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Bob Hawkes

Has the Pandemic Influenced Recent Domain Name Sales?

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By Bob Hawkes, Apr 15, 2020
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Have you seen a change in domain name sales or inquiries during the pandemic?

  1. No significant recent change in sales or inquiries.

    110 votes
    35.1%
  2. I have seen more inquiries, but fewer completed sales.

    42 votes
    13.4%
  3. I have had more inquiries and more completed sales.

    38 votes
    12.1%
  4. I have had fewer inquiries and fewer completed sales.

    123 votes
    39.3%
Total: 313 vote(s)
  1. Bob Hawkes

    Bob Hawkes formerly MetBob NameTalent VIP Gold Account Trusted Blogger

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    Many have speculated on how the COVID-19 pandemic, and associated business climate, will influence the domain name sales market. In this article I look for statistical evidence of recent changes in domain name sales numbers or total dollar volume.

    I also collected opinions from domain investors on what they are seeing in the market, both in terms of inquiries and closed sales. Here is a summary of what I found.


    Statistical View of Recent Domain Market

    I used the NameBio database to see if domain sales had dropped off during the last month, when the impact from the pandemic would be expected to be most severe. The data below refers to a last month, or last three months, period ending April 13, 2020. That is, last month refers to data from March 14 through April 13, while the three month average is based on a period from January 14 through April 13. For the three month period, I expressed the data in terms of monthly averages, so the two can be compared.

    Keep in mind that NameBio data is a mix of retail and wholesale domain name sales, and that only certain sales venues report their data.
    • I first looked at sales in all extensions. The past month had slightly more sales, 10,100 compared to a 9530 monthly average in the preceding three months. However, the total dollar volume in the last month was down by almost 10%.
    • If we look only at .com sales, the picture is not much different. The number of sales is up 5.5% from the recent monthly average, but the dollar sales volume is down about 5.4%. This could be interpreted either as a larger number of wholesale transactions, as some domain investors liquidated part of their portfolio in tough economic times, or that domain investors have lowered retail prices in order to try to attract sales.
    • One way to separate wholesale transactions from retail ones, is to look only at sales taking place at certain venues. If we include only sales from Sedo, BuyDomains, DomainMarket and Private Sales, there was a slight 1.7% decrease in retail sales numbers during the last month, and a 3.8% drop in retail dollar volume. I suspect these changes are not statistically significant. Of course, the selection of these venues does not perfectly split the retail and wholesale parts of market.
    • Another option for separating retail and wholesale sales, is to look at sales within a certain price range. If I look only at .com sales of $10,000 and up, there is very little change during the last month. There were 72 sales during the last month, compared to a recent monthly average of 78, and the dollar volume is $2.5 million compared to a recent average of $2.6 million. The difference is not significant.
    • If one instead considers all .com sales of $1000 or more, the last month saw 1193 sales compared to a 1252 monthly average in the preceding three months. The dollar sales volume is about $5.1 million in the last month, compared to a recent monthly average of $5.6 million. It might be concluded that in the $1000 and up .com market there has been a drop of about 9% in retail sales volume during the last month. Average prices edged downward as well.
    • We study wholesale transactions by looking at the low price end of the market. The last month saw 15.8% more sales in the $100 to $200 range compared to the monthly average. The dollar volume is also substantially up, suggesting more wholesale transactions of late.
    • With a NameBio membership plan, it is possible to look at sales below $100. In the .com extension there were about 9% more sales below $100 than the recent monthly average. In the last month alone, there were more than 26,900 .com sales listed in NameBio at prices less than $100.
    • If instead of the last month we consider the month of March, we can use data from the Dofo monthly sales report for March 2020. That shows 21 sales (all extensions) of $50,000 and over, while in 2020 year-to-date there were 48 sales in total within that price range. This suggests no evidence yet of a drop at the top end of the market, and in fact the rate in March was above the 2020 average. It is possible that the drop-off will occur in later months, and previous economic collapses have had a delayed reflection in the domain market.
    • It had seemed to me that recently BuyDomains has had more sales listed on NameBio, particularly related to health, education and remote services. Indeed, with 1119 sales from the first few months of 2020, compared to 2052 in all of 2019, BuyDomains are definitely selling more domain names. I wondered if this was because they had a portfolio well suited to recent demands. However, I think it may simply be that they have been steadily increasing their sales each year. For example, in 2018 they sold 1423 domain names.
    • I would summarize what the numbers tell us in the following way.
      • There is little evidence yet of a significant change in the retail domain market .
      • There may be an indication of some lowering of prices.
      • It seems clear that there are more wholesale transactions taking place.
      • There is some evidence that the very top of the market is at least as strong as normal.
    • It may well be too soon to conclude what the impact of the pandemic economic slowdown will be.


    Domain Investor Perspectives

    I asked the following three questions to obtain investor perspectives on what they are seeing in their own portfolios.
    I share a selection of responses below, but urge you to go to the NamePros request thread to see all of the responses in full.

    Brandsly, who has a large portfolio of about 7000 domain names, reported that while gross sales of typically $40,000 to $50,000 per month dropped to about one-quarter of that in March, that the early part of April seems to be rebounding nicely.

    Josh Reason shared the following perspective:
    NameBuyer statistics shows fewer sales compared to the same period last year, but higher revenue:
    Abdul Basit reports that sales are still happening, but fewer in number and concentrated at the lower end.

    Karmaco reports a stronger March 2020 compared to 2019.

    Garptrader shared several recent significant sales, all happening in just a few days, but also pointed out that natural volatility means that one should be cautious about interpreting anything unusual in a short time period.

    Nikul Sanghvi of Hypernames, who periodically shares with NamePros readers detailed analyses of his domain sales, provided a comprehensive picture of what has happened in his portfolio lately. He reports that:
    He also reported that while sales volume is similar to last year, average prices have edged downward.

    F33333 reports:
    A similar view was expressed by AnthonyD:
    FolioTeam reports more visits but not a correspondingly higher number of sales. She writes:
    SuperBrander reported:
    A number of people I talked to reported that a greater number of sales are now opting for monthly payment plans. For example, Pay.My.id reports about 60% of sales are on payment plans recently That makes sense in the current economic climate.

    The negotiation process, and fraction of successful sales, may be seeing changes as well. Nikul Sanghvi says:
    SuperBrander also encountered a failed sale that was attributed to the pandemic:
    While OnlineBusiness reported a number of successful sales in March, he also added:
    A similar experience was reported by Brandsly who wrote:
    She went on to say, though, that we may see a quick return to near normal as people adjust.
    Among the areas that seem strong of late, Pay.My.id indicates “health, security and financial” are popular, with others have added education, delivery, digital and remote services. Some suggest that travel and entertainment domains are a tougher sell than usual right now.

    I asked about parking, but only a few respondents commented on that. Pablohc86 suggests recent volatility, but overall not much different from the past.

    Length did not allow me to fully quote all who responded, so head over to this NamePros discussion thread to read additional reflections on what is happening in the market during the pandemic.

    I would like to end with this sensible and optimistic view expressed by OnlineBusiness:

    Final Thoughts

    While I think there are hints of a changing market, I don’t think that there is clear statistical proof yet.

    The entire market is probably down only slightly.

    Not surprisingly, with many people at home and on the Internet, there seem more people looking at domain names, but not more buying.

    The statistics suggest more wholesale movement of domain names, and this may be a buying opportunity for some investors.

    There are probably more significant changes in the types of domain names that sell, rather than the total sales volume. That may partly explain the differences between individual experiences.

    It is likely that the percentage of offers that do not convert to closed sales will increase. Those who offer monthly payment plans may improve their chances.

    Just as in conventional investment, it is always wise to carefully consider changing markets, but it is also important to not panic or over react.


    What Do You Think?
    • Are you seeing recent changes in offers or sales, the types of names getting interest, or parking revenue?
    • More generally, how do you see the domain market changing in the months ahead?
    • Have you altered your personal domain investment activity during the pandemic?
    • Have you done any price adjustments?
    As always, I welcome your contributions in the comments section. If you have not already done so, please vote in the poll.



    A sincere thank you to all domain investors who shared their experiences, in some cases in significant detail. I also acknowledge the NameBio database that made this statistical analysis possible, as well as Dofo for the March 2020 sales analysis.
     
    The views expressed on this page by users and staff are their own, not those of NamePros.
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  4. Bob Hawkes

    About The Author — Bob Hawkes

    Domain analyst, writer and educator, with particular interests in domain name phrases and non-business uses for domain names. I am a risk averse domain investor who only invests modest amounts in a variety of extensions and niches. Don't hesitate to contact me - I like to help!

    This is Bob Hawkes's 34th blog post on NamePros. View all blog posts

    Home Page:
    https://namesthat.win
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  5. Comments (21)

  6. FolioTeam

    FolioTeam AMDB.tv VIP

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    Wow. Bob. Very comprehensive report. Thanks for the read.
     
  7. The Durfer

    The Durfer Top Contributor VIP Blue Account

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  8. WatchDogue

    WatchDogue Top Contributor VIP

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    This is quite an interesting and well reasoned analysis, presenting both some hard data number crunching and, the self-reported comments of a great variety of domain name sellers.

    Together that makes for quite an intriguing and informative article whose results quite frankly, I'm very pleased to say, surprised me with the reasonable steadiness of the domain marketplace during this dark economic climate.
     
  9. J Sokol

    J Sokol Top Contributor VIP

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    Thanks for your in-depth analysis, Bob. My sales remain steady ... and low-priced. I've been glad to see a lot of substantial sales in the NP Completed Sales thread.
     
  10. brandsly

    brandsly Top Member PRO

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    Thank you so much for your research, analysis and report. I remember both of us commenting on the post about the sale of washyourhands.com, and I said that one thing I've really learned from the pandemic is how important it is to have a highly diversified portfolio: it will allow you to catch more opportunities, and also that every decent name that makes sense will have its time.

    I think my sales were affected more severely in March compared to say BuyDomains, is because my portfolio is very heavily concentrated in certain industries - technology, travel, marketing, food, retail, fashion, finance...most of these categories were obviously strongly affected by the pandemic. Tech-centric categories depend heavily on VC fundings and most of my clients are technology startups. From various sources I've read, it was clear that a lot less money were flowing into VC-backed startups since the outbreak. As you mentioned, I still believe the impact was a bit exaggerated because of the shock factor, and thankfully it looks like it's recovering pretty well for me this month.

    For a much larger and more diversified portfolio like that of BuyDomains, while sales for certain industries might have declined, the loss sales were more or less made up in other trending categories and Covid related industries like healthcare, remote education/meeting etc. I think this is the reason why the data didn't show more significant changes.

    I was monitoring retail sales last month very closely, especially the sales from BuyDomains, and this was my first observation. A lot of the names sold were directly or indirectly related to the pandemic in some way. I personally do not own a lot of those types of names if any at all.

    This is the first significant market fluctuation I've experienced since I started investing in domains 3-4 years ago, and diversification is an invaluable lesson I've learned through this. Hopefully I will be more prepared for any future events.There are always losing and gaining industries, especially when there's a significant catalyst in play like the pandemic event. A highly diversified portfolio will experience less impact and might even catch some opportunities.
     
    Last edited: Apr 15, 2020
  11. Paul T

    Paul T Upgraded Member Gold Account

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    Thanks Bob - As usual on the money!
     
  12. marijuanadomain

    marijuanadomain Established Member

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    Has the Pandemic Influenced Recent Domain Name Sales?

    what pandemic?
    Never heard anything about it....the sun is still shinning everyday.Life is good.
    What you smokin?? Please give me some
     
  13. AbdulBasit.com

    AbdulBasit.com DomainsWeb.com AbdulBasit.com PRO VIP ★★★★★★★★★★

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    Thanks for another wonderful in-depth article which amazes me how much research, time and passionate you're in gathering data and sharing it. So nice of you :xf.love:

    I'm glad to see most of the investors are overall happy with the number of sales and inquiries flowing in considering the current situation worldwide. That's a good sign and one thing is clear that domain industry isn't affected hugely like other offline businesses.
     
  14. Pay.My.id

    Pay.My.id Established Member

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    Wouw ... its super threads Bob, sales still suitable with my own target
     
  15. QuestFuture

    QuestFuture Established Member

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  16. Jimmysun

    Jimmysun Established Member

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    Thanks for article.
    It's sort of such questions as: which scenarios would you likely to do shopping, when you lose or win money in casinos? I had always been the earlier one.
     
    Last edited: Apr 16, 2020
  17. AnthonyD

    AnthonyD Optimal Names VIP Gold Account

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    I voted "I have seen more inquiries, but fewer completed sales" - LOTS of inquiries but they're all below $100, still I reply to all of them. Parking revenue has remained at Christmas-time levels which is usually my peak but the numbers have been sustained this year through April, thus far.
     
  18. Arjun Oli

    Arjun Oli BitBank Gold Account

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  19. Jurgen Wolf

    Jurgen Wolf Top Contributor VIP ★★★★★★★★★★

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    0 sales for me in Q1/2020.
    Never had zero sales in Q1 previously.

    Regarding 1st half of April...
    Sold 2 domains, but just for mid $XXX on average.

    Overall, looks like more inquiries and less serious buyers.
     
  20. Bob Hawkes

    Bob Hawkes formerly MetBob NameTalent VIP Gold Account Trusted Blogger

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    The results surprised me as well. I was expecting to see a significant decline at the top end of the market, but so far this does not seem evident. I think there will be a decline, but just it does not yet show in the early weeks of the pandemic. I note that the wider group who have voted in the poll indicate almost 40% say that both inquiries and sales are down, and another 16% indicated that although inquiries up completed sales are down. It is also important to keep in mind that one month is a very short period to spot any trends, particularly at the top end where the number of sales in a month is limited.

    Perceptive comments here and in your entire post. The topic of portfolio diversification is an important one, and has been on my to-do list for an article for a long time. Thanks for your contributions.

    Thanks again to everyone.

    Bob
     
  21. manpreet

    manpreet Established Member ★★★★★★★★★★

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    Interesting Analysis and very well written. Bob was, is and remains to be an asset to the Domain Industry. I am sure everyone will agree with the same.
     
  22. DomainPanda.com

    DomainPanda.com Established Member

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    Thanks for the article. Domain industry needs such kind of quantitative and detailed researches, not just subjective thoughts.
     
  23. twiki

    twiki Upgraded Member Gold Account

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    Here's my current strategy (works for me):

    Indeed I have observed is an increase in low-end demand ($250 or less) with quick flips at $100 or $150, especially lots of inquiries. Also a decrease of demand on high-priced domains. I also think it takes a while for them to decide even on a low-end value domain.

    At this point I have decided to split the portfolio.

    The low end tier, I'm discounting a lot ($100-$200) and the sales have increased significantly. Yeah for some it might feel weird (like you might be selling them too low), but there's advantage in doing so. I deal in .coms and there is always a lot of supply especially in this range, so they all pay for renewals and some end profit now.

    The higher end tier (above 2...3k) I'm actually increasing the price and preparing to hold for long. It may take a while until market is back on track. Higher end customers are still buying domains in 4-5 figs. Furthermore great names (especially .coms) are worth holding to as the value increases over time.

    The 1-2K middle tier stays roughly the same.

    The reason for low end tier is simple. Many brick and mortar business have gone bust and they try to move online. But budgets are tight therefore the situation. I actually feel great discounting as in most cases it's just small business folks trying to make a living. Hell I'm all into helping that. :xf.smile: It brings a great feeling. They will put them to good use.

    So if you have a mixed bag portfolio and enough names (many of us do), the above strategy is what I would recommend right now.
     
  24. Domaindogged

    Domaindogged Top Contributor VIP Gold Account

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    Quality Analysis Bob's a Hall-of -Fame sure bet
     
    Last edited: Apr 17, 2020
  25. November

    November Top Contributor VIP

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    Thank you for your article. It's very useful :)
     
  26. Sash2T

    Sash2T New Member

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    Thank you
     
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