names through their service, then revenue can be considerable. Most importantly, many Web host resellers utilise domain parking to build a solid database of prospective customers. In order to both register and park domains, users must yield important personal and consumer information. This information, once collected, can be utilised by hosting companies and Web hosting resellers for telemarketing purposes.

Consumers of domain parking services will eventually require full-service hosting, if they desire to deploy a Web site or use e-mail services. Domain parking is thus the first step towards establishing an Internet presence. For this reason, domain parking should be integral component of any large scale hosting reseller operation.