If you have been monitoring the Chinese domain market recently, you'll have noticed a drop in the volume of sales in comparison with December. This article, written by Travis from DomainShane.com, has some excellent infographics to show an obvious decrease.
What causes this decrease? It could very well be Chinese New Year. I speak with brokers and contacts in China every day, and every single one of them has told me that there is a large drop in spending in the weeks before Chinese New Year. Less investors are spending money. This is, apparently, in preparation for the festivities that happen over a period of time before and after New Year, which falls on February 8th this year.
During this period of time, I believe it is traditional to spend money on new clothes and other items for the festivities; since it is a new year, new items are sought after as this symbolizes a new start. Investments are seen as being less important to some at this time of year.
You could argue that due to the fact that domain names are entirely online in a 24/7 world, Chinese New Year shouldn't affect sales at all. This is a valid point, but from the evidence I've seen, including the recent drop in value of ultra-premium domains, I would say that the frugality of Chinese investors is in full effect, with average sales prices and volume decreasing.
If you study data from venues such as BenMi.com, ChaoMi.cc, as well as Sedo's sales figures, there is a noticeable difference between December and January, which I think will only get more obvious the closer we are to the festive period.
The good news is that in the weeks after last year's Chinese New Year (February 19th), we started to see the sharp increases in 4L Chip prices that have risen to an average sales price of around $2,000. Will this year's Chinese New Year bring a similar trend in another category of domains? Only time will tell.
What causes this decrease? It could very well be Chinese New Year. I speak with brokers and contacts in China every day, and every single one of them has told me that there is a large drop in spending in the weeks before Chinese New Year. Less investors are spending money. This is, apparently, in preparation for the festivities that happen over a period of time before and after New Year, which falls on February 8th this year.
During this period of time, I believe it is traditional to spend money on new clothes and other items for the festivities; since it is a new year, new items are sought after as this symbolizes a new start. Investments are seen as being less important to some at this time of year.
You could argue that due to the fact that domain names are entirely online in a 24/7 world, Chinese New Year shouldn't affect sales at all. This is a valid point, but from the evidence I've seen, including the recent drop in value of ultra-premium domains, I would say that the frugality of Chinese investors is in full effect, with average sales prices and volume decreasing.
If you study data from venues such as BenMi.com, ChaoMi.cc, as well as Sedo's sales figures, there is a noticeable difference between December and January, which I think will only get more obvious the closer we are to the festive period.
The good news is that in the weeks after last year's Chinese New Year (February 19th), we started to see the sharp increases in 4L Chip prices that have risen to an average sales price of around $2,000. Will this year's Chinese New Year bring a similar trend in another category of domains? Only time will tell.
