Buying Domain Names

As a domain investor who flips domain names for a living, I think that making a reasonable offer for an acquisition target is one of the most challenging things I do. If my offer is too low, I likely won’t receive a reply from the owner. If the offer is too high, I won’t make a profit when I try to re-sell the domain name.

Making a fair and reasonable opening offer is the best way to close a deal. For me (and from my perspective), knowing what is a fair offer and what is a lowball offer is mostly gut feel, but it’s also knowing what the market is and has been for similar domain names.

One thing I recommend doing before making an offer on a domain name, especially if you are talking high 4, 5, or 6 figures, is doing some market research on that domain name and other, similar domain names. I recommend checking out NameBio.com or DNSalesPrice.com to see if they have sales in their database you can either use to determine a fair offer or even justify your offer when you receive a response. I recommend checking for the actual name, synonyms, and variations of the name – like -ing, -ed, -es…etc.

Both NameBio.com and DNSalesPrice.com have sales archives for domain names you might not have heard about selling. For instance, you might not see a full sales report on domain sales under $1,000, but they might have been archived on one of those websites. It’s also a great way to learn about other names that sold, and perhaps if you see a name that sold for a great price, you can target that name as an acquisition in the future.

I recommend doing your market research before making an offer because that will help guide you on making a fair offer. Should the domain owner tell you that your offer is way off, you can reply with a link to a sales report justifying your offer amount and telling the owner that you think it’s fair when compared to a recent sale.

There are a number of larger domain portfolio owners that sell domain names. While companies like Name Administration will generally only sell domain names at end user prices, there are companies that have fairly decent pricing. Buy Domains, for instance, has a huge portfolio of domain names, and many are well priced.

That being said, buyers can often get more reasonable deals on domain names, lower than the listed price, depending on the seller. The price discount that is offered generally depends on variables such as asking price, time of the month, sales volume, previous inquiries for the domain name, revenue generated by the domain name, and other proprietary variables that differ for each domain owner.

One piece of advice I can give you to get the best deals is to inquire about and purchase domain names in bulk. When you buy in bulk, you can generally get an even better price on the domain names.

What I do is write down a list of domain names I like from a particular company, and I inquire about the group of domain names at one time. I ask the domain owner for the best possible price on individual domain names as well as a bulk price. If I choose not to buy the list of domain names, I will go back to the domain owner and ask for a deal on the group of domain names I do like. I find companies are more likely to make deals on multiple domain names.

One other purchase tip I can give you is to try and make larger purchases at the end of the year (like next week). If a company hasn’t met its goals, wants to pad its numbers, or needs liquidity, they may be more likely to give better pricing at the end of the year.