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How powerful is "NO RESERVE" when promoting a domain auction?

Labeled as question in Domain Buying and Selling Discussion started by Avtar629, Apr 22, 2019.

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  1. Avtar629

    Avtar629 MarketDN.com Gold Account VIP

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    I've been told it's best to put "NO RESERVE" on all my auctions that it would really get eyes on it but exactly how effective is it? Has anyone ever done a test to prove this? or is it all just assumption and here say?

    Sounds logical enough to put NO RESERVE for your domain auctions. The only concern is if the bids are only increments of $5 at a time and never gets above $100. which is ok I guess? but we're not here to domain just to make $100 are we?

    So along with putting a domain at "NO RESERVE" how do you increase your chances to get more bids?

    An amateur would put maybe 10% of what their target price would be. Say their target price or hope for price is $10,000? Then we're looking at a $1000 reserve.

    Depending on quality of course. Are there people out there who INVEST (meaning resellers) on $1000 domains?

    What's the mindset for such a domainer to invest that much on a domain? Is the expectation that domain should or could be sold for $100,000? or $50,000 in a week? or a month? or a year? or years later?

    Or are such buyers usually endusers who want the domain to develop? (assuming you contacted all possible endusers).
     
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  2. bmugford

    bmugford www.DataCube.com PRO ICA Member VIP ★★★★★★★★★★

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    Well, putting "no reserve" certainly won't hurt. It is either a net gain or neutral, so there is no reason not to put it.

    You increase your chance to get more bids by having objectively good domains; domains that will appeal to many people.

    On top of that you need exposure on a major venue like GD or NJ for example.

    I buy domains for 4 figures frequently at auctions, NamePros, and directly from owners.

    There is a huge gap in quality between the type of domains I buy for 4 figures and the quality of domain a typical domain investor expects to get 4 figures for.

    Brad
     
    Last edited: Apr 22, 2019
  3. secretagentdad

    secretagentdad Upgraded Member Gold Account

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    No reserve is for when you actually intend to liquidate at a whole sale price.
    I personally can't be bothered to bid on auctions with reserves.

    Auctions with reserves are just a hyped up listing.
    I'm not really interested in providing free price discovery.
     
    Last edited: Apr 23, 2019
  4. Avtar629

    Avtar629 MarketDN.com Gold Account VIP

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    I understand "try appeal to many people" concept when it comes to domains.

    But I've seen some pretty niche specific domains before where there could only really be one intended final enduser buyer ( can't remember them right now off the top of my head)
     
  5. lock

    lock PremiumNameDomain.com VIP

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    Since min offer is like $30 if you own domains you have no idea of value or are your cleaning house it is a good option as you still make money if first year of ownership. If your chasing big money put a min offer on.
     
  6. convertcontent

    convertcontent Established Member

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    I completely agree that for domains, you get way better domains with higher priced domains. Even $100 domains are so much better than recently expired domains that everyone has passed on.
     
  7. xynames

    xynames XYNames.com PRO VIP

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    If the item being sold has value then you’ll often end up getting more with no reserve than with. Put something that is worth 1200 with a 1000 reserve, or starting price a 1000, and no one bids. Same item no reserve starting price a penny watch it get bid up to 1300.
     
  8. Andrew Knox

    Andrew Knox Upgraded Member Blue Account VIP

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    If you are want a fast sale then no reserve is the way to go.
     
  9. poweredbyme

    poweredbyme Content is king VIP

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    I tried it few months ago. In less than 1 month, around 7 of my domains were sold for $10-15. Those domains would otherwise be sold for $100+ each.
    For domains under $500, no reserve auction works well if you need urgent cash and are willing to accept less than 5% in value.
    For domains above $1,000, no reserve auction works well. But it's very risky. Auction duration, venue, auction timing should be chosen carefully. You can choose those variables better and better by more practice. Until you learn the best combinations that work, it's more likely to sell many domains for cheap than for good prices. No reserve auction is usually a very costly learning curve. That's why it's not popular.
     
  10. Avtar629

    Avtar629 MarketDN.com Gold Account VIP

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    Thanks.

    Those $10-$15 sales. Where did those happen? Here on NP?

    I don't know of any auction sites that have below $25 starting bids.

    When you say "For domains under" are you talking about domains that a domainer feels should sell for $500? Or $1000? And should be priced as such?

    Just want to understand. Thanks.
     
  11. poweredbyme

    poweredbyme Content is king VIP

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    Those domains were sold at namesilo, maybe some of them at bido. There are many small marketplaces. They don't have minimums.

    Yes those are market values which a domainer feels.

    "And should be priced as such?"
    Do you ask why do I categorize my domains based on price? Because I implement different strategy for each category. Price is a major but not a single factor in classification. I also have websites, domains which are expiring, etc. Why does price the major factor? Because each price layer has different type of buyers with different expectations and level of expertise. When you sell something that is worth 4+ figures, very professional persons will sit on the other side of the table.

    Selling a domain or website is very similar. But I should clarify that most domains I actually sold for 4+ figures were established websites which I developed or bought.
     
  12. poweredbyme

    poweredbyme Content is king VIP

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    I sold those domains with no reserve for a test purpose only. This is not my first test. I try no reserve auctions around every 2-3 years. It never worked for me for the domains below 4 fig. It worked well for 4+ fig websites. But the number of tests I have done for 4+ fig websites/domains is not too many.

    How well did it work for me? I sold couple of websites for minimum 2x more than I would sell with "buy now" or "make offer"
    No reserve pulls more eyes on the auctions. I think some people don't have time for auctions with reserve. But obviously it's very risky to start an auction with no reserve. It can end up with less than 10% of what you expect.

    Here I would like to tell you, the price or the market value you feel, is the main determinant on the success with no reserve. If you feel your domain is worth 4+ figures and if you are confident on your own appraisals then give a try to no reserve auction. I hope you will get better results with "no reserve" than "buy now or make offer"
     
    Last edited: May 6, 2019
  13. Avtar629

    Avtar629 MarketDN.com Gold Account VIP

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    No reserve has always scared me. When I see these no reserve auctions selling for $4 figures. It makes me sad a bit because when I check the domains age it's usually that these domains have 10-15 years aging.

    What chance would my 1 year old even 2 year old domains have as far as profit? I've seen some domains that were not even a year old immediately auctioned off ending up with a final bid of $500-$800. That amazes me all the time. Is it simply just the "power" of the quality of the domain? I think that domain I saw recently that sold like this was like some new term that was "hot" like when Trump tweeted "Covfefe" and Covefefe.com was sold.

    can 1-2 year old domain sell for low to mid three figures at least using the no reserve method?

    Do you feel that sometimes it's all about how much promotion you spend money on for the auction?

    If we talk about promoting no reserve auctions then we're diving into a situation where your expected profits would get eaten up by your promo spend per domain even before the domain gets sold and paid for. Like you'd be "in the hole" for a domain for 1-2 years renewals plus $20 for advertising at one site and then another $10 at another and then $35 for a 7 day promo and yet one more.

    We're talk $85 all in all. If the domain sells just for $100 your profit is only $15? lol no to mention the 20% commission. lol
     
  14. poweredbyme

    poweredbyme Content is king VIP

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    Importance of domain age has been discussed a lot here and I joined some of those threads. For me domain age is one of the most important indicator and I believe people with fat wallets pay attention to domain age. I disagree with the general opinion here on the domain age and avoid starting a fruitless debate in an irrelevant thread.

    And yes my successful no-reserve auctions were aged ones as usual. However some of my aged domains were sold for under $20 in my no reserve auction tests. There are other factors. Age adds value. But you can't measure its weight.

    The chance is very low unless your domain is a top domain in a trendy niche like crypto niche. I ignore the sales under 4 figures. Those are not serious things. Because the portfolio that generates cash inflows mostly from the sales of under 4 fig domains, $500-800 sales, is likely making loss and has full of junk domains in it. One of 500 junk domains may be sold occasionally for pure luck. But $500-800 revenue will not be enough to pay the renewals of 499 domains.

    No reserve auctions do not help those domains. Because there must be already a good amount of eyes on the domain. If only 2 persons are interested in your domain and if you put it on a no reserve auction and if any one of those 2 persons did not notice you have started a no reserve auction, then that auction will likely end up with a loss. But if 10+ persons are already interested in your domain or website and if you put it on a no-reserve auction, you will likely get more $ than you expect.

    Only for the domains that can be sold for 4 figures and above. Here we return back to one of the most critical thing: how are you confident on your own appraisal. Domaining, like all businesses, is more of a guesswork and willingness to take risks at least until you make accurate valuations.
     

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