I think some of you are doing this wrong.

[domaino]

I've started two threads in recent weeks but from doing a bit of lurking and reading around, and speaking purely from a "how to run a business" point of view, I think some of you are doing this wrong.

I've seen some pretty savvy domainers on here and they seem to play their cards pretty close to their chest - more than that though, I've seen quite a few domainers who seemingly, are really struggling re: sales and cashflow.

It occurs to me - and please keep in mind I'm not a domainer, I develop websites and own an SEO agency in the UK - that in order to get ahead, domain acquisition should be lower on the list of priorities of some.

• In order to have a business, you need to have someone to sell to - you need ACTIVE buyers.
• Valuing a domain, IMO, is easy - the hard part in this is finding buyers.
• I would question why anyone who's not a gazillionaire has a portfolio of more than say, 10 domains; how are you going to find the time to proactively sell them all? Maybe that's why you aren't? Because you are spending so much time on acquisition and so little time on identifying buyers?
• IMO, it also seems this is an industry where the main quality isn't valuing a domain which I think with a small amount of education anyone can do - it's selling.
• To find buyers you've got to offer something of value and spend all of your time promoting it - once you've done this, you will have a list of buyers and selling will be easy.

What can you do to find buyers? Why not focus on building a list? Maybe develop a domain news site and encourage people to subscribe to your e-book? << which is geared around domain acquisition...

Better yet, why not start an auction house for a specific TLD or ccTLD? i.e. domainlore. Or maybe a list of all public domain sales i.e. like that provided by Acorn Domains. If I were active in this industry, I would be spending 90% of my time selling/building a valuable resource which attracts buyers, rather than hunting for new domains.

Again, I'm not a domainer, I'm just speaking as a person whose been around online marketing since I was 16 and at the age of 27, owns a digital agency and a few successful web properties - in short, I may be way off, but not as far as I can see.

 

[jideofor]

You have a point...and like you said, some don't reveal their cards on the table.

However, it's a continous learning process for us all. But I should aiso let you know that there are some people could just disappoint you even though they had agreed to buy domains from you, at least, it has happened to me 3 times now.

Thanks for the insightful contribution

 

[DU]

There are many ways (legitimate and illegitimate) to profit from domaining (as many as there are to lose). A lot of these don't involve selling. Many people park domains that have revenue > renew costs. These don't need to be actively marketed as they pay for themselves. It's not a question of volume but of volume quality and just management of revenue in and revenue out.

There are also unethical methods of profiting that still exist. Most people in the domain industry say it's ok to screw someone over. Caveat Emptor. Fake traffic, end user with no industry knowledge, overinflated prices, fake sales, etc. You name it, it's been done.

For those that work on volume dealing - spamming is easier than you think and you get away with it more than you should.

The problem with lists is that generally they are targeting other domainers and not end users. Which means that most lists seem to eventually die out - though some survive. But some of the people that do inbound marketing are definitely in the best position.

Generally, I agree with you. I would take it one step further...

SDSINC would say - don't buy a name with one buyer, buy a name with many buyers (generally these will be aftermarket/quality drops) and not hand-reg. This is the best advice for those who want to succeed buying and selling. It really IS quality over quantity (except when you have 1,000 of names).

Some "unnamed" people say - buy one name with exactly one buyer, the one who you already sold to.

 

[WordWalker]

I would question why anyone who's not a gazillionaire has a portfolio of more than say, 10 domains...?

No doubt, allocating time for development and generating cash flow is essential -- and a huge challenge, but as to why someone who is "not a gazillionaire" would hold more than 10 domains, I have a few thoughts:

I am not a domain flipper. My plan has always been one of development. However, instead of looking to generate significant cash flow with just a handful of domains, I have always believed I would be better served developing hundreds of domains that, combined, would generate good revenue. I've attached a PDF file with domains representative of my portfolio acquired at reg. fee with the above plan in mind. While reasonable minds may differ, I suspect very few of these names would be available today for hand registration*. However, if I had it to do over again, I would cap my portfolio at something less than 500 domains (or whatever dollar amount each domain investor is comfortable carrying on an annual basis). The renewal fees can quickly sneak up on you and cut into resources necessary for actual development. It can be a huge distraction.



*Of course, there are NP members who will be quick to inform me that, based on the attached list, I've been wasting my renewal fees all these years on pigeon sh!t domains, but that is a subject best left for another thread on another day. :bah:

 

[biggie]

[*]To find buyers you've got to offer something of value and spend all of your time promoting it -

:talk:


another side of the coin is....

if you're already getting offers, then you don't have to "find" buyers.


imo....

 

[-NC-]

I develop websites and own an SEO agency in the UK

Do you have an office?
Do you own it or rent it from a company that specialises in commercial property?
Did you get a cold call which sold you that lease or did you seek it out yourself?
Does the company start up businesses themselves in the offices which have been empty for a while?

 

[domaino]

Do you have an office?
Do you own it or rent it from a company that specialises in commercial property?
Did you get a cold call which sold you that lease or did you seek it out yourself?
Does the company start up businesses themselves in the offices which have been empty for a while?

Ah, after reading the post below I actually get the analogy - in my defence, it's 00:15 over here in the UK and it's been a bit of a long day!

Ok, but I'm not sure that holds water - where does it end? Is there any concern for cash flow or do you just keep buying?

It's a bit like our going out and buying 10,000 link opportunities without clients to sell them too; what's the point? << not that we actually buy links in this day and age, of course.

Cash flow and I would say more importantly time, is obviously everything in business. If you spend a significant portion of the latter domain prospecting and hoping for a sale, and if you break it all down, your hourly rate would probably be a lot lower than it would be if you spent that time proactively building an audience, or prospecting for buyers backed up by even one QUALITY domain.

Much as I'm sure you have NC, I've reviewed tons of industries as a result of campaign preparation, competitors analysis and general "can I make money in this niche?" - in most instances, nay 95% of the time, I find quality always trumps quantity.

---------- Post added at 03:01 PM ---------- Previous post was at 02:59 PM ----------

[/COLOR]

There are many ways (legitimate and illegitimate) to profit from domaining (as many as there are to lose). A lot of these don't involve selling. Many people park domains that have revenue > renew costs. These don't need to be actively marketed as they pay for themselves. It's not a question of volume but of volume quality and just management of revenue in and revenue out.

There are also unethical methods of profiting that still exist. Most people in the domain industry say it's ok to screw someone over. Caveat Emptor. Fake traffic, end user with no industry knowledge, overinflated prices, fake sales, etc. You name it, it's been done.

For those that work on volume dealing - spamming is easier than you think and you get away with it more than you should.

The problem with lists is that generally they are targeting other domainers and not end users. Which means that most lists seem to eventually die out - though some survive. But some of the people that do inbound marketing are definitely in the best position.

Generally, I agree with you. I would take it one step further...

SDSINC would say - don't buy a name with one buyer, buy a name with many buyers (generally these will be aftermarket/quality drops) and not hand-reg. This is the best advice for those who want to succeed buying and selling. It really IS quality over quantity (except when you have 1,000 of names).

Some "unnamed" people say - buy one name with exactly one buyer, the one who you already sold to.

This all sounds pretty much spot on to be honest - nice post!

---------- Post added at 03:01 PM ---------- Previous post was at 03:01 PM ----------

You have a point...and like you said, some don't reveal their cards on the table.

However, it's a continous learning process for us all. But I should aiso let you know that there are some people could just disappoint you even though they had agreed to buy domains from you, at least, it has happened to me 3 times now.

Thanks for the insightful contribution

No problem jideofor, thanks for the contribution.

 

[DU]

Do you have an office?
Do you own it or rent it from a company that specialises in commercial property?
Did you get a cold call which sold you that lease or did you seek it out yourself?
Does the company start up businesses themselves in the offices which have been empty for a while?

Do companies look at the building that they are leasing that are empty and think to themselves .. you know what makes sense?

Let's buy lots more of these empty properties all over the place in the vague hope that some new startup SEO Agency needs an office there. One day, you never know, a magnate may come along that wants to spend an arbitrarily large amount of money to get this "prime" location we have....

Domain - Real Estate Analogies break down very quickly.

 

[WordWalker]

Do companies look at the building that they are leasing that are empty and think to themselves .. you know what makes sense?

Let's buy lots more of these empty properties all over the place in the vague hope that some new startup SEO Agency needs an office there. One day, you never know, a magnate may come along that wants to spend an arbitrarily large amount of money to get this "prime" location we have....

Domain - Real Estate Analogies break down very quickly.

When well financed real estate speculators enter buyers' market conditions making low-ball, quick close cash offers, that's exactly what they're doing! Carrying the analogy forward, when a domain is "hand registered" for $10, the buyer is convinced he knows something the rest of the market doesn't and will financially benefit as a result.

Unfortunately, determining the true present market value for a domain name is far different than appraising brick and mortar real estate. If domain buyers were accurate in their assessments of value, 95% of all domains registered wouldn't continually be "recycled" year after year. For real estate investors, misjudgements in value for even a single transaction can lead to huge losses. Domain investors can suffer huge losses, too - but, remember, each bite at the domain apple is only $10.

That $10 entry point for domain purchases is both the allure and undoing for many in this industry.

 

[-NC-]

Domain - Real Estate Analogies break down very quickly.

True it is a cliche which breaks down. I thought it might be amusing in the context of the OP's earlier thread.

A domainer is a lot like a land developer

 

[lincolndsp]

great domains don't need active selling - they sell on auto-pilot

 

[accent]

great domains don't need active selling - they sell on auto-pilot

And promoting to potential buyers can stand against you in UDRPs.

Just to knock down another dream while I'm here, developing cuts greatly into the market for selling the domain - many buyers only inquire about "unused" domains, they assume a developed site is not for sale.

What the OP is talking about is domain flipping. Most of those with a lot of domains are long term holders. It is a wholly different business.

There actually are two distinct domain markets. If you want to sell a decent domain you can find a buyer here, on Sedo, many places - another domainer will invest in it (if its good). He will only pay a relatively small amount for it, and he has a wide range of domains he is interested in.

If you have good domains you get inquiries from businesses - end users. A business wants one specific domain. Needs, actually, because it, (or a small number of alternatives) fits perfectly plans they have. Thus the domain the reseller would only pay $100 for is now worth $1000.

All the other domains the investor owns still are $100 if he wants to sell them quickly. The premium for a specific domain is because of the holding time, which can be many years.

Businesses pay the premium because the value of the specific domain to their business is great. Indeed, a few thousand dollars for a domain would equal the cost of a single one page ad in a magazine - and the domain is a one-time purchase. This is the thinking behind buy and hold - that good domains are hugely undervalued at present. Many investors do not want to sell at any price. Right or wrong, time will tell.

The sales route for domains is highly inefficient, many potential buyers of premium domains don't know how to get the domain they want. Whoever solves this market will become very rich.

 

[lincolndsp]

many potential buyers of premium domains don't know how to get the domain they want. Whoever solves this market will become very rich.

i would add - have no real understanding that end user worth can be thousands and why's that. instant gratification trap.