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15 Pricing Points / Tips: The $300 - $3K retail price range, explained

Labeled as guide in Domain Buying and Selling Discussion, started by twiki, Sep 14, 2021

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  1. twiki

    twiki Top Contributor VIP Gold Account

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    As you might have read previously, in the past I've posted a lot of stuff about pricing domains under $300 (market range). This time I'm going to address the standard retail price range, $300 to $3K. Hopefully it would be useful to you.

    There are some things I've observed in my sales experience and shared here. But don't forget to test, test, test. There is no universal rule in domaining, and each strategy must be tailored as per your portfolio and style.

    Okay, so here's what I have observed.

    1) The $300 - $3k range is primarily covered by impulse buys.

    Most buyers for domains in this range are indeed impulse buyers, or anyway the emotional part plays a significant role. This is important, always keep it in mind. You want them to follow that impulse.

    Side note I'm currently using fixed pricing only in this range, so make sure you check it out too. We want the buyers to hit that wallet right now, and they're free to have remorse tomorrow.

    2) The $300-$750 price range gap ("dark zone") + my the least favorite price of them all ( ~ $499 )

    ( Edit note: This mostly applies to .com domains)

    This range has always been where my most difficult pricing choices reside. I have no problem pricing any domain above $1k, but in this intermediary range, it's a tough choice. Nothing is perfect here. I am currently avoiding this "dark zone" because of the bad results I had with it. I prefer to either downprice to $299 or increase to $788 or $1K. This is how I get best results. In most cases, downpricing to $299 increases results a LOT. At least double the sales ratio, which means better earnings.

    My recommendation is, you might want to move your domain's pricing out of this range. Either up or down will be good, your call. I think many beginners could make more money by avoiding this gap with their names.

    $299 is reachable range to the average Joe, while $1K is for a small business. In-between? There's perhaps only cheapo small business owner lurking here, not the best buyer.

    3) The "X88" price endings = best results.

    As a note I'm currently only using pricing ending in "88" for almost anything in standard retail range or above. I've seen from sales results that this worked far better for me. This is not by accident.

    Think about these prices for an example: $1499, $1495, and $1488. Which one would be better, easier to remember and to swallow?

    Well, $1499 does not fool anyone. That's an $1.5K wolf disguised as a sheep. The buyer knows it. It's a measly $1. I've found the x99 tactic to work only in the market range (under $500 in fact). Above that, not so much.

    $1495 is probably the worst of the pack. I don't like it. Never sold one, also not at $1490 etc. It's hard to get into mind. Too many different digits in the number. You have to make it easy for the buyer.

    $1488 is my favorite by far.

    I really love the "88" ending, and so do my customers. It looks and sounds well if spoken, and it is also easiest to remember. Also, it offers the customer a $12 discount. That's not much, but still anyone would like to save $12 if possible. Side note, it's not really $1500, right? Though, in fact, it basically is.

    Many experienced domainers use the 88 pricing. You may want to try it out.

    4) $750 and $788

    I remember reading early on NP (years ago) that there's a price barrier above $750, so this is a key price point. In my experience, I also found it to be true.

    Then, I wanted to understand why. I'm always trying to peek into the buyers' mind; if you successfully do so, this can significantly impact your income.

    That barrier is simple to understand if you manage to enter the buyer's mind.

    Its' the "I'm not spending 1K on a bloody domain name" barrier. $750 is NOT 1K. $850? Well, it's almost there. Seems 1k-ish already. In any case it is much much less appealing to buyers from my testing.

    Since in domaining the sales ratio is the most important factor (even more than price), you have to do everything you can to improve this ratio. I would suggest avoiding the $800 - $999 price zone completely; either stretch it to 1k or stay at 750. I've never ever ever had any sales whatsoever in this zone, so I'm not recommending it. Of course you can still have such sales, your names could be different etc; but what might suffer in such case is the sales ratio so you might want to test more in this respect.

    Also, between $750 and $788, again the "88" wins. $788 always brought me extra $38 at no negative impact whatsoever on the sales ratio (Ive tested this a lot). For my buyers, it appears to be more or less the same. But also, it's easier to remember as it has only 2 numbers (7 and 8) which are also consecutive, so it's easier to enter and stick to your brain. Side note, 99 is also consecutive; but unfortunately too close to 100 so it does not fool domain buyers. Might be useful though for pricing cheese at the supermarket.

    We always want things that are easy to understand as using the brain is an effort for any operation (not kidding) so by instinct we always tend to avoid all hassles if possible.

    This is also why when we've just made a bad choice we tend to go along with. We're "committed now" - and in many cases it's far less fatigue to do so, even though the results might not be the expected ones.

    $788 is simply less fatigue for the buyer, and more money for us.

    5) $950, $988 and $999

    Don't use these. I mean it, really, don't. Pricing like this have always seriously and negatively impact my sales. And for good reason. It's again, $1K wolf disguised as a sheep. Better price at 1000 or 1050 or whatever your fancy is.

    Note, I've never ever sold a single domain at these price points.

    Also, I made some research early on these, using publicly reported sales. The worst sales ratio I have observed has always been right below 1k or 2k. By pricing at 1K or right above 1K, you get more sales and extra money. It's counter-intuitive; but again, buyers are not rational creatures in general. So everything might not be exactly as it appears at first glance.

    6) $1000, $1049/$1050 and $1088

    Again, in this pack $1088 wins. $1050 is also not a bad price point, some prefer it (also 2050). But again I've found the 88 much more effective so I stick with it. It does not impact the sales ratio.

    Also, here the psychology wins again. $1000 is $1k in the buyer's mind. $1050 is also $1K. Surprisingly perhaps, $1088 is also 1k, but nicer as a number so they like it. Although it is closer to 1100, the buyer doesn't appear to see it that way.

    (And if they did, the ratio would go down such as it goes for 1100 or 1200; down hard. I also don't recommend $1200/$1288 that much; has lower conversion ratio).

    And since 1K is a hard limit for many small businesses for a domain purchase ("I'm not paying more than 1k") by using the 88 you're getting the most $ without impacting the sales ratio.

    It's just a psychological limit; many buyers can definitely afford more but won't want to ever pay more than this for a domain.

    I also want to say that barely 1..2 out of 10 buyers really understand the value of a good name and how cheap it is to invest in a proper name compared with any other marketing strategy. It costs less and brings more ROI than anything else.

    ( And worst case scenario, if you bought a great name you can sell it for quite some amount years later, even if the business has gone bust meantime. )

    7) $1488 - my best friend

    This is by far my most favorite price in this range. It is still affordable for many; and if you're going to dig into reported domain sales above 1K you'll see a huge number of domains sold with prices around this number. If I had to pick between 1288, 1488 and 1788 I''ll always pick 1488. The sale price x sale ratio = RESULT is biggest for this number from all my tests. So I stick with it.


    8) $1488 vs. $2988

    This is important, so follow closely.

    Domain buyers are very sensitive to price - in the standard retail range at least. For the high 4 to 5-fig range, it changes but the buyer profile also changes. But for our bread and butter range of below $3k, price sensitivity is still quite high.

    Having these two choices:

    a) I can either sell 1 domain at $2988

    or :

    b) 2 domains at $1488.

    Now guess which of these two cases bring MOST money overall?

    Yep, it's almost always 2 domains at $1488 (unless the value of the domain really commends 3k or more). Might be counter-intuitive for many; but hear me out.

    By pricing at 3k the sales ratio decreases vs 1.5 k by A LOT. Not so many buyers will buy at 3K.

    In fact from there above, the playground is for tech startups and big money. Everyday small businesses buy doomains at 1-2K in general. I believe the ratio is like 3-4 times better for 2 domains at $1488.

    Now of course if you have very valuable domains feel free to price them 3K and above; but if you have plenty of names at ~$3k and thinking whether you should discount some and see what the result would be, well, I would recommend trying out this half-price at $1488. It always brought best results for me.

    Note: My first-ever above 1k sale was a .org I sold for $1488. My second was a .com at $1488. Ever since, the biggest number of sales I had in the 1-3K range were, by far at $1488. It is above $1K, but "not $2K". Side note being closer to $2K changes everything, in the same fashion as described above for the right under $1K prices.

    The only downside is that you double the number of domains sold. BUT you also get more money to buy more because results might be better overall.

    And if you do the math, the loss in domain count is insignificant. For say 100 domains and 1 sold out (standard 1% ratio) you have 99 domains left; but for 2 sold you still have 98 domains domains left. That's not much of a difference! Yet it brings better money due to higher sales ratio which will be seen at the end of year in balance. You might see a 50% increase in the balance if you opt for the second.

    Yet our mind tells us "whoa, I'm selling out too many of my precious names; I should stick to 3..4K" without really taking all into account and realizing: Your scarcity mindset might work against you right now. You're killing your results by now allowing the most important factor at play to work for you - sales ratio, the most important factor.

    9) At this point, let me clarify for a bit what my overall sales goals are. This might be useful to you depending on where you stand in the domainers' rainbow of colors, as domainers are indeed different. You can position like this, or the complete opposite.

    My goal is to make the most $ I can today, while preserving the future as well and working for a retirement portfolio (end goal). The end goal of any business owner is the exit. Or it should be.

    Since I have a lot of volume (= many names, lots to buy from) and there are far more domains out there than I can ever buy and hold (and mange) today, I tend to price to sell effectively right now. I'm interested in what I can sell today, not to renew for a decade of hopes. I also use a good part of it to reinvest in more better names. This keeps the pile ever growing.

    This is why I rarely report 2.5 or 3k sales for example. I tend to avoid these to some degree. Of course I can sell many of my names for 3K and more and sold such; but I prefer to price more aggressively because the sales ratio goes up way faster. Therefore overall I get more cash if I price a bit lower.

    I've seen a few domainers using efficient pricing like that but they don't report much. Yes it's not so pretty when reported on NP as a 3K-4K sale or more; but it's keeping the bank account full and I'm happy with that. I don't care about anyone's impression of it. I care about my bottom line.

    But if you have limited source of names or find that increasingly difficult to buy some today, then you should probably not do this. Focus on keeping high prices instead on your limited portfolio, as to not dwindle your portfolio too fast. I personally don't have that problem.


    10) $1750 / $1788

    I don't currently use this price as I found it quite ineffective. It's a bit too close to 2K. I've seen other domainers mentioning that they use $1750 as a hard limit as getting above that really turns down the sales ratio. I didn't have much success with it either.

    If you've been reading all I've said above, I think you know why.

    $1988 or $1950 is the same $2k for the buyer. $1850? Bad price. You'd better price at $2050 or $2088 instead. It's more straightforward, and it also brings extra $ - for no ratio impact.


    11) $1950 / $1988

    Again by now you should know to steer away from these two already. Either price higher, or lower. You're too close to 2K so you're losing money.

    12) 2088 and 2288 - valid price points

    I don't price in these two points anymore, but I consider them valid. Decided to limit my pricing steps and these two went out on the window.

    The reason is, I found out that I better stretch the numbers up to $2488 which offers me best results. The difference isn't that high for the buyer, but definitely counts in the bank. Also if the buyer wants to negotiate, this offers me some room for negotiation. This might often be a buyer who has to choose between a 3K domain and mine. I bet they choose the $2488.

    13) $2488 - my second best friend

    $2488 is my second best friend, after $1488. It's a great price point and I've had good results with it. It's not 3K, yet it brings almost 3K, or in the nearby zone.

    And in a market where everyone tends to retail price at 3... 4K, this is aggressive discount pricing. I get the chance to win that buyer and sale among all other $2950 or $2988 out there in the same listing. I sell more, and faster.

    14) $3088 or $3K

    This is just a standard price that everyone uses.

    You can always also use it yourself for any names befitting. If that's their retail value and you're willing to wait for that retail sale, don't hesitate, go ahead and use it. I use it too although not for everything.My advice would again be to go for the 88.

    15) Final pricing tip, most important:

    Always price for your buyer's mind. Not for yours.

    The biggest error I see around, apart from regging terrible domains, is domain overpricing. I'm seeing this way too often. I also do it at times and then find myself having done it again (when FOMO kicks in).

    In fact I tend NOT to report all sales and keep some out, because I've seen people jumping in, and telling me I've sold for cheap. Then long discussion ensues and it's tiring to do that all the time.

    Well guess what, I really know that. It's my price choice in most cases, not a mistake. Yet there are precise reasons behind each price and I'm not guess-pricing. I'm pricing to earn most. Or to trim my portfolio as I'm getting better names now. My prices are affordable, have said this already, not high but also not dirt cheap. You can follow my style or use yours. It's your decision.

    I set my prices where the market makes more money for me, not where anyone else says the price is right. And you should also do this.

    That's my measure of things here - the buyer. And the market usually sets prices lower than where we expect them to be.

    But of course occasionally I do make mistakes though like any of us. When I underprice by accident, I don't stick to a negative feeling. Buyer just got a sweet deal and I got money to buy 50 more names like that. Everybody wins.

    Now recently I have formed a habit. Can't say I always follow it but I strive to. Might help you.

    Whenever I'm pricing something, step 1) I think: "How much is this domain worth?" ( And let's say I decide that the correct retail price is 2k.)

    Then I ask the more important question, step 2): "What would the intended buyer think this domain is worth, in such way that they would be ready to buy it on spot?" (Maybe 1.5k. Or another price. Anyway.)

    Guess which of these two is the price you should be using...?

    Yes - you can hold on to pricing and never discount. Yes you can price full retail and not like me. Yes this is a valid approach. Yes if you only hold 20 domains, this part my advice doesn't apply to you.

    But in most cases, average domains of average domainers aren't 5-fig material. They have lots of names, sometimes many hand regs, bad drops etc; and they keep them at crazy prices for the sole satisfaction of the registrars, the only winners in such a game.

    The bulk of the domain market is rolling within this most important range described in this post. And in this range, price always matters. A lot.

    If you want to do this like a profitable business, you have to always follow the market, your buyers. And to test quite a lot. Increasing sale ratio usually beats increasing prices, in the $300-$3K range.

    Correct pricing matters. Everything matters; each tiny detail you get straightened can bring you thousands more in the pocket over the year.

    The customer is always right. Especially when they reach for their wallet. So that's the AHA! moment.

    Fortunately, in domaining, once they paid... everything is set and there's no turning back. But you have to get them there, and fast if possible. And not let them think too much or have reasons to go back and forth.

    Happy selling! And feel free to comment below.
     
    Last edited: Sep 14, 2021
    The views expressed on this page by users and staff are their own, not those of NamePros.
  2. Dude called Michael

    Dude called Michael Just one more...

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    What a great and detailed post, thank you @twiki . I can confirm what you said about XX88 endings, it truly works. Wanna highlight the fact that the 'dark zone' applies mostly to .com . Others like .net and .co do sell pretty well in that range, at least they do for me. Looking forward to your next entry!
     
  3. twiki

    twiki Top Contributor VIP Gold Account

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    Forgot to mention that indeed my portfolio is focused on .com, or at least my best part of it. Thanks for mentioning this! Yes you are right, ngTLDS differ in this gap zone.
     
  4. khalidamir

    khalidamir Established Member

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    What about the sale ratio between 1488 and 1088, did you notice any significant difference?
     
  5. twiki

    twiki Top Contributor VIP Gold Account

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    Not really. These two are quite different, I mean i use different domains for each. I didn't find downpricing from 1488 to 1088 to be that effective. So I simply decide carefully which goes where.

    ( Edit: Obviously 3K to 1.5K is a completely different story and a large difference. But here you're still in the 1k+ zone... and I've sensed buyers mostly feeling 1488 > 1088 as the domain being not so valuable. So I keep my less valuables at $1088 and everything worth around 1.5k will not be discounted that much cause this is a high volume point anyway, works better than 1088. )
     
    Last edited: Sep 14, 2021
  6. VadimK Iberica

    VadimK Iberica Established Member

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    What's up with $988, why specifically you don't like it? Sounds like a good alternative to $999, no?
     
  7. olcayto

    olcayto NameFree.net

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    @twiki thank you so much for this thread, this is a great tool for domainers to pay attention. All the details are golden for whom be able to understand.

    Stay well,
    Olcayto
     
    Last edited: Sep 15, 2021
  8. twiki

    twiki Top Contributor VIP Gold Account

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    988 is not the issue. Yes I believe it would be better than 999.

    But. The problem is that instead of pricing like this, you better price at 1050 or 1088.

    I had terrible results with 9xx and 19xx pricing. Zero sales, basically. Once changed to 10xx they sold fine. And reported sales also seem to indicate low results for such pricing. So it's basically not in your favor to price like that.

    One might think it makes the domain more desirable as it appears to be lower in price. For 9xx an 19xx, with domains, I found this not to be functioning - at all.

    Edit: Of course there are others who sell at this price range, and some will. I just don't recommend 9xx as all my tests with this range went bad. 1088 is likely the best way to go, at least for .coms.

    For ngTLDs however, as @Dude called Michael mentioned above, it appears that 800-9xx range is valid and might pay better than 10xx; so it still depends a bit on the TLD. I'm primarily a .com domainer.
     
    Last edited: Sep 15, 2021
  9. VadimK Iberica

    VadimK Iberica Established Member

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    Got you, thanks for the explanation!
    Interesting, I will definitely try out your ''number'' system, let's see how it goes!
     
  10. twiki

    twiki Top Contributor VIP Gold Account

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    Good luck!
     
  11. twiki

    twiki Top Contributor VIP Gold Account

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    May I also recommend this,

    When doing such a test, make a split test. Half your selected names at say 988, and other half of that price category at 1088. And let them sit for a longer while.

    The difference in price isn't high but you should notice the difference in sales per each price.
     
    Last edited: Sep 15, 2021
  12. VadimK Iberica

    VadimK Iberica Established Member

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    That's exactly what I did already yesterday when read the post and asked the question. (y)(y)
     
  13. Ostrados

    Ostrados EpicName.com VIP ★★★★★★★★★★

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    Nice! Thanks for this great thread @twiki

    I've had decent number of $500 sales but strangely non of them was BIN all were counter offers. Maybe that confirms that 499 doesnt work well for BIN prices (impulse buying), buyers looking in this price range are usually looking for a cheap domain for personal website or side project and so 499 seems expensive compared with many domains available below 300. On the other hand small business owners may feel that domains priced in this range are low quality domains and thus prefer to buy 1k domains instead.

    It is all about the end use of the domain, and you are right about price sensitivity between different buyers groups (person, small business, company..etc) for each group different price range is more effective.

    Domain quality and value in first place is heavily correlated with potential end use, and so I price my domains accordingly, for example I price domains that will be used by bloggers below $1k and domains that will be used by small businesses at $1k-$2k range... and so on.
     
    Last edited: Sep 15, 2021
  14. iPoorna

    iPoorna New Member

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    Thanks for the contribution, really helps. May I ask, did you do any outbounding with your names? the .orgs?
     
  15. twiki

    twiki Top Contributor VIP Gold Account

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    Not at all. I only use inbound. Listed on Afternic and that was all.
     
  16. playlife

    playlife Established Member

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    Thanks for sharing. In your experience, do you think the improvement in sell thru rate will increase revenue even if you drop the price from $1488 to $788 or from $788 to $299? Even though domain price drops by about 50% but if sell thru rate can increase by 3 to 5 times then it's worth it.
     
  17. phaethon

    phaethon Established Member

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    Thanks, Twiki. Great thread. I was thinking that some registrars get comission for names listed on Afternic. That means a domain that is listed at 788 on Afternic, might end up cost over 1000 on the premium network. If the end users filter out names over 1000 dollars that belong to the Afternic Premium network, which Afternic xxx pricing would be safe to stay under 1000 based on your experience?
     
  18. davidc1

    davidc1 Top Contributor VIP ★★★★★★★★★★

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    Make offer is the way...
    But replace afternic by godaddy auctions + sedo for the make offer game.
     
    Last edited: Oct 6, 2021

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