discuss Broker Commissions and the extra mile

ThatNameGuy · Oct 19, 2019

I've started and been active in quite a few different businesses and industries in my life, but the domain business really mystifies me. The business I'm most experienced with is the debt recovery and collection business. I started a company called Credit Control Corporation in Virginia in 1973 and operated it for about 15 years when I sold it (note, it's still in business today generating 10M annually in commission/fee revenue). Not all, but most collection businesses operate on a "commission" and the last time I checked I think the "average" commission paid is around 30% of dollars collected, but the fee varied based on different criteria like the age of the debt, the amount/size of the debt and the kind of debt ie. medical, retail, financial.

Today I saw on NP where New.Life sold two domains in one day for $63,000 (Congrats New.Life if you're reading this.) The first domain he (his broker) sold for $38,000, and he paid Uniregistry a commission of 10% or $3,800. The second domain he sold for $25,000, and paid Afternic a commission of $4,000 or 16%. My initial thoughts to commissions like this are, wow that's really cheap, no wonder domainers/brokers only sell 1-2% of their portfolios annually, and why I'm reluctant to work with a broker at all.

Now more to the point, I'd gladly pay a commission of 25 to 50% of a domain sale "if" a broker could liquidate 5-10% of my domains annually. It doesn't seem unreasonable to me, if I were to list 10 food and beverage domains with a broker who understands that industry for them to sell one in ten. For example, I just registered a couple of domains; TopNotchWines.com (note that Elliot Silver owns a business called TopNotchDomains.com) I say this because I'm sure it will add credibility to my reputation here on NP for "crappy" domains

, and shortly after I reg'd that, I reg'd TipsyLiquors.com because I always wanted to own a liquor store, and I know that's a pretty "catchy" name as well

My question is this, why aren't there any brokers in this industry who will go the extra mile to sell domains like I went the extra mile in the debt recovery business to collect my clients debts? My clients gladly paid me my commissions

because they knew the alternative was little or nothing returns

Any brokers out there reading this, I want to hear from you. What gives??? Anyone else care to opine?

wwwweb · Oct 20, 2019

xynames said:
Given that Bulloney/That Name Guy started this thread and is questioning the entire domain industry - fair enough maybe he has some points - I think it on topic enough to question the questioner, as in - how does one join NP now two years ago and remain “Restricted” the entire time?

Bulloney went in big on .home or is it .homes I can’t remember, but I have never seen a reported sale in this extension. He is in for a rude awakening when it comes to renewals which are going to cost 3x the registration promo price.

New.Life · Oct 20, 2019

wwwweb said:
Given the sale amount, you had the margin to not even blink at the commission.

I don't complain!

New.Life · Oct 20, 2019

wwwweb said:
Bulloney went in big on .home or is it .homes I can’t remember,

.today - extension

Brands.International · Oct 20, 2019

Let's be realistic here - no one is going to liquidate 10% of our portfolios or make any miracles for us

We can engage good broker's interest when we have:

- top quality names in .com or top ccTLDs - this means that broker will work a lot, but will get pretty good volume of money at the end of the effort. 99,99 % of people here do not have such names, not even far.

- names with high liquidity (this means that broker will work a lot less, as it will sell quickly by definition). Several people here have such names (if you have LLL.com, it is really not that difficult to broker it, particularly if seller does not insist on unrealistic sale price)

- very good new gTLD names (so far only very well educated brokers are interested, as most brokers do not have yet enough knowledge to sell them, but there are some people who already can. But even in this case you must be very patient, no one does miracles on request, it can take few years if you want really good money for your domain name)

The idea that in 2019 someone will hand-register names on whim and then someone else (THE BROKER) will liquidate 10% of such porftolio will never work.

As I have written 1000 times here, it is better (for typical domainer new to the game) to keep high quality 10 names (and extend them years into future), then to have average quality 1000 names, and then dropping them all once first full renewals comes (which is at year 2). Then again registering 300 names for $4 yeach, and then again loosing those $1200 when first renewals come.

But for this, we need to understand, how to select those 10 names from the 1000

ThatNameGuy · Oct 20, 2019

xynames said:
Given that Bulloney/That Name Guy started this thread and is questioning the entire domain industry - fair enough maybe he has some points - I think it on topic enough to question the questioner, as in - how does one join NP now two years ago and remain “Restricted” the entire time?

xynames...your question is really "off topic", but since you asked, my answer to you is NUNYA!

branding · Oct 20, 2019

ThatNameGuy said:
That would only work "if" the broker agreed to "go the extra mile" in order to deserve the greater commission. In the debt collection business, in order to collect/recover the debt where I earned 50%, I would need to typically spend more $$$. The same would be true of brokers in the domain industry. Like I said earlier, I don't see brokers even trying to sell more domains on behalf of their clients.

You have the right idea NameDeck, but I don't see brokers wanting to increase domain liquidation even if they could at a higher commission. There has to be something psychological, criminal or simply unethical behind their reluctance to even try to liquidate more domains even at a higher rate

I disagree. Sure, maybe they won't sell more at first but I'm sure since you'd be a client that's willing to spend top dollar for their services eventually they will much rather try to sell your names than what others offer for sale given the quality of the names is the same. Results, more sales.

As you stated yourself, the domain Industry has some of it's own unique laws but isn't that much different from other industries apart from the fact that valuating assets can be a bit harder.

I actually use this, let's call it 'bonus system' in real estate and am willing to pay up to 50% of the amount that exceeds my market valuation. Combine it with a deadline and you're golden. Like, only if you can close in under two months or whatever is reasonable under the circumstances. Its costly but keeps your cashflow healthy.

If the incentive is big enough it pays off. Money rules the world.

That being said, if you're really talking about merely wanting to accomplish a higher sell through rate I think brokers are not your go to audience but you may want to hire someone willing to spam your names all over the place. That will work 100%. I'm not going into how I feel about this tactic and the legality of it but yeah, it's an option that solves your issue.

People going this route calling themselves brokers are highly questionable though.

New.Life · Oct 20, 2019

lolwarrior said:
But for this, we need to understand, how to select those 10 names from the 1000

Let potential buyers decide which of your domains you should add to this list!
If they find you and offer to buy one of your domains even when they are not for sale, and offer you, for example, $5K-$10K... feel free to add this domain to this list.

I have some domains for which even domain investors offer me $5K-$10K.
...and yes these domains are new gTLDs.

Joe N · Oct 21, 2019

ThatNameGuy said:
Bob...my point is a broker to sell more domains, more likely than not needs to be paid a higher commission, not a lower commission. Lets say for example you own a portfolio of 100 domains whose "average" value is $1,000 per domain. Your portfolio value is 100K, and "if" you paid your broker a 10% commission and he sold 2% of your domains this year, he would net $200 or 10% of $2,000 in commission, and you would net $1,800. Now lets say your broker was paid a 30% commission, and as a result was able to sell 4% of your domains instead of just 2%. Your broker than would net $1,200 in commission and you would net back $2,800. Make sense? My point is, the additional commission you pay your broker nets you back an additional 40%, $2,800 vs. $1,800

Rich, the issue here is that the amount of work/effort required for the broker to sell that 4% makes it not worth their time. There's no benefit in using their industry experience and contacts to peddle low value names when they could be earning commission on names that sell for five figures and up.

But why are you criticizing the brokers? Get out there and sell your names yourself. You're a salesman. You like chatting to people. And you seem to truly believe in the value of your names. So pick up the phone and start peddling those babies. What's stopping you?

ThatNameGuy · Oct 21, 2019

lolwarrior said:
Let's be realistic here - no one is going to liquidate 10% of our portfolios or make any miracles for us

We can engage good broker's interest when we have:

- top quality names in .com or top ccTLDs - this means that broker will work a lot, but will get pretty good volume of money at the end of the effort. 99,99 % of people here do not have such names, not even far.

- names with high liquidity (this means that broker will work a lot less, as it will sell quickly by definition). Several people here have such names (if you have LLL.com, it is really not that difficult to broker it, particularly if seller does not insist on unrealistic sale price)

- very good new gTLD names (so far only very well educated brokers are interested, as most brokers do not have yet enough knowledge to sell them, but there are some people who already can. But even in this case you must be very patient, no one does miracles on request, it can take few years if you want really good money for your domain name)

The idea that in 2019 someone will hand-register names on whim and then someone else (THE BROKER) will liquidate 10% of such porftolio will never work.

As I have written 1000 times here, it is better (for typical domainer new to the game) to keep high quality 10 names (and extend them years into future), then to have average quality 1000 names, and then dropping them all once first full renewals comes (which is at year 2). Then again registering 300 names for $4 yeach, and then again loosing those $1200 when first renewals come.

But for this, we need to understand, how to select those 10 names from the 1000

I agree 10% may be unrealistic, but knowing what I've learned about this industry in general, and knowing what I know about marketing I believe 4% is more than realistic.

We needn't argue about this, but a 2% sell rate is DEPLORABLE any way you look at it. "Hoarding" of domains is just one of the problems, but the industries refusal to try other strategies is really stupid imho. Lets just take the last two domains I reg'd, TopNotchWine.com and TipsyLiquors.com. For me to list these two domains with the likes of Afternic, Sedo, Uni, or Dan is a total waste of my time. Regardless of what you think of the names, I know they're at least OK names for "end users" in this industry.

Do any of you know how HUGE the wine industry is? How about the liquor industry? Do you know how many new liquor stores open each and every year? How about how many wineries or online wine sites there are worldwide?

I have learned a few things since I arrived at NP in November of 2017. I've learned new gTLD's are not the way to go for me, and I've learned "end users" aren't looking for me or any of my domains. Thus I need to go after them or find a broker who will. I was one of the top performers in the debt collection/recovery business mostly because I was pretty creative and innovative. The business I started from scratch in 1973 is now doing 10M in fee revenues annually. It appears I may know a little about what I'm doing, unlike many of the people in the domain industry. I'm not going anywhere virtue of the FACT I'm doing just fine, and I'll continue to get better each and every day. And to think you or anyone else can't improve performance is ludicrous. The old business theory TQM didn't believe "if it 'aint broke don't fix it", rather there's ALWAYS room for improvement

ThatNameGuy · Oct 21, 2019

Joe Nichols said:
Rich, the issue here is that the amount of work/effort required for the broker to sell that 4% makes it not worth their time. There's no benefit in using their industry experience and contacts to peddle low value names when they could be earning commission on names that sell for five figures and up.

But why are you criticizing the brokers? Get out there and sell your names yourself. You're a salesman. You like chatting to people. And you seem to truly believe in the value of your names. So pick up the phone and start peddling those babies. What's stopping you?

Been there done that Joe...but I've got so many things on my plate I don't have the time to continue doing it on my own. Besides, when I was in the debt collection business I had a few people who worked for me (i had about 30 employees) that were much better at it than I was. Not everyone can do it, but the few who can, make an excellent living.

There really should be brokers who specialize in healthcare domains, real estate domains, trades like builder/developer/designer domains, technical domains, food and beverage domains, etc. Most in this industry really can't see the forest for the trees, however the few that can have a lot of room for improvement. Sorry if you don't see it

ThatNameGuy · Oct 21, 2019

wwwweb said:
Bulloney went in big on .home or is it .homes I can’t remember, but I have never seen a reported sale in this extension. He is in for a rude awakening when it comes to renewals which are going to cost 3x the registration promo price.

You know very little about what you speak. First it's .homes, and I have some serious backing for the portfolio of 100 + names that I own that compliment my other .com real estate names. Renewal of my names is a whopping $25 a piece, and at that rate it would cost me $2,500 to renew 250K worth of names that I own. What about that "rude awakening"? Hell, my Social Security check is $2,500 a month, and you don't think I can afford to stay in this business

wwwweb · Oct 21, 2019

ThatNameGuy said:
You know very little about what you speak. First it's .homes, and I have some serious backing for the portfolio of 100 + names that I own that compliment my other .com real estate names. Renewal of my names is a whopping $25 a piece, and at that rate it would cost me $2,500 to renew 250K worth of names that I own. What about that "rude awakening"? Hell, my Social Security check is $2,500 a month, and you don't think I can afford to stay in this business

Not with $0 in sales, no you can’t. Spend $2,500 on one great name you can flip for $10-25k with a $10 renewal if you want to something you can liquidate with little loss, and still have a large upside on an end user sale.

You like Rob he bought sybs.com here on namepros for $995 today, many people had it on their radar, and that is a name here is going to make 2-20x his money on possibly. Even he has given you subtle hints in previous posts to maybe check the path your on in a polite way.

Yes, it’s true some people buy gtlds, and think outside the box, but to own such a diverse portfolio to figure all this out at a higher renewal cost does not work effectively. The renewal will eat your profits against all the dead inventory, and these guys are hiking renewals up again in the coming month also.

Honestly I thought .homes might have a pulse, but it is an absolute dud year to date, it should have a pulse, but it has no follow thru.

Most people here have learned the hard way, and are simply looking out for you so you don’t lose more money. Sure you might sell a name for $2,500, but if your valuing them so high most likely you are going to not be able to come to terms with an end user on valuation, and lose the deal.

As usual we all know nothing, and you know everything, so let’s just leave it there.

Joe N · Oct 21, 2019

ThatNameGuy said:
Been there done that Joe...but I've got so many things on my plate I don't have the time to continue doing it on my own. Besides, when I was in the debt collection business I had a few people who worked for me (i had about 30 employees) that were much better at it than I was. Not everyone can do it, but the few who can, make an excellent living.

There really should be brokers who specialize in healthcare domains, real estate domains, trades like builder/developer/designer domains, technical domains, food and beverage domains, etc. Most in this industry really can't see the forest for the trees, however the few that can have a lot of room for improvement. Sorry if you don't see it

I'm just not seeing the business sense in amassing a massive portfolio of names without having a plan to sell them. It seems backwards.

Why not ask these questions before buying the names? Why invest over 20K and then bemoan the lack of brokers who can sell for you?

JB Lions · Oct 21, 2019

ThatNameGuy said:
Now more to the point, I'd gladly pay a commission of 25 to 50% of a domain sale "if" a broker could liquidate 5-10% of my domains annually.

This doesn't make sense coming from you. You've posted time and time again about your infinite knowledge of domains and selling them, even tho you haven't. So why would you pay 25%-50%, when you don't have to? Why wouldn't you just sell them yourself? You've said many times this is easy. For you to say you would gladly pay somebody up to 50% is very telling. For that amount, why don't you become a broker?

Joe N · Oct 21, 2019

ThatNameGuy said:
Most in this industry really can't see the forest for the trees, however the few that can have a lot of room for improvement.

A rather ironic sentiment.

From the day you joined, I felt your zeal would be a great asset for you in domain investing. I'm looking forward to the day that we get to see you harness it productively.

ThatNameGuy · Oct 21, 2019

JB Lions said:
This doesn't make sense coming from you. You've posted time and time again about your infinite knowledge of domains and selling them, even tho you haven't. So why would you pay 25%-50%, when you don't have to? Why wouldn't you just sell them yourself? You've said many times this is easy. For you to say you would gladly pay somebody up to 50% is very telling. For that amount, why don't you become a broker?

Oh...where have you been JB? Instead of realizing the domain industry has HUGE problems with very few solutions, you attempt to trash me

. For the record, I confess to making mistakes like we ALL do on a daily basis. This industry is riddled with hoarders (not my term, but Verisigns) and domain deplorable's (my term

). One of my mistakes was initially buying mostly new gTLD's, however I've reversed course and my portfolio of about 1,200 domains now consists of 80% .coms and 20% new gTLD's.

While doing all this over the last 24 months, I've been developing several businesses, the latest being 9Time™ that will revolutionize golf...FORE

!!! Sporting a Virginia vanity license plate that reads "Name Guy", I've been extremely active Re-branding Hampton Roads Virginia to a "catchier" and more recognizable name like SeVa that stands for Southeast Virginia or CoVa that stands for Coastal Virginia. JB, my area of the country has a MASA of 1.7M people, and my part in this is no small task.

Many of my friends and peers wonder how it is I'm able to do all this at my age...just turned 72 yesterday

, but I have more energy, business savvy and passion than most people.....just ask Rob Monster of Epik or Bob H or Eric here on NP.

So now to your question, why don't I become my own broker? I would JB if only I had the time and I didn't already have so much on my plate. I wasn't born yesterday, and I believe there's a better way to sell domains than to simply list them with the likes of Sedo, Afternic, Uni, Dan etc., and hope and pray they sell a deplorable 2% of portfolio's annually. You may be satisfied with that, but I'm NOT!

Finally, I find it interesting that NONE of the brokers who are reading this aren't attempting to defend themselves and this industry.....i guess they have a reputation as hoarders and deplorable's they need to live up to, thus their silence

ThatNameGuy · Oct 21, 2019

wwwweb said:
Not with $0 in sales, no you can’t. Spend $2,500 on one great name you can flip for $10-25k with a $10 renewal if you want to something you can liquidate with little loss, and still have a large upside on an end user sale.

You like Rob he bought sybs.com here on namepros for $995 today, many people had it on their radar, and that is a name here is going to make 2-20x his money on possibly. Even he has given you subtle hints in previous posts to maybe check the path your on in a polite way.

Yes, it’s true some people buy gtlds, and think outside the box, but to own such a diverse portfolio to figure all this out at a higher renewal cost does not work effectively. The renewal will eat your profits against all the dead inventory, and these guys are hiking renewals up again in the coming month also.

Honestly I thought .homes might have a pulse, but it is an absolute dud year to date, it should have a pulse, but it has no follow thru.

Most people here have learned the hard way, and are simply looking out for you so you don’t lose more money. Sure you might sell a name for $2,500, but if your valuing them so high most likely you are going to not be able to come to terms with an end user on valuation, and lose the deal.

As usual we all know nothing, and you know everything, so let’s just leave it there.

For the record, I'm doing just fine thank you, and I can assure you I'm having 10X the fun you're having. Read my response to another of my critics JB Lions, and get back to me. In the interim, my recommendation to you is be more open minded, and realize there's ALWAYS a better way

BrandPlease · Oct 22, 2019

WOW the bulloney never ends, it's amazing how little you grasp from the hundreds of responses you get.

It's not about a this niche broker & that it niche broker that is the problem. Guaranteed they would take your names if they were of the quality they are willing to present to a high value lead. Presenting crap names to a high value relationship - is just about the worst possible business decision possible.

Maybe this will be easier to follow. You are a Lamborghini dealership owner - are you calling you 4 Lambos & 2 Ferrari customers when a VW Bug comes in?

You are trying to sell bugs to Lambo owners and are upset they don't want them and no one here will agree with your insistence that your names are not the ONE & ONLY Problem you have. Well your attitude stinks as well.

Good luck

BaileyUK · Oct 22, 2019

Sometimes DnameAgame you/we have to say it the way it is.

Politeness isn't a continuing option when all avenues have been explored

eurorealtor · Oct 22, 2019

ThatNameGuy said:
First it's .homes, and I have some serious backing for the portfolio of 100 + names that I own that compliment my other .com real estate names.

Real estate niche is not "the best choice" for a domain investor. In general, the real estate agents prefers a free to register long tile domain names. Many agents use a subdomains of their chains, like "joerealtor-kw-com", the others just use whatever is free to register. It is nothing unusually to see 4words .com domain names being used by realtors, as long as they don't have to pay over reg fee.

wwwweb said:
Spend $2,500 on one great name you can flip for $10-25k with a $10 renewal if you want to something you can liquidate with little loss, and still have a large upside on an end user sale.

Most valuable advice in the entire thread.

ThatNameGuy · Oct 22, 2019

eurorealtor said:
Real estate niche is not "the best choice" for a domain investor. In general, the real estate agents prefers a free to register long tile domain names. Many agents use a subdomains of their chains, like "joerealtor-kw-com", the others just use whatever is free to register. It is nothing unusually to see 4words .com domain names being used by realtors, as long as they don't have to pay over reg fee.

Most valuable advice in the entire thread.

With regards to "real estate not being the best niche" in which to compare domain sales....I agree on the one hand, but the context in which I used deplorable domain sales as an example of why brokers don't sell more domains just doesn't compute.

Going back to my debt collection model, the debt collection industry charges commissions based on many different criteria. As an example, for "first placement" debt the industry charges on "average" 20 to 30% commission, for what is called "second placement" debt the industry charges 30 to 40% commission, and for "third placement" debt the industry charges from 40 to 50% commission. Are you following me? Keep in mind, regardless of technology commissions are percentages of sales, and that constant has remained the same over time.

All I've been saying is "if" brokers were paid a higher commission to sell the 98% of domains they don't sell, just maybe they can afford to "go the extra mile" to sell more domains for their customers. Let's use the analogy that Bob Hawkes alluded to in his post comparing new car sales (first placement domains) to used car sales (second placement domains). Imagine if you will a "used domain salesman/broker" who might go that extra mile, and do things like industry trade shows for restaurant domain names, for healthcare domains or financial services domains, might you not expect to sell more domains? How about a broker/salesman who by using AI can target specific "end users" to sell more domains? Emailing potential "end users" like all the Johnson's who are realtors and builders, or all the Johnsons finishing school and entering the workforce might be a start. This might be a job for maybe a "second placement" broker/salesman who would deserve maybe 35% commission because they went the "extra mile".

I'd gladly pay a 35% commission to a broker/salesman who would go the "extra mile" for me. It sure beats paying a 10% commission where very few, or worse, no sales are made

This is all pretty clear to me because I see the deplorable sell through rates as an opportunity to increase domain sales. I just wish I had the time or the technical know how to "MakeSomethingHappen", the domain I've used for my personal email since September 1, 2001.

ThatNameGuy · Oct 22, 2019

wwwweb said:
A better way to make 0 sales like yourself. It's ok I get it my old man is stubborn also, we just learn to live with it.

I can see your having a lot of fun with that restricted account.

Good luck

Thanks wwweb and Ray aka BaileyUK....it's through this thread that I've been contacted by a private broker who understands the reasons behind the deplorable sell through rate of just 2% annually of domains listed for sale. I'll take this opportunity to continue to ~~trash~~ critique this industry, as well it should be.

Go Daddy reached out to me because they wanted to be my broker via their brokerage division Afternic. I had and still have about a thousand names "supposedly" listed with them. I say "supposedly" because I left it up to them to "list" and "price" my domains the way they saw fit since they're "supposedly" the experts. Bottomline, they totally dropped the ball and let me give you a prime example; on April 26th 2019 I hand registered the domain; CandoBrands.com (check it out at WHOIS if you don't believe me). At the time I registered it, these are the EXACT words GD's rep said to me in an email;

" Wow Richard, I’m surprised that candobrands.com was publicly available? Kinda shocked, but I like cando way better than brandcan. I agree with all the commenters. Congrats!"

Fast forward SIX MONTHS, and you can check for yourself, but Candobrands.com isn't showing that it's for sale via GD or anyone else

I ask anyone reading this....is there any wonder why I might think this industry has a lot of room for improvement? And not just in the ways I'm recommending, but in other ways as well.

I could go on and on, but to my many critics here on NP...give it a rest. Your ARROGANCE, not mine is holding this industry back. Stay tuned, for I plan on being around for a very long time

BrandPlease · Oct 22, 2019

You are truly an odd duck. GoDaddy & Afternic (+their employees) are "supposedly" the experts. HAHAHAHAHAHAHAHHAHAHA. Maybe they should hire you as you think they are in need?

bmugford · Oct 22, 2019

Any industry has room for improvement. That being said, it is not like you have the solutions.

There is no comparison between being a debt collector and selling domains. They are completely different fields.

That would be like me expecting to succeed in the domain field because I ran a successful car wash. There is absolutely no relevance or correlation.

Being lectured on everything wrong with an industry by someone with limited experience in said field, that collects domains like beanie babies and doesn't even make domain sales is pretty amusing.

Brad

BrandPlease · Oct 22, 2019

I truly like to try and offer only positive advice or at least frame it that way - bulloney, does make it impossible at times. But, going to try and offer some constructive feedback.

CanDoBrands - yes cool, I like it. It is a good name to be good domain sales marketplace. Maybe some marketing/SEO agency type interest (which is good) but to me it's a good portfolio brand.

Prob is it's not an "end user" name (IMO, only) it's an industry name. So, 1. sell it to a domainer - as you know they will be very low$$ for any decent name. 2. Develop and use it for your site.

It's not good good "investment"/ listing/ auction type name.

Best of luck

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