discuss Ethical or not: Creating an auction for a specific domain that has 2 or more buyers.

If it's an auction you want, I would suggest a slightly different approach, something I have been contemplating myself recently

- first, set up an auction...

- next, start contacting prospective buyers, informing them about an ongoing auction of such and such domain, that might be of interest to them...

Not sure that an auction is the way to go when doing outbound, though

Sent email to 4. Three replied back for pricing and I asked that I was open to offers. One came back with an offer and am negotiating now but stalled and almost there. Sent emails back to the other 2 that domain name is almost sold but open to their offers. One email came back saying "thanks for the update". I don't believe pressure tactics like a bidding auction work on buyers even if the other gets the sale.

MasterOfMyDomains said:

i would lmfao if someone did that to me. Set a bin
This is the name, this is price.
Are you going to get them to sign up at sedo to battle it out?
Compare domain to car

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i have seen many users to signup especially for one domain which they want.. if you are calling all endusers they can come signup and bid max price this is also true when domain is in auction enduser are more interested and aggressive to buy the domain.

john888 said:

Sent email to 4. Three replied back for pricing and I asked that I was open to offers. One came back with an offer and am negotiating now but stalled and almost there. Sent emails back to the other 2 that domain name is almost sold but open to their offers. One email came back saying "thanks for the update". I don't believe pressure tactics like a bidding auction work on buyers even if the other gets the sale.

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just email them that domain is in auction if you are interested you can bid on it. i have tried it and succeed many times.. plus if the domain is in auction i would suggest to go crazy on outbound and marketing dont give up until last hour keep marketing on keyword of your domain to all ... trust me it works

I view outbound as walking on a tight rope. Unless you engage the buyer and get him emotionally / financially vested in buying your domain name, you have very little to no leverage. What you want in outbound is to close the sale as early as possible and at the highest ticket size as possible.(Straight Line Persuasion).

What is the delta of the amount that the auction would bring you vs the risk you run of your prospects turning cold because you've just made them do more work. Depends a lot on the context of your relation with them, but I would any day prefer to make their lives easier, establish a relation to harness later and move on.

IMO, this would be ethical per the definition of the word. But given the context, it would not be the right thing to do.

Offering + negotiating, then setting up an auction to make them compete: seems tacky to me.

As a prospect on the receiving end of that, it'd leave a bad taste in my mouth. Not a good "customer experience" -- they may feel misled.

If you have an auction set up first, and your initial outreach is a clear invitation to bid, that's much more agreeable. My 2c.

Your proposed approach is not "unethical" per se, but I believe there's a significant chance it could put people off doing biz with you.

Also once you paid to list the domain in a sedo auction and paid their stupid commission fees then you would probably end up with less money than you have got from just accepting on offer via email and dealing through escrow.

All is fair in love and war

100 percent ethical, but I don't know if it works. Are buyers aware of eachother's existence, or can they both think you will do shillbidding.


Maybe make one of them make its offer, and start auction, and then invite the other party (if selling at Sedo).

If buyer A agrees to a price and then buyer B agrees to a higher price after you made a deal with buyer A or they are under the impression the domain was already going to be theirs then yes it's immoral (not necessarily illegal but immoral all the same). If buyer A and buyer B are both shooting offers and nothing is solid and you wanna make them fight it out, go for it by all means!

Jay Ha said:

But in this case all the buyers didn't accept my price and we're still in the middle of negotiations. Maybe I should have made that clearer.

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If you are selling to end users, you are potentially setting yourself up for legal issues. Nobody has taught you “first right of refusal”? which you should extend to the first response, first person you think you are “negotiating” with a deadline. Everything quoted on initial contact with multiple prospects should be “subject to prior sale”. Give the first responder, first option once they refuse the offer, then offer it to the other party, if they also refuse your price you are done and can do anything you want including embarrasing yourself by emailing them both to bid at auction. You have (2) prospective customers unwilling to buy it at that price, so you are now free to do what you want. Wasting all this energy on a $200-500. Sale is amazing.

https://www.realtor.com/advice/buy/right-of-first-refusal/

MetBob said:

Slightly related, has anyone ever developed a domain investor Code of Ethics (if so link please someone!)

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ICA Code of Conduct -- it includes a commitment to adhere to all applicable laws that seek to curb and control internet fraud and abuse but it doesn't directly address sales negotiations or unsolicited offers to sell.

Just so you don't misinterpret the results of your poll... I have voted yes on the fact that yes it is ethical but I would have voted no if the question was. "Should I invite buyers who have made offers after outbound marketing to a public auction to bid for the domain?".

It is ethical as it isn't harming anybody and they have a choice on whether to bid or not but to be honest I think it will annoy them more than anything. Why don't you just say you have had a better offer and to get the domain their offer needs to be higher?

Inviting them to a public auction and going through the sign-up, verification process etc will add more barriers in the way. Also, do you think they will offer more than 20% above their latest bid? If not, then there is no point as you will be paying Sedo a commission on the final bid.

If they are way off the price you are willing to accept and they won't budge after you have said you have a better offer, then tell them you will put the domain to auction if they are not interested. You will most probably lose their interest but if you don't want to accept their offer anyway, then there is no loss.