Location – Online & Offline Business Costs
I have went shopping with my girlfriend in San Fransisco a few times, and got to thinking about how most of the businesses in the city pay $4,000 to $20,000 per month for rent. In many cases, with a 5 year term.
You can buy a great domain name for that. You can compete in the search results in most markets for that. Monthly rent to buy exposure in one city is recurring. Many online marketing costs and domain costs are not.
In time, online will be much more competitive than it is today, but many markets are still wide open, and likely will remain so for at least a few more years.
As mobile communications and web access move to free, and Google becomes the default homepage for the web, a strong market position on the web will be worth as much or more than any offline real estate.