Is GoDaddy adding 5% on top of its Afternic 15% commission?

[Recons.Com]

I was up for very unpleasant surprise today.

The names that I, for example, have priced for $2499 are showing as $2724.11 at Godaddy. Apparently, this change might be experimental for now as it is not showing the same for all, but it will have very adverse effect on all domain investment community. And it is grossly unfair too.

GD announced with lots of fanfare that it is reducing the Afternic commission from 20% to 15% to justify raising Dan commission from 9% to 15%. Apparently, there have been plans to recoup that and more, as 5% on the gross is more than 5% on the original price.

So what will be the impact on all of us? If GD does go ahead with it (and for the period and scope of the experiment) we will lose at least 5% of our sales if the price elasticity is straight line. But, we all know that it is not and there are psychological thresholds. E.g. 2499 to 2724, from my experience, will result in 10-20% loss for two reasons: a) again, it crosses 2500$ limit; b) the "magic" endings like 00, 99, 88, 50 are ruined for someing like 24.11 ending. GD itself in its blog had published an experiment involving namefind names that showed 8% increase in sales from going to 2499 from 2500, so this changes are meaningful.

See also the attached slide by Darpan (SH founder) showing how important those thresholds can be. Crossing $5k barrier, e.g., can result in 35% loss in sales numbers.

Now couple this with the upcoming 7%-10% increase in .com pricing, and loss of 10%-20% in sales so that GD can make extra 5% can be devastating to all of us.

If GD does go ahead with this, we should all look for an alternative to both Afternic and Godaddy, as they will eventually squeeze us all out of the business. If Godaddy does implement this, I will look into moving my 34000 .com domains out of Godaddy and will stop using Afternic landers.

This is just getting ridiculous. Godaddy, decide already, if we are your partners in the business or the competition.

 

[Recons.Com]

One way or the other, there should be consequences for GD for this kind of abuse of power. In 2-3 years, my folio will be 100 000 .coms from current 34000. And if they are with GD's competitor, say Dyna or Spaceship, that is 200 000 difference for Godaddy (less 100k from them, plus 100k to their competition).

And it won't be just renewals, but also AN commission, auction buys etc. that I will do my best to minimize. Currently, I spend over $500k a year with GD between renewals, auction buys and commissions and that number will be around $2MM a year in 2-3 years that GD won't be getting from me.

 

[Edukar]

@GoDaddy I warned that a dashing time has come for your company. You should not offend your customers. Solve the problems on time. Final countdown has begun.

 

[rohitgoyal]

I was up for very unpleasant surprise today.

The names that I, for example, have priced for $2499 are showing as $2724.11 at Godaddy. Apparently, this change might be experimental for now as it is not showing the same for all, but it will have very adverse effect on all domain investment community. And it is grossly unfair too.

GD announced with lots of fanfare that it is reducing the Afternic commission from 20% to 15% to justify raising Dan commission from 9% to 15%. Apparently, there have been plans to recoup that and more, as 5% on the gross is more than 5% on the original price.

So what will be the impact on all of us? If GD does go ahead with it (and for the period and scope of the experiment) we will lose at least 5% of our sales if the price elasticity is straight line. But, we all know that it is not and there are psychological thresholds. E.g. 2499 to 2724, from my experience, will result in 10-20% loss for two reasons: a) again, it crosses 2500$ limit; b) the "magic" endings like 00, 99, 88, 50 are ruined for someing like 24.11 ending. GD itself in its blog had published an experiment involving namefind names that showed 8% increase in sales from going to 2499 from 2500, so this changes are meaningful.

See also the attached slide by Darpan (SH founder) showing how important those thresholds can be. Crossing $5k barrier, e.g., can result in 35% loss in sales numbers.

Now couple this with the upcoming 7%-10% increase in .com pricing, and loss of 10%-20% in sales so that GD can make extra 5% can be devastating to all of us.

If GD does go ahead with this, we should all look for an alternative to both Afternic and Godaddy, as they will eventually squeeze us all out of the business. If Godaddy does implement this, I will look into moving my 34000 .com domains out of Godaddy and will stop using Afternic landers.

This is just getting ridiculous. Godaddy, decide already, if we are your partners in the business or the competition.


Show attachment 254198

There is another flip side to it especially in case of outbound. Many times we ask the buyer to purchase the domain directly from Godaddy website as per the agreed price and when they see different price over there then its gonna raise lots of red flat in their mind. Even without outbound , pricing would be different in different platform which would cause confusion and red flag in the mind of buyer.

 

[GoDaddy]

We appreciate the community’s patience as we thoroughly looked into this.

To be clear, GoDaddy/Afternic are not quietly adding commission to these purchases. In territories where we are required to collect VAT or local taxes, they are added to the displayed price in the search result automatically.

A final validation is performed in the cart at the time of purchase and these fees are paid in full to the relevant authority.

This can be made clearer to the purchaser, and it is something we will look into doing. We’ll also continue to closely monitor our sale landers, search results, and cart, where premium domains are displayed in local currencies, for areas to adjust and improve.

 

[equity78]

I pointed it out to GoDaddy and they are looking at it, but not seeing anything immediately abnormal. The change in price is likely attributed to a country + currency combination.

I know I have gone to GoDaddy and maybe something to do with my browser had me showing that I was in India. I just clicked the right location and it was fixed.

 

[Recons.Com]

I assumed this was common knowledge? It's always been my understanding that different members of the AN network were free to list names with whatever mark up they wanted. I've certainly heard this being mention multiple times over the years. It's quite possible you'll find your names listed for different prices at different network members. I certainly don't agree with it (it's essentially front running) but I'm surprised people are surprised. It's definitely not something new.

While partners can do it, GD is not a partner, it is the owner of Afternic.

Again, hopefully, it is a glitch, like attributing me to a country with 9% surcharge, but even that is troubling if GD has problem correctly identifying its customer's country. Regardless for what reason the wrong price is shown, that is a lost sale with 10% to 30% chance.

Just few weeks ago every time I visited GD auctions, it would put me into GD Ireland. I would switch back to US and in few minutes I was back in "Ireland". So, possibly, GD has put me into another country this time, which, again, is a serious glitch in itself. USA is your bread and butter and it shouldn't be hard to get an accurate DB and also fix your software so that it is clear which country the client has been identified from and also the change persists instead of being reset. For info, I don't use any vpns, blockers, proxies etc. and my ip/location is easily identified even by free services on the net just by visiting them.

 

[Recons.Com]

After setting my location to USA in the noon, by 6 pm I am back to "Singapore - English". This is just too ridiculous for a multi-billion company to shoot itself in the foot and take down its partners along for the ride.

 

[Acroplex]

We appreciate the community’s patience as we thoroughly looked into this.

To be clear, GoDaddy/Afternic are not quietly adding commission to these purchases. In territories where we are required to collect VAT or local taxes, they are added to the displayed price in the search result automatically.

A final validation is performed in the cart at the time of purchase and these fees are paid in full to the relevant authority.

This can be made clearer to the purchaser, and it is something we will look into doing. We’ll also continue to closely monitor our sale landers, search results, and cart, where premium domains are displayed in local currencies, for areas to adjust and improve.

The asking price should be displayed - not your estimated price involving any possible fee, sales tax, or VAT.

The residents of locales where tax is routinely collected, such as in the European Union, already know that VAT is extra. By increasing the displayed price you're distorting the seller's expectations and perhaps also lead to failed sales.

 

[Dane]

@GoDaddy - Same problem here. I am located in the US. If I go to godaddy.com (on my phone OR on my computer) and I search for one of my own Afternic-listed names, I am shown a price that is 9% MORE EXPENSIVE than my listed price. This is not good. I also see a +65 phone number, which is the country code for Singapore. This too is not good.

 

[Recons.Com]

@GoDaddy - Same problem here. I am located in the US. If I go to godaddy.com (on my phone OR on my computer) and I search for one of my own Afternic-listed names, I am shown a price that is 9% MORE EXPENSIVE than my listed price. This is not good. I also see a +65 phone number, which is the country code for Singapore. This too is not good.

There. I have asked in investor chats and the problem is indeed widespread.

In territories where we are required to collect VAT or local taxes, they are added to the displayed price in the search result automatically.

A final validation is performed in the cart at the time of purchase and these fees are paid in full to the relevant authority.

James, this part of your response is troubling to me, because I assumed the problem is self-evident. Again, it is not showing only for the territories where the surcharge might be relevant, but to other countries, including the bread-and-butter of .com sales, USA. And, the final verification part is not helpful, as people typically don't add a product into their cart, if they did not like the price.

 

[Recons.Com]

Do you wonder why Singapore?

Sorry to hear about your ongoing challenges with the GoDaddy listings. Hopefully it will be sorted out tomorrow, with the Easter holiday over.

Not sure why Singapore of all places... Before, it would default to Ireland. While it was as dumb, at least a) there was no financial consequence as the price was the same and most of the time in USD (euro isn't as much problem either) b) I could explain that they might have some offices there as tech companies like Ireland for anything Europe.

Singapore is a headscratcher.

And, no, I wouldn't get my hopes high about them fixing it so soon. The Godaddy/Afternic sync problem (I list the names and they show as unlisted in my account for some) was first reported by me mid Summer 2023. After few weeks and forth, I was told "we know about the problem, not going to fix any time soon, deal with it". Not literally, but close enough. After about 9 months since, it has gotten worse, as now MOST names show as unlisted when added and now if I change prices in Afternic, in GD they still show with the old pricing (i.d. new bug added).

And that bug is as simple as it gets. I mean how difficult is it to populate one DB with the data from another DB and sync it? And how difficult is it to check a person's IP against available DB of IPs and correctly identify it? A novice could do it in minutes. For this multi-billion company this is an unsolvable problem.

 

[Recons.Com]

Just when we thought things couldn't get any worse at Godaddy. That is actually a 9% markup from your example.

you are right (

 

[Recons.Com]

read again

It still doesn't make sense, as my prices are listed as USD, not Euro and there is no option in my afternic to list them at different currency. So, listed USD, showing on GD in USD, not sure where you see conversion creeping in.

There are two scenarios that I am hoping for though.

: a) it is just purely scientific experiment for them to understand implications of price differences and is done on a small scope; b) they have screwed up the geolocation and have identified me as some country that requires 9% sales tax on top (then, again, why US number?).

 

[spikedo]

Where's the guy who developed DAN.com? If there ever has been a need for another GoDaddy/Afternic alternative, there is one now.

 

[Acroplex]

Looks like this f*ckery continues:

https://twitter.com/x/status/1773513376754503690

 

[korganian]

Just when we thought things couldn't get any worse at Godaddy. That is actually a 9% markup from your example.

 

[Recons.Com]

There is another flip side to it especially in case of outbound. Many times we ask the buyer to purchase the domain directly from Godaddy website as per the agreed price and when they see different price over there then its gonna raise lots of red flat in their mind. Even without outbound , pricing would be different in different platform which would cause confusion and red flag in the mind of buyer.

Can you imagine also the moral side of GD offering something for let's say 2000$ on landing page with its logo on it and for $2180 if it is searched on its site? This is beyond ugly. Not sure who came up with the idea, but he/she should be fired.

Let's assume GD was selling $50 mill worth domains via its site with 15% commission totaling 7.5$MM/year for it.

Now it adds 9% hoping to earn extra 4.5$MM/year. But, here is the actual math will work, if the sales drop by 20% due to higher prices, random ending prices and crossed thresholds. $50MM will become $40MM, 15% commission earning will become $6MM (net loss $1.5MM to GD) and the 9% surcharge will be not $4.5MM, but $3.6MM. So, net gain might be just $2.1MM and that is if it doesn't backfire via alienated buyers and sellers and doesn't force all the stakeholders to stop tolerating the monopoly position of GD in the aftermarket. $2MM extra cash at the cost of lost tens of millions for its partners and risk to its overall business is the stupidest possible decision.

 

[Furquan]

@GoDaddy

 

[EJS]

I just checked a domain name I listed for sale and parked via Dan.com for $4,995 (CrushTheShorts.com). I did not separately add the domain name to my Afternic account, so it is exclusively listed at Dan and syndicated through the Afternic network. When I searched for the domain name on GoDaddy, it shows up in the registration path with the $4,995 listed price.

I also looked up a name I have parked at Dan and listed in my Afternic account at the same $1,988 price point (HogRoasts.com). That, too, shows up in the registration path for $1,988. I tested this on different browsers - one of which is logged in to my GoDaddy account and the other is not.

Maybe @James Iles can offer some insight since I did not detect anything abnormal. You can also check these two names to see if they're showing up at different prices for you.

 

[equity78]

Actually, when you think about it, I'm surprised there isn't more of this about. They certainly aren't the first company to implement what is basically 'front-running' your sales listings. Since the Godaddy take-over of Dan I have moved all my listings to Sedo only. Then surprised to see all my domains appear on 123-Reg (The largest UK based registration service) with a 10% premium to my Sedo pricing. There may well be a relationship between Sedo and 123-reg that I'm not aware of.

My first thoughts were this must be the work of one individual, but no, this is through the 123-reg purchase platform and it is a consistent 10% across all domains of mine. Been going on there for some while

When you think about it, it does make for a tempting business model. I just wondered how the contractual obligations stack-up. Could get rather messy for the buyer unless there was a real-time link into the Sedo platform. Then of course there's the ethical issue of my relationship with Sedo.

No Bailey I first started writing about this years ago, Some registrars mark up your domain names, reps from Sedo and Afternic at the time said well some do that because they might not participate if they cannot make more money. Now you can contact them and tell them I don't want to be on registrars that mark up prices. This seems different as GoDaddy was not showing different prices. This here could be a glitch, as Elliot and others are not seeing different prices.

https://www.thedomains.com/2017/07/19/lot-shady-things-coming-light-week/

Afternic Chief Revenue Officer Bob Mountain:

Select partners are testing markups on Afternic domain names. There hasn’t been a fundamental shift, we’re just working with some of our partners at their request. If you would like to have your names removed from being listed at these markup resellers, please contact Afternic customer service.

 

[equity78]

OK, thanks for that, I mistakenly believed that once you selected. No to participating in Sedos partnership programme, That was that. I have only ever paid the lower rate on sales

So are you stating this is basically NO different to what the OP is bringing to our attention. Thanks

I think this might be a glitch, because this is GoDaddy and they never had a higher price. The partners marking up has been around for close to a decade.

 

[JB Lions]

I'm seeing this too now, they added 9% to the price.

Added some names today to Afternic Fast Transfer at $1500, they show at Godaddy at $1635.

Ok, $1500 again.

For some reason it was Singapore - English. Put it back to United States - English and it shows the $1500.

No idea why it was on Singapore English

 

[Recons.Com]

Another day, another reset to Singapore. This time, also comes with the flavor of Singapore currency. Few weeks since being reported, a multi-billion company cannot fix a simple technical problem of correctly identifying its customers and REMEMBERING the choice causing it leak $millions a day.

 

[Recons.Com]

My godaddy auctions page today:

My Afternic landers today:

The name is listed at $2488 and this is how many USA visitors sees this and other names when they go there.

The same name if searched at Godaddy.com (registrar path):

The inability of this company to fix simple bugs is astounding