I am a regular participant in expiry auctions. Expiring domain name auctions can be a good place to acquire domain names, although some would probably say that auction prices have gone up considerably during the last few years, squeezing out quite a bit of the domain investors might need. Buying expiring domain names can be more cost effective than trying to purchase them from domain owners though, and expiry auctions remain one of the better ways to acquire good inventory.
I want to share some of the things I look at when evaluating expiry auctions. I think every auction participant has their own set of attributes they consider, and here are some of the things I consider when backordering domain names and bidding on auctions. These are not necessarily in order of importance. Your additional thoughts are invited in the comment section.
Generic nature – It is very important to me to only buy domain names that are generic in nature. I have no interest in buying a domain name where there is only one possible buyer because there is only one company with that name. I focus on generic domain names that cover an entire category or industry and would likely have many suitors in the aftermarket.
How a name sounds / could it be a brand or used by a company – To that end, I also want to consider whether I think a company would be willing to use the domain name in market. A domain name might be generic in nature but so specific that it would be tough to find a buyer or have a buyer find the name.
Other extensions owned by multiple companies and the age of them – One way to understand if a domain name is generic in nature is to see if other extensions are registered by more than one company. If the matching .net, .org, .info, .website, and .whatever domain names are all registered by different companies, this likely means the exact match com is generic enough. If many companies are using the keyword(s) in other extensions, it probably means there are prospective buyers that would want to upgrade.
Age of the domain name expiring – This isn’t a huge factor, but I have heard Google considers domain name age in its rankings. Whether or not this is true, we might not know, but if some people think it, there may be someone willing to pay a premium as a result.
How it was used – If a domain name expired after 15 years of having a “for sale” message on the homepage, it would be hard to justify paying a premium when the former owner couldn’t sell it. Timing is everything, but I would keep that in mind. I would also probably not buy a domain name if I could tell it was blacklisted, used for nefarious purposes, or had some other negative history. I don’t want to spend time dealing with the people who may think my business was somehow connected to its past usage.
Google results and keyword numbers – This has been less important to me of late, but it is always good to see the number of Google results and keyword searches to see if there is life. If I am bidding on a keyword domain name and there are only 20 websites in the world that have the particular keyword, it’s probably not going to be easy to re-sell.
Valuation – For better or worse, the appraisal tools tend to look at more things than I look at and they process much more data. If they say a domain name is worth $10,000, I don’t necessarily agree with the valuation, but it does show that there is some life and resale value.
Price – Maybe the most important aspect of domain auctions. There are plenty of times I love a domain name but if I can’t buy it with enough room to make a comfortable margin, I will spend my money elsewhere.