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.

 

[namewaiter]

Hi all

Now, does this mean that methods recommended for selecting domain names are a bit wide of the mark or am I missing something here?

reseller's who want to buy names at discounted rates rely on this valuation method.

 

[markfromslo]

Here's a list of a few names that I have sold for between $1,000 and $10,000. It may provide an idea of what sells. I don't want to put the actual sale prices down, but they go from high to low.

I don't think any could be valued based upon OVT, and none had traffic to speak of.

Roommates.us
EasyFinancing.com
LifeExtensionRX.com
SolarToday.com
VirtualJury.com
Buzzster.com
SolarBuyer.com
BadSpace.com
Zoobie.com
FreeVirtualServer.com
QuikNotes.com
Tofu.cc
AirPollution.info

 

[cache]

so what kind of buyers were they? end users?

Here's a list of a few names that I have sold for between $1,000 and $10,000. It may provide an idea of what sells. I don't want to put the actual sale prices down, but they go from high to low.

I don't think any could be valued based upon OVT, and none had traffic to speak of.

Roommates.us
EasyFinancing.com
LifeExtensionRX.com
SolarToday.com
VirtualJury.com
Buzzster.com
SolarBuyer.com
BadSpace.com
Zoobie.com
FreeVirtualServer.com
QuikNotes.com
Tofu.cc
AirPollution.info

 

[markfromslo]

so what kind of buyers were they? end users?

I know SolarToday.com, Roommates.us and LifeExtenstionRx.com were end users for sure. I don't know about the rest.

 

[-Adam-]

Nice sale on Roommates.us btw I think you got a great price for it.

 

[Dutch]

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

Yes, patience is needed, and I think you have to have a genuine gut feeling about the potential of the names you buy (and renew) in order to survive this game.

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?

Will PM you the name. I'd rather not go into specifics about my approach to choosing names, since competition is already fierce enough and I still have a lot more registering to do!

But in general terms you already answered the question yourself: be creative.

...still it is this challenge which is most interesting if you have a love for language.

Totally with you there, floatingworld

 

[goodkarmaco]

The domains at the Dnj reports very well may be super names, but think about this.. millions of names are buried in the auction houses and are never seen. Just so many names. Its a lucky few who get a offer.

You or I may have names that are just as good or better than many seen sold in the Dnj reports, but we still have the names.

For instnace the live auction coming up will see many names sell for huge prices.

Some of the names that do sell for a high price may have been offered for sale for years by the domain owner, but they really never got seen, not enough end users coming in to the auction houses to do a search and make a bid.

So some who have had names offered will recieve a lot of money just because they were lucky enough to have the name included in the auction.

There is something about a live auction that brings out the competitive nature in investors. Plus when many are looking at the same item offered for sale a " I have more power than you" person with more money ends up buying the name.

In some instances the domain owner who is scratching his head because he had the name for sale for years in Sedo and Afternic and maybe a couple other auction houses is all too happy now and thinks he is on a roll.

The fact is he may have a great name, but there are millions of great names around. He is one of a very few who "cashed in".

Thats what we are all wanting, a great sale.

 

[markfromslo]

The domains at the Dnj reports very well may be super names, but think about this.. millions of names are buried in the auction houses and are never seen. Just so many names. Its a lucky few who get a offer.

You or I may have names that are just as good or better than many seen sold in the Dnj reports, but we still have the names.

For instnace the live auction coming up will see many names sell for huge prices.

Some of the names that do sell for a high price may have been offered for sale for years by the domain owner, but they really never got seen, not enough end users coming in to the auction houses to do a search and make a bid.

So some who have had names offered will recieve a lot of money just because they were lucky enough to have the name included in the auction.

There is something about a live auction that brings out the competitive nature in investors. Plus when many are looking at the same item offered for sale a " I have more power than you" person with more money ends up buying the name.

In some instances the domain owner who is scratching his head because he had the name for sale for years in Sedo and Afternic and maybe a couple other auction houses is all too happy now and thinks he is on a roll.

The fact is he may have a great name, but there are millions of great names around. He is one of a very few who "cashed in".

Thats what we are all wanting, a great sale.

I agree with the auction mentality and wrote an article about it once (Name Drop Auctions Going Bonkers). I rarely win a domain at Snapnames anymore because I preset a price I think the name is worth and pretty much stick to it. The egos of the others force the name to be overbid and I get out. Now, I often pick up a name for $60 with no other bidders on snapnames because I'm the only one with either the foresight (or stupidity) to buy it. Much of it is intuition, and knowledge of near future trends. I think hard times will be coming for many of those "big name buyers". It reminds me of the real estate bust that we are just getting into now (and most think we are at the bottom already). When there is too much consensus of optimism, there's trouble ahead.

But you certainly do not have to pay the huge dollars to make big bucks. My average selling price is something like 17X what I paid for the name and the hold time is not that long. Now, these are not million dollars names, but I've got other business to make those levels of dollars. This is just for fun (well, it used to be more fun). But I don have name that I belvie I will get in the high xx,xxx or low xxx,xxx within a few years that I did not pay more than a few hundred to a few thousand for.

So, to summarize, you need experience (my first names were crap!), knoweldge of keywords/world events/trends/the future (in order words, well read), and just plain intuition, which I think you are either born with or not.

And to directly answer the "Are we wrong?" question on valuation--I think 98% of names are overpriced for their value and about 99% of names are over paid for when the big players get involved on snapnames. I have the money to beat them, but I'm not that stupid.

 

[kaz2]

And to directly answer the "Are we wrong?" question on valuation--I think 98% of names are overpriced for their value and about 99% of names are over paid for when the big players get involved on snapnames. I have the money to beat them, but I'm not that stupid.

Great reply slobizman; I believe that alot of it is about having a good name and being in the right place at the right time. The keyword is patience.

Regarding the auctions on Snapnames, how do you get into those as a seller? I have not been able to find a way of registering with them as a seller so how do they obtain their names for auction?

Regards, kaz2

The domains at the Dnj reports very well may be super names, but think about this.. millions of names are buried in the auction houses and are never seen. Just so many names. Its a lucky few who get a offer.

This is the daunting part of it - sometimes I have a look at the names for sale at Sedo and I am quite surprised that some domain names do not get any offers at all. When there are 5,000,000 names up for sale how do you get yours to stand out?

Some of the names that do sell for a high price may have been offered for sale for years by the domain owner, but they really never got seen, not enough end users coming in to the auction houses to do a search and make a bid.

By auction houses I take it you mean operations like Snapnames etc. How do they obtain the names to sell because I have not been able to figure out how to register as a seller with them?

 

[markfromslo]

Great reply slobizman; I believe that alot of it is about having a good name and being in the right place at the right time. The keyword is patience.

Regarding the auctions on Snapnames, how do you get into those as a seller? I have not been able to find a way of registering with them as a seller so how do they obtain their names for auction?

Regards, kaz2

You cannot get in as a seller. They catch the names when they drop through scores of registrars they work with that all run powerful scripts the microsecond the name us up for grabs.

I've often thought that if some of my names that receive bids on Sedo or Afternic, or no bids for some time, were on snapnames, they would sell for a high price there quickly due to the egos there having to beat each other.

Someone else asked how do you get your name to stand out at Sedo with 5,000,000 names for sale. That's easy to answer. Get good names. Ones that companies would be looking for. Ones that don't have many other alternatives.

99% of names registered are pure crap. With all due respect to many of the people on this forum, I have to laugh when I read the "names available" or "just expired" or "domain appraisals" threads and people slap each other on the back with "nice list of names, etc." on names that will NEVER sell. Crap. Lot's of crappy names.

I don't feel bad saying this because I've bought my share of crappy names too. I've been doing this for about 18 months now. In that first six to 12 months or so, I didn't know what the hell I was doing. I have 4300 names now. When renewals come up, and I batch renew once a month I look at the names and just shake my head sometimes. I'm letting expire about 20% of the names, I'd say. About half of what is left I know I'm simply taking a flyer on and may never sell; I've give them another year or two. The rest I think I'll sell within a few years. But I work hard to hunt, think, read, and use various tools on the web that I don't think everyone knows about to get some good names. I've really slowed down the pace now waiting for the really good ones. Patience.

By the way, another important aspect not many people talk about in both selling and buying is negotiation skills. Extremely important. That's why I like to buy direct form people so I can converse with them.

 

[cybertonic]

Brandable names versus Generic names:

If you want to create a new service/business then probably it makes sense to buy a brandable name.
This way you get your own identity.
Now if you looking for additional names to help your businness then generic ones are probably the only ones that makes sense.

The problem I see with brandable names is at the inverse of generic domains they are based in personnal appreciation.
I can find this name great while you can find it uggly.
This problem does not exist with generic domains, when a domain in a specific niche is based in a popular term then most agree the domain has a good value.


Domain buyer point of view:
Buy unregistered brandable domains is not very difficult...
So when is time to take a buying decision:
You have in your hand x unregistered brandable domains options and few ones already registered that cost really much money.
Statistically the chance you select a domain from the second pool is very low.

In a seller point of view:
Because you a selling brandable names then the chance you own the name a buyer has in his great domain ideas list is low.
When a buyer contact you probably he will be the only one to contact you about this name.
So you have 2 solutions, ask a crazy price and certainly lost most of your sale chances for this name.
Or propose a reasonable price to maximize your sale chances.

This is why I think that yes there is a market for "brandable names" but these names are longer to be sold and the average sale price is generally low.


...

 

[kaz2]

You cannot get in as a seller. They catch the names when they drop through scores of registrars they work with that all run powerful scripts the microsecond the name us up for grabs.

In other words they (Snapnames) are the sellers of the names? Is this approach ethical; by this I mean, are they obtaining names from legitimate businesses who had no intention of selling - I mean when you look at some of the great names they sell you have to ask "who would be mad enough to let a great name like that lapse?"

99% of names registered are pure crap. With all due respect to many of the people on this forum, I have to laugh when I read the "names available" or "just expired" or "domain appraisals" threads and people slap each other on the back with "nice list of names, etc." on names that will NEVER sell. Crap. Lot's of crappy names.

You're right slobizman, some names are really bad! I have registered my share of stinkers but my excuse is that I've been doing this for about 6 weeks or so. I already know that I will not be renewing a few. Lately I have begun to analyse potential names a bit more critically and have passed up on several that I just KNOW I would have registered 4 weeks ago!

 

[markfromslo]

In other words they (Snapnames) are the sellers of the names? Is this approach ethical; by this I mean, are they obtaining names from legitimate businesses who had no intention of selling - I mean when you look at some of the great names they sell you have to ask "who would be mad enough to let a great name like that lapse?"
You're right slobizman, some names are really bad! I have registered my share of stinkers but my excuse is that I've been doing this for about 6 weeks or so. I already know that I will not be renewing a few. Lately I have begun to analyse potential names a bit more critically and have passed up on several that I just KNOW I would have registered 4 weeks ago!

It is legitimate, although it's unfair to all of us. But, that's just the waythe world works. Snapnames.com, Pool.com, enom.com, Cowdrops.com, et al....they all do it.

Yes, take much time thinking about the names before buying when you are new. I think the most important thing to ask yourself is, "who would want buy this name?" If there are many businesses or commercial ventures that could make use of the name, then that's one green light. But if the name is simply cool, then you might want to pass. For example, a name I just saw today that I would have bought when I started is LooneyWorld.com. I just like it and this it would make a cool website. But how many people are out there that really could use the name, and be willing to pay for it? They could come up with similar names that would work since neither of the words are critical keywords. I used to buy a lot of names like that (and a few did sell), but the odds are against me now and with so many names bad odds get expensive.

 

[Volholic]

Slobiz
You inspired me to reg a name that I found that had dropped
It is something that I did not know actually existed until I googled it----It is not readily available at the moment but might be in the near future.

solarbarbecue.com

Thanks man

 

[kaz2]

But if the name is simply cool, then you might want to pass. For example, a name I just saw today that I would have bought when I started is LooneyWorld.com. I just like it and this it would make a cool website. But how many people are out there that really could use the name, and be willing to pay for it?

You're dead right slobizman - that is the sort of name that I registered in my initial flush of enthusiasm; brandable but with a limited market so the odds of finding buyers are slim. In fact, you probably have to wait for the m to find you!

Now I am going to focus on generic terms / keywords that have wide use and focus on .com's, .net's and .info's.

Just how marketable are good generic .biz domain names - I ask as they don't seem to sell well.

I have located many good generic .us names but, as I don't live in the USA, cannot register them - it is very frustrating as I think that the .us TLD will come to rival .com at least in America. is there any way of purchasing .us domains if you are located in England?

 

[markfromslo]

You're dead right slobizman - that is the sort of name that I registered in my initial flush of enthusiasm; brandable but with a limited market so the odds of finding buyers are slim. In fact, you probably have to wait for the m to find you!

Now I am going to focus on generic terms / keywords that have wide use and focus on .com's, .net's and .info's.

Just how marketable are good generic .biz domain names - I ask as they don't seem to sell well.

I have located many good generic .us names but, as I don't live in the USA, cannot register them - it is very frustrating as I think that the .us TLD will come to rival .com at least in America. is there any way of purchasing .us domains if you are located in England?

I like the info's and you can get them for $2 at the moment at Godaddy. I saw a nice info at Snapnames for $60 minimum today and thought I'd check a few other variations of it. Bought three better ones there for $6 instead of $60 (or more). Robotics stuff--the lemmings aren't looking for these as much as other high OVT because they want to sell names NOW. I can wait a few years for names I buy for reg fee.

I have a few .us's too. My highest selling name was a .us name. But just as with .info, a .us name has to "fit" the tld.

I am surprised that .biz has not done better. It's universally understood, commericial, and can be reg'd by anyone. But, they just for some reason have not taken off.

 

[kaz2]

I have a few .us's too. My highest selling name was a .us name. But just as with .info, a .us name has to "fit" the tld.

Hi, I agree with you about the .biz; it should have been a natural for everyone - perhaps it will take off in the future so maybe now is the time to speculate?

What exactly do you mean when you say the .us name should "fit" the TLD?

Thanks.

 

[markfromslo]

Hi, I agree with you about the .biz; it should have been a natural for everyone - perhaps it will take off in the future so maybe now is the time to speculate?

What exactly do you mean when you say the .us name should "fit" the TLD?

Thanks.

For example, I would not care much for SoftwareDownloads.us, considering downloading is international. Doesn't make sense. Or SearchLessons.us, since it's the same anywhere. And obviously, you would not by something like Firenze.us.

On the other hand, when I sold Roommates.us it made since since it was regional, and I own some [city name].us names. Or An AutoTrader.us would work too (TM aside) since people are usually going to buy within their own country. Constituion.us would be good. etc, etc, etc.

 

[kaz2]

For example, I would not care much for SoftwareDownloads.us, considering downloading is international. Doesn't make sense. Or SearchLessons.us, since it's the same anywhere. And obviously, you would not by something like Firenze.us.

On the other hand, when I sold Roommates.us it made since since it was regional, and I own some [city name].us names. Or An AutoTrader.us would work too (TM aside) since people are usually going to buy within their own country. Constituion.us would be good. etc, etc, etc.

I see exactly where you're coming from slobizman. It makes sense to do it this way as the .us tld is country specific. Do you think that this could be one reason why the .biz extension hasn't taken off? Could it be that it is seen as the poorer cousin of the .com which is viewed as an international tld for business? As a result it has been ignored. It is amazing how many times I have looked up a name and found all the usual tld suspects EXCEPT .biz taken!

I can honestly say that I've learnt more from starting this thread than I have in weeks or reading etc. I'm grateful for domainers like you taking time out to answer queries and improve the knowledge of newbies.

 

[markfromslo]

I see exactly where you're coming from slobizman. It makes sense to do it this way as the .us tld is country specific. Do you think that this could be one reason why the .biz extension hasn't taken off? Could it be that it is seen as the poorer cousin of the .com which is viewed as an international tld for business? As a result it has been ignored. It is amazing how many times I have looked up a name and found all the usual tld suspects EXCEPT .biz taken!

I can honestly say that I've learnt more from starting this thread than I have in weeks or reading etc. I'm grateful for domainers like you taking time out to answer queries and improve the knowledge of newbies.

I really don't have an answer to the .biz valuation.

Happy to help.