sales Don't Shoot for the moon

I think "Shoot the moon" is different for each person. My "Shoot the moon" is anything 100x for handeg and 10x for anything over $500, 5X for anything in the low thousands...etc

Any name you register has the ability to "Shoot the moon". So don't let anyone tell you to not shoot for the moon!

Since we talking about Shoot the moon! Does anyone know where to play Spades?? I miss playing on Yahoo!!

topdom said:

Domainers sell to flippers, flippers sell to endusers.

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Another reason not even to try to watch the moon. Save the flippers!

The premise of Shooting The Moon is not based on the Quality of your domain, but rather on the fact that an End User that you don't know anything about might have fallen in love with the specific domain that you might have and that they want it at any cost. Although the chances of such scenario might increase if you have a premium domain name, but that might not necessarily be the main requirement since the most important factor is how suitable your domain is to the specific needs of an End User who thinks that your domain is what they have to have. It happens to all of us when something catches our eyes that we have to have and that we are willing to pay more to get it as the price might not be the most important factor for us in that case. Perhaps that's why some paintings sell for astronomical prices or that some people pay thousands of dollars more to see their favorite concerts or sports games.

The only way to know whether this method is going to work for you or not is to try it for a while provided that you can afford the wait, and remember you have to overcome three major obstacles to get to the Moon, first you have to get an offer on one of your names which doesn't happen that often for most domainers and then you have to gamble on whether the person who has made the offer has sat their heart on having the specific domain that you have and that they can't do without it. You also have to gamble on whether the buyer who has fallen in love with your domain has a lot of money to spare. If all the stars line up correctly you might be able to get to the Moon after all, but you might want to have another strategy in place in case if they don't.

PS: The more specific the domain is that you have gotten an offer for perhaps it is better justified to Shoot The Moon for it.

IMO

I agree with Michael's take on this. It is very similar to mine in the shoot for the moon thread.

Buy, sell, rinse, repeat is the model that works for many profitable domain investors.

The key here is a model needs to be repeatable. Outliers are not repeatable.

Brad

Best to try all different kinds of strategies to see which one works for you better.

IMO

It is so silent here. Everybody waiting for a statement by Rob Monster?

However, if I remember correctly the other thread ended similar to the message of the article here which is another Best-of-Namepros.
It resulted like You need a great domain name to come anyhow near the moon, but if you are an unknown domainer you probably will never shoot it.
That´s why I like the comparison to Mr. Mann´s sales, because let´s face it: Those reports about him or Mr. Schwartz or the Costello Brothers or other VIPs are tempting and able to create too high expectations.

bmugford said:

The key here is a model needs to be repeatable.

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Great conclusion which reads so easy but isn´t. Personally I´d be happy to identify those never selling domains much earlier as I do now to remove ballast from my (pseudo) moon rocket park. I know 80% or more of my names will never sell - but which ones?

Blitzpotz said:

Everybody waiting for a statement by Rob Monster?

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you can read mind's

Blitzpotz said:

It is so silent here. Everybody waiting for a statement by Rob Monster?

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no

frank-germany said:

no

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And another post added with two letters.

But wait, I feel he is nearby.

LarryDomain said:

I think "Shoot the moon" is different for each person. My "Shoot the moon" is anything 100x for handeg and 10x for anything over $500, 5X for anything in the low thousands...etc

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This. Exactly this. We've been working on an AI appraiser that might never see the light of day. But the idea is to only look at wholesale sales and come up with a wholesale valuation, and then use that to calculate a retail range. You've closely described my formula for converting wholesale to retail, although it needs to be an equation and not stepped. But the basic idea is the same, the higher the wholesale value the lower the multiple, with a very high multiple at the low end of the spectrum.

Your pricing model is not a moonshot at all, it's perfectly practical and realistic. A moonshot is a price that has an extremely low probability of being accepted, not about the multiple. Like replying with "similar names routinely sell for six figures" for completely average or even low-quality names. Great way to kill every inquiry instantly. Asking $1-2k on a hand reg is not a moonshot, even though it is a 100x+ return.

The main point is that if you ask for extremely low-probability prices on every inquiry you're never going to make a sale, or if you do it will take a decade or more. That's just statistics. Most people will have given up by then. Just do it on a small percentage of your portfolio if anything. It's also not that easy to walk back a price from "six figures" to $5k either. The buyer won't take anything the seller says seriously at that point, and it makes the seller look inept and weak. So it isn't really the case that the seller can just come down significantly without any harm done, so might as well start off crazy and hope to get lucky.

You must be making sales given your sensible approach to pricing and the quality of names in your signature. It's immediately clear that you understand this business better than most.

bmugford said:

I agree with Michael's take on this. It is very similar to mine in the shoot for the moon thread.

Buy, sell, rinse, repeat is the model that works for many profitable domain investors.

The key here is a model needs to be repeatable. Outliers are not repeatable.

Brad

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You are exactly the type of investor that people should be looking up to and trying to replicate, not the people who got in extremely early and are playing a different game entirely. I would imagine many of my thoughts and beliefs about this industry where influenced by watching you do your thing over the years.

Michael said:

You are exactly the type of investor that people should be looking up to and trying to replicate, not the people who got in extremely early and are playing a different game entirely.

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I'll co-sign that!

imo...

biggie said:

I'll co-sign that!

imo...

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Need another one?

Thank you for the outstanding analysis and article @Michael. By taking the time to do this you will no doubt make a positive difference to countless domain investors who take your message to heart and respond accordingly. Sincerely thank you, both for this article and the outstanding NameBio.

Also very interested to hear of your future AI project related to wholesale and retail pricing.

Thanks again,

Bob

As stated in the article it is numbers game, it will take 1 lifetime to shoot for the moon on one "subpar" domain if you own less than 500 domains!

Statistics is very simple concept
period

Michael said:

But the idea is to only look at wholesale sales and come up with a wholesale valuation, and then use that to calculate a retail range. You've closely described my formula for converting wholesale to retail, although it needs to be an equation and not stepped.

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Michael - I loved this article, so first of all, thank you for writing it...

I run a very similar stepped model. The multiples need some revision but it's roughly like this: https://twitter.com/hypernames/status/1122780585125130245

I think it would be interesting to see your equation run in the opposite direction, using a high/medium-probability retail value to determine a wholesale price range. Then the purchase becomes the theoretical point at which the money is made.

If investors don't use enduser prices to determine wholesale values, a few things could happen:

• Higher chance to overpay for the acquisition at wholesale = poor deployment of capital
• Once an investor has overpaid at auction/wholesale, a static multiple (like 10x/100x) forces a low-probability retail price (moonshots) and a weaker sell-through rate
• If end-user prices are static, but domains are getting more expensive on aftermarket, margins will become tiny.
• If we ignore end-user prices and trade on wholesale only, domains will end up getting used as a store of value. Then we get stuck in an asset bubble, passing money around to each other.

Nikul Sanghvi said:

Michael - I loved this article, so first of all, thank you for writing it...

I run a very similar stepped model. The multiples need some revision but it's roughly like this: https://twitter.com/hypernames/status/1122780585125130245

I think it would be interesting to see your equation run in the opposite direction, using a high/medium-probability retail value to determine a wholesale price range. Then the purchase becomes the theoretical point at which the money is made.

If investors don't use enduser prices to determine wholesale values, a few things could happen:

• Higher chance to overpay for the acquisition at wholesale = poor deployment of capital
• Once an investor has overpaid at auction/wholesale, a static multiple (like 10x/100x) forces a low-probability retail price (moonshots) and a weaker sell-through rate
• If end-user prices are static, but particular domains are getting more expensive on aftermarket, margins will become tiny.
• If we ignore end-user prices and trade on wholesale only, domains will end up getting used as a store of value. Then we get stuck in an asset bubble, passing money around to each other.

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The model seems very reasonable to me, good stuff. The only reason I don't have it stepped is it gets weird at the edges, like a $999 acquisition might be priced quite a bit off from a $1,000 acquisition.

It wouldn't work in reverse though because retail prices don't have predictive value, you need to solve for wholesale and then extrapolate to retail. I'm just talking from an AI perspective though. You could certainly look at a name on auction and say to yourself "I think that could reasonably sell for $25k retail, I'm willing to pay around a grand for it." But it wouldn't work for an AI to try to guess at retail and work back to wholesale, there's not enough data and it's too random.

That's why I believe automated appraisers are crap right now, they don't exclude retail and it muddies the waters to the point where it all becomes nonsense. It's even hard for a human to peg a retail value, if you ask 10 experts you'll probably get 10 different answers. Used to happen all the time on DomainSherpa's Guess that Price segment or whatever it was called, guesses were all over the place.

I agree though, domainers need to give more thought about retail valuation when buying. Many are just bidding because others are participating, and are buying names for a grand or more that aren't likely to sell to an end user for more than a few grand. That doesn't work if you're only selling one out of every few hundred names. Perhaps they are just banking on the wholesale value going up so they can flip it, which as you say leads to a bubble. It works for massive buyers who are only trying to grow their top line though and are ok with a 10-year ROI, and they're squeezing the margins to the point that the little guy can't play.

I think we've been there for 2-3 years now actually. End user prices are not keeping up with the growth in wholesale prices, not by a long shot.

equity78 said:

Rob Monster of Epik recently started an interesting discussion over at NamePros about “shooting the moon” when selling your domains. Basically the premise was that you don’t know how much the buyer would be willing to pay, so you might as well ask for an astronomical number and see what happens.

After all, you can’t get a high price if you don’t ask… right? Plus you can always offer a lease as a cheaper alternative, or you can walk your price back down.

For 99.99% of you this is terrible advice. Why?

Read more at Namebio

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What I know for sure is that this is an important conversation to have for all of us. We must always be willing to look honestly at what we're doing and smartly make needed adjustments.

Paul 11 said:

What I know for sure is that this is an important conversation to have for all of us. We must always be willing to look honestly at what we're doing and smartly make needed adjustments.

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Also, this means that regardless of whether we like or dislike someone's reply, it is a valued contribution to this discussion. This is the strength of our community!!!

Thanks for sharing indepth analysis and information.

Regards
DpakH

I'm shooting for the moon, or as I like to call them "Hail Mary"s on a small portion of my names, the best ones, that I'm willing to hold onto for a decade or longer.

The rest - I'm taking a much more reasonable approach, similar to @Nikul Sanghvi 's chart. I've had plenty of "down to earth" sales, which has kept me in business.

Still waiting on my one moon shot though!

Great analysis Michael. Liked Nikul's approach as well.

frank-germany said:

they did it in `69
so why wouldn't you?

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If i may, they didnt.

equity78 said:

Rob Monster of Epik recently started an interesting discussion over at NamePros about “shooting the moon” when selling your domains. Basically the premise was that you don’t know how much the buyer would be willing to pay, so you might as well ask for an astronomical number and see what happens.

After all, you can’t get a high price if you don’t ask… right? Plus you can always offer a lease as a cheaper alternative, or you can walk your price back down.

For 99.99% of you this is terrible advice. Why?

Read more at Namebio

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Great advice.

Nothing bad to give the moon a try and when no landing space your crash back to earth with your domains...at least it better than going down from earth to blackhole without end and disappear for life.

I shoot for the moon on names that are a very long term hold that I see appreciating in the future. I get realistic with the med tier stuff and move and recylce when things get slow.