- Impact
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I know for a fact that some domains purchased in the $300 range at an auction sold at a $3000 range to an end user. I also know many hand regs or bargain bin domains sold for the same range so where does the disparity come from?
While browsing the appraisal section on the forum, I saw a lot of brandable domains get a $4X appraisal and I also saw a lot of EMDs and keyword domains get the same appraisal, even though I'd value the latter a lot more in some cases.
The difference is in sell through rates. I think brandables (specifically made up words or two word combos) can be so utterly specific, that very few people would consider buying them. Whenever they do, they were going for that specific name for a reason and they won't settle for alternatives because there are none similar. On the other hand, more generic domains are easy to think of and will thus attract more buyers. This results in a faster sale, even if the price ends up being the same.
My point is, appraisals don't tend to acknowledge this and this might mislead people. It's easy to appraise a hand reg brandable at $4x and it technically would be right as they tend to sell over at brandbucket and similar websites in that range but there are people who specialize in hand regging and selling brandables who have to struggle to sustain a positive ROI. These people typically need to have large portfolios to have regular sales and don't forget the eternal renewal loop. On the other hand, a portfolio of expensive liquid domains might need to be a fraction of that size to achieve the same number of sales.
This might be obvious to seasoned domainers, but newbies might leave thinking they just got free money after getting their hand reg appraised at $1500; an appraisal which might not even be wrong in a technical sense. Then they will do it again and again, thinking they are multiplying money. I think it might be helpful to indicate this somehow while doing an appraisal.
P.S. I have nothing against brandables. I was using them because they are the easiest example. Obviously, a brandable domain like Neva.com will blow this notion out of the water. I generalized for convenience.
What do you think about this? Discuss.
While browsing the appraisal section on the forum, I saw a lot of brandable domains get a $4X appraisal and I also saw a lot of EMDs and keyword domains get the same appraisal, even though I'd value the latter a lot more in some cases.
The difference is in sell through rates. I think brandables (specifically made up words or two word combos) can be so utterly specific, that very few people would consider buying them. Whenever they do, they were going for that specific name for a reason and they won't settle for alternatives because there are none similar. On the other hand, more generic domains are easy to think of and will thus attract more buyers. This results in a faster sale, even if the price ends up being the same.
My point is, appraisals don't tend to acknowledge this and this might mislead people. It's easy to appraise a hand reg brandable at $4x and it technically would be right as they tend to sell over at brandbucket and similar websites in that range but there are people who specialize in hand regging and selling brandables who have to struggle to sustain a positive ROI. These people typically need to have large portfolios to have regular sales and don't forget the eternal renewal loop. On the other hand, a portfolio of expensive liquid domains might need to be a fraction of that size to achieve the same number of sales.
This might be obvious to seasoned domainers, but newbies might leave thinking they just got free money after getting their hand reg appraised at $1500; an appraisal which might not even be wrong in a technical sense. Then they will do it again and again, thinking they are multiplying money. I think it might be helpful to indicate this somehow while doing an appraisal.
P.S. I have nothing against brandables. I was using them because they are the easiest example. Obviously, a brandable domain like Neva.com will blow this notion out of the water. I generalized for convenience.
What do you think about this? Discuss.