How are people selling domain so cheap?!

[DayDayHi]

Hi, I am new to the world of domaining and was doing some research and became curious as to how people can sell domains so cheap. Doing the math, even if someone is their own registrar, don't you still have to pay ICANN something like .20 per name and then also pay VeriSign $7.85 for .com domains. So if someone is selling a domain for $5 they are loosing money. So the very least I could get a domain for is $8 (forget about the .99 domain "specials" for argument sake).

Am I missing something? Thanks for your help!

 

[The New Guy]

They may lose money on every sale, but they make it up with volume.

 

[iowadawg]

They may lose money on every sale, but they make it up with volume.

Think about that for a moment!
Hahahahahahah

 

[RazorNF]

The registrar loses money on those cheap registrations. They hope to turn a profit by upselling you on other things like hosting, and through future renewals.

 

[garptrader]

One other way Godaddy can afford to fund cheap registrations is via Premium Listings and Godaddy Auctions commissions. To the extent that domainers as a whole are able to identify domains which some other party might be willing to pay $XXX or more for, Godaddy can earn a 20-30% commission on that sale for a domain which otherwise might only yield a $1 profit.

 

[DayDayHi]

Thanks for the replies! Some of that makes sense, I guess I am mainly looking here on NamePros and people have a list of a few hundred names for $3-$4 a piece. And again, even if they are a registrar themselves, they still have to pay roughly $8 for ICANN and VeriSign fees.

 

[Whogister]

Renewals... I hate renewals!!!

 

[htmlindex]

They may lose money on every sale, but they make it up with volume.

WTF???

If they sell domains for $5 and it costs them $8 to register, and they do big volume selling at a loss of $3 each, then they are doing a big volume of losses!

 

[Whogister]

Everyone take it easy on The New Guy, aye?
He's new in town so give him a break.

 

[DnEbook]

deleted …..wrong answer ….whoops

 

[cdboard]

SNL: How do we do it? Volume!

https://screen.yahoo.com/first-citywide-change-bank-2-000000534.html

 

[The New Guy]

SNL: How do we do it? Volume!

Somebody got the reference.

---------- Post added at 12:57 AM ---------- Previous post was at 12:54 AM ----------

WTF???

If they sell domains for $5 and it costs them $8 to register, and they do big volume selling at a loss of $3 each, then they are doing a big volume of losses!

You don't understand high finance.

Sure, someone like you could try to sell one thing that costs $8 for $3, but you'd end up losing $5.

But if you sell a million of those things a month at three dollars each, you've made three million dollars. That way losing $5 doesn't seem so bad, does it?

Top people with degrees and stuff have thought this through. If you think this plan doesn't make sense, just how many times have you made $3 million a month???

 

[-EM-]

money laundry.

Somebody got the reference.

---------- Post added at 12:57 AM ---------- Previous post was at 12:54 AM ----------



You don't understand high finance.

Sure, someone like you could try to sell one thing that costs $8 for $3, but you'd end up losing $5.

But if you sell a million of those things a month at three dollars each, you've made three million dollars. That way losing $5 doesn't seem so bad, does it?

Top people with degrees and stuff have thought this through. If you think this plan doesn't make sense, just how many times have you made $3 million a month???

Are you serious?

 

[ulasbbtr]

you talked a lot but don't include statistics. Probably, when they offer 1$ registrations, they have enough data to calculate how many of them renew next year, how many of them become new customer and bring profit from other purchases. That's why usually they offer 1$ to only North America. They are not stupid, plus they have their big data to examine.

 

[NameOmnia]

Am I thick or 3$ x 1MLN = 3MLNs but -5$ x 1MLN = -5MLNs aka at the and you lost 2 MLNs??????????????????

If it's true that you have those costs like verisign & icann you are at a loss ( as a registrar I mean ). So I think that for GD & Co the money comes out from ALL the other products they sell which are basically nearly cost-free for them.

As for domainers who buy and sell well if you regd a name for 8$ ( so no coupons or discounts ), you don't want to renew it and want to take some expenses back then it's acceptable to sell it for 5$ for example. Clearly this should happen for a small part of your portfolio otherwise you better question your decision to be a domainer I'd say!

There are many reasons why people liquidate names : they need funds for other projects, they bought a better name than the one they are going to sell, they want to increase the quality of their portfolio, they bought that name to develop it and they changed their mind, OR they have to pay for their wedding like it's happening to me...but that's another story...

 

[wot]

:p

 

[NameOmnia]

You don't understand high finance.

This is way too funny.

One thing is high finance where everything is virtual and you just add " some zeros " to an account and remove some from the other; different thing is when you have fixed costs you have to pay so your profit is : Gross minus Expenses / Costs..

Please..before saying I don't know about it please let me tell you I have been a financial adviser and a broker for some years and I have a vague idea of they way banks make money out of nothing as well as the stock market while businesses and people don't...just saying

 

[FanCube]

Thanks for the replies! Some of that makes sense, I guess I am mainly looking here on NamePros and people have a list of a few hundred names for $3-$4 a piece. And again, even if they are a registrar themselves, they still have to pay roughly $8 for ICANN and VeriSign fees.

Sure resellers often lose money on a sale. Basically resellers will build up a portfolio of domains and hope for an overall profit. A basic example: a reseller builds up a portfolio of 200 domains. At $10 each in reg fee that would be $2000. The reseller then sells 100 domains for $7 losing $3 on each so overall the reseller is losing $300. However, if the reseller can sell 10 domains at $500 each, a profit of $4900, and keep 90 domains in the portfolio for future sales the reseller would overall have made a profit.

 

[yogiDomain]

You don't understand high finance.

Sure, someone like you could try to sell one thing that costs $8 for $3, but you'd end up losing $5.

But if you sell a million of those things a month at three dollars each, you've made three million dollars. That way losing $5 doesn't seem so bad, does it?

This is way to funny.. lol..

what are you talking???:lol::lol::lol:8-X

 

[NameOmnia]

Sure resellers often lose money on a sale. Basically resellers will build up a portfolio of domains and hope for an overall profit. A basic example: a reseller builds up a portfolio of 200 domains. At $10 each in reg fee that would be $2000. The reseller then sells 100 domains for $7 losing $3 on each so overall the reseller is losing $300. However, if the reseller can sell 10 domains at $500 each, a profit of $4900, and keep 90 domains in the portfolio for future sales the reseller would overall have made a profit.

HHHMMMMM....maybe this is what the " high finance " guy meant...

 

[DnEbook]

sorry i only skimmed over your post, yes it is the upsale with the hosting and privacy and hopefully years of renewals

 

[Whogister]

OK, I was wrong...
Keep picking on The New Guy... lol

 

[The New Guy]

OK, I was wrong...
Keep picking on The New Guy... lol

Apparently the native language issue is strong and people can't pick up on sarcasm.

 

[mitok]

Hi, I am new to the world of domaining and was doing some research and became curious as to how people can sell domains so cheap. Doing the math, even if someone is their own registrar, don't you still have to pay ICANN something like .20 per name and then also pay VeriSign $7.85 for .com domains. So if someone is selling a domain for $5 they are loosing money. So the very least I could get a domain for is $8 (forget about the .99 domain "specials" for argument sake).

Am I missing something? Thanks for your help!

If you talk about regular people......some will sell domain for $5 and make $4 profit as they registered domain with a coupon for only $1.
Some will sell for $5 because they bought it from someone for $2.
And some will sell for $5 because they think better $5 than $0, although they paid $10 for it.
I have one active thread in marketplace section at the moment and selling some domains very cheap. Why? Because I get them even cheaper and took them "just to take something" and am busy with selling better domains so dont have time for these.

There might be many reasons why someone put on sale domain for few buck only.
The registrar thing is already explained.