The short answer based on recent experiences is VERY!
Now it is no great revelation that having a good URL is important but the extent of how important has always been argued. Recently I have been cleaning up our Software Industry Resource Directory here at Softletter and in the process I was amazed at the clear pattern that emerged in terms of which companies were still active and those that have closed.
Companies that were lucky enough, or invested, in a URL with a clear and understandable service or benefit are surviving. Those that chose to settle for URL's that are acronyms, meaningless or hard to remember have perished.
For example, list broker service companies with names like: addresses.com, directmedia.com, emailresults.com and acculeads.com have survived and stay on the top of Search Engine results. Companies that used initials like XYZ.com have not; or meaningless URL's like silvermonkey.com also have not remained viable. Interestingly, companies with cute names like 'silvermonkey' get great initial PR and attention, but as time goes on and the ability to keep up the advertising diminishes to normal levels the name starts losing its luster as it is not memorable. So if I am looking for a good source of leads and I come across the choices of: greatleads.com, emailresults.com, silvermonkey.com and XYZ.com, and have not established preference I am going to look at the first two choices that mean something to me and my perceived needs. If one of those meets my needs I will never get to the third or fourth choice. This is often the difference between success and failure.
So what about the extension alternatives? It is OK to have a great name with .net, .org, .biz or other such extensions. The answer is that typical users expect .com for any business or service organization and if the .com does not work they will move on to the next alternative. It has also been found that there is certain distrust for companies using the alternative extensions. A typical thought is "how good is this company if they do not have a .com address?". Clearly government organizations are fine with .org and Internet Service Providers are fine with .net. Internet users are savvy and know what those extensions should be associated with. But you should not be surprised if you get greatleads.biz that your advertisements will be feeding your competitor at greatleads.com.
What are your experiences? We want to hear from you.