Prices are coming down for domain names

[mole]

Have you noticed how cheap it is to catch dropping .COM names for $60 or less nowadays, or how cheap people are selling domains on forums like this?

Contrary to popular (read speculative/euphoric) belief, .COM names are actually plummeting in value. With .XXX being introduced soon, the dive will be even more.

The so-called sales you see is only SYMPTOMATIC that those who got their names early in the game are now trying to liquidate what they have for whatever they can get, as compared to the no big money no name position they took in past years.

 

[barefoottech]

What is Happening is people are Realising Quality wins over Quantity Everytime
It is Better to Pay Top Dollar for one Great Name then for a Collection Of
Lousy Names
Just Because !*#.COm (Example Only) is 3 Char doesn't mean it has Any Intrinsic Value so Inflated Value based on Being 3Char will Drop over Time
But something Like ParaGuay.com has Real Value
Case in Point Google.com is Worth Way more than Any 3Letter .com Could ever hope to Achieve

 

[slaughterbeck]

What is Happening is people are Realising Quality wins over Quantity Everytime
It is Better to Pay Top Dollar for one Great Name then for a Collection Of
Lousy Names
Just Because !*#.COm (Example Only) is 3 Char doesn't mean it has Any Intrinsic Value so Inflated Value based on Being 3Char will Drop over Time
But something Like ParaGuay.com has Real Value
Case in Point Google.com is Worth Way more than Any 3Letter .com Could ever hope to Achieve

Are you sure? I kind of like Xkt.com!

 

[Zeeble]

What is Happening is people are Realising Quality wins over Quantity Everytime
It is Better to Pay Top Dollar for one Great Name then for a Collection Of
Lousy Names

I believe that that is not quite the whole story. I would NEVER pay $2k for a domain. The only possible time that I would is if I couldn't ANYTHING else for branding purposes. Most people won't pay above $400. Most of the big figure sales seem to be speculators hoping that the domains value will increase over time.

Just Because !*#.COm (Example Only) is 3 Char doesn't mean it has Any Intrinsic Value so Inflated Value based on Being 3Char will Drop over Time
But something Like ParaGuay.com has Real Value
Case in Point Google.com is Worth Way more than Any 3Letter .com Could ever hope to Achieve

Exactly! That is what is leading to the demise of the .com. They have inflated value, which is why they are losing value. People are only buying to resell, no real potential for an end user. The same thing is happening to the .com as happened to the stock market in '29. Same problems, same result (except, not so severe because they do still hold value).

 

[enetwork]

The real issue here that everyone is overlooking is traffic. Does the domain get traffic or does it not. It can be any extension but the fact is generic .com domains are the domains that bring in the most traffic, period. Most of the people buying domains base the amount they are willing to pay on the amount of traffic a domain produces and the amount PPC search engines are paying for that traffic.

This argument that .com is losing any value is completely baseless. When you start seeing PPC prices falling drastically or type in traffic going down, you can then make this argument. Until then there is no argument.

All indicators for the forseeable future point to PPC rates only going up.

As long as there are domains with traffic and companies willing to pay for that traffic, there will always be valuable .com domains and they will continue to get even more valuable.

 

[barefoottech]

As long as there are domains with traffic and companies willing to pay for that traffic

My point exactly .
People will only pay top dollar for Intrinsic Value
The Name on it's own has no value if no-one Visits the Developed site or
Needs the Undeveloped Domain Name
Good Names Will Appreciate in value
Lousy Meaningless Names Regardless of ext Will Depreciate

 

[EbookLover]

I wish .sc reg fee would drop! I could register so many dot South Carolinas...

Now, you bring up a good point here. You called .SC "south Carolina". However, many call it SOURCE or maybe a cc for some country I cannot think of right now. This, I believe is one major problem with domains today. I mean, how are people supposed to remember extensions when they hear so many different meanings to one extension, that is if they even heard of the ext at all. (“people” being the everyday guy who knows zilch about domains).

Now, as we all know, .COM is widely abused, too. I mean think of all the non-business .COM sites out there. TO the best of my knowledge, .COM stands for commerce or commercial, which, when you think about it, those words are not widely used by consumers when pertaining to buying a service or a product (this is why I like .SHOP foir ecommerce). When I think "commerce" I think more like B2B commerce, not really B2C or even C2C.

Think the only reason why .COM is still so popular is because that is the first real heavily marketed ext. Just a few years ago it was all .COM this nad .COM that. The .COM bubble burst, travelocity.com, priceline.com, espn.com, and so on. Walmart.com, hotmail.com, google.com. See were I'm getting at? Everything (in USA at least) is mostly .COM when you hear the media.

So basically, the problem lies in the fact that ICANN (or whoever else) was not looking ahead enough into the future. They did not release great extensions like .XXX and or even .info (which I think is a decent ext). The public got too used to the few extensions that were released from the start, mainly .COM. It boggles my mind to think that organizations that control these extensions did not see this mess coming a mile away. It really is a mess as far as categorization and familiarity is concerned.

Case in point is .XXX. No I do not want to discuss .XXX again, but it is a perfect example. Despite the legal problems of .XXX, .XXX is truly a great extension. Everyone knows what XXX stands for. even if XXX stands for "poison" to some, it is still something that is "restrictive" and perhaps even "taboo". IMO, .XXX is the greatest extension out there (and it isn’t even "out there" yet). It is easy to remember because the "term" XXX or "triple X" is used widely around the world.

So since .XXX was never released, the porn biz and other adult biz went for the “king of extensions" .COMs. And who can blame them? it's too widely recognized to go with any other domain when you are selling something on the internet.

This is the case for most all extensions other than .COM, .Net, .ORG, and even .INFO. Simply not enough average "joes” know about them or know what they mean or stand for. Some might even think that anyone who does not use a .COM or other very familiar ext is a scammer. I don’t doubt that to be the case at all.

So, it would be logical to think that it will all get ironed out as time goes by, but the problem is that too many unpopular ext were release in too little a time. Instead of focusing on a few memorable ext, they instead made the whole mess even messier by overwhelming the market with too many extensions, that for the most part, are never really gonna make it in the minds of the average web user. .BIZ comes to mind. I mean, what cannot be construed as a business? Even a non-profit is a business. Heck, corporations operate much like a non-profit, and vice versa. The only difference it that the non-profit disburses money by the end of the year because they are not supposed to show a profit. Corporations disburse all the money by the end of the year in bonuses to the "chosen" few at the top in order to avoid heavy taxation on all monies "leftover". .BIZ is a terrible extension, IMO. Too general.. It would be like .web or .internet (although, .web is kinda neat actually).

I do believe that it is possible that all these newer exts are making .COM prices plummet, but not really to the extent the OP makes it seem. I think that any drops in prices are more due to economical frustration and uncertainty more than it is that they are being diluted by other exts.

IMO, I think .COM is, and will be for a while, a great ext to invest in. All this categorization mess brought on by lack or foresight in the domain industry. At this rate, it will be a long time before the web people start using exts rightfully to suit the site. People (web surfers) have to get used to these ext and understand what they mean before this can ever happen. As it stands now, it is foolish mistake for, say, an ecommerce site to use anything but .COM, simply for it's wide popularity.

As an example, I, as an American (and pretend I am not into domain trading), if I am looking for brown socks for whatever reason, and if the searches bring nothing and I am reduced to randomly typing in domains to see if I can find any brown socks, I am going to do the following...

I would first type brownsocks.COM. Nothing. OK. Then .NET. Nothing still. Then. ORG. No go. .INFO? Nothing again. .US....well forget it. Last resort, I might even try .GOV for shi+$ & giggles and also because I just heard a .GOV URL on a PSA on the radio or the TV. I have a family and a life. I can't go looking up every extension just to find these brown socks. I'll just quit after .com or a few other really popular ext, because that is all I remember and I don’t have that kind of time anyway. I'll just take a trip to the mall and get some brown socks. And if it was just info on brown socks I was looking for, I'll just go to the library the next chance I get.

And if this is the way many non-domain traders think, it will be along time before. COMs become as worthless as it is being made out to be in this thread.

Are you sure? I kind of like Xkt.com!

I hear you, but "like" is one thing. Actual value is another thing. I see a lot of peole try to push 3 char domains like pq8.com or r0i.com Really what kind of worth do they have? Chances of them ever having any real value in the futire is slim, too. SOme people seem to think that any 3 char domain is a good domain. I just can't see it that way though.

 

[-db-]

Everybody is right to some extent. It's really not something that can be defined in a single broad sweeping yes or no statement, IMHO. It's too complicated with too many individual ways of breaking it down.

Also, I think some are underestimating the growing recognition of .US/.INFO/BIZ, and these extensions are making a real impact. Each week it seems I see a new billboard, magazine or newspaper advertisement for a business in the new name space. And the young generation? These kids know all about the new extensions, because it's been more affordable to get a good name in that neighborhood. They and their buddies have sites there. They feel right at home typing DOT US, DOT INFO, DOT BIZ. They are growing up right alongside these new extensions. This will continue to impact things as they both mature.

Even my Dad, in his 60's and what I consider an 'average' or 'novice' web user, knows about .US/.INFO/BIZ

COM is King, but the king is not alone in the castle.

 

[ecalc]

Many users type searchterm (minus ext) in browser address bars. Browsers go to searchterm.com by default. Dot com will rule as long as browsers work this way.

 

[barefoottech]

Browsers go to searchterm.com by default[/url]
Err Mine Doesn't .FireFox Rules

 

[ecalc]

What extension does FireFox default to?

 

[barefoottech]

It doesn't default to anything ,It does a Best guess fit

 

[IAmAllanShore]

Folks, I could write a novel (Sharon ) here, but I won't :gl:

Instead, let us remember back to whatever your first economics class was.

There is a limited supply of 3 letter .com's (Or any name .com's for that matter), and they have all been making their way to END-USERS for many a year now. Those end users now HAVE the name they need. (How many times can McDonalds buy mcdonalds.com ? Past that, they don't have the huge ticket need for domains (Sure, registrations of "mcflurry.com" hoping to make a bundle will continue, but that's just not logical).

It's not that the price is decreasing, it's that the majority of really valuable ones HAVE been sold to END USERS already (Or obtained by reverse-hijacking, but I won't go there ). There is now less of a supply of end users to sell to, as the end users have bought and paid for their names already.

There is, however, no shortage of $1 - $5k domains, and the fact that they continue to be sold is evidence enough of this :imho:

What is more, as Sharon and others have mentioned, making a few $500 sales is nothing to be ashamed of. I have personally sold 4 names this week for prices between $100 - $600, and the most I paid for any was $40 and they were held less than 6 months. Not a "let's all retire now" week, but still respectable :imho:

The average price of 3 letter .com's on snap and elsewhere continues to rise as more money comes into the market (Domainers have money? Who knew... ).

Anyhow, in short... the highs of "men.com" will be a thing of the past, probably. HOWEVER, the total "purchasing power" directed to domains en banc seems (At least in my niches) to be on the level or at a slight upward tilt.

-Allan

 

[CrazyTech]

Allan makes some valid points indeed - nice summary of a novel there.

Just go around one day - find people who are semi-computer literate like the average person and ask them what they associate with the internet. Ask them if they've heard of .biz, .us, .info and some of the others. See what the results are. .com currently is and always will be the coveted king. For the average person .com is the internet. Allan's post takes my thoughts from there.

 

[SharonTucci]

I believe that that is not quite the whole story. I would NEVER pay $2k for a domain. The only possible time that I would is if I couldn't ANYTHING else for branding purposes. Most people won't pay above $400. Most of the big figure sales seem to be speculators hoping that the domains value will increase over time.

I disagree with that. I've had some fairly good sales and not one has ever been to a speculator - the bulk of my business is to end users as it should be.

Who pays this? Well, when you consider the REAL value of a domain here for branding purposes, $2-20k is a drop in the bucket compared to other marketing expenses. How much does it cost for a full page ad in the Wall Street Journal for a company in financial services? How about designing the ad? What about running a commercial one time during prime time or a big event like the SuperBowl? What about producing that commercial?

I've spent years in email marketing. One of my clients - one of the best brand names in the automotive industry (high end) spends an average of $15k for a TEAM to put together one email that goes out to subscribers. Real businesses don't think twice about spending $X,XXX for a domain that has some potential value for them.

Exactly! That is what is leading to the demise of the .com. They have inflated value, which is why they are losing value. People are only buying to resell, no real potential for an end user. The same thing is happening to the .com as happened to the stock market in '29. Same problems, same result (except, not so severe because they do still hold value).

Sorry, but that is not accurate. Perhaps it seems that way when you look around the forum but the transactions on forums, afternic, sedo, etc represent only a portion of sales that go on. IF you have a good portfolio, buyers DO go to you.

Folks, I could write a novel (Sharon ) here, but I won't :

Hey, play nice Allan :P

 

[IAmAllanShore]

Hey, play nice Allan :P

:hearts:

Just trying to give you a plug Ms. Tucci :hehe: :sold:

And on another note: Just got another offer via email in between this post and my last one :D

-Allan :gl:

 

[equity78]

Nice points Sharon and ALLAN comparisons to 1929 I just have to laugh it is so off kilter. AND never overlook the jealousy factor so many who talk down have more than one reason for their opinion. AND Sharon you make the best point that's what I am interested in REAL Business with real BUDGETS not the Domain Wanted section like hey I got $50 looking for a traffic name that earns PPC. Chis Chena, Elequa, Adam Dicker and many more, these people have real money, real development plans and so do Major Corporations.

 

[IAmAllanShore]

Chis Chena, Elequa, Adam Dicker ....

Predicting the future:

Top 10 searched usernames on NP on 6/25/05
<you know>

Top 10 users to report spam sent to their PM box
<you know>



-Allan
p.s. - Don't spam, we're watching you...
:gl:

 

[EbookLover]

Many users type searchterm (minus ext) in browser address bars. Browsers go to searchterm.com by default. Dot com will rule as long as browsers work this way.

My IE6 doesn't do that (and of course my Avant Browser doe snot either). Neither does my FF or my Mozilla or my Netscape 7.0 & 4.7. Didn't check my Opera.

What I find interesting is that "hotmail.com" is (or at least used to be) in the top 3 most searched terms. SO can we conclude that the average web surfer doesn't know the difference between his adress bar and a search engine? I mean, why woul dso many peole type "hotmail.com" into google if they just wanted to go to hotmail.com?

 

[barefoottech]

Good Domain Names Can easily justify Big DOLLAR price tags
Like any other Intangible associated with business like Trademarks,TradeNames
Domains are like Books. Any one can type random characters on paper
Paper & ink is only ever worth minimal value. It is the Value Adding of creativity and marketing that makes it worth Hundreds,thousands or Millions of Dollars. Same with Domains
It has all to do with one of the oldest laws of Business.
Supply and Demand.
Limited supply , Big Demand = High Prices
Unlimited Supply, Small demand = <reg fee imho

 

[vip-ip]

Well, at first they were free, at one point they started costing money, bigger money, and bigger money, so now they're dropping ......

 

[mole]

Holy skunks, I've just done some binomial calculations using historical data from the past three years, the .COM ice is melting faster than we think :o

 

[Joe123]

Mole, do you want some domainers to panic and offer to sell their portfolios to you at knock-down prices?

 

[mole]

Of course not, ny. :o I have a truckload of .COMs and I am worried about their depreciating value just as anyone else. Yun Yee did a smart move to sell his massive portfolio to Marchex for $164m when he did.

 

[Joe123]

If that is the case, I think it is best that you get out of the industry whilst you can and sell your portfolio very cheaply. I believe you will find many willing buyers here :bah:

Of course not, ny. :o I have a truckload of .COMs and I am worried about their depreciating value just as anyone else. Yun Yee did a smart move to sell his massive portfolio to Marchex for $164m when he did.

 

[Raz0rBlade_uk]

This is a bad time for sellers. I would know!