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Bob Hawkes

Too Many Or Too Few Choices?

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By Bob Hawkes, Jan 28, 2021
  1. Bob Hawkes

    Bob Hawkes Top Member NameTalent VIP Gold Account Trusted Blogger

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    Choices can be wonderful, letting us feel better about an action, or empowering new ways to accomplish a goal. But is it possible to have too many choices? Are you, or the marketplace you use, presenting potential purchasers with too many possible domain name choices? Alternatively, is it possible that you are not offering enough ways to make the purchase? In the right circumstances, choices can help the user feel good about the purchase. But they can also sow doubt and inaction, leading to fewer sales conversions.


    Purchase Choices

    Let’s set aside for now the question of how many domain name possibilities should be presented, and look simply at contact and transaction options. These could include:
    1. A contact form for more information or price.
    2. An email or telephone number to learn more or get a price.
    3. Some sort of instant messaging or chat option.
    4. A price and buy-it-now button.
    5. Make-offer option.
    6. Payment plan options.
    7. With your own lander, you could offer several places to buy the domain name on different marketplaces.
    What if you offer all, or most, of these choices, will that be overload and actually decrease the sales conversion rate? Or will the many choices increase conversion rate? For example, someone might not be scared away by your buy-it-now price, if they also saw a payment plan or make-offer option.


    Alternative Domain Choices

    If you sell on marketplaces, your domains will be presented along with numerous other name options. Seeing so many choices may leave the potential buyer so uncertain that they do not feel prepared to make a decision.

    If you have a large portfolio, you may be directing potential purchasers to your own site. Is it better to show them multiple names, increasing the chance that one of the names will appeal to them, or a lander with just one name and no distractions from other names?


    What Do Experts Say?

    How much choice is optimum is one element of customer experience, and numerous academics have studied the topic. One expert is Dr. Sheena Iyengar, a professor in the Management Department at Columbia Business School. She delivered a 2010 TED global address on the issue of choice. She points out that Americans embrace and demand choices more than those who live in much of the rest of the world. This suggests that possibly the optimum solution will vary with the region of the potential purchaser. Her book The Art of Choosing explores aspects of choice in more detail.

    While she was not speaking of domain name choices, several things she said resonated with me as I considered the question of choice and domain sales.
    I think there is a real problem in domain marketplaces, where too many similar domain names are presented at once. The differences between names may seem slight to the potential buyer, leading to uncertainty or even frustration, and they may end up buying none.

    Research, admittedly with rather different types of choices, has suggested that it becomes counterproductive when more than 7 or 8 choices are presented at once. I think there is room for innovative disruption in domain name marketplace search to optimize and personalize the process, rather than simply presenting long lists of names.

    Another expert, psychologist Dr. Barry Schwartz, said in a 2005 TED Global event of the paradox of choice.

    What Do Big Domain Sellers Do?

    I had a look at how some of the large domain sellers operate. BuyDomains are part of the Endurance International Group, and operate both the BuyDomains and DirectDomains brands. I entered a few names to see what the lander looked like, and it took me to a DirectDomains lander with a price and Buy-It-Now button, along with a Make-An-Offer option. They provided a telephone number for contact. Interestingly, the names that I saw came with a Save x% Now message in red, showing both the regular and reduced price. The idea of showing a discount is doubtless effective in motivating some buyers. Directly on the BuyDomains page, the domain had a buy-it-now price and button, but not the make-offer option.

    At HugeDomains the potential purchaser is presented with a list after search, and when selecting a name from that list you are shown two options, Buy Now and Start Payment Plan. They give a phone number for contact, along with an email form. There is also some general promotional information on domain names and their company.

    At DomainMarket one is presented with a long list of names after doing a search, with buy-it-now prices shown, and when clicking on a name it immediately goes to a payment page with You are buying…. They do provide email and telephone contact information. However, if you type in one of their names, it presents both buy-it-now and make-offer options.

    At NameFind, following a selection, it puts the name in an Afternic cart.

    At SquadHelp when you look for a domain name it presents a number of possibilities with the price and a logo. When you click on the logo the buy-it-now price is prominently shown along with a purchase button. Below that there is a monthly payment plan option. Depending on the name you will be shown a few options for payment duration. SquadHelp have recently announced new hyperpersonalized search aspects for their site.

    At BrandBucket options are shown with price and logo, and when you click on a name you have a Buy Now price button, as well as an option to complete a form to inquire. Their search allows choice by style or industry, as well as advanced search features.

    One issue that many of us have complained about was the problem of no buy-it-now price and button right on the Afternic domain landers. Nikul Sanghvi recently expressed an opinion that many of us share.
    GoDaddy have just announced that landers with Buy-It-Now pricing are coming soon, and that is, in my opinion, very good news. I am not certain, but believe it will apply to Afternic landers as well. Currently these landers are not yet available to investors, but are being tested with GoDaddy’s own portfolio of names.

    Sedo has traditionally supported landers with both buy-it-now and make-offer options. They recently announced new simplified landers, now operational, that make the pricing even more obvious. Neither Sedo nor Afternic currently offer integrated monthly payment plan options.

    For some time DAN have offered all of Buy-It-Now, Make-Offer and payment plan options, depending on seller choices.


    What About Sales Of Comparable Things?

    Some customer experience professionals urge a call-to-action with a single purchase mechanism, that is buy-it-now or make-offer, but not both, and definitely not both along with a payment plan. Nothing else is exactly like domain names, but if we consider how real estate, vehicles, businesses or valuable artwork are sold, it seems to me that offering a combination of a list price, along with both make-offer and various payment options, is widely used.


    Final Thoughts

    I do not see a downside in having multiple options on how the potential buyer can make contact. Different people prefer to communicate in different ways, and the more options you are able to support the better.

    With respect to whether allowing both make-offer and buy-it-now might actually detract from sales closing, I feel uncertain. I think some buyers do like the idea of being able to get a deal by bidding less than buy-it-now. Others prefer a straightforward buy at fixed price situation. The offer process may extend the purchase process, and the buyer in the interim may become less motivated to buy.

    While I presume that the data comes from their brandable market, and may, or may not, apply to domain sales in general, Darpan Munjal, CEO of SquadHelp, shared
    Nikul Sanghvi recently asked
    In my opinion that is an option definitely worth considering.

    After reading various views, my personal opinions are summarized below.
    • Ideally the number of domain name possibilities presented at any one time should be limited, with personalized search to optimize the names presented.
    • There should be multiple contact ways presented, because some prefer to contact by telephone and others prefer email or online chat.
    • If the domain is priced, the buy-it-now price should be the clear dominant option for the majority of names.
    • If make offer is also available, that should be in smaller font and a colour that draws less attention. I am still pondering the possibility that buy-it-now without any make-offer might be best.
    • Payment plans can be offered, but again should not be displayed with equal prominence to the buy-it-now price.
    Some available landers come close to achieving the above. I have always found parking landers send a confusing message, even when it is clear that the name is for sale too, but realize that many feel differently.

    I hope you will share what you feel in the comments section.

    Here are a few links to articles on NamePros somewhat related to this topic:
     
    Last edited: Jan 28, 2021
    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 informal 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 76th blog post on NamePros. View all blog posts

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  5. Comments (16)

  6. Somertonian

    Somertonian Established Member

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    Bob,
    A very interesting article as usual. A factor that you didn't mention is price category. I would presume people looking at 5 and 6 figure prices would have a different preference to those looking at 3 or 4 figure prices. My view is that the payment plan is the hook to catch the not sure and less bold investor and acts as a good balance to the buy it now price which is definitely bold and sure.

    Regards,
    Somertonian
     
  7. unmark

    unmark Established Member ★★★★★★★★★★

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    Very interesting and as always very informative. Thanks a zillion!
     
  8. oldtimer

    oldtimer Do some good for humanity and the environment VIP ★★★★★★★★★★

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    @Bob Hawkes, Thanks for a very thorough analysis,

    It might be important to also consider what Caliber and Category the domains fall under.

    If you have a high Caliber domain that relates to a popular category that attracts corporate end users then you might be better off to go with "Make Offer" only.

    But if your domains are targeting the average small businesses and start ups then having a "Buy Now" price in the low four figures (like $3488 or $4995 or ..... ) along with including some kind of a payment plan might be the way to go. (It might be a good idea to also include the "Make Offer" option if your "Buy Now" price starts getting into the high side of things so that way you won't scare any potential buyers away.)

    And if you just have domains that you want to get rid off quickly then having a low "Buy Now" price without providing any other options might be your best bet. (like $1288 or $2488)

    Disclaimer: I don't have much experience in domain sales, the above conclusions are based on my understandings of what I have read about the different strategies that domainers use at different levels and for different caliber domains.

    IMO
     
    Last edited: Jan 29, 2021
  9. Mytz.com

    Mytz.com Top 4L [email protected] ieie.com CuTu.com NeSu.com QAMI.com PRO VIP Gold Account

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    NonHipster Established Member

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  12. jiy k

    jiy k Established Member

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    Very Valuable info. Thanks.
     
  13. FolioTeam

    FolioTeam AMDB.tv VIP

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    Interesting and valuable information as always. Thanks for the analysis. I pretty much agree with all the points you raised
     
  14. pb

    pb Top Contributor VIP ★★★★★★★★★★

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    For $xxxx domains BIN + installments + optional contact / make offer is definitely the best combo.
    For higher value domains having a price listed might not be the best idea; it helps to have at least a contact form, but the real buyer will find a way to you.
     
  15. Ostrados

    Ostrados EpicName.com VIP

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    Thanks @Bob Hawkes for this great article! This is very important topic for domain investors.

    Regarding showing both BIN and Make Offer together, the popular opinion is that it is not recommended, but personally I prefer to show both BIN and make offer in my landing pages because I feel that I will miss some potential sales if I dont show both. You are not all the time aware about the domains you have, so you may receive resaonable offers on some forgotten domains that you would be happy to sell at lower prices. You cant adjust pricing all the time especially with large portfolio, so a make offer might help in getting offers on your overpriced domains or on domains that you plan to drop.

    Personally in my experience I switched to BIN + make offer in last 2 months in 2020 and it helped me in getting extra 2 sales in addition to my regular BIN sales.

    @Nikul Sanghvi reported very interesting results in his legendary 2020 report where he switched to BIN + make offer in 2020, and the results he got are great, there is no sign that BIN+offer reduced his sales, I believe it is the contrary it helped in getting more sales. Although he got less average $ amount per sale but I think that was compensated by increase in number of sales.
     
    Last edited: Jan 30, 2021
  16. Nikul Sanghvi

    Nikul Sanghvi hypernames.co PRO VIP ICA Member

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    Thank you @Bob Hawkes for the shout out.

    It's a tough one - and I don't think there are any right or wrong answers.
    However, I do think you need to decide based on your own investing and pricing strategy.

    Some domainers might only want to sell a few domains a year, but they also want to extract maximum value... in many of these scenarios, they will severely limit the number of options and make the buyer work harder to track down the owner. Sometimes, they'll only use obscure Price On Inquiry pages. Other times, they won't even use a landing page and leave the domain unresolving.

    Other domainers, will have huge portfolios to manage, and won't have time to consider offers, or deal with calls and email inquiries. BIN only might be an optimal set up here - especially if you are renewing all of the domains each year without dropping any. Here, pricing correctly becomes really important in regards to overall yield.

    For a domainer like myself, with a relatively high portfolio churn, it was very useful to have Make Offer available, alongside BIN. It kept me motivated to see regular inquiries, and also was a useful signal (data point) which I could use for deciding which domains I might want to renew for a bit longer. I did however find myself discounting around 40% (from the displayed BIN) on Make Offer sales via the DAN lander, vs mostly achieving 100% of the list price on networks like Afternic. And if Make Offer is there on the page, you can expect it will be used by the potential buyer in over 80% of circumstances (rather than the BIN button).

    Payment plans will also speed up the number of sales that you make - but they will also slow down cashflow and reduce your ability to compound that capital over time. So this might only be suitable for sellers where cashflow isn't an issue. Instalments might not be suitable for high value names where you potentially risk a domain being abused, front-run or a UDRP being initiated against a domain of value (without the proper contractual agreement in place).

    So whilst I totally agree that the number of options is important, I think it's equally important to match those options against your own style of investing strategy and/or the type of inventory that's in your portfolio.

    Thanks again for another awesome write-up - you're on fire.
     
    Last edited: Jan 30, 2021
  17. The Durfer

    The Durfer Top Contributor VIP Gold Account

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    Omar Negron Top Contributor VIP

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  19. LUP

    LUP Top Contributor VIP

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    Confusion always occurs because there are many choices. The fewer choices, the more creative people are.

    Great article. Thanks bob!
     
  20. Chinwong

    Chinwong Established Member

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    Great insight there Bob. Your analysis is on point.
     
  21. TauseefKhan

    TauseefKhan Top Contributor VIP

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    Great insights as usual. Thanks
     
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