discuss 3+ yrs in domaining. No 4-figures

[abstractdomainer]

I have been a part of the domaining industry for quite some time now. And this is something strange when I look at many people making a terrific amount of sales and it has been 3 years and I haven't made a four-figure sale.

While there have been tonnes of low three-figure sales and that has been my focus, there have been exactly 0 sales in the four-figures as much as I recall. I need your help in diagnosis if you will. There could be three reasons for this, I believe:

1) I do not own the right names that sell for 4-figures - So, my strategy has always been to take up some names (like 20-30), which would sell for low to mid $$$ and close them, as much as possible.

2) I do not price the names right - I dip my feet deep into .CO as well, but major sales were in mid-3-figures only, with the platform taking a chunk of it and I remained with whatever was left, in bits-and-pieces.

3) I never renew my domains (not even 1) - A third thing that I believe is going wrong with me, is not renewing the domain for another year, looking at the trade-offs. I look at domaining in a short-term perspective maybe, which is why four-figures are not coming my way. I usually think of it this way:

-- You renew a domain for say $15 which may not sell for another year or the year after that, whereas in promos, you may end up getting 7 domains for the same cost. The chances of selling 1 out of these 7 is still high for me, since the risk is diversified. And hence, it makes sense to diversify the risk

-- Another thought process I have, when I see a domainer invest $2k for a single domain name, is that how can someone be so sure that it is a good investment??

I have two questions:

1) Help me diagnose the problem in my thought process and investment strategy so that I get in that four-figure league ( I make good money from domaining but never good sales)
2) Help me understand, what gives people confidence to renew a domain or acquire something for a $2k price?

 

[nabeel1988]

you comment on many appraisal posts appraising the domain and yet you price your own domains the wrong way.. That also sums up the wrong appraisal value you give to the posts you reply to.. I have not seen you appraise most domain above XXX figures, you underappraise others domains and underprice your own domains..

 

[NewDayBrand]

sz

I have been a part of the domaining industry for quite some time now. And this is something strange when I look at many people making a terrific amount of sales and it has been 3 years and I haven't made a four-figure sale.

While there have been tonnes of low three-figure sales and that has been my focus, there have been exactly 0 sales in the four-figures as much as I recall. I need your help in diagnosis if you will. There could be three reasons for this, I believe:

1) I do not own the right names that sell for 4-figures - So, my strategy has always been to take up some names (like 20-30), which would sell for low to mid $$$ and close them, as much as possible.

2) I do not price the names right - I dip my feet deep into .CO as well, but major sales were in mid-3-figures only, with the platform taking a chunk of it and I remained with whatever was left, in bits-and-pieces.

3) I never renew my domains (not even 1) - A third thing that I believe is going wrong with me, is not renewing the domain for another year, looking at the trade-offs. I look at domaining in a short-term perspective maybe, which is why four-figures are not coming my way. I usually think of it this way:

-- You renew a domain for say $15 which may not sell for another year or the year after that, whereas in promos, you may end up getting 7 domains for the same cost. The chances of selling 1 out of these 7 is still high for me, since the risk is diversified. And hence, it makes sense to diversify the risk

-- Another thought process I have, when I see a domainer invest $2k for a single domain name, is that how can someone be so sure that it is a good investment??

I have two questions:

1) Help me diagnose the problem in my thought process and investment strategy so that I get in that four-figure league ( I make good money from domaining but never good sales)
2) Help me understand, what gives people confidence to renew a domain or acquire something for a $2k price?

Hi bro,

Here is my modest opinion.

1. You know money going in and out is a good thing.. if you will sell for example 10 names for $xxx in a short period of time and 1 name for $xxxx in a very long period, it may be better to sell the 10 names.

2. Maybe the answer to your question is that it's related to the prices proposed by other sellers on the platforms you sell on, for example SH prices are in general between $1299 minimum with a discount and $2399, the same quality of names or even less quality on BB are listed for much higher prices.
this may be the reason.

what are the platforms you were the most able to sell on this 3 years?

Regards

 

[Knup Solutions]

It is likely a combination of all those things.

1.) You won't get any 4 figure sales unless you ask 4 figure prices.

2.) You won't get consistent 4 figure sales unless you have domains that appeal to end users.

3.) By not renewing any domain you are getting rid of the time value. Even great domains can take many years to find the right buyer.

Other things that could effect this are -

• Asking prices.
• Negotiation skills.
• The extension. It is always going to be easier to sell quality .COM.
  
• Is the domain listed on popular venues? Is it easy for the potential buyer to find?
• Does the domain have a large enough pool of potential buyers?

To me the fundamental business model is likely flawed. Just taking low quality, low price domains because they are available and not renewing any has limited upside.

There are not a lot of good domains available to hand register in 2020, especially in .COM with 140M+ registered.

I generally only buy domains I am willing to renew since time value is a major part in the equation. Still, then you need to cover the expenses of all the domains that don't sell in a given year as well.

With an average sell through rate of around 1-2% you need both quality and quantity to make steady passive sales in a higher price range.

I would re-invest some of your sales into higher quality domains on the aftermarket. Then you are likely to see better results.

Brad

Well said, Brad

 

[abstractdomainer]

It is likely a combination of all those things.

1.) You won't get any 4 figure sales unless you ask 4 figure prices.

2.) You won't get consistent 4 figure sales unless you have domains that appeal to end users.

3.) By not renewing any domain you are getting rid of the time value. Even great domains can take many years to find the right buyer.

Other things that could effect this are -

• Asking prices.
• Negotiation skills.
• The extension. It is always going to be easier to sell quality .COM.
  
• Is the domain listed on popular venues? Is it easy for the potential buyer to find?
• Does the domain have a large enough pool of potential buyers?

To me the fundamental business model is likely flawed. Just taking low quality, low price domains because they are available and not renewing any has limited upside.

There are not a lot of good domains available to hand register in 2020, especially in .COM with 140M+ registered.

I generally only buy domains I am willing to renew since time value is a major part in the equation. Still, then you need to cover the expenses of all the domains that don't sell in a given year as well.

With an average sell through rate of around 1-2% you need both quality and quantity to make steady passive sales in a higher price range.

I would re-invest some of your sales into higher quality domains on the aftermarket. Then you are likely to see better results.

Brad

And my question here, how do you develop that feel for quality names?

The majority of my four-figure and all my five-figure sales have been domains I’ve owned longer than a year.

Reassures my belief into some of my domains. I'll check if they are worth renewing and then renew.

What an outstanding and comprehensive answer to an important query just given above by @bmugford.

I feel much of the pull that the OP expressed in his model (although I definitely do renew some domains, so not as extreme). That said, I see the logic in Brad's approach. And he has the record of success to prove it.

I like all of the factors that he lists as important. Especially pricing, negotiation and pool of potential buyers.

The time value argument he makes is the most tricky. Part of my mind argues, if I did not get an offer this year, will I likely have a different result if I hold it another year? I think a good mechanism to get a second opinion on what to keep, and what to fold, is perhaps among the most important ways domainers can help each other.

I realize Brad favours mainly .com, where at least renewal and registration, except for discounts, are pretty similar. With new and general country code that is often not the case, where the two values are sometimes very different. My probabilistic mind argues that a model of trying many for a year might make sense for those extensions, since the cost ratio is often of order of 15 or 25 x (not always).

One approach I find useful is to divide my domain names periodically into three buckets. One bucket, that I feel really good about possible end use, aesthetics of name, sector, etc. I place in top bucket with definite plans to renew and often do that well in advance. But I also force myself to choose a number I definitely plan to let expire barring a serious offer or sale, of course. The middle ones are the tough ones, of course.

Thanks again for great answer, Brad.

Bob

Very valid point! Exactly, domainers can help identify what to renew or let go!

 

[abstractdomainer]

If you don't renew any of your names then you are essentially only hand-registering I assume?

Without going into too much detail, it's not surprising that you haven't sold any domains in the 4 figure range when your avg cost is $5 per name with zero renewals?

Yes. $2-$5 mostly. I get the point.

 

[Jv1999]

the answer was "I never renew domain names." Shoulda led with that... can't make the higher sailz unless you wait for that incoming offer...

or if you outbound a lot.

 

[yoosuf]

I'd trust Brad's sense a lot more than mine!

I have a pretty good feel for what can sell for four figures, and I'm getting a bit of a feel for five figure names. I would say it's after three years thatI started feeling pretty confident. Probably would have happened more quickly if I had put more time in.

which aftermarket ?

 

[lock]

If you out bound your clearing names if your holding your holding.

 

[bobo4us]

How many domains do you own?

I've never owned more than 100 domains at the same time, this means my renewal bill is under £1000 a year.

I've made a four figure sale every year for 10 years apart from 1 year.

Do you go for quantity over quality perhaps? I see lots of people on here building a portfolio of 500+ hand regs, and if they were more patient and put serious work in they could have built a portfolio of 100 good domains on the aftermarket over say 18 months and then had a portfolio they can afford to keep.

Pile them high sell them cheap is not a great strategy when two renewals destroys all profit.

Carefully building a small portfolio of commercially attractive domains makes more sense.

When registering ask this question....

"Who would buy this domain?".

If you can't identify 3 very obvious end users for a domain then don't acquire it. Or at least 1 that you are very confident will want to buy.

One flaw with hand regging is that if there was an obvious immediate buyer, wouldn't they have registered it? When buying expiring domains you could be picking something up which hasn't been available for registration for 10, 15, 20 years. You find domains where there has been a buyer coveting it for years! A good example below...

I bought LondonClock.com for about $30 a couple of years ago, because there was a business called London Clock with £5m in the bank (accounts are public in the UK). They were using LondonClock1988.com or something like that. It was previously used by a different business in the USA, it was 20 years old when it dropped..

It was obvious they were going to try and buy the domain for me, sold for $3000 within a few months.

Just blindly registered domains is just gambling, and gamblers don't very often make a profit. I'm not saying that you are one of those people, although you may be?

Its really hard work finding good domains at low prices on the aftermarket, and there's a lot of competition, it requires a lot of knowledge and skill, a hell of a lot of research... but that's domaining. I've bid for about 90 domains over the past 2 weeks, I've only won 4 of them, the rest went above my budget and I'm trying to be a value investor... I'll renew the 4 I won until a buyer comes, because I'm confident in the quality, that's the level of hard work and patience required.

Hand regging speculatively isn't really domaining, its gambling.

Better off acquiring 2 good domains per month for $30-$100 a piece from the aftermarket and slowly building a quality portfolio over a few years than any number of speculative hand regs.

this is deep. i learn new things here.

 

[marijuanadomain]

Domains are like me.
I am very easy and available BUT NOT CHEAP.
I Am expensive.

 

[abstractdomainer]

If it's a GD closeout domain then it's maximum $11 plus registration fee, so about $20 total.

It takes time and patience to find them, but they're there.

Ohh nice. Let me give it a try after having developed an eye

Experience. I did not start out buying domains in that range. I worked my way there.

I think you really need to work on the buy quality, and being willing to renew the quality domains.
The upside on registering whatever and not renewing anything is very limited.

It also doesn't give you much experience in domain valuation.

Brad

Makes sense! Thanks for the advice! This time, I am gonna renew some of my names.

I have owned domains for almost twenty years and have had only two sales.

I consider myself a hobbyist and an end-user/developer.

I am trying to begin to think like a domainer.

This thread has been very useful.

Thank You All Very Much !

P.S. cheap strategy - save your pennies and wait for the next NameCheap One Cent Sale !

What do they sell for 1 cent? .xyz?

 

[otismo]

look at the list of implosions

What do they sell for 1 cent? .xyz?

look at the list of implosions

 

[topdom]

I think 4 fgures are for flippers. Regular domainers sell to flippers only most of the time and in low2-low3 figure range. For example I received several low 3fig offers, and none was good enough, but after waiting for a while , I decided to "accept all", and what do you expect buyers to do: thank for the favor? No they assume I'm desparate, and drop their offer. This can only be explained by one thing: They are not real endusers. How to locate actual endusers behind those offers: I don't know.
.............
Sometimes flipper activity can be healthy. For example someone does ooutbounding for my domain, and offers half of what actual enduser is willing to pay. And if sold (in both places)
then I would get 50 (or 40) percent of actual selling price, but maybe otherwise I wouldn't be able to sell. If instead of a flipper offer, this is an investor offer, then probably I would be offered much less, because there is a risk of not being able to sell.
....
On the other hand popular registrars like Godaddy, 1and1 can theoretically abuse their popularity and act like brokers/flippers in most cases when there is an inquiry, and this would hurt both number and volume of sales significantly, unless endusers are smart and negotiate directly with actual sellers.

 

[manpreet]

I have been a part of the domaining industry for quite some time now. And this is something strange when I look at many people making a terrific amount of sales and it has been 3 years and I haven't made a four-figure sale.

While there have been tonnes of low three-figure sales and that has been my focus, there have been exactly 0 sales in the four-figures as much as I recall. I need your help in diagnosis if you will. There could be three reasons for this, I believe:

1) I do not own the right names that sell for 4-figures - So, my strategy has always been to take up some names (like 20-30), which would sell for low to mid $$$ and close them, as much as possible.

2) I do not price the names right - I dip my feet deep into .CO as well, but major sales were in mid-3-figures only, with the platform taking a chunk of it and I remained with whatever was left, in bits-and-pieces.

3) I never renew my domains (not even 1) - A third thing that I believe is going wrong with me, is not renewing the domain for another year, looking at the trade-offs. I look at domaining in a short-term perspective maybe, which is why four-figures are not coming my way. I usually think of it this way:

-- You renew a domain for say $15 which may not sell for another year or the year after that, whereas in promos, you may end up getting 7 domains for the same cost. The chances of selling 1 out of these 7 is still high for me, since the risk is diversified. And hence, it makes sense to diversify the risk

-- Another thought process I have, when I see a domainer invest $2k for a single domain name, is that how can someone be so sure that it is a good investment??

I have two questions:

1) Help me diagnose the problem in my thought process and investment strategy so that I get in that four-figure league ( I make good money from domaining but never good sales)
2) Help me understand, what gives people confidence to renew a domain or acquire something for a $2k price?

I only find number 3 as a problem. Must renew or at least keep checking which of your dropped names got registered at once. Just my two cents.

 

[dombastic]

I just paid mid $X,XXX for a top quality single word .ORG last month

Why?

 

[AgentE13]

Don't expect someone to pay you 4 figures if you don't think your domain is worth renewal.

I think you should get more quality names instead of quantity.

You will get many more queries, and the renewal price will be much less.

Imagine having 10 good domains (10 X 15 = 150$ / year for renewal) instead of 500 hand regs or poor quality domains.

 

[Coindoji]

This all nice and dendy, the biggest obstacle and actually deal here is to determine the value of domains, you do it right, some do it wrong. I, for example, would not pay a reg fee on 95% of those domains, and you make a living off those .

So, it's all about spotting a good name or a name that at least have some potential. InsuranceGrades, FundingWhale, BotCoin.co(I would drop even .com)... I mean, congratulations on that skill, I'm just stupid not to spot values

 

[Mytz.com]

Thank you for sharing

 

[Israel Ebenezer]

Monitor the traffic on your Domains!
The domains that I pay good money for GET TRAFFIC!
Buy quality. Dump your garbage and know what qualifies as a good name.
If you get something that somebody else wants (not what You want), you will see your 4 ,5 and 6 figure sales.
Also, do not price your Domains so low.
There are too many domainers desperate for sales that price great names for a few thousand $$.
Do not do it!

If you need money so badly borrow from a friend/family or sell your body, etc.

 

[othellotech]

3) I never renew my domains (not even 1) - A third thing that I believe is going wrong with me, is not renewing the domain for another year, looking at the trade-offs. I look at domaining in a short-term perspective maybe, which is why four-figures are not coming my way. I usually think of it this way:

I can recall immediately some "interesting" sales where we'd had the domain for less than a year, and some db querying shows there have been 36 in total of 4+ figures.

One was a pair of names dropcatched (2 alternate spellings) which I felt were usable. Not initially for resale.

Contacted within days of parking it by someone who had been chasing one of them for years - in retrospect should have asked more than I did but 1k for the pair, was a quick 4000% profit

The one that still annoys me several years on was an auction win, and whilst waiting for the ability to transfer (due to "auction-lock"), the registrar took the domain out of our account and changed the nameservers on it *without even contacting us* - when queried they claimed they'd been told it was stolen.

Registrar, IP and WHOIS history and some investigation showed not only had we not done any such thing, the people we'd bought it from, had picked it up from the registrars own expired domain system as they sold rather than deleting them. Long story cut short, a previous registration of the domain had been in the name of this company claiming ownership, but that was years prior, and it had dropped, been re-registered, not-renewed again and sold on (twice) since then - so not even the "original" domain as such !

Where that could have been a simple margin-over-cost flip due to "oops we'd lost
our domain due to whatever, I see you now own a matching domain, can we buy it from you ?" conversation (which happen every now and then) due to starting with the bullcarp, once I managed to get the domain back (and then separately get them to unlock it so I could make changes to it) instead of being happy if it would get 5-ish, I started with the "you gave me agro, so now it's 25 grand" pricepoint

I used them as an example in a talk, and when doing the prep looked at the whois etc to grab some dates - it was showing a hugedomains landing page so not managed properly post acquisition !

Back on topic...

I do "prune" regularly as well as do new registrations and direct acquisitions - regular 3, 4 and 5 figure sales come from combinations of inbound enquires, own websites, custom landing pages, as well as 3rd-party platforms - been very impressed with DomainAgents who contacted me regarding a domain owned for a while that had been earmarked for a project but not started on - all done-and-dusted in 8 days from initial contact to domain paid and gone

The average age of a domain we've sold is ...

SELECT COUNT(*), SUM( TIMESTAMPDIFF (YEAR, registrationdate, expirydate) ) AS age FROM domains WHERE status="Sold";
| count(*) | age  |
+----------+------+
|      679 | 5015 |

Looks like about 8 years old on average to me

WHERE status="Sold" AND TIMESTAMPDIFF (YEAR, registrationdate, expirydate)=0;
| count(*) |
+----------+
|      107 |
+----------+

So 1/6th of sales are domains less than a year old, but the average price across all of those shows as ~315

Slightly scarier is the number in the drop table of 12281 - that's about 150k in regfees (let alone all the renewal fees) on domains that didnt sell