Back when I was a newbie domainer I had lots of ideas about how to make money in this industry. They all failed. But I did have one hair brained scheme that yielded a minor success. This was mostly due to dumb luck.
The story begins when I hand registered the name of a wealthy person. For the purpose of this blog, let’s call him Herman Mankowitz. Mankowitz was not famous but if you searched him on Google you’d see he was a member of a very, wealthy family. After a few months of owning HermanMankowitz.com I was contacted by a young women via LinkedIn. Let’s call her Alice.
The first thing I did was research Alice. Her LinkedIn account and Facebook page made it easy. I wanted to know if she was representing Mankowitz or not. That would have a big impact on my asking price. I found out Alice was an American who was working for a non-profit in Africa. However she had previously worked for a global marketing and technology company in Australia. Bingo! I postulated that this connection to an International PR firm was the link between her and Mankowitz. Not because Mankowitz was Australian but because a wealthy person would likely hire a prestigious, International firm to handle their personal business. I surmised that Alice’s former employer had enlisted her to negotiate on their behalf. Now I was ready to respond to her query.
- Alice: I am looking to buy a name. Would you be able to help me with that?
- Me: Sure, I can help you. What did you have in mind?
- Alice: I wanted to purchase one of the names. How much are you selling them for?
- Me: Which name are you interested in?
- Alice: Are there different prices for different names?
- Me: Yes, absolutely.
- Alice: How much for HermanMankowitz.com?
- Me: That one is $10,000 per the listing here at DomainTools (link)
- Alice: $10,000? Are you kidding? I was thinking $500. Would you sell it for $500?
- Me: Sorry, no I would not accept $500. It may be that this is not the right domain name for you.
- Alice: What is the minimum that you would take? And which other domains might be cheaper?
Note: This conversation took place over a period of 3 days and I could tell she was living in a much different time zone. Africa’s time zone didn’t fit with her communication schedule so I concluded that she was back in Australia. This supported my suspicion that she was in cahoots with her old company. Also, when she started asking about other domains I felt like she was playing games and I wanted to put an end to that. I also didn’t want to enter into the typical negotiation where each party slowly comes down or up in price and meets in the middle. I wanted $10K for this name. So I decided to do something radical.
- Me: I wouldn’t take anything less than $10,000 for that domain and in fact I’m thinking of raising the price to $12,500. My other domains have similar pricing. I know that is way out of your price range so I’m not sure there is much more for us to discuss. I do thank you for contacting me and I sincerely hope you find a domain that is right for your project. Good luck and best wishes.
Note: I thought my message would sober her up and that I would get an offer in the $5K range. But instead there was no response. Silence. Day after day, month after month. During that time I did some research and learned about common law trademarks for public figures and realized I could be facing a UDRP hearing. I thought I could even face frivolous legal action since a wealthy person has a lot of money to burn especially if you make them angry. I didn’t have any money for legal fees so after 3 months I decided that I should take the offer and run. I thought $500 was not too bad for a hand regged domain. But how to come down from $10K to $500? I felt like a fool. Finally I came up with a strategy.
- Me: I’ve recently been reading up on Herman Mankowitz’s charitable activities and I’m very impressed with his social contributions. As a fellow supporter of charitable causes I’d like to see this domain name get into the proper hands. I’m now prepared to release the domain, to an appropriate person, at a much lower price. Please let me know if you are still interested.
- Alice: Thanks for reaching out. We had moved on from that URL, but might be willing to discuss it for a nominal fee. What number did you have in mind?
Note: This return message sounded encouraging so I decided to increase my counter offer and ask for more than $500.
- Me: Under the circumstances I would let it go for $1500.
- Alice: We truly appreciate you reconsidering upon understanding his work. We would like to purchase the site for $1,500. As I’m sure you’d appreciate, we’d like to keep the terms of our agreement confidential and we would like to use Escrow.com to complete the transfer. Is there a phone number that I can reach you on to discuss details?
The sale went smoothly with the buyer paying the escrow fees. She was working for a small tech company in Australia and was the indirect representative of Herman Mankowitz. Several weeks later the domain became the home for a website that extolled Mankowitz, his life, and his accomplishments.
Learning From My Mistakes
When Alice quickly agreed to $1500 I knew that I’d left money on the table. In hindsight I think I could have gotten $3K for that domain if I had handled the situation differently. But overall I feel good about the sale. I had made a profit and Mankowitz had gotten his domain for a reasonable price. Most of all I’d learned some lessons for next time.:
- I need to think twice before buying the name of famous person unless it’s are very common name like Herb Jones. Otherwise I could face a UDRP hearing or worse yet a law suit. It’s probably not worth the risk.
- I need to make sure potential buyers can contact me easily. They shouldn’t have to find me on LinkedIn to start a conversation about a purchase.
- If I set a high initial price it shouldn’t be so high that the buyer feels they are being taken advantage of.
- I shouldn’t lose my patience even if the buyer starts to play games. Slow and steady wins the race.
- In some circumstances it might be OK to play hard ball and say “It seems like we’re not going to be able to make a deal here. What do you think?” but I shouldn’t completely shut down the communications.
- If I contact the buyer after a long period of silence I shouldn’t assume that I am the only motivated party. They may be just as desperate to close the deal as I am.
What are some ways you would have handled this negotiation for a better outcome? Let us know in the comments below.
Meanwhile, check out this great list of brandables available at NameJet: