I'm working on a script to rank a domain based on a few different factors. I'd greatly appreciate any advice you guys (or girls?) could provide to help me improve my algorithm
I'm using 6 factors currently, the max score is 20 points
* TLD
* Domain has a dash?
* Domain has a number?
* Google results for SLD
* Overture results for SLD
* Overture results for domain
- TLD
-------------------------------
com -> 3
net -> 2
org -> 2
info -> 2
biz -> 1
us -> 1
ws -> 1
- Domain has a dash
-------------------------------
If the domain doesn't have a dash, add 1 point, otherwise no points added
- Domain has a number
-------------------------------
If the domain doesn't have a number, add 1 point, otherwise no points added
For each of these questions, answer honestly, and if in doubt, answer a point less than you believe. (Or get someone else to do this appraisal system for your name)
1) Number of words in your great domain names (including prefixes such as e- )
One word = 20 points
Two words = 12 points
Three words = 6 points
Four words = 0 points
Five words = - 5 points (minus 5)
More than five = - 10 points (minus 10)
2) Number of characters in your name (including prefixes, but not the "-")
1 to 5 = 20 points
6 to 8 = 12 points
9 to 12 = 4 points
13 to 15 = 0 points
16 to 20 = - 5 points
More than 20 = - 10 points
3) Does your domains for sale contain a prefix or a suffix?
No = 10 points
Yes:
internet = 5 points
e = 5 points
i = 5 points
live = 3 points
new = 3 points
u = 3 points
a = 1 point
v = 1 point
Other = 0 points
4) Does you name contain a hyphen?
No = 5 points
Yes = 0 points
5) Is your name generic? (This only applies to one-word names)
(NB. Generic means that the name cannot be trademarked, e.g. business is generic, bobsbusiness isn't)
Yes = 5 points
No = 0 points
6) How frequently is your name used in everyday conversation? (ignore prefixes)
(e.g. Auto gets 10, Car gets 10, AutoBreakdown gets 3)
Rank your name on a 1-10 scale. 10 being used frequently, 0 never used.
10 points = heard daily (e.g.. Bank, Sport, Mom, Dad, TV)
8 points = heard every couple of days (e.g. Loans, Tax, Film, DVD)
6 points = heard frequently (eg. Privacy, Net)
4 points = heard infrequently (e.g. Acreage, Casino)
2 points = very rarely heard (eg. Royalty, Tyres)
0 points = never heard (e.g. PrimeAcreage4Sale)
7) How large is the industry that may want your great domain names ? (e.g. Drugs gets 10, Tyre Retreds gets 0)
Rank your name on a 1-10 scale. 10 being big industry, 0 being small
10 points = Massive Industry (e.g. Banking, EntertainmentNew.com, Autos, Business)
8 points = Big Industry (eg. Adult, TV, Music, Mp3, Films, Comms)
5 points = Medium sized industry (e.g. Gambling, B2B, Hotels, Real Estate)
3 points = Small Industry (eg. Paper, Rocks)
0 points = Tiny Industry (e.g. Tyre Retreds, Glass Painting)
8) Now, add up your points and you should have a total out of 80.
9) Refer to the table below to see the value of your domains for sale :
These values are for .COM names.
=> For .NET names, the value is 20% of .COM
=> For Country Domains (ex. .DE) names, the value is 20% of .COM
=> For .ORG names, the value is 10% of .COM => For names that have letters replaced by numbers (e.g. "0" for "o") their value is approximately 10% of the original.
10) The figure quoted above is the VALUE of your name. This is the top price that your name could fetch if you hold off selling it at present.
Follow the steps below, roughly in order. Each step should help you get closer and closer to a value for a great domain names ! This domain valuation model is equal parts experience from appraising professionally, and common sense. This model has been reduced to 4 steps. By no means is it perfect and it has always been shaped by comments and suggestions and the changing market.
-------------------------------
(- STEP 1 -) Research It!
-------------------------------
A) Identification of great domain names for sale
identifying a domain name in these terms will help you establish a basis on which to further appraise the name.
1.
"Industry-Related and Common Domain Names"
This shows what points an appraiser needs to keep in mind if they identify a domain name as belonging to a particular industry, (or a particular product or service). Nearly all "recognizable" entities can be placed in an industry of some sort. If the Domain Name is not involved in some industry in some way, refer to section 2.
2.
"Non-Industry-Related and Uncommon Domain Names"
This applies to "all other" domain names. Ones which cannot be either understood, indentified, or do not belong in any industry which is involved in any kind of commerce. These names generally
- do not sound like anything we know or understand
- are a phrase that makes no sense, or very little
- are phrases that are uncommon, or have no outright identifiable commercial value.
B) Recent Domain Name Sales:
Perhaps one of the most important metrics you can use to get a good foundation on which to flesh out an appraisal is the recent sales. (The only problem is getting your hands on this data. Generally sites like afternic.com publicly display sales, but these are mostly quick sales or low-cap sales. The mid-cap sales [10K - 75K roughly] are the hardest to track because they happen in private. High cap sales also can happen offline, but sometimes get great media attention and therefore are more trackable. For any group of appraisers you would need at least one full-time "researcher" who is hunting down sales data and tracking important changes in the market.) One thing to remember is that there is rarely information that cannot be bought.
C) Industry:
In some cases, the potential value will be extremely obvious. In most cases, however, you will need to research the value of the industry in which the domain name falls, if it is a recognizable domain name.
1. Industry history, trends and potential: Real Estate... is it booming this year?
2. Commerce potential: Just what does history show about how well these things sell?
What is the collective value of the industry your domain name belongs to?
D). Availability:
Saturation of Domain Names within this industry
How many domain names pertaining to the one being appraised:
1. Are for sale on the aftermarket
2. Have been registered
3. Have not been registered yet
Answers to these three questions give appraisers a reference point for just how popular registration in a particular industry is.
E) Other:
1. Country of Origin
Where is your name from and what language is it in? (spelling, etc..)
2. Ratings
- Violence or intent to disturb
- Adult domains which include graphic content
- Race or hatred names
- Names that Infringe in Trademarks
3. Bids and Development:
Is this domain developed or has it received bids already? (if it has received SERIOUS bids, then you already know the least it could sell for.. trouble is telling which ones are serious or not!)
********** Characters **********
As "forsalebyowner" showed us, you can't always judge a name by its length but compare it to DAutos.com .
***********************************
1-5 Char. = Optimal
6-10 Char. =
11-16 Char. = Less attractive without a solid idea
17-25 Char. =
26 + Char. = Generally past the pain threshold of typing in a name.
********** Extension **********
*********************************
Most Attractive Extension currently:
.COM
Newcomers which offer the most commercial promise:
.TV, .FM
Extensions which have potential but have yet to be proven:
.CC, .WS, .VC, .TO
Extensions which have proven to be lower in value than .com (from 10% to 90% lower)
.NET, .ORG, .CO.UK, and ALL country .TLD's
Extensions which are not generally for sale
.MD, .EDU, .GOV
NEW ICANN Chosen Extensions with undetermined values.
.SHOP, .WEB, .STORE, .SEX, .???
(These can be appraised with comaparative anaylsis, but keep in mind they may not even exist)
**********Spelling**********
****************************
Alteration ("skool"): (can be used and do sell)
Incorrect spelling: (difficult to sell)
Hard to spell: (Retains a good amount of value)
**********Alterations and themes**********
******************************************
"Tricks" (h0use, scho0l): (Can and do sell)
"Modifications on success" (example: OnSaleByOwner vs. ForSalebyOwner): These have had somewhat of a hard time selling because the brands they are modifying have taken years, or decades to build!
**********Confusion variables**********
***************************************
1. Vitaminshoppe.com vs. vitaminshop.com (when you need to TELL someone how to spell it): (Depends on Who came first and Trademark issues)
2. TO vs 2 and easy vs. EZ (when you need to tell someone which one it is): Do you have both iterations? Depends also on who came first, etc...
**********Hyphens**********
****************************
0 Hyphens: Best
1 Hyphen: Retains some Value *subtract 30-50%
2 Hyphens: Very Difficult to sell *Subtract 60-75%
**********Prefixes and Suffixes**********
*****************************************
Popular prefixes and suffixes can have either a positive or negative effect.
One Character Prefixes:
1. None at all
2. e
3. i
4. v, u
5. d, b, x
6. Others
Multi-Character Prefixes
1. Buy, shop, sell (and others related to selling)
2. web, internet (and others related to the www)
3. cyber, virtual, domain
4. Others (email arik9@hotmail.com to add yours!)
(by, at, for, of)
Even if the prefix is not on the list, remember that it is more important the the prefix is understandable and is being used to help the domain name somehow, or it is is being used for marketing purposes.
1). Brandability:
Can you sell it? Is the name brandable? (even names that sound "funky" have some serious value due to branding potential. This is an important and very subjective factor: consider chumbo.com or kosmo.com)
2). Marketability:
(Who will buy it: Do you know Market segment buying habits? - If you have a great domain name like FIberOptics.com, what are the chances that someone will buy it? Well it can help to look at the market you are selling to: in this case your best bet is the industry itself: sell to fiberoptics companies) Within the industry who are the most likely buyers and how does that helped/hurt the chances of you selling a domain?
3). Memorability: will people remember it?
(This is certainly tied to brandability: but its a measure of how often you repeat it in your head or if you say it to your friends: for example, PhoneCentral.com is more memorable than Phones24by7.com)
4). The Look Test: -Take a look at your domain... does it read well? Would it look good in a magazine or on a bus? Do the letters look nice? are there three "s's" in a row? This is perhaps the most subjective.. but there are always things the majority of people will agree on.
5.) Time Sensitivity: example: Pokemon, Themes that lose value quickly. Is yours destined to fall by the wayside anytime soon?
-------------------------------
(- STEP 4 -) Value It!
-------------------------------
This will also include the percentages of domains that fall into that range.
First Select a Category, then a range within that category. Ideally this should be based on Domain Name Sales, and updated frequently.
-------
Note:
This model is a bit different in that is not really just a model. It is more of a "guide" in that it gives insight into how at least one appraiser views the process of valuating domain names. In a "model" sense, you can distill out what the industry already agrees on (.com is best, shorter is better, etc.. )
The 10 most important values of a Great Domain Names:
CONSIDER THIS CALCULATION: Imagine that you invested $10,000 into a Premium Domains - because a domain name has an exclusive property value, consider its invesment over a 10 year period of time: that is only $1,000 per year in actual cost. This is less than $100 per month or less than $2 and 75 cents per day. Considered in the totality of an advertising and communications budget, this is almost neglectable. And yet, a quality domain name is the base core element to be able to launch a website. And so far, quality DOT COM domain names do nothing but increase in value, month after month. So, this is an very small advertising investment which keeps increasing in value, and in no time, has paid for itself. But above all, instead of purely being a marketing expense(since a quality domain has a very strong marketing impact), it is a resellable investment. When could we over resell to someone else the expense of an advertising campaign, after it was used and spent? That makes investing into a quality domain name an essential consideration.
01
VALUE 1 - A Quality Domain is an Unlimited e-Property:
On or attached to a domain you can set up any sort of project, activity, meeting place, information center, sales functionality of any size you want. The fact that there is no limit to the size of website attached to a single domain name, the sky really is the limit as to how valuable a domain name can be made. In addition to any number of pages on this website, you can add an unlimited number of subdomains. (example: YourDomain.com can have Members.YourDomain.com or Support.YourDomain.com as additional, totally individual websites). This you can compare to a boundary less subdivision of a property. (impossible in the brick and mortar world). But a quality domain is much more than that.
02
VALUE 2 - A Quality Domain is a Powerful Traffic Generator for your website:
Pending on how well descriptive a domain name is, it will make it easier to attract visitors. A complex or difficult domain name that doesn't tell you anything about what is being offered, will rarely in and of itself attract traffic. So many companies will use their company name as sole domain name, yet, so often, their company name gives no clue of what is being offered.
But a quality domain that already speaks for itself, will do that, just based on curiosity and interest. www.theAirTravel.com says a lot more about what the site could offer than www.SVMB-TRVLCTR.com - not to mention how much easier it would be to communicate the actual domain name to a friend or an associate.
! A GOOD TEST:
you can perform a perfect and simple test
to see if a domain is "right-on"
simply by trying to pass it on over the phone
to someone who has not heard it before.
Inevitably, you will have to resort
to phonetics (sounds) to communicate it.
If the domain name consists of common dictionary words
or common spoken words, your task will be easy.
And if it is easy to communicate, it is easy to remember.
03
VALUE 3 - A Quality Domain is a Supplementary Back Door to your business:
Even if you have a principal website that is already generating good traffic, by adding good strategically chosen great domain names, you can add a more "entry doors" to your business. Every domain name can forward its visitors right to your front door (without ever being noticed by the visitor, because it all happens in milliseconds).
Some examples for a computer business might be:
ComputersClub.com
ComputerFresh.com
XComputers.com
EmotionalComputer.com
ComputerPartners.com
TheCheapestComputers.com
BuyNewComputer.com
Today, many companies use several domain names (even though they often only run 1 website), and use them as "back-doors" or "additional entry doors" to invite people to their business. Example: the Debeers Diamond group uses over 1,600 different domain names from our collection, to point to their jewelry site.
04
VALUE 4 - A Quality Domain is a Search Engine Ranking Supplement:
Today more and more search engines "look" at the domain names itself, to see if it matches up with the keywords that are listed in the site or in the metatags of the site - they also "look" at the domain name, if it matches the word or keyword that the prospect typed in the search engine. This is how you can rank much higher with a well chosen domain name.
Then, you can attach specific and each time different metatags (i.e.. keywords) to each individual domain. Normally, it is recommended to use no more than 25 keywords per domain - because if you use more, a lot of the search engine spiders will reject your site. This allows you to target a very specific group of prospects with one particular domain, and another group with the next domain, etc.
05
VALUE 5 - A Quality Domain is Short in length but must be Descriptive:
Not to long ago, everyone was hunting for the shorted possible domain name. It seemed that a 4 or 5 letter domain was much more valuable that one with more characters. But length isn't everything (haha)... The capacity to describe is actually more powerful than length. Let's take a look at some examples:
Yes, of course Business.com was sold for $7.5 million dollars - and there is no doubt about it that part of the value is because of its exclusivity and shortness of name or word. But, on the other hand, it is not very descriptive: one could wonder: "What kind of Business?" or you may try to guess: "is it Automotive Business or Advertising Business or Monkey Business" - whereas a domain name like: YachtBusiness.com or www.ClickableBusiness.com a lot more descriptive - here you know what business they mean.
And we must keep in mind that in our common language, there are descriptive terms that are simple not short in length. Example: a RealEstateAgent could hardly be shortened to a domain name like Real.com or Agent.com. www.BuyNewTelevision.com is a little long but indisputably a highly descriptive domain.
06
VALUE 6 - A Quality Domain is Easy to Remember (= sounds good):
After all the best thing you can ask for is that people remember your website. And it sure is a lot easier to remember a website, if you remember the name of the site.
A little hidden secret about memory, is that it works best on Auditory Input - what we hear, we remember stronger than what we see. Even though they say that a pictures speaks a million words, in reality it would than mean that a sound speaks a trillion words. Just imagine a TV add without the sound, or a movie without the sound - would all these feelings and these emotions be produced? So, sound is very important. A high quality domain name must SOUND GOOD. Thus, many specialists in Premium domains seem to feel that when a name "sounds" good, that its potential is really strengthened (especially if it is used in Radio or TVads). Remember the Test (see above).
07
VALUE 7 - A Quality Domain must Stand out from the Rest:
In 1993 there were only 139 websites worldwide. At that point it made little difference which domain name you had. However today, with almost 30 million Dot Com, Net, and Org, plus with all the other extensions being added, it is important to stand out.
By visiting the net you can see how many domains are already in existence with that keyword - and it is shocking, especially for common words that describe common business, to find out how many are already registered. To stand out in a crowd you've good to look good & sound good.
08
VALUE 8 - A Quality Domain is far better with a DOT COM extension:
So often people, investors and clients have asked me, but what about the other extensions. My answer has always been, and remains even stronger today: GREAT: with every new extension that becomes a success (and some will), the stronger Dot Com will grow - with every new extension that doesn't (and some will), the stronger Dot Com will grow. So DOT COM will continue to win on both sides.
Much like the Champs Elysee in France (which is a like the "5th Avenue" of Paris) is still today the number 1 commercial avenue of Paris (and always will be). Yet over the years, many other avenues have been added, some of which have become successes in their own league, and obviously some businesses on these alternative avenues have done very well - yet, today, stronger than ever before in these many decades of history of the Champs Elysee, it is still NUMBER ONE - and the most prestigious (and extremely expensive) location in France, almost in all of Europe.
Dot Com is now programmed in everyone's "brain cells" for at least generations to come, and just like if Pepsi attempted to erase Coke from our minds, it only makes the real thing stick better. Or if Avis attempted to erase Hertz from our minds, it only strengthens the position for the number one.
When we were to calculate the number of times that we hear "DOT COM" on the television, radio, in conversation, read it in magazines, newspapers and on billboards - it is probably in the hundreds if not thousands of times per day. So, even it they were to give everyone a frontal lobotomy, I bet that still parts of us would remember and respond to something DOT COM. Today many newspapers, magazines and TV stations will use DOT COM as a descriptive term to refer to the entire internet industry or economy.
09
VALUE 9 - A Quality Domain is wise Investment that keeps growing in value:
With the current trend in the DOT COM market, it is quite possible and likely that the above values will only increase rapidly over the next few years, even months. In other words the name itself is remarketable at anytime for more than its original cost, especially once a working website has been associated with it.
A domain can be FOREVER: when you buy a domain it is yours exclusively to use for your business for as long as you wish - no one else in the world can get that domain (providing you keep up the small renewal fees). All the time it will be helping with advertising and branding your web site. In addition to these benefits the value of good domain names is increasing rapidly thanks to their limited supply (once they're gone, they're gone). This means that they make an excellent investment - even in the short term.
Example: If you buy a good domain for $10,000 and only used it for 5 years - this means that the cost is averaged to $2,000 per year - and the domain will be worth much more than what you paid as the Internet increases in its growth! Where else can you get advertising/promotional tools that operate in this fashion? A Quality Domain can be used to form a very simple advert to draw visitors to your site (the savings in advertising costs alone will pay for the domain many times over).
10
VALUE 10 - A Quality Domain is Highly Resalable asset:
It has been the case many times that an owner of a good domain was approached by a highly interested buyer, even before a website was fully established, and could make a handsome profit just by reselling it.
When you invest into a weak domain name - it will almost be impossible to ever sell it to anyone else. When you invest into a strong quality domain name, it will ALWAYS be an attractive value for some other investor or developer.
Whether you want or need to sell your domain name or you want to sell your entire web project - the first thing that an prospect buyer will look at is indeed the DOMAIN NAME. Besides being able to recover your invested value at any time you wish to sell it, in most case you will be able to make a high profit on your original investment.
No doubt about it: a quality domain name increases the value of any quality website.
Plain English words, spelled correctly, including slang, make more sense to people. They are the most valuable. Names like cars4u.com have a second-class aura about them and are more difficult for people to read and recognize.
Simpler words are better. Words that are easy to spell are better. Simpler and easy-to-spell might be relative, however, because different markets use different language and jargon. If you sell services solely to accountants, your domain name needs to appeal to accountants; using simple and easy-to-spell accounting jargon makes sense even if the general public is not familiar with such words.
3. Marketability:
How many people in the world are potential customers? Points
10
9
8
7
6
5
4
3
2
1 Percentage
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
The number of people on the Web (in the world) who are potential customers for the website that the name promotes is a significant component of domain name value. For instance, the domain name cola.com rates 10 points (assuming it doesn't violate a trademark), because virtually everyone loves cola (e.g., Pepsi). The name loans.com rates high, because many people borrow money for a house, car, etc. The name fountainpens.com rates low (1 point?), because few people buy and use fountain pens any longer.
4. Development Potential
How is the name relevant to what is to be sold using it? Points
10
8
5
2
0 Relevancy
Exactly relevant
Very relevant
Some relevance
A little relevant
Not relevant at all
A domain names for sale that's relevant to what's being sold is more valuable, because it's self-explanatory. For instance, we suspect that if we see a website with the domain name dietbooks.com, we will expect it to have something to do with books on various weight-loss schemes. If one is looking for a plan to lose weight, one will be attracted to such a website.
On the other hand, the domain name amazon.com tells us nothing. If it wasn't the name of a famous online bookstore, we might suspect that it sells artifacts from the Amazon River basin or travel packages to Brazil. A name that is not relevant to the business it promotes may be a great name, but it takes a lot of time, energy, and money to associate it in the public's mind with what it's selling. That's called branding. Branding is expensive. Names that might make great brands but are not relevant have modest value. They acquire great value only when someone spends the money to brand them. The owner of the online bookstore spend a great deal of energy and money to brand Amazon.com, a recognizable name for a bookstore today.
5. Length:
Length in characters not including the dot suffix (e.g., .com). Points
10
9
8
7
6
5
3
1
Number of Characters
Under 5
6-10
11-15
16-20
21-26
27-31
32-48
48-63
This a general evaluation scheme with mixed accuracy. It is true, all other things being equal, that shorter names are more convenient. That is, they are shorter to type and easier to remember. However, language has literary and poetic qualities. Consequently, some longer names may be better than shorter names, because they read better, sound better, look better, conger up better images, are more clever, or have other cultural characteristics that make them more useful as names than the shorter words or phrases that mean the same thing. The number of characters alone is not an accurate indicator of value.
6. Likely Buyer:
What kind of buyer is most likely to buy the great domain names if the owner discontinues using it? Points
9-10
7-8
5-6
3-4
1-2 Buyer
Fortune 1000 company
Medium-size corporation
National non-profit institute
Small Business
Individual
Who is the owner most likely to sell the domain name to should the owner end his or her use of it? This makes a great difference in the value. For instance, a name suitable for a physician but not for a medical organization will most likely be sold to a small business (i.e., a doctors' practice). Doctors can't afford to spend millions on a domain name. On the other hand, a domain like cars.com or TurboAutos.com might sell to a substantial corporation. There are plenty of large corporations associated with the auto industry that can afford to pay millions for a domain name.
7. Bonus Points:
Add points for the following, if appropriate, but the total should not exceed 12 points.
Positive Points Awarded For
2 Well known industry term or phrase (not trademarked)
2 Catch phrase or something someone would say naturally
2 Generic name of a business
2 A name for national use rather than just local use
2 Words reflecting national, international, or commercial importance
4 Unique words that have no synonyms
Negative Points Awarded For
-2 Domain names that contain a non-alphabetic character
-2 Domain names that contain "i" "e" "r" "s" "y"... in addition to words
-4 Domain names that contain an abbreviation
-4 Domain names that contain "my" "and" or "the"
The above characteristics are not so important that they rate a separate scale by themselves; but, you should take them into account. For any of the characteristics above appropriate to your domain name, add the positive points provided above. However, subtract the negative points.
A well known industry word or phrase can make a very powerful domain name for certain markets, particularly since it's usually highly recognizable but not a trademark. The generic name of a business is valuable for the same reason. Words reflecting importance or that have the ring of importance are likely to be more valuable than words that do not.
A word or words that have synonyms, have potential competition from other domain names. Unique words or phrases that have no synonyms and have no competition are likely to have greater value.
Who Will Buy It?
A domain name is worth only what a specific person (or company) will pay for it. For instance, business.com sold for over $7,000,000. Many appraisers, even, today, would likely appraise business.com in the $2,000,000 price range. But the owner found a specific buyer who wanted it bad enough to pay the high price.
Conversely, there are plenty of wonderful domain names available for sale now that appraise in the $2,000,000 price range. But if a specific buyer doesn't materialize to purchase a specific name at that price, the name may sell eventually for much less than $2,000,000, if it sells at all. Domain name appraisal is not an exact science. There is a substantial amount of domain name investment speculation. The accuracy of domain name appraisals is always highly questionable until a buyer materializes and a transaction is completed.
Transaction Assumptions
An appraisal assumes that a domain name sells after being on the market a reasonable time. For domain names, that may mean many months, perhaps years. If a seller is looking for a quick sale, the name is not likely to be worth nearly as much.
In addition, an appraisal assumes a normal seller and a normal buyer without abnormal pressures to sell or buy will make the transaction.
If these assumptions are not appropriate, the assumptions that are used by the appraiser should be noted in the appraisal.
In addition, domain name appraisals assume that the domain name is not currently being used for a website business. Otherwise it is assumed that if the domain name is currently being used for a website business, the next owner will buy only the name, not the website business. In this case, extra analysis is required to determine the operational value.
Operational Value
If the domain name to be appraised is already up and running as a website, it may have extra value (i.e., operational value). That will depend on the potential for the name to promote the next use. For instance, suppose the domain name clockshop.com is a website storefront for Elegant Time, a retail store selling expensive imported grandfather clocks. Whoever buys clockshop.com (domain name) but not Elegant Time (the business and business name) is probably not going to sell fancy grandfather clocks. They are likely to offer a different assortment of clocks for sale. Nonetheless, the fact that the domain name has been operating and getting hits probably makes it worth more than if it had been inactive.
There is no easy formula for evaluating this aspect of appraising a domain names for sale . The problem is to separate the blue sky value of the business name (i.e., Elegant Time) from the online marketing value of the domain name (i.e., clockshop.com). This evaluation depends on the situation, and this type of analysis requires extra effort and data. Appraisers who know what they're doing will probably charge extra for an appraisal that includes evaluating an operating domain.
Accuracy
How accurate is the appraisal that you calculated above with the appraisal calculator? It's only as accurate as the input. Even with accurate input, however, it lacks an important ingredient: human judgement. Although it's true that the input requires human judgement, what's missing is the overview component of human judgement that must be applied to the results from the calculator to ensure greater accuracy than the calculator by itself can provide. Accordingly, you can't take the calculator seriously (see the disclaimer paragraph immediately under the calculator). If you want a more precise estimate of a domain name's value, get an appraisal from an experienced domain name appraiser.
A domain name appraiser, in fact, may use a point system or calculator like the one above. The appraiser, however, presumably is a disinterested party and can more objectively make the inputs that the calculator needs to calculate an estimated sales price. In addition, the appraiser renders a final overall review and a final judgement using his or her knowledge, together with the results that the calculator generates, to reach a final estimate of value. Therefore, when you need an accurate appraisal, hire a domain name appraiser.
Appraisal Quality
Domain name appraisers are not licensed, have no professional organization, use no commonly accepted appraisal procedures, follow no established domain name appraisal standards, and have no regulation. In addition, most domain name transactions are private, and the details of sale, such as the sale price, remain unknown to the public. This lack of public information (comparables) make it difficult to develop the core of accurate information necessary for doing valid appraisals. Therefore, you need to ask your appraiser the following questions:
What are the appraisal procedures used?
What is the body of comparables that supports the appraisal?
What are the standards that dictate the creation of the appraisal report?
What is the experience of the appraiser?
If the answers are not satisfactory, you should seek another appraiser.
Keep in mind that the procedures that the calculator uses are reasonable ones, and different appraisers will give each of those procedures different weights. Such procedures can be used as a core of methodology. There are other appraisal procedures that may be more or less rigorous and accurate. But an estimate of value made without following intelligent appraisal procedures is not likely to be accurate.
Appraisals of domain names will become increasingly important as domain name owners die, get divorced, create financial statements, and the like. Accurate valuation of assets is required in many real-life situations. The value of many domain names is now high enough to make domain name appraisal a very important business. If you seek an appraisal of a domain name you own, you need to make sure the appraiser does a competent job.
Common Sense Valuation Model
URLbuyers.com has developed a robust, automated tool for helping our users estimate the value of domain names. Our valuation tool is provided free of charge to assist buyers and sellers in understanding what a realistic starting point is for negotiation purposes.
The Common Sense Model has 12 criteria:
Extension (Top Level Domain)
Character Length
Number of Words in Domain
If Numbers exist
If Hyphenations exist
If Misspellings exist
If Abbreviations exist
If domain is Generic
Applicable Industry
Focus within Industry
Marketability of Domain
Brandability of Domain
Extension (Top Level Domain)
The most valuable domain names are .com's. All other extensions (.net, .org, etc.) are usually worth 15-30% of their .com equivalent.
Character Length
In general, the longer a domain the less valuable.
The longer a domain is, the harder it is to spell, say, type, and remember. Typically, beyond 10-15 characters, a domain begins to lose significant value.
Number of Words in Domain
The most valuable domain names are one word. Some two-word domains can still have good open market value, but beyond that, the domain begins to lose value. For example, "Business.com" is worth a considerable amount more that "TheBestBusiness.com". The one exception to this rule might be prefixes. Some prefixes like "e" and "i" can be used without greatly reducing the value of the domain. However, the prefix adds length and many times, a bit more complexity. Therefore, the more words in a domain, the less valuable. For our model, we consider each grouping of numbers as one word. Also, each prefix, suffix, acronym, or abbreviation is also considered one word.
If Numbers exist
Combining numbers and letters in a domain is almost always a bad idea. Numbers are inherently harder to remember. As a side note, every website is actually referenced by a number called an IP address. The entire domain system was built so text (letters) could be used to reference numbers to make remembering websites easier. Who is going to remember the IP 216.247.233.21? The name "URLbuyers.com" is much easier. Try "http://216.247.233.21/" to see for yourself. Therefore, our model values domains with numbers less than domains without numbers.
If Hyphenations exist
Hyphenations are another concept that make it a bit harder to remember a domain. They add 1 more character to an otherwise shorter domain name. When telling people the site name, do you say "dash", "hyphen", "subtract sign", "that character right next to the zero on my keyboard"? "URL-buyers.com" is visually easier to see the word separation, but in general, people would rather just type "URLbuyers.com" Hyphenated domains also receive a lower value than non-hyphenated domains.
If Misspellings exist
The concept here is clear. "URLbiyers" or "URLbuyerz" or "URLbuyyers.com" just aren't worth much. The only cases where these names are extremely valuable are when the domain is very close to a VERY common word that everyone types. Most businesses aren't going to brand their name or their products based on a misspelled domain. Misspellings also devalue a domain.
If Abbreviations exist
In general, abbreviations devalue a domain name. In some rare cases where the name spelled out is extraordinarily long, the abbreviated version might be worth more. Domains like "USA.com" would be worth more than "UnitedStatesofAmerica.com" simply because of the length and ease of typing. However, for most domains, abbreviations devalue the domain. Domains like "InternetHwy.com" are going to get a lower valuation than "InternetHighway.com"
Substitutions also fit in the "abbreviation" criteria of our model. ForSale.com is worth much more than "4Sale.com". ShoesForYou.com is worth much more than "ShoesForU.com" Other examples of substitutions would be:
"4" for "for" or "four"
"2" for "to" or "two"
"U" for "you"
"R" for "are"
"0"(zero) for "O"(letter)
"1" for "l" (lowercase L)
use of "DOT"
use of "WWW" ie "WWWbuyers.com" instead of "buyers.com"
If domain is Generic
Generic means that the word relates to an entire group or class - ie. "general" and is not associated with a trademark or brand name. Generic domains are better overall since they can be used for multiple purposes. The domain "Tires.com" is worth much more than "EagleTires.com" Eagle is a company that produces tires and has branded their product as not just any tire, but an "Eagle" tire. Would Goodyear ever consider buying the name "Eagletires.com"? No. They would, however love to use "Tires.com" so they can say they're the best and biggest tire manufacturer. Generic names have more uses, therefore more demand, therefore, a higher value.
--------------------------------------------------------------------------------
Industry and Focus
Market size and positioning within the market definitely play a factor in the value of a domain name. Our model has incorporated many various "Industries" which attempt to provide a classification for every possible domain. These classifications take into account the market size, and thus the domain's value due to supply and demand. Industry Focus determines "how much" the domain applies to the broad industry classification.
1. Entire Industry
If the domain applies to the entire industry, in general, it's value will be greater than a portion of the industry. Consider the name "Entertainment.com". This is the broadest focus classification since it captures the essence of the entire Entertainment Industry. Entertainment.com could be used for music, movies, television, radio, board games, or an almost unlimited number of things which relate to the Entertainment Industry.
2. Major Portion
This is a smaller, but still large portion of the applicable industry. A possible domain would be "Music.com". Again, we're not saying the Music Industry is small, but we're sure you'll agree that it's not as large as the Entertainment Industry. Another example for a "major portion" focus might be "Furniture.com" (within the Consumer Goods Industry). For this domain, consider how the traditional retail channel markets furniture. Since you can probably think of many different retail stores in the Consumer Goods Industry that only provide furniture, this is definitely a candidate.
3. Focused Subgroup (Niche)
Focused Subgroup or "niche" is a smaller portion still. This classification would be used for targeted, specific domains. Revisiting our furniture example from Option 2 above, consider the domain "Chairs.com". It certainly is more difficult to think of stores that ONLY provide chairs versus those that provide all types of furniture. Even though Chairs.com may be an extremely valuable domain, it is obviously targeted to a smaller market than "furniture.com" and thus would be valued using a smaller market size within the Consumer Goods Industry.
--------------------------------------------------------------------------------
Marketability - How easy is domain to say and remember (and understand)?
This aspect of the common sense valuation model attempts to capture the effect the domain name has when people say and hear it. Can they remember the domain? Is it easy to say and/or visualize? Our model attempts to capture Marketability on a scale of 1 to 10.
1. Domain is impossible to say
If the domain is impossible to even say, it's marketability will be extremely low. Names such as "Excelsier.com" are challenging to say which also leads to confusion when trying to spell (or type) it. The domain might sound cool, but because of it's challenging pronunciation, it gets a low marketability rating.
2. Must help people say domain (See option 1.)
3. People have difficulty saying domain (See option 1.)
4. People have difficulty recalling domain
Just because people can say it, doesn't mean they can recall it easily. Consider the domain "HelpHelpHelpNineOneOne.com". It's simple, 3 "Help" words in a row followed by 911 spelled out. However, when trying to market this name, who's going to remember that it is 3 Helps in a row? Or that "Nine One One" is spelled out versus in numeric form? A domain such as "Help911.com" would be more marketable.
5. Moderately easy to recall domain (See option 4.)
6. Slightly easier to recall than average (See option 4.)
7. People can recall it immediately (See option 4.)
8. People understand it immediately
Now we're getting to the very marketable names. Not only can they SAY and REMEMBER these names, but they also UNDERSTAND them. When you understand a domain, you're much more likely to remember it. Not only is "Car.com" easy to say and remember, but you know what a car is. The higher options, 9 and 10 are for those names with longer-retaining understanding.
9. People understand and can recall 1 day later (See option 8.)
10. People understand and can recall 1 week later (See option 8.)
--------------------------------------------------------------------------------
Brandability - Can the domain describe site's content
This aspect of the common sense valuation model attempts to capture how well content can be associated with a domain. Highly brandable sites are those in which thinking of the content reveals the domain. Brandability is also measured on a scale of 1 to 10.
1. People are confused by the domain name
Consider the name "Bambosa.com". It's short, somewhat easy to say, and very generic - there's lots of possibilities for content associated with this site. But when people hear it, they certainly won't know what the site is about just by the domain name alone.
2. People question the domain's purpose (See option 1.)
3. Challenging for people to associate web content (See option 1.)
4. Somewhat challenging for people to associate content
(See option 1.)
5. Moderately easy to associate web contentn (See option 1.)
6. Slightly easier to associate with web content (See option 1.)
7. People can guess web content fairly easily
When you hear "house.com" what do you think of? It's easy to say, remember, and understand, (marketability) but what is the site used for? It could be for selling or buying your house. It could be used to help you take an inventory of everything in your house. It could be a site to help you build a house. It could also be for financing to help you purchase your house. If you thought of each of the things just mentioned, it is unlikely that you would go to "house.com". You'd probably try "realtor.com", "homeinventory.com", "homebuilder.com", and "mortgage.com" before "house.com".
8. People can quickly guess web content (See option 7.)
9. When thinking of content, domain is close
Now we're dealing with the EXTREMELY brandable names. Not only do people know what the content is by the name, but if they think of the content first, the domain comes to mind. Think about a site for helping you with your taxes. There's a domain! "Taxes.com". A close name would be "MyTaxes.com". Also consider "Conflagration.com". By the way, conflagration means "fire". When you think of something burning, you wouldn't think of "conflagration" you think of "fire". Therefore, how common a word is definitely affects it's brandability.
10. When thinking of content, exact domain comes to mind (See option 9.)
--------------------------------------------------------------------------------
Valuation Model Summary
In Summary
The most valuable domain names don't have any misspellings, hyphenations, abbreviations, or numbers. They are .com's with one word, less than 10 characters, apply to a large market, are easy to say, remember, understand, and can be easily associated with a site's content. If your find any of these, be sure to register them! If you are attempting to value one of these rare domains (i.e. computer.com, beauty.com, business.com, etc.) that domain could command a significant premium on the open market ($500,000+).
Most domains have some good characteristics with a few less desirable characteristics. These domains can also be valuable. The reality is that most domains are worth less than $1000, and names like "I-Have-The-Best-Business-On-The-Web-4-U.com" aren't even worth the registration price. Let our FREE Domain Valuation Tool help you choose.
Hands up anyone who read 5% of whats written above
Heres and algo for ya, seeing as though the domain market is still somewhat 'fluid'.
Check the garden for birds, times this amount by 4. Next throw a dart at a dartboard, for a .com times the score by 10, for any other extension times by 3. Add score 1 with score 2 and write it on a piece of paper. Next, make a paper dart with the piece of paper and throw it at your dog, make yourself a cup of tea, check past and most recent stats of sales of similar names and take off 10%. [/endofalgorithm]
__________________
If a man will begin with certainties, he shall end in doubts; but if he will be content to begin with doubts he shall end in certainties. Sir Francis Bacon
10%: $350,000 - $499,999)
