Just won my first Snapnames Auction!

[Krane65]

Spent $525 on it and it's appraisals are all $x,xxx. I really hope I don't get burned on this one, as that is alot of money to me (i'm poorish).

 

[fka1080405]

Appraisals mean nothing because appraisers aren't buyers (and often aren't even human). Expired domain name auctions are a fantastic source of domain names but you have to be extremely cautious and must understand the auction dynamics.

The price of a domain at auction can balloon from $100 to thousands of dollars just because one other investor has a personal interest in the domain name. The auction platform matters a lot too, Snapname vs. GoDaddy vs. DropCatch all have their own bidder behaviour. And remember, this is a zero sum game, other domain name investors win when you lose, they have an incentive to drive up the price, if you spend all your money on one domain, you can't afford to win any other domains! And higher prices being reported means better perception of domain value across the market (which benefits other investors).

Almost every domain you buy at auction will be a loss. That's just the reality of domain name investing, most domains will never find a buyer. You avoid being burned by good auction discipline not by buying specific domains. Even the best domains that you get for a great price will probably never sell, and that's no problem at all as long as your strategy considers that.

If $525 is a large amount of money to you, you should immediately stop participating in auctions that go beyond $25. There are no absolutes, and you may get lucky and find a buyer for this domain, but as a general rule...

* Expect that for every 100 domains you acquire, only 1 will sell
* Plan to be profitable on each sale, i.e: for every 1 domain you sell it must cover the cost of the other 99 you acquired
* Bank your profits, do not burn all your profits by reinvesting in as many domains as you can find, remain disciplined!

If your average spend per domain is $50 then you need to sell each domain for at least $5,000 to be profitable. If your average spend per domain is $525 then you need to sell each domain for... $52,500 to be profitable. Do you think you can sell the domain you just won, for $52,500? If not, it was probably a bad buy.

Go to NameBio and look at all the domains that were won at auction on Snapnames last year, then look at how many have been sold since then. You'll probably find that even less than 1% have been sold since then.

If you post what name you bought, better insight can be shared. Hopefully it's a .com

 

[Krane65]

Appraisals mean nothing because appraisers aren't buyers (and often aren't even human). Expired domain name auctions are a fantastic source of domain names but you have to be extremely cautious and must understand the auction dynamics.

The price of a domain at auction can balloon from $100 to thousands of dollars just because one other investor has a personal interest in the domain name. The auction platform matters a lot too, Snapname vs. GoDaddy vs. DropCatch all have their own bidder behaviour. And remember, this is a zero sum game, other domain name investors win when you lose, they have an incentive to drive up the price, if you spend all your money on one domain, you can't afford to win any other domains! And higher prices being reported means better perception of domain value across the market (which benefits other investors).

Almost every domain you buy at auction will be a loss. That's just the reality of domain name investing, most domains will never find a buyer. You avoid being burned by good auction discipline not by buying specific domains. Even the best domains that you get for a great price will probably never sell, and that's no problem at all as long as your strategy considers that.

If $525 is a large amount of money to you, you should immediately stop participating in auctions that go beyond $25. There are no absolutes, and you may get lucky and find a buyer for this domain, but as a general rule...

* Expect that for every 100 domains you acquire, only 1 will sell
* Plan to be profitable on each sale, i.e: for every 1 domain you sell it must cover the cost of the other 99 you acquired
* Bank your profits, do not burn all your profits by reinvesting in as many domains as you can find, remain disciplined!

If your average spend per domain is $50 then you need to sell each domain for at least $5,000 to be profitable. If your average spend per domain is $525 then you need to sell each domain for... $52,500 to be profitable. Do you think you can sell the domain you just won, for $52,500? If not, it was probably a bad buy.

Go to NameBio and look at all the domains that were won at auction on Snapnames last year, then look at how many have been sold since then. You'll probably find that even less than 1% have been sold since then.

If you post what name you bought, better insight can be shared. Hopefully it's a .com

Thank you for the post! Man that is a little bit of a buzzkill for me, lol. But yeah it is a two word .com

 

[biggie]

Hi

in this game, don’t spend more than you can afford to lose

imo…

 

[bmugford]

Spent $525 on it and it's appraisals are all $x,xxx. I really hope I don't get burned on this one, as that is alot of money to me (i'm poorish).

Could be good or bad, who knows.

As far as appraisals go, you can find many aged GoDaddy closeouts that appraise for $X,XXX+ on all the major tools to buy for $50 or less daily.

Brad

 

[pb]

As far as appraisals go, you can find many aged GoDaddy closeouts that appraise for $X,XXX+ on all the major tools to buy for $50 or less daily.

It works both ways, so there's still some hope for OP's ROI.

 

[bmugford]

If your average spend per domain is $50 then you need to sell each domain for at least $5,000 to be profitable. If your average spend per domain is $525 then you need to sell each domain for... $52,500 to be profitable. Do you think you can sell the domain you just won, for $52,500? If not, it was probably a bad buy.

Some domain formats are more liquid, so that is not always the case.

For instance, you are not likely to 100x on a LLL.com or CVCV.com.

Basically the higher quality the domain is, the lower the ROI is likely to be.

It's not that hard to buy a bunch of domains for $50 each and randomly sell one for $5,000 to the right buyer.

As domains get more expensive, it is way harder to maintain that ROI.

Brad

 

[Ali Mustafa]

Spent $525 on it and it's appraisals are all $x,xxx. I really hope I don't get burned on this one, as that is alot of money to me (i'm poorish).

Congrats on your first SnapNames win & don’t stress too much as sometimes auctions feel expensive at first you never know who the right end user might be. Curious to see the name if you are comfortable sharing it.

 

[URL Stream]

The auction platform matters a lot too, Snapname vs. GoDaddy vs. DropCatch all have their own bidder behaviour

Can you please elaborate on this?

 

[snake_case]

congrats (: do not think two times put it on sale and forgot about it!
time to invest in more domains!

 

[fka1080405]

Can you please elaborate on this?

After tens of thousands of auctions, my current belief is:

Most GoDaddy bidders are rubes, they chase GoDaddy valuations and get caught up in bidding. You are probably bidding against someone running on vibes.

DropCatch bidders are sophisticated and disciplined. You are probably bidding against someone who knows how they are going to make money from the domain they are bidding on.

Snapnames has a large number of backorder bidders, auction participation is often driven by a long standing interest in the domain.

The worst auction to overpay at is a GoDaddy auction because there is the highest chance the price was driven up by someone acting inexplicably. The best domain to overpay for at auction is a Snapnames domain. At Snapnames, there is a much higher chance you're bidding against someone who specifically wants the domain. If you win a domain at Snapnames (like the OP) and regret it, you are much more likely to be able to sell it to the second bidder than if it had been a domain at auction with GoDaddy.

edit: as it's a related belief, I'll add: I think the biggest single mistake novices make when participating in expired domain auctions is thinking that bids are a statement of willingness to pay that amount for the domain. Expired domain auctions exist in a parallel universe, someone who is willing to bid $500 for a domain is unlikely to be willing to pay $500 for the domain if it was listed with a Buy It Now on Afternic.

 

[bmugford]

After tens of thousands of auctions, my current belief is:

Most GoDaddy bidders are rubes, they chase GoDaddy valuations and get caught up in bidding. You are probably bidding against someone running on vibes.

DropCatch bidders are sophisticated and disciplined. You are probably bidding against someone who knows how they are going to make money from the domain they are bidding on.

Snapnames has a large number of backorder bidders, auction participation is often driven by a long standing interest in the domain.

The worst auction to overpay at is a GoDaddy auction because there is the highest chance the price was driven up by someone acting inexplicably. The best domain to overpay for at auction is a Snapnames domain. At Snapnames, there is a much higher chance you're bidding against someone who specifically wants the domain. If you win a domain at Snapnames (like the OP) and regret it, you are much more likely to be able to sell it to the second bidder than if it had been a domain at auction with GoDaddy.

edit: as it's a related belief, I'll add: I think the biggest single mistake novices make when participating in expired domain auctions is thinking that bids are a statement of willingness to pay that amount for the domain. Expired domain auctions exist in a parallel universe, someone who is willing to bid $500 for a domain is unlikely to be willing to pay $500 for the domain if it was listed with a Buy It Now on Afternic.

There is certainly a difference between auction venues when it comes to the process, bidders, popularity, etc.

GoDaddy is always going to have competitive auctions as it is the largest registrar, with the most inventory, most customers, and public auctions.

They also have a long track record of shill bidders and auction rollbacks, so who knows what to believe.

There has been a lot of auction shenanigans over the years.

Some of the other venues require backorders to participate, so naturally you are going to have a smaller buyer pool. Sometimes at less popular venues, great domains can fly under the radar.

Brad

 

[WhySleepAlone]

They also have a long track record of shill bidders and auction rollbacks, so who knows what to believe.

There has been a lot of auction shenanigans over the years.

Would GoDaddy do something and ban those accounts?

 

[bmugford]

Would GoDaddy do something and ban those accounts?

Probably, but the bar is low to just create new accounts and keep doing it.

Here is a thread about it -

https://www.namepros.com/threads/godaddy-expired-auctions-can-be-tricked.1306045/

I am not sure about the current status, as I rarely bid.

That scheme turned me off as I could no longer trust the results.

It had been going on for over a decade and targeted most of the best domains, especially liquid ones.

Brad

 

[william]

Please internalize and learn from what others shared above. Regardless if this was a good investment or not, it will be a valuable lesson that can save you thousands in the long run. If you'd like to share the name here or privately, we may be able to shed more light on the quality of this investment.

 

[WhySleepAlone]

Probably, but the bar is low to just create new accounts and keep doing it.

Here is a thread about it -

https://www.namepros.com/threads/godaddy-expired-auctions-can-be-tricked.1306045/

I am not sure about the current status, as I rarely bid.

That scheme turned me off as I could no longer trust the results.

It had been going on for over a decade and targeted most of the best domains, especially liquid ones.

Brad

Thanks Brad. I guess you are right.

I have recently begun to taking part in the Expired Auctions -

Name	Final Price
ArabClub.com	$1309
EuropeHouse.com	$455
FourVines.com	$940
kasner.com	$1380
Liveondemand.com	$623

Taking into the consideration the STR, the price doesn't quite make sense.... likely to be shill bidding?

 

[bmugford]

Thanks Brad. I guess you are right.

I have recently begun to taking part in the Expired Auctions -

Name	Final Price
ArabClub.com	$1309
EuropeHouse.com	$455
FourVines.com	$940
kasner.com	$1380
Liveondemand.com	$623

Taking into the consideration the STR, the price doesn't quite make sense.... likely to be shill bidding?

I doubt it, on these.

These are plausible prices, on a very popular auction venue.

The fraud was happening mainly on the most liquid domains, from short domains to ones with high SEO value.

A bunch of the actual rollbacks were mentioned in the thread I linked to. That is just the tip of the iceberg.

Brad

 

[biggie]

Expired domain auctions exist in a parallel universe, someone who is willing to bid $500 for a domain is unlikely to be willing to pay $500 for the domain if it was listed with a Buy It Now on Afternic.

Hi

the thrill of a bidding war is more stimulating

imo…

 

[Daniel Owens]

Spent $525 on it and it's appraisals are all $x,xxx. I really hope I don't get burned on this one, as that is alot of money to me (i'm poorish).

Could be good or bad without knowing the domain it's a mystery. If something appraises at 1K+ it's often not worth paying $500+ for. All day long I can find closeouts for under $50 so xx that appraise at 1K+. You also got to look at the sell thru rate, it takes about 100 .coms that appraise at $1,000+ to actually get an 1K+ plus sale within 3 to 6 months for most people. Better to find good closeouts. Then on the other hand it is rare but sometimes a domain if it's a 4L .com or dictionary word will appraise low and sell much higher. Automatic appraisals are only worth what they cost which is usually nothing. If you are poorish start small and slowly build a decent portfolio.

 

[AriesAlpha]

Good luck!

AA