Drop competition has increased a lot lately, wondering why. (Also closeouts etc)

[twiki]

I have the feeling I'm missing something about what's going on here.

It is obviously normal for domain competition to increase over time. But what I am talking about, is a quite significant increase in the last 6 months or so. The same in closeouts. (And I'm not even touching the auctions subject.) Like competition has almost doubled or so.

There are days when I can't find anything at drop to secure. Good names aren't even dropping that much. DC gets many of what remains (and no, they aren't getting in auction, it's the investor partners of DC who are scooping up those mid-value names).

Pandemic did not have a significant effect on accelerating drop competition. Things have been rather linear during 2020-2021. But not anymore.

One year ago, I was expecting I'm going to replace some of my upper tier names with better ones by now.

As sales have dwindled gradually since the end of summer, I was expecting a lot of names to be released into the market, as certain domainers will have to trim their portfolios etc.

Instead, and weirdly enough, the opposite has happened. I find myself renewing a lot, and not buying. Also names that previously did make to the $5 closeouts club now are scooped up at $30-$40.

During spring 2022 I could secure some good names for some reason. Maybe the war has spooked some investors and they let them expire. Anyway. I expected this trend to continue. But in fact later the trend has reversed. The less domains are selling for retail amounts, the more you can't find them anymore.

I have also observed that discounting my names to low xxx range does not help selling them anymore.

In previous years I could sell lots of weakish names before drop for $75, $199 or $299. This is not happening anymore. (Not talking about NP... where you can't sell an everyday domain for $10 lately)

My explanation for this (just a theory):

Lots of domainers and website owners who previously were willing to drop $199 or $99 on such domains (ones I did not renew), now have low cash reserves and therefore they don't buy at that price level anymore. Instead, they have all flocked to drops and closeouts to get some others.

Side note I know my names are bought by US buyers in most cases, so it might be related to the known fact that most US citizens no longer have significant cash reserves like they had when pandemic started.

Another half of the theory is, certain domain investors who are cash afloat might not want to lose money through inflation. What could be a best way to protect your cash rather than securing some names that you can sell later for a tidy profit, once this turbulence has passed?

Anyway. What is your opinion? Hoping to get to the bottom of this, what on earth is happening exactly.

Thanks

 

[okaydomains]

Hi twiki, excellent topic. I have a couple of theories.

1) Your own tastes have improved. You're no longer interested in many dropping domains that an earlier version of you would have purchased. So there appear to be less good domains available.

2) .com renewals have increased in price, but to the extent that is causing more names to be dropped its still going to be the weakest names that are dropped. You don't notice these names anymore because your taste and your filtering software has improved substantially.

*I would also point out that carrying cost is irrelevant to premium names. Who gives a crap about $10/year when you paid $10k for the name? Also, what millionaire gives a crap about $10/year, or even $2000/year, when we're talking about owning an important asset? So I think the renewal price increase is a red herring - no one cares except for owners of cheapo names. Also vs. inflation .com prices have actually decreased.

3) GoDaddy rejiggered their pricing. Previously the top price for a closeout name was $11, now it is $50. People like me always start by looking through the most expensive closeouts because they aren't as picked over. I don't care about paying $50 vs $11 for a name - its either a quality name that I think I can sell for $2k+ or its not. Saving $40 on the buy doesn't make a crappy domain a good domain. This means names that used to sell for $11 now sell for $50.

4) As time goes on, successful domainers are building ever larger piles of cash and taking on outside investments. There is simply more capital available for domains.

5) When a premium name is purchased it leaves the market forever. That means new companies have to choose from the slightly worse names which are still available for sale, increasing the market for those 2nd tier names. In other words, companies have to accept they will never own Nest.com so they have to move on to their next choice. This creates / increases demand for e.g., Roost.com or MyNest.com. Repeat this all the way down through each tier in the market.

6) With an inefficient market featuring massive margins like this, you should expect newcomers and more sophisticated capital to enter the market quickly. That we've been largely left alone for this long by institutional capital is somewhat amazing.

7) Private wholesale markets exist now, e.g., DNWE.com. Also networks of buyers and brokers keep forming, so an increasing number of these good names are trading hands in private.

8) Most importantly, domains are more valuable than ever and their value is obviously increasing. As "software eats the world" and every business becomes global, it becomes more important than ever to have a good piece of cyber real estate for people to find you.

There was a blip in time where brands thought "oh, they'll just Google me or find us via Facebook or the app store anyway, so domains aren't that important." You had billion dollar brands spending millions advertising their Facebook.com URLs. That isn't happening anymore because it was a stupid idea.

Similarly people thought apps would wipe out websites. Apps are popular, but you still need an anchor in cyberspace just to download the damn app in the first place. I think the pendulum is swinging back towards awesome mobile websites and away from apps, anyway.

(This XKCD comic was so far ahead of its time)

I do think that competition in drops and auctions is increasing, but I think it feels exaggerated because of the above.

 

[okaydomains]

If you do the math with the sales ratio and sales price (often in the 2k-ish range), you'll see that paying more than the reg fee for them does not translate into profit.

Incidentally I have done the math.

Using these very pessimistic assumptions and dropping any unsold domains after 3 years:

STR	0.025
Avg Sale Gross	$2500
Avg Sale Net	$1750
Domain Buy Cost	$60
Renewal Cost	$10
Domains added per month	10
Domains added per year	120
SH + BrandBucket Submission Fees	$2
Aftermarket Commission	0.3

Here's what I get:

Expected Profit (end of year)	Yearly	Total
Year 1 (0 sales)	-$7,440	-$7,440
Year 2 (3 sales)	-$3,390	-$10,830
Year 3 (6 sales)	$660	-$10,170
Year 4 (9 sales)	$4,710	-$5,460
Year 5 (9 sales)	$4,710	-$750
Year 6 (9 sales)	$4,710	$3,960
Year 7 (9 sales)	$4,710	$8,670
Year 8 (9 sales)	$4,710	$13,380
Year 9 (9 sales)	$4,710	$18,090
Year 10 (9 sales)	$4,710	$22,800

No one is getting rich there, but its profitable and a pessimistic scenario. If you can beat any of those inputs it works out far better (especially STR and gross sale price). Also $60 / name is on the high end of costs - that's assuming every name was bought as a $50 closeout. Usually that can be improved upon.

 

[Ostrados]

The interesting fact is, it happened kind of suddenly, started end of summer 2022 and has been like this ever since.

Something definitely happened in summer 2022, a sharp decrease in sales for me and everyone I know. That rough period continued until Dec 2022. After that things started to roll again but not as good as in past years.

Not only in domaining but everything related to the online space went down from Bitcoin to NFTs to Metaverse.

I think the economic uncertainty made a huge shift in people priorities and investment. There are now more important stuff like inflation, food security, oil supply VS Useless FB VR headset for $1500 just to experience a crappy low polygon legless chat!

 

[Ostrados]

I have the feeling I'm missing something about what's going on here.

It is obviously normal for domain competition to increase over time. But what I am talking about, is a quite significant increase in the last 6 months or so. The same in closeouts. (And I'm not even touching the auctions subject.) Like competition has almost doubled or so.

There are days when I can't find anything at drop to secure. Good names aren't even dropping that much. DC gets many of what remains (and no, they aren't getting in auction, it's the investor partners of DC who are scooping up those mid-value names).

Pandemic did not have a significant effect on accelerating drop competition. Things have been rather linear during 2020-2021. But not anymore.

One year ago, I was expecting I'm going to replace some of my upper tier names with better ones by now.

As sales have dwindled gradually since the end of summer, I was expecting a lot of names to be released into the market, as certain domainers will have to trim their portfolios etc.

Instead, and weirdly enough, the opposite has happened. I find myself renewing a lot, and not buying. Also names that previously did make to the $5 closeouts club now are scooped up at $30-$40.

During spring 2022 I could secure some good names for some reason. Maybe the war has spooked some investors and they let them expire. Anyway. I expected this trend to continue. But in fact later the trend has reversed. The less domains are selling for retail amounts, the more you can't find them anymore.

I have also observed that discounting my names to low xxx range does not help selling them anymore.

In previous years I could sell lots of weakish names before drop for $75, $199 or $299. This is not happening anymore. (Not talking about NP... where you can't sell an everyday domain for $10 lately)

My explanation for this (just a theory):

Lots of domainers and website owners who previously were willing to drop $199 or $99 on such domains (ones I did not renew), now have low cash reserves and therefore they don't buy at that price level anymore. Instead, they have all flocked to drops and closeouts to get some others.

Side note I know my names are bought by US buyers in most cases, so it might be related to the known fact that most US citizens no longer have significant cash reserves like they had when pandemic started.

Another half of the theory is, certain domain investors who are cash afloat might not want to lose money through inflation. What could be a best way to protect your cash rather than securing some names that you can sell later for a tidy profit, once this turbulence has passed?

Anyway. What is your opinion? Hoping to get to the bottom of this, what on earth is happening exactly.

Thanks

There are 2 contradictory observations:
1- People buy more in Auctions and closeouts
2- People pay less on liquidation

It means the issue is not with low cash because of #1.

I have no explanation. Maybe people trust GD more and do not trust seller to seller domaim acquisition. It is hard to sell domains at NamePros for $20, yet lower quality domains sell at 10x that at GD expired auctions. Or maybe the problem is exposure, NP does not get a feaction of exposure thay GD auctions get.

 

[okaydomains]

@twiki appreciate your responses.

One other thing I hadn't considered: as more small registrars partner with aftermarket auction houses a higher percentage of domains are sold before ever reaching the drop stage (or even pendingDelete).

I know in my experience that when I see a particularly good domain dropping it's usually from a registrar that doesn't partner with anyone for expiration auctions. I assume this happens less and less all the time. If there was a big change recently it could be because another tranche of registrars is now partnering with an auction house.

For example, I caught HushSecurity com today - I was surprised it dropped. But it was with Google Domains, which I don't think does expired auctions yet.

You called out Grim.com the other day - I forget who the registrar was but it was a weird one. Otherwise that name never would have dropped.

Thanks again for the discussion!

 

[Ostrados]

True.

But how come this influenced domains in the direction of increasing competition? Key question.

I was expecting more names to be dropped instead due to low sales.

The opposite happened.

As I mention there is a "shift" I speculate that people who used to invest online are now shifting from unsecure investments such ast BTC and NFTs to a more secure investments such as domains.

On Twitter I see new commers (that I don't see here at NP) that don't play the slow game and don't mind to pay high prices, it seems they have big budgets and high appetite for bulk domain acquisition.

I think these are the people you are describing in your observations, they sweep the auctions, closeouts, drop catch.. and have little knowledge about the existance of low wholesale marketplaces like NP.

 

[evil]

I can confirm that there is more competion backordering domains at low price level.
Six months ago it was easy for me acquiring more than 10 domains per day; since few months rarely happens.
I have not changed target, strategy and budget.
So there is only one explation for me: more competitors and/or more money in backordering.
Another easy benchmark is the cost for the acquisition of LLLL.com that has increased in last months.
This trend is combined with a decrease in parking revenue and a decrease in the number of sales.
Those who backorder domains at high prices at this time will lose money because it is not a sustainable business if sales do not increase.

 

[twiki]

Thanks for those numbers. Indeed if I reduce the STR to 1% and sale gross to $2k it starts losing money, even if I reduce the domain buy cost to $20 and the commission to 15% (Afternic). 1.5% STR makes it work but barely.

Its a tough game to be sure, especially at the lower tiers.

My wholesale /discount-ish model used to work very well. But it stopped in July. Made losses for 2-3 months after that but recovered by the end of 2022.

Fortunately when that happened, I was already half way transitioning to a full retail model.

Now my numbers are far less good than before, but the new model is functional and less risky.

 

[twiki]

As I mention there is a "shift" I speculate that people who used to invest online are now shifting from unsecure investments such ast BTC and NFTs to a more secure investments such as domains.

On Twitter I see new commers (that I don't see here at NP) that don't play the slow game and don't mind to pay high prices, it seems they have big budgets and high appetite for bulk domain acquisition.

I think these are the people you are describing in your observations, they sweep the auctions, closeouts, drop catch.. and have little knowledge about the existance of low wholesale marketplaces like NP.

Can't tell if this is the definite answer. But. It's the first explanation that really does make sense.

Edit: Some might have been able to cash out their crypto before that market fell. Hence, they're with money.

 

[karmaco]

I personally think its a good sign people are keeping their best names while continuing to focus on obtaining quality not quantity.

As you said weakish names not selling as before maybe weakish names have seen better days and are no longer investment worthy.

With ever increasing renewal costs focus on whats worth having has shifted. People willing to pay more for better drops rather than just wait for $5 bin shows priorities have shifted.

Could also signify less newcomers scouring bottom of the barrel type names. People left are more savvy.

 

[twiki]

@twiki appreciate your responses.

One other thing I hadn't considered: as more small registrars partner with aftermarket auction houses a higher percentage of domains are sold before ever reaching the drop stage (or even pendingDelete).

I know in my experience that when I see a particularly good domain dropping it's usually from a registrar that doesn't partner with anyone for expiration auctions. I assume this happens less and less all the time. If there was a big change recently it could be because another tranche of registrars is now partnering with an auction house.

For example, I caught HushSecurity com today - I was surprised it dropped. But it was with Google Domains, which I don't think does expired auctions yet.

You called out Grim.com the other day - I forget who the registrar was but it was a weird one. Otherwise that name never would have dropped.

Thanks again for the discussion!

The partnering with small registrars is not going to cause this massive shift. These together don't have much. Also only a fraction of those are even put up for sale there. Tons of what is expiring isn't listed via either Afternic or Sedo prior to dropping.

This seems to be a squeeze from multiple directions, for example:

1) People renew more and good names are NOT easily getting discarded

I'm thinking now, perhaps some of the great names I caught in 2021-2022 belonged to domain investors who died of Covid or something. Because there was definitely an uptick now and then of great names dropping during that time.

2) Auction prices etc are higher than ever, including closeouts BUT on the other hand smaller investors won't pay anymore over $50 to buy a domain, hence everything at drops and closeouts and some cheaper auctions is scooped en masse.

3) Non-investors are backordering and registering and keeping more domains for whatever future plans (this is an assumption though).

4) Financial conditions prompt existing domain investor to renew rather than discard, again for protecting their cash. Even if you sell later at net zero profit, it's still better than having an inflation of 5%, 10% or even more (15% in my country).

All taken together have caused this.

The interesting fact is, it happened kind of suddenly, started end of summer 2022 and has been like this ever since.

As if something significant happened then = such of the burst of the tech bubble (but how?) and also inflation has hit etc. Who knows what else.

 

[twiki]

Incidentally I have done the math.

Using these very pessimistic assumptions and dropping any unsold domains after 3 years:

STR	0.025
Avg Sale Gross	$2500
Avg Sale Net	$1750
Domain Buy Cost	$60
Renewal Cost	$10
Domains added per month	10
Domains added per year	120
SH + BrandBucket Submission Fees	$2
Aftermarket Commission	0.3

Here's what I get:

Expected Profit (end of year)	Yearly	Total
Year 1 (0 sales)	-$7,440	-$7,440
Year 2 (3 sales)	-$3,390	-$10,830
Year 3 (6 sales)	$660	-$10,170
Year 4 (9 sales)	$4,710	-$5,460
Year 5 (9 sales)	$4,710	-$750
Year 6 (9 sales)	$4,710	$3,960
Year 7 (9 sales)	$4,710	$8,670
Year 8 (9 sales)	$4,710	$13,380
Year 9 (9 sales)	$4,710	$18,090
Year 10 (9 sales)	$4,710	$22,800

No one is getting rich there, but its profitable and a pessimistic scenario. If you can beat any of those inputs it works out far better (especially STR and gross sale price). Also $60 / name is on the high end of costs - that's assuming every name was bought as a $50 closeout. Usually that can be improved upon.

My numbers are more pessimistic.

STR = 1.5%, just have that accounted.

AVG sale gross = $2K

I do however source names cheap and also sell a lot before dropping. But it's changing lately. AVG going up, number of names down, STR ~ 1%.

Edit: And I have stopped selling names at a discount before expiry.

 

[phaethon]

I think the big players buy more aggressively than before, even domains not worth much. For example I let

forexdynamite.com​

expire as I don't believe in the Forex niche and it was bought by BuyDomains.
Agree with Twiki, the drop decline over the last 6-9 months has been significant.
You are literally searching for a week to find a half decent drop to buy.
Waste of time.

 

[twiki]

Hmm, this topic made it to the weekly most seen list...

Anyway. Came back here to add a bit of extra info.

As some of you might know, my domain tools are tuned to filter domain lists rather well including my appraiser which went public for a short while (some have used it).

The news being:

While the number of domains found in total is more or less the same, the top section where the best picks are in my tools, is dwindling each day. So good names at drop are now a fraction of what they were one year ago. Less and less names appear there and most are gotten either by DC or another registrar. It's now 1/4 to 1/5 of what it used to be 1 year ago. That's insane.

I used to get 4-5 good domains per day one year ago and a few meh as well, well right now I'm getting 0 good domains per day, or perhaps 1 sometimes - where it went under the radar for any given reason.

So on one hand, the source has clearly dwindled fast which means, people are renewing names much more as before.

Also, I think the guys behind DC regs (their partners, actually - probably large firms like BuyDomains or something similar) already use rather competitive filters today, AI-based or not.

They are good, improved, and no longer getting crap if you ask me (crappy stuff actually makes it to the public auctions, which means common users, but what the partners get are better names than any of that). Edit: The guys obviously know in this market domains don't sell anymore as they used to, hence a readjustment in quality levels a well.

So yeah, this market is getting squeezed from all angles.

At this time it seems my drop-based domain sourcing is about to come to an end. I barely got 1 domain per day overall in the last 30 days which is unprecedented.

Furthermore, closeouts aren't of any help either.

I can only:

1) renew what I have,

2) participate in auctions (little luck there for me and prices are insane)

3) scour closeouts and drops and marketplaces for obscure names of value (lot of work for little result)

4) Or do handregs (kinda viable but still very risky).

The first option seems the only one that makes sense for me at this point.

Edit: I think you can still have good sourcing at auctions for nTLDs but in the .com area there's nothing worth it, really. Unfortunately I no longer do them, only .coms .

 

[DomainNature]

Maybe the issue is in the fact that people have spend most of their money before Christmas/New Year, now they have begin the new year and have to make some money until it takes back to having cash, although we live in hard times, many people just don't want to waste money on digital things but rather are cautious on spending and save for unknown disaster.
I myself have begin to economy allot, even if I see great names dropped I pass on most of them, then later I see they are registered by someone else.

 

[Revisiting]

I don't participate in the Drop chasing or auctions myself. I do think more people are participating in domains these days. Even the number of newbie posts seems to be growing. We can't ignore the economic impact of people having less to spend on the high end luxuries and less for going-out for socializing and meals etc. Sitting at home what can I easily get into that doesn't cost too much, will fill my time and feel like I can learn something, maybe make a few bucks.. I agree I don't think the end-user market is growing, probably a few now defunct business names are being dropped. Who knows Domains may become the new bitcoin

Why not, each one is certainly unique and the value can either enthrall you or send you into depression. Collectively we probably use up the same amount of electricity as those mining set-ups.

Domainminer seems popular

 

[twiki]

There are 2 contradictory observations:
1- People buy more in Auctions and closeouts
2- People pay less on liquidation

It means the issue is not with low cash because of #1.

I have no explanation. Maybe people trust GD more and do not trust seller to seller domaim acquisition. It is hard to sell domains at NamePros for $20, yet lower quality domains sell at 10x that at GD expired auctions. Or maybe the problem is exposure, NP does not get a feaction of exposure thay GD auctions get.

It might indicate that those that buy those domains at GD auctions etc are NOT domainers from NP, but some other bunch entirely.

 

[twiki]

Hi twiki, excellent topic. I have a couple of theories.

1) Your own tastes have improved. You're no longer interested in many dropping domains that an earlier version of you would have purchased. So there appear to be less good domains available.

This is a good assumption. Unfortunately that is not the problem.

I would be perfectly happy (actually ecstatic) to get domains of the quality I scooped 6 to 18 months ago. But they aren't available anymore. Only second grade names are dropping, and the few meh ones are snapped by DC and they aren't worth bidding up to hundreds or thousands $.

The fact that I don't get second tier domains now isn't related to my tastes improving, but rather that due to market situation I have to sell first tier only.

So I'm talking about that category. But I can safely say that even in the second tier it's the same situation.

People are renewing names they didn't use to. And this went sharply up since mid last year, not on the gradual trend it was on for years until now.

2) .com renewals have increased in price, but to the extent that is causing more names to be dropped its still going to be the weakest names that are dropped. You don't notice these names anymore because your taste and your filtering software has improved substantially.

I would be quite happy if you were right, but unfortunately again that's not the case.

I almost never see names I of the quality I got (and hundreds of them) like one year ago. None.

*I would also point out that carrying cost is irrelevant to premium names. Who gives a crap about $10/year when you paid $10k for the name? Also, what millionaire gives a crap about $10/year, or even $2000/year, when we're talking about owning an important asset? So I think the renewal price increase is a red herring - no one cares except for owners of cheapo names. Also vs. inflation .com prices have actually decreased.

Well drops are a special category. Most drops aren't worth 10k in a sale; got max $6k on one that is a rare situation.

If you do the math with the sales ratio and sales price (often in the 2k-ish range), you'll see that paying more than the reg fee for them does not translate into profit.

Multi-year renewals does not work unless you have a special strategy for that, as in names that will definitely pay a profit once a certain niche matures (risky).

3) GoDaddy rejiggered their pricing. Previously the top price for a closeout name was $11, now it is $50. People like me always start by looking through the most expensive closeouts because they aren't as picked over. I don't care about paying $50 vs $11 for a name - its either a quality name that I think I can sell for $2k+ or its not. Saving $40 on the buy doesn't make a crappy domain a good domain. This means names that used to sell for $11 now sell for $50.

Same here. Unfortunately not many are worth the $50 anymore, if at all.

4) As time goes on, successful domainers are building ever larger piles of cash and taking on outside investments. There is simply more capital available for domains.

This makes more sense. I have the feeling large investors are using domains as a way to ride this inflation and depression thing. Especially that domain price is predictable, such as ICANN .com price increase announced for next years. Less than inflation for sure.

5) When a premium name is purchased it leaves the market forever. That means new companies have to choose from the slightly worse names which are still available for sale, increasing the market for those 2nd tier names. In other words, companies have to accept they will never own Nest.com so they have to move on to their next choice. This creates / increases demand for e.g., Roost.com or MyNest.com. Repeat this all the way down through each tier in the market.

This is correct.

My problem is, the void has been created all of the sudden in the last few months of last year. As if something major did happen in the market then.

It must be inflation and recession or whatnot related because it happened right after the tech market bubble has burst. And it's counter-intuitive; you'd expect more such names to be dropped while what happened fast is the exact opposite.

6) With an inefficient market featuring massive margins like this, you should expect newcomers and more sophisticated capital to enter the market quickly. That we've been largely left alone for this long by institutional capital is somewhat amazing.

They see it too speculative and risky.

To some extend, 2022 drop in certain sales proves so, but this is an unique event so far.

7) Private wholesale markets exist now, e.g., DNWE.com. Also networks of buyers and brokers keep forming, so an increasing number of these good names are trading hands in private.

Can't comment on this, no data. However the thing is much larger than that I believe.

8) Most importantly, domains are more valuable than ever and their value is obviously increasing. As "software eats the world" and every business becomes global, it becomes more important than ever to have a good piece of cyber real estate for people to find you.

There was a blip in time where brands thought "oh, they'll just Google me or find us via Facebook or the app store anyway, so domains aren't that important." You had billion dollar brands spending millions advertising their Facebook.com URLs. That isn't happening anymore because it was a stupid idea.

Similarly people thought apps would wipe out websites. Apps are popular, but you still need an anchor in cyberspace just to download the damn app in the first place. I think the pendulum is swinging back towards awesome mobile websites and away from apps, anyway.

(This XKCD comic was so far ahead of its time)

I do think that competition in drops and auctions is increasing, but I think it feels exaggerated because of the above.

That'd be average end users scooping up domains for certain future usage and renewing them.

Maybe. Can't tell exactly. As I said I'm still missing a good part of the story here.

 

[twiki]

Something definitely happened in summer 2022, a sharp decrease in sales for me and everyone I know. That rough period continued until Dec 2022. After that things started to roll again but not as good as in past years.

Not only in domaining but everything related to the online space went down from Bitcoin to NFTs to Metaverse.

I think the economic uncertainty made a huge shift in people priorities and investment. There are now more important stuff like inflation, food security, oil supply VS Useless FB VR headset for $1500 just to experience a crappy low polygon legless chat!

True.

But how come this influenced domains in the direction of increasing competition? Key question.

I was expecting more names to be dropped instead due to low sales.

The opposite happened.

 

[Jeffrey]

4 LETTERS were less than 30$ 12 years ago. Now it ends mostly over 200$

 

[twiki]

Ironically drop lists now have better domains than $5-$11 closeouts

I agree.

In most cases even better than $30+ clouseouts... especially if you take into account the price as well. Even so many of these are taken at 30+, ones that I would not buy at $5.

 

[phaethon]

1) renew what I have,

This. And buy only names you intend to keep for five years at least, if you find any.

 

[twiki]

This. And buy only names you intend to keep for five years at least, if you find any.

Haven't found much of that lately... if any.

Fortunately I have those I'm going to renew, and it's a good number still.

 

[twiki]

Some further, and deeper thoughts.

One of the things that got me fully into domaining was the ability to scale. At least this was the situation a few years ago.

There is a lot of volume in medium-quality names out there. And if you had a good eye back then, you could scale and make good money. That I did, and sales thread here have showed a good part of it couple years ago and more. The scaling potential is what always kept me in. I'm not here to make say a couple thousands per month in profit. And I never reached where I aimed at, to be in the top, though I made some money down the line of course and still do.

That time - the time of scale, is now gone.

Beginning of 2022, discounting suddenly stopped working for me. Completely.

Before that, I used to increase sales ratio a lot so I was selling a lot before expiry. I made a LOT of posts about how to discount and what to expect, price levels etc. Several NP'ers here used my methods with decent and good results. But discounting halted flat in January 2022 for reasons I can't fathom, no more sales. Today no matter at what price I discount a say medium quality domain, $999 or $199 or $99, or even less, there are NO takers.

Wild.

So something was brewing in even before what happened mid-year; again suddenly, things that we all observed: This very fast competition increase + fast decrease in sales for us here. I wonder if there is any connection with my experience of discounts not working anymore (and no, it's not platform related cause I tested several including Sedo, Dan before it was acquired etc. It's all a macro.

Overall, 2022 was a massive shift in the domain business and in more than one direction, in fact like in all directions possible.

This makes you think... what on Earth is going on here. (scratching head)

The inability to foresee the future is what bothers me at this point.

I know from experience, not having predictability in your business is one of the most damaging factor you can have. And I think we all have this feeling right now.

Edit: Important note here: The only theory I have here about discounting not working anymore, is that those buyers are gone for some reason. And that's not because those domains are suddenly bad. It's because they cannot afford them anymore.

Most likely other investors were buying my names at $199 or $299. Now they can only afford a drop or a handreg etc.

Either their sales went bad since 2022 started, OR they don't have financial reserves (or trust) anymore to invest in domains they can sell later for a profit.