The importance of your domain name cannot be overstated. Domains can often make or break a site. But requirements are different depending on the purpose of your site, whether you want your site to become a well known brand, or if you're primarily going to rely on people finding your site through both unpaid and paid search.
If you're targeting a specific keyword or phrase you'll have an easier time ranking for that phrase if your domain exactly matches it. If you're planning on selling "big widgets" and your goal is to get visitors through search, it will be easier to rank well for "big widgets" if your domain name is BigWidgets.com. The same ranking benefit works if your domain extension is a .net or a .org (but less so for other extensions like .biz, .info, etc.). There are at least two reasons for this ranking bonus.
First, ranking in search engines is largely determined by the words people use to link to your site (anchor text). If most people link to your site using the anchor text "John's Store", you'll rank better when people search for "John's Store". If your domain is JohnsStore.com, it's likely that people will use "John's Store" as the anchor text when they link to your site, influencing your rank for that phrase. If your domain name is BigWidgets.com, it's more likely that people will use the anchor text "Big Widgets". So having a domain name that exactly matches the phrase you want to rank for can be beneficial as it influences anchor text.
Second, search engines rightly assume that a domain named BigWidgets.com is about "big widgets". This makes sense, as no one would want to have a domain named BigWidgets.com if their site was about miniature ponies. So search engines give a ranking bonus to a domain that exactly matches a search term. This bonus does not appear to be extended to all domain extensions (only .com, .net, and .org) in Google, and domains with hyphens do not get the "exact match bonus". Additionally, domains with hyphens are more difficult to remember in that most are not hyphenated.
So if the purpose of your site is to be the best resource on the internet for "big widgets", or if you want to sell only "big widgets, it could be a smart move to purchase the domain BigWidgets.com if possible. However, exact match domains may not be quite as brandable as alternatives. If your goal is to create a well known brand you may be better off with a branded domain.
A branded domain doesn't necessarily match the purpose or keyword phrase the site is about. Well known branded domains include Google, Orbitz, Amazon, and eBay. However, it is possible to have a branded domain that is more descriptive. Well known examples of descriptive branded domains are TripAdvisor, NYTimes, and Overstock. The key to a branded domain is that the focus is on the brand and not on an exact match keyword. Would Google have caught on if it would have been named "SearchEngine.com"? It's debatable.
If the topic of your site is going to be broad, and you'd like to have the greatest chance of building a well known brand, you're probably better off with a branded domain. Also consider that most websites do not get the majority of their visitors though a single search term. Some sites that focus on one very high traffic term do, but very often a site will get less than 10% of it's traffic from the primary "head term" it targets. Most search volume tends to come from the "long tail" of the search graph. While an exact match domain will help you to rank more easily for a very specific phrase and potentially give you a head start into a market, a brandable domain may have more staying power over time.
There are many registrars where you can register your domain. GoDaddy is one of the most popular, and the company we use here at Hungry Piranha. If the domain you want to buy is not available to register, you may still be able to purchase it either from a company like BuyDomains or from the current owner. You shouldn't pay more than about $10/year for an unregistered domain, although some companies will attempt to rip you off and we've seen them charging upwards of $30/year. For a registered domain, the sky is the limit. You should decide what you're willing to pay for a domain before you begin negotiation the price. At domain sellers like BuyDomains, you can normally negotiate the price down at least 30% off the asking price.
Here's how easy it is to register a new domain with GoDaddy:
1. First, type the domain name you'd like to get into the form on their home page:
2. If the .com version of your domain is available you'll see it selected like in the image below. If it's not, you can choose the .net or .org. I generally wouldn't recommend getting any of the other extensions.
3. Godaddy will suggest numerous additional options to you as you can see in the image below. I would recommend clicking "no thanks" for all of them, as they're unnecessary.
After you choose your domain, you'll need to get a hosting account.