In order to profit we need to buy low and sell high. Sounds simple. But it’s not. Especially in the domain industry. Why? Because there’s no standardized and regulated repository for valuations, acquisitions and sales. In other words, no measuring stick. This leads to a lot of frustration for domainers, especially those that are new. One of the main scapegoats for our buy/sell pricing conundrum are the estimated pricing tools. Oh how we love to trash talk Estibot and their ilk!(more…)
I feel the biggest hurdle to considering domain names as legitimate assets is how discretionary (random) prices are. In 2010, you could find two-letter .com domains that sold for around $100,000 (JF.com, XI.com and SZ.com) and one domain for $8 million (FB.com). That is an 8,000% difference! – Giuseppe Graziano, GGRG.com
Despite two decades of conventions and commerce, domaining is still in the latter part of its Wild Wild West stage. Why? Well one reason is because the market is so fragmented. There are at least a dozen different marketplaces all with different rules, terms and procedures. Until there is a centralized organization that all markets report to and that requires an agreed upon, standardized set of rules and conditions, for all transactions, that will remain the case.
“Want to be successful in the domain business? Don’t piss your money away” — Michael Berkens
Every year it becomes increasingly more difficult and time consuming to find saleable brandable domains that are available for hand registration. It’s now so laborious, that its value for domainers that have good paying jobs and/or enough funds to purchase quality domains in the aftermarket, is questionable. However, as I mentioned in last week’s blog, if you have the time (maybe you’re unemployed) and enjoy spending hour after hour “panning for brandable gold” here are some tips on how to find good brandables.
When I BUY a domain I put a value on it and I stick with that value. PERIOD! Offers much lower than my value MEAN NOTHING!! — Rick Schwartz
In October 2016 I acquired a strong brandable in the Go Daddy closeouts. I was very surprised that no one had bid on it and I bought it immediately. About 6 months later, I got an email from someone who was interested in buying it.
Now……….. whenever I get an inquiry on a domain, the very first thing I do, is research the person making the inquiry. I don’t respond to their email until I have some intel on the ID of the potential buyer. Why? Because my sale price and negotiation strategy may vary greatly depending on the identity of the person wanting to buy the domain.
“Don’t be romantic about your domains. Don’t fall in love with them. You’re not a collector of domain names, you’re an investor.” – Michael Cyger at DNAcademy
Last week we talked about money management and its crucial impact on our success as domainers. Small changes in money management can make or break our business. One of the biggest mistakes we make as domainers is renewing domains that have little chance of selling in the next one or two years.
If you had zero end user sales last year then renewals will likely take you further into the hole. If you had a few sales then renewals can still significantly erode your profits. So it’s a fine line to walk.
There’s been a lot of talk in recent months about the rising demand for brandable domains in the aftermarket. It seems more and more domainers are hopping on the brandable domain train and pushing up prices in the drops and auctions. I’ve noticed that, in some cases, domains that were hand registered less than a year ago are selling for as much as $200.
Here’s a few samples from January 2017, as reported by Namebio, listed by domain name, hand reg date (month & year), sale price in Jan 2017 and marketplace.
Success often starts with failure and I have failed many times this year. Some of my failures have been in auctions. There are many times I’ve bid and lost. Most of the time, that’s a good thing. It demonstrates my ability to limit my bidding and not go past my limit. Or as Mike Mann says: “If you beat me in the domain auction, congrats, you paid too much.” Well I’m not as cocky as Mike Mann but I do think disciplined limits when bidding is a good thing. Whether the person that outbid you “paid too much” or not is debatable. That depends on, if and when, and for how much they sell it.
On the other hand we’ve all had the experience of getting into a bidding war and letting our emotions run away with us. In those situations we go past our price limit and end up paying more than we thought the domain was worth. I’ve also had the experience where, in hindsight, I was too cheap and failed to step up and pay the price the domain was worth.
In looking back at recent auctions I see all of these scenarios at work.