If you’re in that position, you probably know the importance of a good domain. You probably want it to sound professional, be memorable and rank high in search engine results.

But if you’re like many of our clients (not to mention friends and family members who often email about this question), you’re not finding it that easy. After all, there are many approaches to branding, and many theories about the relative importance of domains to search optimization.

Then there’s the fact that so many domains are, simply, taken.

Well, if you’re looking to name or rename your domain for more traffic and memorability, read on.

Know your purpose

Before you start brainstorming, you need to know your website’s purpose.

Most domains today serve one of two functions: They either reflect an identity or describe an offering. In other words, they’re either brand-based or keyword-based.

Think Nike.com versus Shoes.com.

Each of these strategies has its strengths and weaknesses. So before choosing your approach, you’ll want to ask yourself a few questions:

• Do I have a strong pre-existing identity?
• Will people find my website mainly through search engines?
• Will my site function more like a brochure or more like a store?

As you’ll see in a minute, answers to such questions will affect your naming strategy—and your results.

When to brand

During the early days of the web, people created domain names that were painfully literal.

Well, if that approach worked, Books.com would be the world’s biggest online bookstore and Search.com would be the world’s most popular search engine. But as we know, Amazon.com and Google.com own those titles, respectively.

The results underscore the power of branding. On the web at the very least, users appear more interested in brand names and their associations than with generalized product or service listings. Bland names tell users nothing, and no allure equals no traffic.

(This, of course, is a somewhat curious observation, because everywhere else on the web, literal tends to win out. For example, straightforward writing is more usable for low-literacy users. And "cute" section headings can be confusing.)

Of course, if you don’t have a highly recognizable brand, you’re going to pay for its development and promotion in either time or money. Creating a brand identity is an (expensive) art unto itself, and solidifying it in your prospects’ minds takes much (costly) repetition.

So, if you have a strong brand, can secure the domain (which, if you have a strong brand, you probably have), and can anticipate that most traffic will come directly to your website from offline media such as business cards or paid online promotion such as search marketing ads, stick to a straightforward brand-based domain.

But if you’re creating a new company, have little brand recognition or want to direct a lot of organic traffic to your site, you should probably consider a different approach.

When to use keywords

Experience and observations of top websites suggest that keywords can play a key role in your domain name’s success.

First off, they immediately tell prospects what’s available. Nike.com is a cooler name than Shoes.com, for example. But if Nike had no brand recognition, you’d be more likely to buy your runners at the latter. And if you have a new venture, face it: You’re no Nike.

Then there’s the impact on search engine optimization.

Some may disagree, but your domain name can have a significant impact on your search rankings. Let’s look at one example.

When people link to your website, they will often simply link its name. For example, if your company’s name were "Widgets Inc." and your URL were "widgetinc.com," you would likely end up with many inbound links telling people, "Go check out Widgets Inc."

Search engines learn about your site in part by the links that point to it. So if the content of a link is "Widgets Inc.," search engines will associate the word "Widgets" with your site. The more inbound "Widget" links, the stronger that association, and the higher your site will rank when someone searches for "widgets."

You can probably see where this is going.

Imagine that your company didn’t sell widgets but, instead, sold doodads. Well, unfortunately, people would be less likely to find your doodads when searching. Furthermore, when they searched for "doodads," your "widgetinc.com" link would show up, which would be confusing. (An issue that you can address if you write effective title and description tags.)

So, for a new company, consider that a keyword-based domain name can bring you faster returns and longer-term results at a lower cost than a brand-based domain name.

This is particularly true if you’re in a competitive market where brand identity and association is less important than solving an immediate problem.

If you want to play ball with the cool kids, you’ll look to associate yourself with a cool brand. And only a few will satisfy. But if you need boots to keep your feet dry, you’ll search based on your pain, goal or solution. And since many websites can solve the problem, the first site appearing for a term like "waterproof boots" will likely get your business.

Of course, "WaterproofBoots.com" doesn’t make a very compelling website. Particularly if you’re selling more than waterproof boots. So clearly something’s missing.

The ultimate name?

At this point you might be wondering whether you’re any further ahead. So let’s summarize and put the pieces together.

If you have a strong brand and own the domain, use it. You may want to consider some additional domains for individual campaigns or product lines, but basically, your work here is done.

If you have a strong need for a non-descriptive brand—for example, to express an attitude or personality, like Yahoo!—proceed with caution. If you have low brand recognition, and need it for success, prepare to spend.

If you’re starting or growing a new company, however, you should probably consider a domain (and possibly company name) built around keywords. But not around only keywords, lest you suffer the same notoriety as Pants.com.

Rather, you want to use keywords to generate a memorable name. One incorporating good branding principles and elements of stickiness such as simplicity, concreteness and unexpectedness.

For example, I have a friend who owns a cleaning company in Toronto. She aptly named it Clean My Space. That’s a memorable brand that also happens to top search engine results for such phrases as "clean condo Toronto." (Note that the link itself tells search engines that this site is about cleaning.)

Or take the website Double Your Dating, which generates millions of dollars a year for entrepreneur Eben Pagan (who started the site in his bedroom). Or My Wedding Favors, which does the same for search optimization guru Brad Fallon.

Learn from their success. Find your keywords and experiment with variations.

Then test, test, test.

Want to start testing now? Consider posting your domain in the comments below for feedback.