question Accept the lowball offer or work harder?

[Candace]

You purchased a domain name on the drop. You've reached out to a few end users but haven't gotten to your entire list of possible end users just yet.

You've gotten a positive response from one end user after holding the domain for about two weeks.

He gives you a low ball 'final' offer. (like $500 on a domain that is worth about $3000 according to the wholesale comparables)

Would you
1. Accept the lowball offer because your ROI would still be awesome and it would be one of your first couple sales

2. Reach out to more end users (after all you've only had the name for two weeks, and you've not contacted all the possible end users just yet)

 

[Nerevar]

Something that I do not understand is "wholesale comparables". Probably you mean retail comparables. If a domain can be "instantly" sold wholesale for $3,000 then the owner would be stupid to accept anything lower. On the other hand, it is quite OK to sell a domain for $500 if it is a handreg, closeout or cheaper dropcatch.

 

[Candace]

Okay. Maybe I'm using the wrong terms. The best comparable sold on afternic for $3000 within the last few years.

I guess I meant that it was a sale on the Aftermarket so I called it a "wholesale sale" vs a sale to an enduser, which I'm calling a 'retail sale'.

 

[Nerevar]

Afternic is generally an end-user market. It will usually fetch better prices than door-to-door email marketing. This is because when you actively market your product, it becomes obvious that you want to sell, and the price tends to be lower.

 

[garptrader]

The decision depends on several factors:

1) the domain - Is this domain really one which could expect a $XXXX offer at some point in the next few years? If so, then selling at a pricepoint well below that may not make sense. However, just because some name sold at Afternic a few years ago with a similar keyword does not mean you are easily going to be able to sell a domain with that keyword for $XXXX. $XXXX sales are not as common as you might think.

2) How easily can you replace this domain with one of comparable quality from the proceeds of this sale? If you find it easy to find expiring names of this caliber for backorder, then sell. On the other hand, if you are likely to have to pay $1500 to find another name like this, then selling far below that may not be in your best interest.

3) How much effort have you put into marketing this name? If you have a $500 offer with just a few contacts, then quickly expand your search and see if you can get one or two additional offers. Then you have competing end users for the same name - an ideal scenario.

4) How badly do you need the cash?

5) How often have you received offers like this? When you have turned them down, do you look back later regretting that decision (as a newbie I once negotiated a low $XXX offer for a .Net up to high $XXX but wanted to get the sale on DNJ so I pushed higher. They found another name and last year I finally dropped that name after paying renewals for years.) Or do you have experience turning down $500 offers and later receiving $XXXX offers? You will never make a $50k sale if you accept a $100 offer but if you get greedy oftentimes you may never receive a comparable offer again.

 

[Candace]

well said garptrader. Thanks for the advice.

I know one name does not indicate how much my name will sell for. I'm talking about studying similar sales. And I also know that the multiple similar sales do not necessarily indicate how much mine can sell for, but I do use the comparables to help me determine my price point.

 

[GoKaizen]

The decision depends on several factors:

1) the domain - Is this domain really one which could expect a $XXXX offer at some point in the next few years? If so, then selling at a pricepoint well below that may not make sense. However, just because some name sold at Afternic a few years ago with a similar keyword does not mean you are easily going to be able to sell a domain with that keyword for $XXXX. $XXXX sales are not as common as you might think.

2) How easily can you replace this domain with one of comparable quality from the proceeds of this sale? If you find it easy to find expiring names of this caliber for backorder, then sell. On the other hand, if you are likely to have to pay $1500 to find another name like this, then selling far below that may not be in your best interest.

3) How much effort have you put into marketing this name? If you have a $500 offer with just a few contacts, then quickly expand your search and see if you can get one or two additional offers. Then you have competing end users for the same name - an ideal scenario.

4) How badly do you need the cash?

5) How often have you received offers like this? When you have turned them down, do you look back later regretting that decision (as a newbie I once negotiated a low $XXX offer for a .Net up to high $XXX but wanted to get the sale on DNJ so I pushed higher. They found another name and last year I finally dropped that name after paying renewals for years.) Or do you have experience turning down $500 offers and later receiving $XXXX offers? You will never make a $50k sale if you accept a $100 offer but if you get greedy oftentimes you may never receive a comparable offer again.

Great advice.

 

[Kate]

Ponder this: the first offer received is often the last you'll ever get.

IMO, if you contact end users, you should already have a price in mind and quote a BIN, while at the same time leaving end users the option to make a lower offer, that you will consider.

 

[johname]

Knowing domains and domainers, $500 probably a good offer.

Looks like you chose the buy on drop, sell before the paint is dry, business model.

When you cold call email people you are begging them to do business with you.

Those comparables might not be so compareable. (sorry but seen too many domainer's comparibles) SmartBomb Smartphone SmartCow (exaggerated but gets the point across) type of things.

Those comparables also might have sat on a sales platform for years with the other business model of "give me $3k or hit the highway"

So bottom line is Probably a good offer, If you are just starting out it would be dumb to lose this deal. Good Luck

 

[Candace]

Thanks @Kate . A price was quoted for the end-user when he asked for one. The end user is a well known multi million dollar company, but the counter was $500. Any insights from that point of view? Perhaps they would like to have it but it isn't a must-have for them. Perhaps they are looking to negotiate? Do you have experience with this?

@johname, I am assuming you mean well, but it may be better to just give neutral advice vs making assumptions and then giving advice based on your assumptions

 

[Jeevle]

Thanks @Kate . A price was quoted for the end-user when he asked for one. The end user is a well known multi million dollar company, but the counter was $500. Any insights from that point of view? Perhaps they would like to have it but it isn't a must-have for them. Perhaps they are looking to negotiate? Do you have experience with this?

I might be wrong here, but are you assuming that because they are a multi-million dollar company that they will automatically pay more? A big company might have a budget to buy lots of domain, maybe just to keep them out of the hands of competitors. So if they bought 100 domains at $500 it would cost them $50K. If they started paying £3K for them their bill be jump to $300K. That may simply be too much for them.

But it all depends on their strategy, how much they need the name, etc. If they buy lots of these names they likely have excellent negotiating skills that us newbies would find difficult to match. Maybe they always do low-ball offers and mostly get the names. So if that works for them they stick to it.

Could be any number of reasons though, so the above is just something that came to mind.

By the way, love reading your daily sales reports at Zandibot.com. Great job.

 

[Candace]

I might be wrong here, but are you assuming that because they are a multi-million dollar company that they will automatically pay more? A big company might have a budget to buy lots of domain, maybe just to keep them out of the hands of competitors. So if they bought 100 domains at $500 it would cost them $50K. If they started paying £3K for them their bill be jump to $300K. That may simply be too much for them.

But it all depends on their strategy, how much they need the name, etc. If they buy lots of these names they likely have excellent negotiating skills that us newbies would find difficult to match. Maybe they always do low-ball offers and mostly get the names. So if that works for them they stick to it.

Could be any number of reasons though, so the above is just something that came to mind.

By the way, love reading your daily sales reports at Zandibot.com. Great job.

Hey Jeevie
Thanks for reading the Zandibot posts. I learn a lot by writing those.

What you say makes perfect, perfect sense. This was an old post when I was struggling to figure out what to do with that domain. I think I had too much hopes for it - I was too attached. But believe me I learned my lesson. I told the story of what happened here. Live and Learn!

 

[Jeevle]

Hey Jeevie
Thanks for reading the Zandibot posts. I learn a lot by writing those.

What you say makes perfect, perfect sense. This was an old post when I was struggling to figure out what to do with that domain. I think I had too much hopes for it - I was too attached. But believe me I learned my lesson. I told the story of what happened here. Live and Learn!

And I learn a lot from reading your posts.

All we can do is live and learn. Easy to get attached to things like domains.

 

[NetworkPearl]

Afternic is generally an end-user market. It will usually fetch better prices than door-to-door email marketing. This is because when you actively market your product, it becomes obvious that you want to sell, and the price tends to be lower.

By afternic do you mean GoDaddy?

 

[Nerevar]

By Afternic I mean Afternic+GoDaddy combo, because whatever you list on Afternic also appears on GoDaddy.

 

[TheName]

By Afternic I mean Afternic+GoDaddy combo, because whatever you list on Afternic also appears on GoDaddy.

Interesting thread.

Ive always listed my domains for sale at Sedo - has been kinda quiet with lots of views but no conversions.

Do you feel Afternic is the better choice for listing domains for sale?

Cheers

 

[deez007]

The decision depends on several factors:

1) the domain - Is this domain really one which could expect a $XXXX offer at some point in the next few years? If so, then selling at a pricepoint well below that may not make sense. However, just because some name sold at Afternic a few years ago with a similar keyword does not mean you are easily going to be able to sell a domain with that keyword for $XXXX. $XXXX sales are not as common as you might think.

2) How easily can you replace this domain with one of comparable quality from the proceeds of this sale? If you find it easy to find expiring names of this caliber for backorder, then sell. On the other hand, if you are likely to have to pay $1500 to find another name like this, then selling far below that may not be in your best interest.

3) How much effort have you put into marketing this name? If you have a $500 offer with just a few contacts, then quickly expand your search and see if you can get one or two additional offers. Then you have competing end users for the same name - an ideal scenario.

4) How badly do you need the cash?

5) How often have you received offers like this? When you have turned them down, do you look back later regretting that decision (as a newbie I once negotiated a low $XXX offer for a .Net up to high $XXX but wanted to get the sale on DNJ so I pushed higher. They found another name and last year I finally dropped that name after paying renewals for years.) Or do you have experience turning down $500 offers and later receiving $XXXX offers? You will never make a $50k sale if you accept a $100 offer but if you get greedy oftentimes you may never receive a comparable offer again.

Solid Advice there mate! Well said.....

 

[biggie]

when looking at the "comparable/comparables" that you compared it to, did you also "know" if the seller/sellers "waited" for that sale or sent out solicitations to unsuspecting people?

as that is the "unknown" within the premises, that end up making the fallacy.

Good Luck!


imo....

 

[Nerevar]

Interesting thread.

Ive always listed my domains for sale at Sedo - has been kinda quiet with lots of views but no conversions.

Do you feel Afternic is the better choice for listing domains for sale?

Cheers

That depends on many factors. In my opinion: for domains that are likely to be searched by industry professionals and corporations, with taget price or $3000 or more, Sedo may work better. For domains that are likely to be searched by startups, with target price between $1000 and $3000, both Sedo and Afternic could work. But when our target users are very small businesses and private individuals, with the expected sale price less than $1000, Afternic(+GoDaddy) is the way to go. Especially, BIN sales under $500 work very well there.

 

[Apprich]

You purchased a domain name on the drop. You've reached out to a few end users but haven't gotten to your entire list of possible end users just yet.

You've gotten a positive response from one end user after holding the domain for about two weeks.

He gives you a low ball 'final' offer. (like $500 on a domain that is worth about $3000 according to the wholesale comparables)

Would you
1. Accept the lowball offer because your ROI would still be awesome and it would be one of your first couple sales

2. Reach out to more end users (after all you've only had the name for two weeks, and you've not contacted all the possible end users just yet)

Sometimes you should take low balls.. It depends on your recent sales report. If you haven't done many sales then take it. If you already have many sales that means you are financially good status then keep trying on others.