Buying Domain Names

I frequently run into the problem of locating domain owners when the Whois information is invalid or outdated. When I want to purchase a domain name, I generally send personal notes to the Whois email address on record – or the historic information if necessary. Oftentimes, I receive the “Delivery Status Notification (Failure)” message that is standard for invalid or inoperable email accounts.

When this happens, I typically call the phone number of the registrant to make contact that way, but I often find that the phone numbers aren’t working either. Depending on the domain name, I will either give up and consider it a lost cause, or I will use a few different ways to get in touch with the owner.

1) Search for the owner’s last name and city on WhitePages.com to find a current phone number. A big DING goes off in my head if the phone number listed is different than the Whois.

2) Search for the owner’s name in Google (in quotes). Oftentimes you will see that the owner is either associated with other companies or email addresses, and you can use those to get in touch.

3) Search for the email address in Google. Sometimes you will find the email address associated with different websites or listed on a particular website along with a more current phone number or alternative means of contact.

4) Search the domain name’s website for info – both the current site and archive.org record. Sometimes the most obvious way of contacting the owner is overlooked.

If all else fails and you need the domain name, you can always visit the last known address. Usually this doesn’t work out, but it is a good way to get information. Sure, most people are reluctant to spend $1k+ on travel and associated expenses to visit a location, but if it can help you buy a $250,000 domain name, why would you give up so easily?

A whole lot of effort went into purchasing Customs.com in September of 2007, and if it wasn’t for going the extra few miles, I would not have been able to acquire it. Sometimes it takes a lot of effort to get in touch with a domain owner, but if it was easy, someone else would have acquired the domain name long ago.

A lot of domain owners have received offers on their premium domain names. Strike that. ALL owners of premium domain names have received offers on their domain names before. It’s virtually impossible to be the first offer someone’s received if they own a great domain name. To get there attention, your email needs to stand out from everyone else’s solicitation.

As a domain buyer, your job is to make an offer that is compelling enough for them to respond. If you insult someone with a lowball offer, they will delete it. Even if you think your offer is a “good” introductory offer, step into their shoes for a minute and imagine you’ve owned that domain name for 10 years and received countless emails. How would you respond to the email? If you aren’t impressed, they won’t be either, and they probably will delete it.

If you ask the domain owner if the name is for sale without naming a price, they will probably delete it, too. They’ve owned the name for a long time for a reason, and that’s because they haven’t received a compelling enough offer to sell it.

The best way to get a conversation going with a domain owner is to make a good opening offer. At the very least, you will usually get a response, and at the best, the domain owner will accept your offer. I enjoy negotiations to a point, but I generally make a strong offer at the outset. Maybe I can go higher, but maybe I can’t. However, it’s generally good enough to get a response.

I’ve also found it helpful to include my phone number in my email correspondence. People want to know they are dealing with other real people, and if they can give you a call to talk, they will generally feel more comfortable. This has helped seal the deal on a couple of acquisitions in the last few weeks.

People are willing to sell their domain names, but you need to give them a reason. For many it’s financial, and you can’t negotiate with someone who immediately deletes your email upon opening it.

One problem I think many of us have is that we sometimes view our domain investments as a means to make a lot of money quickly. I know a number of people who got started in the industry after reading articles about people like Rick Schwartz making a lot of money with virtual assets, and they want to follow suit because it looks like a great lifestyle filled with “easy money.”

I must admit that the domain investor “lifestyle” I live is great, but it’s not exactly the stereotypical one that people probably think about. I work 12-16 hour days developing, researching, and negotiating, and I work every day. I enjoy what I do, and I set my own hours, so it’s worked out well. If I want to take a day off, I have the ability to do that. There are very few people in the industry who sit back and relax all day while drinking cocktails on the beach at night, although that stereotype does sound relaxing.

All of this said, I want to give a bit of a warning to people who may be new to the industry. Just because you see a specific type of name selling for a lot of money (and growing in value), it doesn’t mean that all similar names are worth the same amount of money. Simply because some people are investing isn’t a good enough reason for you to buy as well unless you know why the name is increasing in value and believe the rationale is correct.

Over the past year, prices in a number of verticals within our industry have dropped considerably, while premium domain names have kept their value. The reason is that many verticals (like 3 and 4 letter domain names) were perceived as being much more valuable than other domain names, and domain investors who were doing most of the buying couldn’t sustain the growth. Eventually, there were many more sellers than buyers, and the prices dropped, tremendously in some cases.

I am not going to preach and tell you what types of names are best to buy and what types of names aren’t. It really isn’t as easy as that. I will say that you should do your due diligence when you buy, and if you are looking to make fast money, you are in the industry at the wrong time. Just about everyone I know is working hard, and there is no such thing as easy money.