I am currently involved in a domain auction with a handful of bidders. I want to share a relatively common sense tip that can sometimes help me determine how much I am willing to pay to acquire a domain name.
There is about a day left in the auction, so I am internally trying to determine the maximum number I am comfortable paying. I checked a very similar name (plural vs. singular) to see how it is used and who owns it. I noticed that the similar domain name is listed for sale on a popular aftermarket website. That domain name has a buy it now price of a little under $2,000.
Some might argue the other domain name is more valuable than the name in auction. I could go either way on it, although a case could be made for either domain name. The keyphrase of the domain name in auction has has one extension registered while the comparable name has 5 of the most popular extensions registered.
If I would win the auction and price the domain name in the $5,000 range, a prospective buyer would almost certainly choose the other domain name. Even if I listed it at under $2,000, a prospect would still probably choose the other domain name. My comfort level bidding for this particular domain name is influenced by a very comparable listing.
Put simply, by seeing a very similar domain name on the market with a buy it now price, I can see the price ceiling I would expect should I win the name and list it for sale. I need to factor in the likelihood of selling the domain name I am about to buy, how quickly it might sell, and potential commissions from a marketplace listing. A little back of the napkin math will help me determine how aggressively to go after the domain name.