NameLot

What makes a domain valuable (or not) in 2020 ?

Labeled as poll in General Domain Discussion, started by Gube, Mar 20, 2020

Replies:
51
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6,470

?

Domain Value: What is the most important factor to you?

Poll closed Apr 3, 2020.
  1. Length

    87 votes
    30.5%
  2. The extension (TLD used)

    116 votes
    40.7%
  3. Age

    28 votes
    9.8%
  4. Word balance ratio

    17 votes
    6.0%
  5. Vowels/Consonants ratio

    2 votes
    0.7%
  6. TLDs taken count

    33 votes
    11.6%
  7. Potential end users

    156 votes
    54.7%
  8. Readability

    47 votes
    16.5%
  9. Dictionary factor

    32 votes
    11.2%
  10. Similar names sold

    34 votes
    11.9%
  11. Another one? (Comment in the thread)

    5 votes
    1.8%
  12. SEO data points (DA, TA, Spam score..)

    12 votes
    4.2%
Multiple votes are allowed.
Total: 569 vote(s)
  1. Gube

    Gube Coming soon Gold Account

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    With the idea of building a new, open, appraisal formula in mind, we thought the domaining community could help.
    Cast your vote on what influences the most a name's value to you.

    An appraiser should help investors to invest at the right price, but can also be used when selling a domain to an end-user ("Proving" the price).
    Making the number random wouldn't work..
    But here are some elements we could use in a future (free) Appraiser :
    • The domain length
      "the shorter the better" or another rule
    • TLD used (Does a .com have the same value as a .paris, Increased complexity here, as some GTLDs might be a better fit than a general TLD)
    • The domain age
      I think it's still believed age can be a deciding factor when buying or selling a domain. (More names available and registered in the past, meaning the average hand reg quality was better)
    • Word balance ratio
      I did use that factor on my personnal scoring system, it worked that way : A domain with a small word size balance had a better score than others (Example : The dog was better than wonderful dog)
    • Vowels/Consonants ratio
    • TLDs taken count
    • Potential end users
      In my formula, I was checking for the amount of similar domains registered (Count of all domains countaining the SLD of the name searched, it's not precise on short SLD, example : the.paris, it was matching all domains containing "the", but .paris was not taken into account - Should it be improved and used ?)
    • Readability
      This factor might not be clear, but basically, we would check if a given name can be spelled and read easily
    • Dictionary factor (If the name is part of a dictionary, and is commonly used for example, could it influences its value?)
    • Similar names sold (Similarity % multiplicated by the sale price?)
    • More factors? Feel free to discuss about them in the thread :)
    You can vote for up to 3 different factors, but if you have more in mind, or would like to defend your point of view, please do.

    Gube
     
    Last edited: Mar 20, 2020
    The views expressed on this page by users and staff are their own, not those of NamePros.
  2. Rob Monster

    Rob Monster CEO, Epik Epik.com Staff PRO VIP

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    I think I know the background here.

    As some folks here are aware, @Gube is the person behind NameInvestors.com. We have been discussing the limitations of current appraisal engines, especially for appraising brandables.

    The existing domains place a great emphasis on search volumes which makes sense if domains still ranked highly based on exact match keywords in the domain name. Since Google Panda, they usually don't!

    There are conventions that define the value of a brandable.

    There are also language-specific dictionaries.

    The appraisal engine should be able to tell you a number but also the reason why it is valuable.

    This will also help people to not drop domains that have great value in a language other than their own.

    Anyway, glad to see some innovation in this area.
     
  3. bmugford

    bmugford www.DataCube.com PRO VIP ICA Member ★★★★★★★★★★

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    Everything is a factor. Domain valuation is highly subjective and requires a lot of nuance.

    Obviously some things matter more than others, like extension.
    A top branding word or keyword in .COM is obviously going to be worth more than some lesser extension.

    Also, the potential pool of end users. The more potential buyers, the more potential value.

    Brad
     
    Last edited: Mar 20, 2020
  4. Gube

    Gube Coming soon Gold Account

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    Thanks for commenting @bmugford
    I agree on both, but retrieving a full list of end users is already more difficult.
    And we could think of a way of estimating how a company/user is likely to buy a name.
    The goal, I believe, will be to identify if the company has a worst name than the one estimated (or buying it wouldn't be useful to them), how they are doing financially (can they afford your name), and how buying that name will help them. More could be identified, but doing it manually takes a lot of time

    It made me think of another factor, competition.
    Let's say I own "the red pizza .com", could a related BIN-listed name influence the buyer, for example "the blue pizza .com" and in that case, limit your opportunities ?

    Gube
     
  5. 7363824

    7363824 Restricted (Market)

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    Readability, pote tial end users, and would I name a business that.
     
  6. Kassey Lee

    Kassey Lee Grandseeds.com VIP ★★★★★★★★★★

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    The value of a domain depends on two factors: (1) How badly does one or more end users need the domain? (2) How much can they afford to pay? Frank Schilling mentioned in a DomainSherpa show years ago that they sold a domain ending with "ings" for $20 million. Remember "ing" was not popular back then.
     
  7. Jimmysun

    Jimmysun Established Member

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    or personal reputation like domain king?
     
  8. Samer

    Samer Top Contributor VIP

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    Length
    (shorter is sweet) less is more,
    3+word will always tempt; they avail for reason

    TLD (only .com)

    Readability
    (another way to say “radio test”)

    Thanks Gube!

    Samer
     
    Last edited: Mar 20, 2020
  9. HotKey

    HotKey Made in Canada VIP

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    Probably not the same rules across the board, I think every single one of the choices are important in and of themselves, dependent on the actual domain, and planned usage/target. Basically what Mugford said.

    If we take this poll and apply it with a specific area or TLD in mind, say .com, it would be a bit more "one size fits all" scenario, but even then there are sub-sections to investing that different strategies apply to different areas. You can't take the rules for "short" and apply realistically apply them to "geo" or good-selling longtails, for example.

    Basically, I look for a good name for what's its worth in it's raw format, and then depending on how I want to price it, how long I'm willing to hold it or who I think it could target, I use many of the options laid out by Gube (nice job) to determine moving forward on investing in the name.

    Good points by Ryan and Jimmy as well, reputation and storefront potential are factors that influence value.
     
  10. Gube

    Gube Coming soon Gold Account

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    Thanks for your comments :xf.smile:

    I see we would need to identify the domain type first and based on that first step result, the next calculations will differ :
    If it's a brandable or a Geo name, a different calculation will be used on the length to be more flexible. (impact less the estimation if the city is large and take place in the name for example)

    @Jimmysun Agree, the reputation can help in some circumstances to close a sale, and might have an impact on the sale price if the person has better negociation skills.
    Broader, promoting our names can also help to sell them, but I will let that for another thread soon, I need to finish another experience before, based on the results, it could be valuable informations.

    No worry @Samer - and the 3 criterias you mentionned have an important place in my current scoring system. I will share the main points I used at the end of the poll

    Gube
     
  11. Internet.Domains

    Internet.Domains Account Closed (Requested) VIP

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    Appraisals work great for mass produced commodities. With domains being unique, appraisal valuations can be way off. When we use automatic appraisals we are submitting our domains to be a commodity instead of a one off, unique, individual domain.
     
  12. Samer

    Samer Top Contributor VIP

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    @Gube, hope you add; “Similar names sold.”

    i find it More useful than appraisal :xf.laugh:

    Samer
     
    Last edited: Mar 20, 2020
  13. stub

    stub DNStore.com PRO VIP ★★★★★★★★★★

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    The biggest factor of all is somebody must have the domain to run their business on that domain. Why do they want that particular domain? Well. Probably because more than one of the factors mentioned above. I think pronounce ability is very important. Which is what makes dictionary words so valuable. Made up names like Google would be included in this pronounce ability factor even though it is not a dictionary word. Deliberate misspellings might work also. Short, ie 4L, are favorites either because they are pronounceable or because they are acronyms. CVCVC+ or VCVCV+ are usually quite memorable as well.

    But I think the biggest problem with a price estimator is that it doesn't take into account the how much the need is from the buyer, or how much they have the ability to pay, and the reluctance of the seller to sell. So estimates of brandable names will always be way below those of the news topping sales we see. This could somehow be factored in by knowing if the buyer has received any tranche of funding in the last year. But I don't see how that could be built into the model.
     
    Last edited: Mar 21, 2020
  14. stub

    stub DNStore.com PRO VIP ★★★★★★★★★★

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    And that's just the front-end. How about the back-end. Must it always be .com, or would .co or .io work. For a startup something other than a .com MIGHT work. How do you evaluate those things in a pricing matrix?
     
  15. lock

    lock DomainUsed.com VIP

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    Just the best name to suit the industry targeted generic.
     
  16. Samer

    Samer Top Contributor VIP

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    DomainKing would have been valuable in ANY owner ;)

    Glad it was the one and only :)
     
  17. lock

    lock DomainUsed.com VIP

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    There was the thread who real Domainking between Mann and Schwartz and the answer is the guy that bought it Schwartz. Face palm at it.
     
  18. Raj2610

    Raj2610 Established Member

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    It should be Catchy ; mostly works better with short names. I believe that there are many factors related to general buying and selling which are applicable to Domains business as well. Seller reputation, buyer paying potential, buyer experience, buyer urgency, domain name feel, patience level of buyer /seller and current market conditions.
    I am relatively new to domain trading and really dont understand the basis of sales which go beyond 10000 Dollars.
     
  19. ovokate

    ovokate Established Member

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    Potential end-user, readability and word balance ratio :xf.smile:
     
  20. Gube

    Gube Coming soon Gold Account

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    The TLD factor would depend on the meaning (if any) of the name then
    A name linked to internet services won't have the same impact on the TLD factor if the tld is .io, (a bit more impact) if .net, and .co (Other factors will have bigger influences on .co)

    On .co, I might take length in consideration, and make the dictionary factor more important since, on that TLD, there are a lot less names registered compared to .com for example (Maybe more "top" names available if we can say)
     
  21. Jimmysun

    Jimmysun Established Member

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    I mean Domianking can sell high price bcz of his reputation, if someone else sell aACRepair for 1.5 million some people may think it is not worth so much, buying a premium domain from domainking could prevent being accused buyers are stupid, in fact you see his portfolio and all domain names are not always "that" good, I believe that a lot of NP domainers' domains even better than his but he can sell high price, which comes from his sales record and reputation.

    The shorter domain doesn’t mean the more valuable it is if the reg volume isn’t big enough.
    1 letter with 26 possibilities, 2 with 676, 3 with 17576, 4 with 456976, Its value comes from whether a large number of registrations make it rare.
     
  22. Bob Hawkes

    Bob Hawkes Top Member NameTalent VIP Gold Account Trusted Blogger

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    Thanks for the thread and discussion, @Gube, but I think it is almost impossible, well impossible :xf.grin:, to answer because it depends on the use of the domain name.

    All of the factors you mention, and others, are of some importance, but which are more important, to a considerable degree, depends on the type of domain name being sought.

    (1) For example, if I am looking for a brand for a big company main site, then the TLD (probably .com) is important as are factors like how it will look in print and when spoken. Generally shorter is better, but not always. But the most important is that the name fit the way the company wants to be perceived. Because different companies have very different ways they want to be seen, we have boring but respectful names, creative names, catchy names, descriptive names, etc. I think there are cases where dictionary words are wanted, and others where not. So subjective, which is why we can be so critical of automated appraisal attempts. In most of the world .com has a dominant advantage here.

    (2) If looking for a name to be used for online marketing of a product or service, possibly a company name too but it is the marketing that is the focus, then things like how searched the keywords are and how descriptive and memorable the domain name is become more important than other factors. You want the name that is the one that people will guess, remember and spell correctly. Sure, if it can achieve that and also feel catchy, a bonus, but that is not the main thing.

    (3) If the domain name is to be used for marketing or promotional campaigns, then the focus is rather different. Here is where I think the phrase, including both sides of the dot, should be as natural as possible to what people would say in everyday speech. Think of it this way could you write a Tweet with the exact domain name in the sentence and it would feel natural. With Twitter, and a few other mediums, just the dot make it hot clickable. Here the new gTLDs can shine, and in my opinion have been under-utilized.

    There are other categories, especially non-profits and individuals, which will also have their own important characteristics. Product support, information sites, etc. each have their own considerations.

    Things like how many TLDs, age, what similar names sold, etc. can be indirect proxies for worth, but clearly they don't directly matter much. An aged domain with links obviously is a huge bonus for (2), but someone having held a name a ton of years by itself means little other than the person kept paying the renewals.

    Best wishes, but you have set, in my opinion, a very challenging task. I realize your question was a bit different, what makes a name valuable, rather than what makes a name valuable to an end-user, but I think the two are tightly connected.

    Bob
     
    Last edited: Mar 21, 2020
  23. Gube

    Gube Coming soon Gold Account

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    Thanks for your response @Bob Hawkes ,
    It will definitely help.

    With all of these in mind, it makes me think the appraisal should be dynamic.
    It wouldn't be a true, "100% guarantee" appraisal but a sort of helper to gather facts on a domain and ultimately help give a price range estimate, based on data found programatically but also based on the end-user itself. (The user would be invited to complete a data sheet, which he could save and access later, and adjust as needed).
    It would be used when buying a name as a reseller to check if buying it is (relatively) worth it and when selling to be able to offer a price, easily. It takes us to the next point :

    A brandable would also do the role of (2) with some limits, here the sorter the better too.
    If the goal for the user is to get type-in traffic, for example, we would need to have a sort of KYC "Know your customer" and try to understand his goals, but that part should go in a CRM I think.

    (3) is also true, and brands could do a better usage of gTLDs and nTLDs, it made me think of the booking.yeah campaign, these (relatively) new extensions will defintely help when crafting new, original campaigns.

    I will try to imagine a potential alpha formula of everything already said, but it won't be easy :xf.eek:
     
  24. koolishman

    koolishman Upgraded Member Blue Account

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    Formula for something subjective?
     
  25. Gube

    Gube Coming soon Gold Account

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    Well, a price range is not subjective.
    If you search for something totally random, it won't tell you it's worth 5M.

    The thing is that, the more info you have, the less subjective it is
     

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