Eight Ways to Fail at Domaining

“A diamond is a chunk of coal that did well under pressure.”Henry Kissinger

Profitable domainers fail 97% of the time on the way to selling 3% of their inventory each year.  Domaining is a highly speculative endeavor.  To be profitable means walking a virtual tightrope of income, expenses and probabilities.  On top of that we have to compete with thousands of other domainers from around the globe. So if we want to exceed – we have to excel.  On the other hand, if we want to fail, there’s at least eight ways to do it:

#1 Spend first, learn later

Would you invest in a stock just because you liked the name? Without doing any research on stock trading strategies? Technical chart analysis? Company fundamentals or current market trends?  Of course not. So why then do we invest in domains without a thorough understanding of the market and a well-developed evaluation skill?  

According to CB Insights, 42% of startups find out, too late, that there was no market demand for their product. My recommendation? Get an education in domain evaluation before you invest your hard earned money and dig a financial hole you may never emerge from.

#2 Avoid planning

Every successful business person begins with a written plan, based on research, facts and figures.   How many domains do you need to buy, and sell, and at what prices, to turn a profit? Is that formula realistic?  Have you ratified it with an experienced, already profitable, domainer? 

Base your business plan on facts and hard data not naïve hopes and dreams. Define your goals and regularly assess your progress to make the necessary revisions and adjustments that lead to success.

#3 Stay in your head

What you don’t know will hurt you. Written records of what you own, what you paid, what you’ve listed, at what price, what you’ve sold, renewal costs, commissions paid etc. are an absolute must. 

You should have a current document that you can look at anytime and within in minutes know your total year to date income, commissions paid, acquisition costs, renewal fees and profits. If you don’t – then you are a prime candidate for self-delusion with regards to your real-life profitability.  

If record keeping is not your thing, then pay someone to do it for you. Just get it done.

#4 Take candy from strangers

As you proceed with your business plan you will encounter problems, obstacles and failures.  You will need additional information and guidance in order to modify your business plan and succeed. 

Random input from anonymous strangers will not place you on the path to success. Seek out qualified information and advice from reputable sources like Domain Sherpa, DN Academy and the writings of veteran domainers who are recognized in the industry.

Avoid taking segmented pieces of information from random people on the web and inadvertently slowing or sabotaging your business growth.  

#5 Treat it as a hobby

The reason casinos make hundreds of millions each year is because patrons view their gambling as “entertainment.”  They have not learned the game, studied it or practiced it. Most of all they don’t approach their gaming with the expectation of winning. They say ”it’s just for fun.”

When they do win, a hand or a play, instead of taking money off the table and going home they continue to gamble until  their broke, thereby concluding their self-fulfilling prophecy as a loser. 

In this same way I hear domainers rationalizing their lack of success by saying “oh it’s just a hobby.”  If you want a hobby buy a bowling ball or a tennis racket. 

Domaining is a business even when it’s part-time.  It should never, ever, be treated as a hobby and if you find yourself speaking of it in such terms it might be time to cash out and spend your money somewhere else.

#6 Expect quick results

If you’re looking for quick and easy profits you’re in the wrong business. I only had a handful of end user sales in my first year.  Now I have a handful every month.  But my average hold time is 390 days!

A 2% sell through rate on 100 domains could mean 4 sales in the last quarter of the second year!  So be patient.

NOTE: I am not recommending sitting on, and renewing, low quality domains with low marketability.  Every domain purchase is a gamble.  Most of the time we lose. So make the odds of winning as high as possible by owning the best quality domains you can afford to own in medium quantity.

#7 Hang out with newbies

Domaining is a solitary endeavor.  Still it’s important to make friends, network and learn from our successes and failures.  Just do it with other domainers who are at least as successful as you are. 

Mentoring a newbie is a noble activity but make sure you’re spending a significant amount of time with domainers who are making more money than you are.  They will lead you higher.

#8 Take it easy, don’t work too hard

Imagine a clothing store that sells the same shirts and pants year after year.  Their sales would fall off a cliff in no time.

Same thing with mid-level, end user, brandable domains.  Like everything in our fast moving culture there are fads and favs, hits and misses in brandables.  Some last longer than others and you need to catch the new trends early and shed old inventory that’s no longer in style. 

Always be looking to upgrade the quality of your portfolio, improve your sell through rate and reduce expenses. 

Stay hungry and don’t get complacent. Commit to spending a minimum number of hours every week refining and improving your skills and domain business model.

There’s a significant difference between patience and complacency.


Brandable domains available in the GoDaddy closeouts at publication time are :

  • HotSunday.com
  • AdVoila.com
  • PayBlanket.com
  • NeoHop.com
  • Azuky.com
  • Vatzi.com
  • Zeoca.com
  • UpToFate.com
  • Questford.com

Keith deBoer

Keith DeBoer is a domain writer, investor and host of the Brandable Insider podcast.

15 thoughts on “Eight Ways to Fail at Domaining

  1. Hey folks, Thanks for reading. Regarding my list of domains in the GD closeouts…….. Just after publication I go to thinking about Questford dot com and decided to do some research. I found that:

    It has an Estibot of $660
    It’s the name of current or defunct companies in the US, UK and Panama
    It’s the name of discontinued $400 sneaker by Burberry
    It’s been continuously registered since 2004
    There are 22 companies in CrunchBase whose names start with Quest

    So I thought…. hmmm, this name has some mind share and it will could appeal to somebody in the near future. And so I bought it 🙂

  2. Keith…in all due respect I don’t buy into your logic at all. I knew immediately when I got into domaining 18 months ago there was something very wrong with this business/industry, and Verisigns recognition that domainers are “scalpers” and “hoarders” spoke directly to my first impressions.

    I won’t go into detail, but some things have happened to me in this industry that confirmed my suspicions to the point that just 10 days ago I hand registered; DomainEthics(.)com. It’s a name that was first created in 2000, and continually renewed for 19 years and just dropped in December, 2018. I tried to buy/register DomainGreed(.)com, but it wasn’t available.

    As an fyi for your readers, most of my businesses have started on a whim, on the back of an envelope or purely by accident. I never planned to be in the domain business, thus no formal business plan. Like a bull in a china closet (formerly Bulloney), I hand registered 1,500 domain names the first 12 months in business. I invested a total of about $15,000 creating about 4 domains a day for 365 days, and I have no regrets.

    Finally, much to the chagrin of domain critics, I’ve made a lot of friends from around the world, and the friends I’ve made far outweigh the $$$ I’ve made, and the $$$ i intend to make. Thanks

    1. Glad my words have stimulated some thought and discussion for you. Thanks for reading and commenting.

  3. in line with your 97% fail rate,

    all the domains in your list are dropped by someone who once thought they were worth buying

    on another point as someone who makes a good living from geo +keyword domains it amazes me how many people in small businesses in usa don’t understand the visibility a mickey mouse geo domain can get you for just a small investment and renewal

    1. This so true: “all the domains in your list are dropped by someone who once thought they were worth buying” That’s pretty much the case for every domain any domainer buys even domains like dictionary words auctioned at NamesCon. And….. 85% of all the brandables that are hand regged have been registered and dropped before too. So why buy?

      Well there could be lots of reasons – the prior owned had it priced too high, didn’t do any outreach, didn’t list it at a good marketplace, didn’t list it at all (if it was owned by a company or a little old lady), someone died and didn’t renew it. The list goes on. But you are right in that the odds are always against us. Rosener and Schwartz have both said that the majority of the domains they own won’t sell in their lifetime. That’s why its a speculative business 🙂

  4. The average hold time of 390 days is an interesting stat. That actually sounds pretty short.

    Do you have a strategy for holding? Do you hold a name for at least X years no matter what? In the case of names that don’t get traffic or inquiries, it can be tough to tell how long to hold onto a name.

    1. Every year I toss the bottom 10% of my folio when the come due for renewal. I’m also trying to get out of the habit of acquiring names I won’t hold for 3-4 years without question.

  5. So tested and true. I am delighted to see that you embedded the antidotes. Calling it “Eight ways to 𝘀𝘂𝗰𝗰𝗲𝗲𝗱 at domaining” may attract even more readers. Thank you, Keith.

Leave a Reply

Your email address will not be published. Required fields are marked *