A Domain Name is Worth What Someone Will Pay For It

21

This is one of the most common rebuttals I receive when I tell someone the price of a domain name they want to buy and their offer is substantially lower. In the history of domain name sales, I don’t think this type of response has ever gotten a domain name seller to agree on a substantially lower price.

Here’s how I recently replied when someone made a sub-$100 offer for a domain name I value into the six figures, and he responded by saying ‘a domain name is worth what someone will pay for it’:

If you walk into a rare car dealership on a Tuesday afternoon and see a beautiful vintage Ferrari on the showroom floor, would you offer the dealer $75 if there is no tacky price tag on the windshield? Your $75 offer to buy [Redacted].com is sort of like that. 

The Ferrari may not have dozens of people crowded around it fighting to buy it – particularly on a Tuesday afternoon. However, the dealer could sell it to a Ferrari collector or someone who wants to have it in his collection for the value the dealer and collector agree upon. The value may seem crazy to me or to someone else who knows very little about Ferraris, but someone who is knowledgeable about rare cars or Ferraris would have a good idea of its worth.

My company acquired this domain name from a company that had not been using it. I know it is worth six figures because domain names are my business.

21 COMMENTS

  1. Like anything else, it takes 2 to tango…it takes the correct partners to make a baby.

    Patience Patience….grasshopper.

    Learn from the wild…patience, patience, stalk stalk and then pound for the food.

  2. There has been perhaps no bigger or greater proponent of the value of domain names in the various blog comments than me. That especially includes even compared to the great success stories and luminaries.

    That needed to be said. And, that said, there is one caveat here:

    When it comes to what I have written before and recently about the phenomenon of “mindless domainer think,” there can be situations where the “greater fool” principle is taking place. And that is what you have when “domain investors” mistakenly believe a domain is far better than it is, and part of their argument includes citing various famous and successful people willing to pay X, Y or Z amount for it. In some situations, however, what you really have is greater fool X, Y or Z making the same mistake about the value of the domain and just being artificial micro market makers enabling a delusion and mistake. The real test is real world value, not the willingness of domainers to deal among themselves.

    Ergo, that, for example, is what you have going on here with a domain like this:

    https://domaininvesting.com/going-all-out-in-bankruptcy-auction/#comment-91163

  3. It is a nonsense argument but it is argued on both sides of the ledger, ie people use to justify stuff like the $30million sale of Voice.com.

  4. This is a good and creative response, but for someone who makes a real offer (maybe mid five figure). A sub $100 offer honestly, does not even deserve a reply.

    • My first reply was:

      “I received your $75,000 offer to buy [redacted].com. The domain name is worth substantially more than that, so the company must decline. For a good idea of what one word .com domain names are selling for these days, you can have a look at this list: https://www.embrace.com/recent-one-word-com-domain-name-sales/

      He then clarified that he was offering $75 rather than $75,000. I then told him, “I see. Sorry for the assumption. No disrespect intended, but I would not have even replied had I known that.”

  5. Look… domain “investors” usually portray the situation as a one way street, as do many domain buyers. But it goes both ways.

    For example, I watched a 15+ year old three word “premium” domain being marketed for up to $1500 for a decade… it got no interest and was dropped. So much for being “premium”. Then a huge domain buyer caught it at the drop and listed it for $3500, down to $2500 the following year, then dropped it. It was probably hand regged soon after. And the WHOIS told me that it was big, experienced and well known domain owners with large portfolios both times, so these people in theory should know how to price them. But they don’t. It could be said that it’s just blatant extortion. Hundreds in reg fees wasted. Who got it third time is unknown as it has privacy, but I guess a small investor.

    Conversely, I often get $25 offers for 4 letter dot coms… stupid offers.

    The ridiculousness goes both ways. But unless we know the precise name in question it’s all just meaningless chit chat.

    It would be good one day when/if that domain sells to tell us what the domain is, how much it was sold for, plus a reminder of this $75 offer that was deemed to be ridiculous (it probably is but…)!

    • I don’t think it matters much for the intent of the article. However, I will say it is a .com, was created more than 25 years ago, and more than 100 extensions with the exact SLD are registered. I paid a lot of money to buy it privately.

    • No – I redacted the domain name. That’s the reason for the brackets. If I had mentioned the domain name, it inevitably would have led to a discussion about the name and its value (kind of like your comment – LOL), so I prefer to redact to keep comments on topic.

      • You tend to undervalue your own while overvaluing and buying into the “domainer think” problem about ones that are not your own, so I doubt you had much to be concerned about. Except for the ironic possibility of me having to defend your own domain from yourself, which I’ve done in the past.

Leave a Reply