Strategy for Expiring/Deleting Domains

Here is a comprehensive strategy for buying domains at Expiring/Deleting Domain Auctions, as of Sept 2015. This process describes how the process of capturing .COM/.NET domains work.

Graphic Courtesy of ICANN​

PRE-RELEASE DOMAIN AUCTIONS

A Pre-Release Domain Auction is an Auction for a domain which has Expired but which can still be renewed or transferred out (restrictions apply.. see below) by the current Registrant.

This is the first stage of the domain dropping process. From 0-45 days after expiry. (The Auto-Renew Grace Period, in ICANN speak). All Pre-Release Auctions end whilst the Registrar still has control of the domain before Day 45 after expiry. On day 46 the domain is given back by the Registrar to the Registry and it will definitely be deleted. There are only very rare exceptions. Renewal (the renewal price plus the Registrar's penalty) by the original Registrant is the most common.

Usually these Auctions begin at most Registrars or Drop Catchers at around 35 days after expiry (varies with Auctioneer) and the domain has still not been renewed by the current Registrant.

The main venues for these auctions are either at a Registrar which has an Auction System, like GoDaddy, or at Snapnames/NameJet which have entered into agreements with some Registrars to be the sole Auctioneer for their Expiring Domain Names.

Usually the current Owner of these domains still has the right to renew the domain. But sometimes Registrars who have agreements with Snapnames/Namejet restrict these rights. GoDaddy is the most generous. Allowing transfer out (or renewal at Godaddy with a penalty) up to 42 days after expiry. You need to read each individual Registrars ToS to know the time they give you to renew the domain or then lose your ownership rights. ICANN says it should be at 45 days. But no significant Registrar follows ICANN rules, here.

GoDaddy is the biggest Pre-Release Auction Market on the planet by way of the fact they are by far the biggest Registrar. SnapNames/Namejet are 2nd and 3rd to GoDaddy, respectively. Everyone else are bit players in this Market. They have a small Market Share. How much? difficult to say, but probably less than 10% for all of them combined. No facts to substantiate this.

It is highly recommended that if you see a domain in a Pre-Release Auction Market you want, you should bid on it at that Auction and not anywhere else. ie: If it is at SnapNames then only bid on it at SnapNames because they control the domain. It is your first and best chance of obtaining the domain.

The biggest downsides are, 1) The existing registrant can still renew the domain, and will be motivated to do so if they see it has value. 2) It is a Public Auction, so you can be outbid by anyone joining the Auction.

The biggest upsides are, 1) You sidestep the Pending Delete Auction which is open to everyone (including Dropcatch/HugeDomains. More on them later) 2) You retain the original registration date (which I like personally. YMMV)


PENDING DELETE DOMAIN AUCTIONS

A Pending Delete Auction is an Auction for a domain which has entered the Pending Delete stage of it's current registration. Almost dead and dropped.

Domains enter Pending Delete stage 75 days after expiry (46-75 days is the Redemption Grace Period, in ICANN speak). There is no coming back from Pending Delete. The domain will delete 5 days after it enters Pending Delete and will be available for re-registration the next day (day 6 after entering Pending Delete or 81 days after expiry).

These Auctions begin when the Domain hits Pending Delete status. It is a free-for-all when a domain drops. The company with the best drop catching system usually wins most drop-caches. This is DropCatch with over 500 registrars knocking on the Registry's door.

The main venues for these Auctions are DropCatch, SnapNames, NameJet. There are a miriad of other competitors, but they are only bit-players. Bit players ocassionally get lucky and capture Pending Delete domains. Usually (not always) the domains nobody else wants.

There are no official statistics, but DropCatch probably captures at least 50% of all drop-caught domains. It could be a lot more. they are the Goliath of Pending Delete Auctions. The reason for this is mainly because their sister company, HugeDomains, wants to snap up all dropping domains which have any value, and to place them on their own Domain Marketplace for sale. Partnering with Dropcatch has, to date, been a very successful strategy for them. But we cannot see if this is profitable or not for them.

The previous Goliaths were SnapNames/NameJet, who held the position now held by DropCatch.

It goes without saying. If you are serious at wanting a domain, you should be backordering it at all 3 of these companies. backorders are free. You only pay if you win the domain. If you are the only backorderer at the capturing company, you win the domain outright.

Now this is where it become interesting because of the different policies of DropCatch to SnapNames/NameJet relating to more than one backorderer.

For SnapNames/Namejet, if there is more than backorder placed at their venue and they capture the domain, then the domain goes into a three day Private Auction. Highest bid wins the domain.

For DropCatch, if there is more than one backorder placed on a domain at their venue, and they capture the domain, then the domain goes into a 3 day Public Auction. Where anybody can bid on the domain.

Because everyone is used to the old system at SnapNames/NameJet where a domain goes to a Private Auction, they reel at the though that anybody can bid on a drop-catch with multiple bidders, if it is caught by Dropcatch. they feel cheated. But it is only the marketplace at work. Of course a Private Auction is preferred because the domain has fewer bidders, not everyone. But with DropCatch capturing the lions share of all drop-caught domains, they have chosen to hold Public Auctions, where prices are naturally bid higher than at Private Auctions. Some say too high. But in general, it is only being bid up to a price where another Domainer can still sell the domain and make a profit, in their opinion. Of course opinions between domainers vary about the price.

There is a twist to this DropCatch dropcatching. As as sop to other domainers, they have stated that HugeDomains would not be permitted to participate in any Dropcatch Auction. This of course is fine, until they are being bid up by other domainers What is not so good, is they recently introduced a Discount Club, where HugeDomains have priority over any backorder. this is not good at all, as users of this service see most of their backorders being captured by HugeDomains. IMHO, you should never use their Discount Club and only participate in their full price backordering, which cuts out HugeDomains access to the domain. You still need to participate in the Public Auction if there was more than one backorder at DropCatch, if you want to capture the domain. The exception only would be if you are placed at the highest bidder and nobody else bid on the domain, which is quite rare.

Personally, I see DropCatch's method of doing business as a paradigm shift. It's not going away. Either embrace it or hate it. It will make flips harder because of the higher pricing, and will usher in longer hold times for domains. I actually like the fact I can poke my finger in the eye of HugeDomains (our biggest single competitor) by placing a full price backorder on DropCatch. Even if I don't bid on any auction, and I just take the captures where I was the only backorderer. It's peanuts in the big scale of things, but it gives me satisfaction

For domains which are not worth the $59 dropcatch fee. I usually backorder at Pheenix. They capture some but not all. With their recently added 100 drop-catch Registrars, they should become more competitive. But they have announced the same policy of as DropCatch of Public Auctions on domains with more than 1 backorder placed on their system, from Sept 19th 2015. This won't suit everybody. But I believe it is the wave of the future. Some day, all dropcatchers will operate like this. IMHO.

CONCLUSION

For Pre-Release domains I only bid at the Auction House which has the domain up for Auction. Nowhere else works. GoDaddy, or SnapNames, or NameJet, or if the domain is registered at a Registrar which runs it's own Auction House, eg Dynadot.

For Pending Delete domains which have value and desirability, I backorder at all three major players DropCatch, SnapNames, NameJet. For domains which I think won't get picked up by any of these three, I use the cheaper drop-catcher, Pheenix. The hundred registrars they just added will make them very competitive in this section. I might even add them to my top three and see how many they catch

See more about DropCatch and Domainers/HugeDomains backorders below.

 

Any comments , corrections, and criticisms are welcome.

 

@stub Thank you. A very good reading.

 

Thanks for this post. It's always good to learn from the senior

 

Excellent post stub. Very informative and will especially help new domainers that aren't familiar with the whole process.

I do have one question for you. Why didn't you post this in the blog section of this site? This would be a great blog post.

 

Because I am unfamiliar with the Blog Section. What benefit does it bring? I thought I posted this in the most appropriate section. I don't really see myself as a blogger.

 

Well what you wrote would be great for the blog section. It would have been a nice change up from the norm. It was well written and informative and those are great to have in a blog post. I don't see myself as one but I do it daily on my sites.

Maybe next one you can post there.

Benefit is it will bring exposure to you and what ever you have in your sig. Marketing is why many of the others do it.

Either way, it was a real nice article.

 

I would vote for making this thread a sticky...

 

very Informative ....thanks for throwing some light on my mind

 

What are the situations when an expiring domain enters pending delete auction stage? I'm asking because if a domain is been back ordered, wouldn't it be turned into a pre-release auction held by the registrars or NameJet/Snapnames?

Thanks for helping us to understand the process.

 

Thanks for this post.
I also discoverred tht Dropcatch is a good catcher now.
But there are others lik Pool.com, domainmonster.co.uk, Eurodns, NAMEBRIGHT etc...
A bit slow is godaddy, but I did some backorders that succeeded for me.

 

I'm not sure I understand your question. There are 2 stages of backordering. 1) Pre-Release 2) PendingDelete. A backorder at Pre-Release doesn't get carried over to Pending Delete. You need to specifically add a Pending Delete backorder.

 

This post has some warped thinking.

1) Firstly you are mixing up GoDaddy Pre-Release Auctions with the rest doing Pending Delete Auctions.

2) Pool had announced more than a year ago that they were giving up on Pending Delete Auctions, but are still operating. The reason they were giving up is because they are useless at it, and probably losing money.

3) DropCatch have been phenomenal from the get go.

4) NameBright are DropCatch's Registrar. They don't participate in the auctions.

5) All you mentioned are bit players except DropCatch (the biggest Pending Delete drop-catcher) and GoDaddy (the biggest Pre-Release Auctioneer).

 

Great thread stub. Thankyou

 

There is a double-edged sword placing your backorder at DropCatch. If you are the only backorderer, then great. You win the domain. But if there is more than one backorderer then it goes to Public Auction which can be bid on by anybody, and the price usually goes up.

Is there a strategy to defeat this? Well no. Declining to place a backorder at DropCatch, and relying solely on SnapNames/NameJet capturing the domain will put you in an inferior position to capture the domain. Which is only recoverable, in the case where DropCatch captures the domain, and if there are 2 or more backorders on DropCatch and you can then duke it out with everybody else in DropCatch's Public Auction.

This is why you should backorder the domain at all 3 drop-catchers. It puts you in the best position to capture the domain. However, realistically, if you don't backorder the domain at DropCatch, you will find, if DropCatch captures the domain, you will either lose the domain because there was only one other backorder at DropCatch, or you will lose the domain because you didn't bid high enough in the Public Auction.

Also, you need to consider what happens if nobody places a backorder at DropCatch? Then DropCatch catches the domain for HugeDomains, in most cases. Two other possibilities are 1) It's a crap name nobody wants, and it drops, or 2) SnapNames/NameJet capture the domain either because nobody wanted it at DropCatch, or they actually beat DropCatch to the domain. Yes this does happen occassionally.

As an aside. You will have noticed that HugeDomains gobbles up a significant number of dropping domains and put them up for sale at fixed prices on their website. Any full priced DropCatch backorders means HugeDomains are precluded from going after that domain, because of a conflict of interest (same owner who is selling drop-catching to third party's). So your full priced bid at DropCatch prevents this from happening, even if you don't capture the domain outright or at auction. Plus one, for the little guy Not to feel guilty about this because it's only the free market at work. Someone other than HugeDomains captured the domain.

However. I am not suggesting you place a backorder for a domain on DropCatch which you have no intention of honoring. This will quickly get you banned from DropCatch Auctions, and would be folly, considering their dominance in the marketplace.

 

Great reading Stub....Thanks

 

Thank you stub. Good thread

 

Thanks for this post. very informative graphics.

 

Thank You for taking the time to post this.

 

Thanks Stub for such a wonderful post, apart from dropcatch, snapnames which is the best you got much success you already mentioned pheenix, how about Godaddy ?

 

Very informative post. Great work. Great names still out there.

 

Ok

Not necessarily. They don't control all the registrars. Don't forget that not everything gets spotted at Godaddy auctions. Plenty slip through into Pending Delete. Your aim is to absolutely avoid an auction, especially at DropCatch.com.

 

Because they are the biggest Pre-Release Auction House, you have to use them also. But some of the older, better names can be found at SnapNames/NameJet. I rate them as 1) GoDaddy, 2) SnapNames, 3) NameJet.

 

Yes. It's actually quite surprising to me the quality of some that pass thru to Pending Delete at GoDaddy. Whilst you definitely want to avoid an auction at DropCatch, I'd still recommend you backorder at all three, DropCatch, NameJet, SnapNames, for the best quality domains. Why? Because if you don't, you won't have the slight chance of being the only backorderer, and either HugeDomains (mostly) or another Domainer will win the domain at DropCatch, either solely or after an auction, because you didn't backorder there, for whatever reason.

 

Thanks Stub for all the info.it is great to see information like this on namepros.
Great Thread!!!!!