HugeDomains.com is Buying 50%+ of Expiring Domains at GoDaddy.com

[Arca]

I've been wondering about the competition in auctions for expiring domains over at GoDaddy.com, because somebody is paying hundreds for seemingly every domain that gets a few bidders.

I’ve also noticed a clear pattern, with the last bidder (or one of the last bidders) entering the auction winning most of the time, which made me think that there is one large corporate buyer piggybacking of whatever domains other people find and bid on. Turns out that is the case: HugeDomains.com is buying most domains over at GoDaddy.com expired auctions. I looked up the WHOIS of the past 150 auctions I have lost at GoDaddy.com, and 84 of those are now owned by HugeDomains.com and listed for sale on HugeDomains.com.

While 50%+ may not be representative of overall domains bought at GoDaddy, they do seem to buy far more domains than anyone else. The 66 names not bought by HugeDomains.com were bought by a number of different individuals and companies (BuyDomains.com bought 6 of those 66, for example), so 50%+ were taken by HugeDomains, while "the rest" of the auction wins were by a number of different individual domainers and companies.

This might not be news to some, but I've never seen anyone mention that HugeDomains is this active over at GD expired auctions, so I thought it might be interesting for some people to know who is outbidding everyone in the lower range over at GoDaddy. I've read people mentioning that HugeDomains buy names in close-out status over at GoDaddy, but never that they buy most of the domains in auctions too.

HugeDomains absolutely dominates all auctions below $5XX, and they only picked up a single name above $5XX (cakemart.com) in my sample of 150 names, so $5XX seems to be a self-imposed limit for them. If I only checked domains sold below $5XX, the percentage bought by them would be even higher. I've been the second highest bidder in lots of auctions that HugeDomains.com won, and in my experience they will keep bidding until you give up or until the price passes $5XX. By outbidding most bidders in the lower end, and acquiring more than half of the domains other people also have interest, it leaves a far smaller pool of names for the rest of the domainers to compete for, so I guess that's part of the reason why the reseller prices for names keep increasing so much for names in this range.

The only way to buy cheap domains at GoDaddy auctions now seems to be to let domains expire with 0 bids, so that they go to close-out status, and then try to snipe them as soon as that happens. However, some domainers seem to think it's smart to bid $12 on any decent name when there is 1-15 minutes left, hoping that nobody else is going to place a bid, so fewer and fewer decent names are let to expire with 0 bids. However, that strategy never seems to work (I've tried it myself lots of names, and it did not work even one time), because there are always other people watching and waiting for the name to go to close-out, and they jump in and bid if you make a $12 bid, and most of those names are eventually won by HugeDomains.com. What experiences do other people have at GD recently? Anyone else have any good strategies for buying expiring domains @ GoDaddy.com these days?

Some examples of expired domains bought at GoDaddy.com auctions by HugeDomains:
Domain: skillsharing.com
Purchase price (at GoDaddy): $540
Asking price (at HugeDomains): $2995

Domain: ledmaster.com
Purchase price (at GoDaddy): $537
BIN price (at HugeDomains): $2195

Domain: cyberstrategies.com
Purchase price (at GoDaddy): $262
Asking price (at HugeDomains): $2895

Domain: crablab.com
Purchase price (at GoDaddy): $320
Asking price (at HugeDomains): $1895

Domain: dailyportal.com
Purchase price (at GoDaddy): $560
Asking price (at HugeDomains): $2895

Domain: fivesecondrule.com
Purchase price (at GoDaddy): $42
Asking price (at HugeDomains): $2695

Domain: deltacloud.com
Purchase price (at GoDaddy): $365
BIN price (at HugeDomains): $1795

Domain: itace.com
Purchase price (at GoDaddy): $499
BIN price (at HugeDomains): $2595

Domain: sunnykitchen.com
Purchase price (at GoDaddy): $200
BIN price (at HugeDomains): $2595

Domain: baristaschool.com
Purchase price (at GoDaddy): $449
BIN price (at HugeDomains): $2895

Domain: cakemart.com
Purchase price (at GoDaddy): $695
BIN price (at HugeDomains): $3495

Domain: visuala.com
Purchase price (at GoDaddy): $315
BIN price (at HugeDomains): $2795

Domain: massanalytics.com
Purchase price (at GoDaddy): $130
BIN price (at HugeDomains): $2095

Domain: edusport.com
Purchase price (at GoDaddy): $535
BIN price (at HugeDomains): $2995

Domain: acneguru.com
Purchase price (at GoDaddy): $52
Asking price (at HugeDomains): $2495

Domain: stylefolio.com
Purchase price (at GoDaddy): $195
Asking price (at HugeDomains): $1995

---

Related: HUGE DOMAINS SNIPING GODADDY CLOSEOUTS

 

[CJ6]

I wouldn't even hand register many of their domains. There is no way they will get $300-$500 each, if they do a bulk sale.

 

[slimjim270]

Thanks for making these reports.

Can you please start to include how many domains make up 100%? The total number of domain sales included in your sampling would give us a much better idea of what we are looking at, in terms of how active these buyers are.

If you have more detailed info to share regarding sales prices or price ranges, that would be welcome too of course. One entity may buy as many names as possible in the low $XXX and below range (or bought right after hitting closeouts, as you mentioned you have also included), thus buying a lot of names in terms of quantity, while another buyer might be more focused on quality, buying fewer names but paying mid-high $XXX and up for most acquisitions, spending more in total.

@Fuadiansyah - Also wanted to say thanks for the charts. Interesting to observe.

I agree with @Arca that 2 separate charts would be helpful... one by quantity (count)... one by $amount... It would be interesting to see if there are different players in different cost tiers.

This is an interesting thread. Certainly sheds light on the reality of the acquisition landscape.

-Jim

 

[slimjim270]

This may be an "amateurish" question...

But why would HD's renewal cost be $25M on 3 million names?

The reason I ask is... doesn't the owners of HD also own NameBright? and if so, why wouldn't they transfer all their GoDaddy acquisitions to their own NameBright registrar where their only (internal) renewal fee is an ICANN $0.18 annual fee?

Yes, they would have up front acquisition cost when purchasing domains from the GoDaddy platform, but they could have a full-time intern transferring the names in bulk over to their NameBright operations (at far less than $25M per year).

Embarrassed to ask, but am I missing something?

-Jim

 

[wwwweb]

you could list them on NJ. Does anyone know if Hugedomains is active on NJ too?

That would be a good way to unload lesser quality domains.

Namejets is their competition, why would they support the competition?

 

[wwwweb]

This may be an "amateurish" question...

But why would HD's renewal cost be $25M on 3 million names?

The reason I ask is... doesn't the owners of HD also own NameBright? and if so, why wouldn't they transfer all their GoDaddy acquisitions to their own NameBright registrar where their only (internal) renewal fee is an ICANN $0.18 annual fee?

Yes, they would have up front acquisition cost when purchasing domains from the GoDaddy platform, but they could have a full-time intern transferring the names in bulk over to their NameBright operations (at far less than $25M per year).

Embarrassed to ask, but am I missing something?

-Jim

There is no margin on .com names the price at the cost is on the high side of $7 plus, others make money will sell thru services such as hosting, and getting a chance to sell
your drop inventory etc.

It's about competing for your dollars, and business.

 

[wwwweb]

I hear ya....but there's no money in buying domains for say an average of $300 to sell for $1,800.

Well, there is, if the sell thru rate is crazy high, but that's not the case with these names.

There is something else at work here.

Maybe a domain buying addiction perhaps? LOL

I think not though.

I totally agree, and I don't think anyone here is more experienced than you, so if your saying it, I hope people listen.

People see sales reports, they watch shows where they say you bought a domain for $500, and sold it for $15,000 etc, coupled with newbie action, tldpros has a India connection, Chinese buyers are much more active, and older investors replenishing sales added to the mix make for an expensive aftermarket.

Everyone here is just figuring out how to understand the investment philosophy, against adding all these pricey second tier names to a portfolio, and trying to pay renewals, commissions, and purchase costs, and still keep your head above water.

Most have taken to the sidelines, as most of us know, they will churn, and burn eventually at such rates, as there is no way they can sell thru fast enough as you also stated.

 

[wwwweb]

keep in mind you still need at least two to bid up the names

Ha ha I don't think you can get away with to many days where that last bidder doesn't jump in as the clock goes under 1 min.

It's always that %##[+{*{^{{ moment, and ends up making you pay $xxx more.

As we saw with pixelpick.com, it would have gone to closeout, but that last minute bid came in, and caused a chain reaction to close at $300. The house won, high bidder lost out, maybe got into the emotional bidding, as it took an hour of back, and forth.

 

[Fuadiansyah]

Thanks for making these reports.

Can you please start to include how many domains make up 100%? The total number of domain sales included in your sampling would give us a much better idea of what we are looking at, in terms of how active these buyers are.

If you have more detailed info to share regarding sales prices or price ranges, that would be welcome too of course. One entity may buy as many names as possible in the low $XXX and below range (or bought right after hitting closeouts, as you mentioned you have also included), thus buying a lot of names in terms of quantity, while another buyer might be more focused on quality, buying fewer names but paying mid-high $XXX and up for most acquisitions, spending more in total.

This may be an "amateurish" question...

But why would HD's renewal cost be $25M on 3 million names?

The reason I ask is... doesn't the owners of HD also own NameBright? and if so, why wouldn't they transfer all their GoDaddy acquisitions to their own NameBright registrar where their only (internal) renewal fee is an ICANN $0.18 annual fee?

Yes, they would have up front acquisition cost when purchasing domains from the GoDaddy platform, but they could have a full-time intern transferring the names in bulk over to their NameBright operations (at far less than $25M per year).

Embarrassed to ask, but am I missing something?

-Jim

Current result:

What do you guys think?
NB: Can't identify "under $100" price as namebio only record sales above $100

 

[dordomai]

This may be an "amateurish" question...

But why would HD's renewal cost be $25M on 3 million names?

The reason I ask is... doesn't the owners of HD also own NameBright? and if so, why wouldn't they transfer all their GoDaddy acquisitions to their own NameBright registrar where their only (internal) renewal fee is an ICANN $0.18 annual fee?

Yes, they would have up front acquisition cost when purchasing domains from the GoDaddy platform, but they could have a full-time intern transferring the names in bulk over to their NameBright operations (at far less than $25M per year).

Embarrassed to ask, but am I missing something?

-Jim

why do you believe they aren't doing this? Also domain cost is not just ICANN fee even for the registrar. I am not sure what Verisign charges, maybe $8. They are not getting them free.

 

[slimjim270]

>> why do you believe they aren't doing this?

@dordomai - good point.

The reason I ask is the amounts quoted $25M/3M is $8.33 which is near the $8.47 GoDaddy renewal cost (via DDC), and I have to assume their operating cost of renewals via their (owned) NameBright register would be lesser than renewing via a competitor site GD.

$2M is a big monthly nut to cover... lot's of domains to churn to cover it.

It's a fascinating stranglehold in their triangle (HD/DC/NB).

-Jim

 

[wwwweb]

>> why do you believe they aren't doing this?

@dordomai - good point.

The reason I ask is the amounts quoted $25M/3M is $8.33 which is near the $8.47 GoDaddy renewal cost (via DDC), and I have to assume their operating cost of renewals via their (owned) NameBright register would be lesser than renewing via a competitor site GD.

$2M is a big monthly nut to cover... lot's of domains to churn to cover it.

It's a fascinating stranglehold in their triangle (HD/DC/NB).

-Jim

It's a rough estimate, don't take it to the decimal, there is no margin for resellers in the low $8 range.

I can't remember if the price is $7.67 or .87 something like that.

It is a go big or go home type operation for sure.

You are not adding the cost of the many millions their registry connections cost on the drop catching side. It is a big operation, their sell thru % would be a interesting number to know for sure.

I do like their monthly plan payment system, I wish Uniregistry would integrate this into their platform.

 

[Kate]

When domainers are all chasing the same domains, prices are bound to explode.
I am not saying you are doing wrong, you aren't. But try to get some names off the beaten path too, and also buy direct from owners. Tedious but sometimes profitable. You want good names, you have to go get them where they are.

 

[garptrader]

To Kate's point, if you cannot beat HD for so-so-quality .COM expiring domains, perhaps it is better to offer fair prices which still allow upside for good aftermarket .COM domains. (domains wanted section)

 

[wwwweb]

To Kate's point, if you cannot beat HD for so-so-quality .COM expiring domains, perhaps it is better to offer fair prices which still allow upside for good aftermarket .COM domains. (domains wanted section)

The domains wanted side, I have tried this, lots of people follow the rules established members, but many newbies, just hound you with garbage, and you get frustrated. They think you are a charity handing out money, it just doesn't work like that, and even when you end the ad, they keep sending stuff.

I have seen so many ups, and downs, and people can't keep throwing money into something with nothing coming out. As many have stated it is a matter of time before they sink X amount, and the credit cards start maxing out, and the sales don't equate to cover minimum payments, where they will be OH S#!%, and maybe they will pull back, or try to sell to cover mounting debts.

This is a very tried, and true business, you have to be focused, and know where your money is going, and coming from. There are summer months where it does get very slow, so let's see how the year pans out for these high flyers. TLDPROS which I thought are India based, using a US address, could have to do with the new tax India is charging online purchased, that godaddy is enforcing is very active also, right up there with HD.

 

[campout]

@slimjim270 I believe that NameBright (and all other registrars) currently have to pay $7.85 to VeriSign for every .com renewal. So $7.85 + $0.18 ICANN fee = $8.03 fixed cost right off the bat for registrars.

Source: Hey Analysts: this is what I think about Verisign’s .com pricing going forward

 

[urlurl]

on GD - 12 out of 13 names i was watching today all got scooped up. very unusual as its usually about 10-25% of names i watch get bid up.

 

[wwwweb]

on GD - 12 out of 13 names i was watching today all got scooped up. very unusual as its usually about 10-25% of names i watch get bid up.

What was the best name on your list according to you, and what did it sell for?

Thanks

 

[168]

you could list them on NJ. Does anyone know if Hugedomains is active on NJ too?

That would be a good way to unload lesser quality domains.

List = payin commish
call = no commish

 

[urlurl]

What was the best name on your list according to you, and what did it sell for?

Thanks

campro.com

not sure what it sold for, will find out tomorrow

 

[Fuadiansyah]

on GD - 12 out of 13 names i was watching today all got scooped up. very unusual as its usually about 10-25% of names i watch get bid up.

They're getting hungrier everyday...

 

[168]

I hear ya....but there's no money in buying domains for say an average of $300 to sell for $1,800.

Well, there is, if the sell thru rate is crazy high, but that's not the case with these names.

There is something else at work here.

Maybe a domain buying addiction perhaps? LOL

I think not though.

Their sell thru rate may be increasing via monthly payment model which few others have adopted.
I have seen this strategy in other industries. (Inventory build). My bet is on M/A.

 

[urlurl]

campro.com

not sure what it sold for, will find out tomorrow

ended at $3,254

its a nice name, but a very steep price for resale

 

[wwwweb]

ended at $3,254

its a nice name, but a very steep price for resale

Thank you, I agree that is a nice name, I saw it early on, and I knew it was going to be pricey so didn't follow it.

I'm surprised it didn't go higher based on some recent activity I have seen on other names.

Guess there was only 1 real shark in that bidding.

It's a good one to put away, and wait, just how long is the question?

 

[urlurl]

i bet a few years ago the same name would have auctioned for $325, lol

 

[Arca]

A few thoughts:

- I haven’t had much time to participate in auctions recently, but the few names I bid on that sold to HugeDomains at GD have been listed at far higher prices than they usually list them at. For example, veggielicious.com sold for $498 and is now listed with a $8895 asking price. That breaks with their past model of listing them in the same price rage as their $X dropcatch.com buys. Not sure if this is something they consistently do know.

- In auctions where I bid against HD, their bidding strategy was different than before. I was about to get several names for $XX, and HD entered with a single proxy bid in the last minute (previously they used to repeatedly outbid you seconds after you placed the higest bid). I bid them up to right under $500 each time (since they normally bid up to $5XX on every name), as I was pretty sure it was HD on the other end, which turned out to be correct, and I never surpassed their proxy bid.

- About their current inventory: whoisology shows 2,384,129 names connected to [email protected] while domaintools indicate 2,628,225 domains.

- NameBright.com now own 1200+ ICANN-Accredited Registrars which they use for dropcatching, costing them $4,800,000 in yearly accreditation fees.

- There seems to be a bit more bidders in auctions elsewhere these days. More people backordering pre-release names at NJ and more people backordering names on the drop. Perhaps it's related to the fact that a few players are scooping up a lot of the stuff at GD? Prices and competition elsewhere seems to be in line with GD though, and it's not like names elsewhere is selling for significantly lower prices (rather the increasingly number of bidders seem to be pushing prices up further at non GD venues).