Domain valuation - Are we wrong?

[kaz2]

Hi all

From reading the threads on this forum it appears that a high valuation for a domain name is based one high overture count for keywords, numbre of google searches etc.

The problem I have is that if you look at the list of domains sold for over $10,000 in the DNJournal it appears that most of the high value domains, if typed into overture and google have neither (1) a high overture count or (2) a high google count. In fact, some of them have very little in terms of results and, worse still, NIL type-ins with the dotcom extension (this is allegedly a key factor in high value domains).

Now, does this mean that methods recommended for selecting domain names are a bit wide of the mark or am I missing something here? My feeling is that the key issue is really, above everything else, value in the eyes of the end-user and not value based on keywords, google, overture etc.

If I am, apologies, as I am still a newbie and keen to learn more.

Thanks.

 

[iodalg]

I agree with you (value in the eyes of the end-user and not value based on keywords, google, overture etc)

Its exactly that who cares on domains like thoose on DNJurnal! Because most domains that sale for high $$$ are premium domains like blue.com sex.com thoose are premium word domains that have value for the end-user! Like vodka.com thoose russian that have paid 3 million for this domain will promote their vodka products in the USA market! But what can you promote with ex 12839495lfkf.net ? Nothing, but if this domain has a plenty of backlinks then you will get traffic, and this has of course value for you (domainer) because you can make some parking revenue! The final value always is for the end-user ! Ex kkkk.net may have been apraised for 300$ but will sell for 3.000$, its the end-user that make the final decision!

If iam wrong, please apologies because iam a newbie too, i hope iam not off the topic! :hehe:

 

[zenlogo]

Your perceptions are correct. The basic value of name can be assessed in 2 ways: 1. as the potential value as a business or organization's address and/or identity. 2. traffic for type-ins. Most automatic appraisal systems are slanted to traffic value and can't assess unique identity value. And that's why you'll see big bucks going for names with low overture... they have have end-user value and traffic has no significance.

 

[-Adam-]

Beauty is in the eye of the beholder.....or whoever has the deeper pockets.

 

[kaz2]

Your perceptions are correct. The basic value of name can be assessed in 2 ways: 1. as the potential value as a business or organization's address and/or identity. 2. traffic for type-ins. Most automatic appraisal systems are slanted to traffic value and can't assess unique identity value. And that's why you'll see big bucks going for names with low overture... they have have end-user value and traffic has no significance.

I agree with you totally! I think that alot of smaller domainers who are looking to buy domain names for investment purposes will always look at keyword numbers unless they can sell on to an end-user who is looking at the name only.

The question is - should newbies look to register names that are attractive and have a potential resale value or should they focus on keyword type names?

Also, how accurate are most of these free online appraisal tools?

Beauty is in the eye of the beholder.....or whoever has the deeper pockets.

Hi Adam

Would you buy an attractive .com name that had poor overture & google numbers?

 

[Dutch]

Although type-in traffic is always great to have, of course, it is certainly not a must for a domain to sell at a high price. I have personally sold quite a few domains for $x,xxx in the past few years, and none of them received any traffic worth mentioning. I actually sold one for $15,000 about half a year ago (my best sale so far), and the domain received somewhere between 5 to 10 visits per month if I remember well. And no - this name was not used as a trademark by anyone. I think it had 4 Google search results, all links merely pointing to places where the domain was up for sale.

Since traffic-rich domains are both hard to find and (usually) very costly, I strongly believe that solid, brandable names (both generic and non-generic) with a nice sound/look/feel, are and always will be interesting to end-users (and to a lesser extent to domain investors), even if the names don't receive mentionable traffic. The traffic will come with development by the end-user

 

[kaz2]

Although type-in traffic is always great to have, of course, it is certainly not a must for a domain to sell at a high price. I have personally sold quite a few domains for $x,xxx in the past few years, and none of them received any traffic worth mentioning. I actually sold one for $15,000 about half a year ago (my best sale so far), and the domain received somewhere between 5 to 10 visits per month if I remember well. And no - this name was not used as a trademark by anyone. I think it had 4 Google search results, all links merely pointing to places where the domain was up for sale.

Since traffic-rich domains are both hard to find and (usually) very costly, I strongly believe that solid, brandable names (both generic and non-generic) with a nice sound/look/feel, are and always will be interesting to end-users (and to a lesser extent to domain investors), even if the names don't receive mentionable traffic. The traffic will come with development by the end-user

Dutch

You are precisely the sort of domainer I have been searching for. Since I got interested in this business, all I have heard is that you must buy domain names based on keyword value only after doing some overture & google research. Initially I bought into this but, as I pointed out in my post, doubts crept in when I analysed domain names selling for high values. Many of them, both beneric and non-generic, with multiple words, sold for high values without any significant overture & google numbers.

Like you Dutch I believe that most viable traffic names based on keywords have been snapped up so the next best approach is to be creative and register domains with attractive and usable terms. Selling such names might take more time as a very specific type of buyer (end-user) has to come along but, based on your own experience, this is profitable.

I am curious to know what name you sold for $15000 - are you at liberty to divulge this?

Could you also give me a brief summary of your approach to choosing names?

Thanks.

 

[wow!]

A good example for these resellers valuation is this one.
I regged a year ago 2 LLL .infos : XPC.info and a "good letters LLL"
Sure most of you will tell that the "good letters name" is worth much more.
Till now I sold xpc.info to an enduser for $1k and the other didnt sell yet .
If you want to buy and sell for reseller prices you can always play by the rules of
"traffic" "good letters" "ranking" ...

In the end of the day the story in domain business is always the enduser pocket.
The big money is there.

 

[kaz2]

A good example for these resellers valuation is this one.
I regged a year ago 2 LLL .infos : XPC.info and a "good letters LLL"
Sure most of you will tell that the "good letters name" is worth much more.
Till now I sold xpc.info to an enduser for $1k and the other didnt sell yet .
If you want to buy and sell for reseller prices you can always play by the rules of
"traffic" "good letters" "ranking" ...

In the end of the day the story in domain business is always the enduser pocket.
The big money is there.

Great example wow!. You have illustrated perfectly how a domain name value is mostly in the eye of the beholder (end-user). Another real life example is the domain name HobbyLink.net which sold for $10,000 (info on DNJournal). It has only 110,000 google searches for the phrase with NO ads at all, only 193 on overture and a KEI of 2.93. Yet it sold for $10,000!!

Now you can't say that the buyer bought this for it's traffic or type-in value can you? I think this just illustrates that keyword research is not the way forward.

 

[-Adam-]

To answer your question, if I could afford it I would buy a very attractive domain name with no history or whatsoever then develop it and market the hell out of it. However since several premiums and generics are taken creativity is the next best step.

 

[floatingworld]

...those with limited imagination will be confined to following algorithmic assessments to make their selections...there is nothing essentially wrong with this but value is largely discounted in the second-hand market. Those who are more blessed however can employ leaps of creativity and possibly strike rich but the risk is the registration of large numbers of blanks which never take off...still it is this challenge which is most interesting if you have a love for language.

 

[kaz2]

...those with limited imagination will be confined to following algorithmic assessments to make their selections...there is nothing essentially wrong with this but value is largely discounted in the second-hand market. Those who are more blessed however can employ leaps of creativity and possibly strike rich but the risk is the registration of large numbers of blanks which never take off...still it is this challenge which is most interesting if you have a love for language.

Floatingworld

You've hit the nail on the head with your assessment. If you follow the keyword tool driven route there will be alot of frustration as most good keywords have been registered. If, however, creativity and lateral thinking is employed, there is the chance that you will stumble on the golden nugget after sifting through alot of sand. Patience is the keyword in this approach!

 

[Ronald Regging]

I registered Teacreek.com a few years back for a business I was starting. It never got off the ground and the domain expired and then last year I found it available still so I registered it again. I think it's a great name. Will someone else think so too and offer to buy it from me? I hope so, hehe. I have few names of this brandable, great company name type... But obviously you need to remember to diversify your portfolio, you can have both types of names.

 

[gazzip]

I have few names of this brandable, great company name type... But obviously you need to remember to diversify your portfolio, you can have both types of names.

Very True - I tend to try and go after two types of name - Usable ones with an established market ie: PragueProperties.com.

And brandable ones that "may" be good for a new company name ie:

DomainFox.com, could be used for a domain register or domain search software with a simple tagline like " the smarter option" - to pull the words together.

Brandable is probably a more risky buy - If I can't think what it can be used for then I don't buy it.

I would also never sell or price a domain based of revenue - just look at the prices of some of the hyphen sales to see why, many of these will have very little or no traffic. End users is where the money is but it does'nt happen in a hurry wait wait wait !

Great thread topic OP

.

 

[kaz2]

Very True - I tend to try and go after two types of name - Usable ones with an established market ie: PragueProperties.com.

And brandable ones that "may" be good for a new company name ie:

DomainFox.com, could be used for a domain register or domain search software with a simple tagline like " the smarter option" - to pull the words together.

Brandable is probably a more risky buy - If I can't think what it can be used for then I don't buy it.

I would also never sell or price a domain based of revenue - just look at the prices of some of the hyphen sales to see why, many of these will have very little or no traffic. End users is where the money is but it does'nt happen in a hurry wait wait wait !

Great thread topic OP

.

Nice post. Don't get me started on hyphens! There seems to be 2 schools on thought regarding hyphens:

(1) They are bad and should be avoided AND (2) They are search engine friendly and therefore good for SEO.

My humble opinion is this:-

(1) They are bad only if you are looking to re-sell the domain name without development. In this case the end user will be asking themselves how user fiendly the name is and how memorable the name is. On this score it is probably not good to register hyphenated names for re-sale only. However, if you came across "credit-cards.com" feel free to reg it!

(2) Hyphenated names are a good thing if you are buying a name to develop or to park for type-in traffic. In this case there is a school of thought which thinks that hyphens help search engines to "read" the keywords if the phrase is longer then 2 words. So "get-me-a-cheap-card.com" would be more SEO friendly than "getmeacheapcard.com."

If you are looking to park for revenue then do not be put off by hyphens if you come across a keyword rich domain. In fact I am thinking of experimenting with a couple of hyphenated names and parking them to see what the results are.

Your thoughts on the above are much appreciated!

 

[gazzip]

Your thoughts on the above are much appreciated!

I am not an avocate of hyphen although it may seem that way to some, I could'nt help noticing more and more good hyphen sales listed at sedo so I started this thread just to monitor them a bit, mainly to get a good idea of what they "can" sell for.
http://www.namepros.com/domain-name-discussion/161100-another-reported-hyphen-domain-sale.html

Lots of different opinions on them and they usually get a slagging from domainers, each to their own but things can/do change.

I read in a sedo article one time that some countries ie: Germany, think nothing about having a hyphen in the domain - it is classed as pretty normal.

I have a few but not many, I have never sold one yet but I have a couple that make me a reasonable amount in PPC

You should have a good read of that thread if you have the time at the end of the day they are more affordable to end users.

ps - I do think more than one hyphen is usually pushing it !


a Hyphen !! who mentioned that :blink:

.

 

[kaz2]

I am not an avocate of hyphen although it may seem that ....
a Hyphen !! who mentioned that :blink:

.

Thanks gazzip, that will be useful. I definitely want to experiment with a couple of hyphen sites but only if they look like having good traffic.

How do your sites do in terms of unique views per day and how do you go about assessing what is a viable hyphenated name (without giving away your secrets!)?

Thanks.

 

[gazzip]

How do your sites do in terms of unique views per day and how do you go about assessing what is a viable hyphenated name (without giving away your secrets!)?

Thanks.

I don't have any sites developed on them but I do have one that I "may" eventually develop.

I have a few that were bought in the drops and have incoming links from previously developed websites but these are just parked earning about $2 to $10 dollars a month at most, not alot but I did'nt buy them for PPC I bought them for the strong keywords and to either develop or sell ?

I would not buy them just for parking unless they have loads of incoming links, parking pages in general do not usually do very well with the search engine rankings.


.

 

[kaz2]

I would not buy them just for parking unless they have loads of incoming links, parking pages in general do not usually do very well with the search engine rankings.


.

Thanks gazzip, what criteria do you use to select a domain name and what are your favourite analysis tools?

 

[Ronald Regging]

I dont think many hyphen domains will get natural traffic, so parking may be useless. You'd be better off developing a minisite optimized around those keywords and trying to get SE placement to bring traffic in.