Choosing a domain name for your website is an important decision. Your decision should be based upon the goals of your site.
How will visitors find your website?
If you are relying upon Google to send visitors to your site then perhaps the best choice for a Domain Name is a Keyword Domain. For instance if you were selling designer clothing online, your best choice for a domain name might be www.designerclothing.com.au.
The benefit of including your keywords in the domain name is that Google will know what your site is about from the domain name. If your content matches the domain name then Google will score you extra points and you are on your way to a good page rank.
If on the other hand you are building a Branded website where visitors are going to arrive at your site thanks to offline advertising or word of mouth, having a branded domain name would be more important. In our example the business selling the designer clothes might be "DsignU" and therefore a domain name of www.dsignu.com.au would be more effective.
Your visitors would enter the brand name in the address bar and find your site directly rather than relying on a Google keyword search.
The most suitable domain name extension for businesses within Australia is .com.au, however if you are hoping to attract visitors to your site from all over the world then I recommend a .com.
.com.au - First choice for Australian business dealing with Australian clients
.com - First choice for Australian business looking to attract visitors from around the world
.net.au - Second choice for Australian business
.org.au - First choice for Australian organisations for Australian visitors
.org - First choice for Australian organisations for worldwide visitors
These are the domain extensions recommended for most clients. In our example above, if the first choice domain www.designerclothing.com.au was not available, I would choose www.designer-clothing.com.au. As long as the hyphen correctly separates your keywords then this is a good choice as a keyword domain name.