I get asked a lot about domain names and their importance in SEO. So, to answer this I say, "Yes, it's nice to get your keyword or phrase in your domain name, but not critical." Let's face it, most keyword domain names are long gone - even the .biz, .info, and .net versions. You could do one with a hyphen in it, for example, www.cheap-pet-food.com, but that can be confusing for surfers to remember. However, you could grab that and point it to your main site to, hopefully, capture some results from it.
New v old domain names
There is definitely some advantages about buying an old domain name as opposed to a brand new one; but also some drawbacks. The big advantage of an older domain name is that the search engines have, historically, weighted them because of their age and so you get a boost. Google has hinted, starting from last year, that they may be reducing the weight they place on domain name keywords, which does, honestly, make sense. With all the "good" ones gone, it's kind of sad for new companies who can't take advantage of this.
However, there are some pitfalls to buying old domain names, and they are very real, and, potentially, really bad.
If it walks like a duck, quacks like a duck and looks like a duck, chances are, it's a duck! Or, to rephrase into an idiom my parents drummed into me, if it sounds too good to be true it probably is! There is a whole "industry" in faking PR (PageRank) on sites to sell for a profit. Another ploy is to offer a site which is yet to be registered and, if someone shows an interest, the scammer quickly goes and registers it, then sells it to you for a profit.
Another dodge is you pay for the domain name, but it never gets delivered.
Who previously owned the domain? What did they do and how did they use the domain name? It could be that the domain is already on Google's bad list, or, worse still, even de-indexed. When I'm researching, I use the WayBack Machine to see what the site used to be. It can be fun watching the evolution of a site by sifting through the snapshots.
It's not just the search engines who may not like your domain name either. There could be negative reviews which already exist on the net talking about your potential business!
Let's assume the previous owner was reputable and your domain name is still in the index, and it isn't the topic of a scam. You grab your domain name which includes the keywords "sports" and "nutrition". Awesome! That's really going to fit with your e-commerce site selling sports nutrition pills. What you fail to realise is that the site used to be all about car racing, or astronomy or something other than what you think it was about (Ie. sports nutrition). As you change all the content on the site, inbound links can start to drop off, or at least become less valuable to your new site as they contain the wrong anchor text and come from a site with an unrelated topic.
How to safely buy an old domain name
Research the domain name and its history. Look at the WayBack Machine, check out its links on somewhere like Majectic SEO, just do a simple check like typing info:<domain name> in your search bar. Also try to research the seller. If you're on a site that allows previous buyers to write a review read them!
Use an intermediary like PayPal to pay for your purchase so, if something goes wrong, you at least have some chance on recouping your loss.
Are there alternative domain names for sale from a more reputable dealer, or brand new from a registrar like GoDaddy?
Be a bit blase
Even experienced domain name buyers get caught sometimes. Just be aware that you can too, and don't get too stressed about it - it can happen. Safely buying an old domain name can be beneficial, but it's not the be-all and end-all. Work on other (far more important) on-page SEO items, and get to building your backlinks. And write GOOD content!