Learn Why a Domain Name Has Value

Elliot Silver
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18

I think a majority of the comments I receive on my articles listing the previous week’s domain sales that took place at Sedo and Afternic fall into one of four categories:

  • Most of those domain names suck
  • My domain names are much better
  • I don’t understand why names like that are selling
  • [Domain Name] was a good deal for the [buyer / seller]

Instead of looking at the list of domain names and comparing them to what you own or analyzing them on their merits, I think you need to dig a little deeper and try to determine why each domain name sold. Do a Whois search to see who bought the domain names. When the Whois reflects the new owner, type in the domain name to see what the new owner is doing with it.

Check out Andrew’s post today about some of the interesting end user acquisitions from last week. While in a  vacuum  environment, it might not make sense that some of those domain names sold at those prices, when you dig a bit deeper, you begin to see why they sold.  Oftentimes, companies with unique brand identities want to upgrade to a better domain name. Other times, companies have a marketing campaign and the domain name is beneficial.

As domain investors, we tend to crucify companies that don’t “get it” when it comes to domain names. They may try to be cutesy by using domain hacks or alternative extensions. They may also add a LLC to the domain name or an abbreviation like NY or CA to identify themselves. If they have the chance to buy the exact match domain name for their company, even if their company name seems to suck, it’s a smart move.

I may not think the company name Linens N Things is good, but it would be worse if the company used LinensNThingsNYC.com because their desired name was unavailable when they needed it.

When you are looking at the weekly sales, forget the sales prices on what seems like random domain names. In many of these cases, the sales price doesn’t really matter and may not make sense. The reason that’s the case is that it boils down to a domain owner’s need for money, negotiation skills, and the buyer’s need for a particular domain name.

If a domain owner doesn’t need the cash, he can hold out for a better offer on a seemingly average domain name. Similarly, if a company needs a domain name, they may be willing to pay more, even though they’re likely the only entity that could ever want the domain name. In short, the prices on brandable domain names shouldn’t really matter to you since they can’t really be used as comps.

The next time you read the weekly sales list, instead of complaining about the domain names that sold or lamenting about how much better your domain names are, why not spend an hour researching who bought what domain names. It will be more helpful to you and your business.

Marijuana.com Sold for $4.20 Million

Elliot Silver
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27

As the end of the year draws closer, another great descriptive domain name has changed hands for a  significant  amount of money. Shortly after I reported Aftermarket.com’s sale of Order.com, the 6th largest public sale of the year,  TechCrunch reported  that Marijuana.com was sold for  $4.20 million. Of course, “420” is a popular number amongst marijuana smokers.

The domain buyer is WeedMaps Media, Inc., an entity of the publicly traded  General Cannabis, Inc. The acquiring company is keeping the popular forum that exists on Marijuana.com, so it likely won’t be treated as a domain sale. The press release announcing the sale mentioned that the forum has over 300,000 registered users and has been online since 1995.

At the end of October 2010, the New York Times had an article discussing the increasing popularity of marijuana-related domain names. In the article, it mentioned that Marijuana.com had been purchased for more than one million dollars back in 2004: “  The New Jersey company that paid over $1 million for marijuana .com in 2004 says it has turned down five offers for more than $2 million for the domain in the last 12 months.”

It looks like a very smart acquisition for a company that wants to be the main source for Marijuana information online.

Aftermarket.com Sells Order.com in 6th Largest Public Sale of 2011

Elliot Silver
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3

Aftermarket.comThis evening, I learned about a large domain sale that was completed by Aftermarket.com  and its Senior Domain Broker,  Omar Kubba. Order.com was sold in a “mid-to-high six-figure sale,” which would rank as the 6th highest sale of the year, according to the Aftermarket.com press release posted below.

Although the final sales price was not released, we can surmise the price was somewhere between $525,000 and $700,000 based on the current DNJournal year to date sales chart covering public domain sales. According to the current Whois information, the buyer of the domain name was Delivery.com, a delivery service for restaurants and stores.

Details about how the deal was consummated were not released.  The sale was completed last week, and Order.com already forwards to Delivery.com.

Congratulations to Aftermarket.com and to Shai Neubauer, the seller of Order.com.

Press Release:

LOS ANGELES, CA –(BUSINESS WIRE)– Aftermarket.com celebrates its first birthday with the successful brokerage of Order.com.   The mid-to-high six-figure sale, which closed last week, ranks as the 6th  highest domain sale of the year, according to DNJournal.com.

The transaction was led by Omar Kubba, Senior Domain Broker for Aftermarket.com’s recently-launched Brokerage division. Aftermarket.com’s Brokerage division was formed specifically to cater to premium, highly-sought-after domain assets, domain names and websites that typically require a high level of hands-on involvement and personal attention due to the premium price tags and sophisticated clientele.

Senior Domain Broker, Omar Kubba, who heads the Brokerage division, views Aftermarket.com’s involvement in the premium domain space a must, commenting that, “Quality domain names above a certain price point often require a seasoned and professional team in order to complete the sale. Our brokers are dedicated to identifying investors and end-users that are committed and understand the long-term value of a premium, one-of-a-kind domain asset.”

As with any relatively new asset class, many of those outside of the domain industry are either unaware of or do not fully understand the true value of a solid domain name. Aftermarket.com brokers educate and evangelize throughout the sales process, reaching out to and working with buyers at all levels, from Fortune 100 companies to small business owners to individual investors. The quick turnaround and flawless execution of the Order.com transaction evidences that philosophy, and further solidifies Aftermarket.com’s unique position in the domain name industry. According to Kubba, “The new owner of Order.com had the savvy and foresight to purchase an asset that will not only appreciate over time, but one that will also add tremendous value to their already-successful business. They understood that there’s only one Order.com in the world, and now they own it.”

Shai Neubauer, the previous owner of Order.com, approached Aftermarket.com after exhausting several other avenues of representation. He knew of the Company’s solid reputation and decided to give the newly-formed Brokerage division an opportunity. “I’ve used all of the known domain industry brokers at one time or another; however, Aftermarket.com was the only company able to open the door to appropriate and qualified end users. Omar Kubba worked harder than anyone else and really went the extra mile to get the absolute best offer on my domain. His knowledge, persistence, and connections really made the difference,” said Neubauer.

Recent enhancements to the Aftermarket.com platform further assisted Kubba in successfully concluding the Order.com transaction. The newly-launched, proprietary Aftermarket.com broker system enabled Kubba to create a central web presence for all of his domain name listings, making it possible to provide a robust, secure, and professional hub for all interested parties. Aftermarket.com currently has exclusive and non-exclusive contracts on many other premium domain assets, with additional access to most of the world’s finest domain name assets; please visit http://broker.aftermarket.com for a partial list of highlighted Brokerage inventory, and www.aftermarket.com for a current list of marketplace inventory.

About Aftermarket.com

Aftermarket.com is a leading digital marketplace servicing the 24/7 demand for Internet domains on the World Wide Web. As an individual brand of Thought Convergence, Inc., Aftermarket.com is committed to offering the most advanced, innovative and secure platform for businesses and individuals to buy and sell domain names on the Internet. With its broad reach, quality inventory, and intuitive user interface, Aftermarket.com services the needs of any individual or business interested in buying, selling or learning about domain name assets. Aftermarket.com is the easy, intuitive and trusted way to make a name for yourself online. For more information, please visit www.aftermarket.com.

LinkWheelService.com – For Sale

Elliot Silver
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0

According to Wikipedia, a “Link wheel is a widely used internet marketing strategy. The basic idea of link wheels is to create a pattern of links which flow from one website to another which would finally link to a targeted website requiring promotion.” There are a number of SEO companies with a link wheel service offering, and the prices range from under $100 to several hundred dollars.

I am offering LinkWheelService.com for sale, and the price is $2,800. The current high offer is $1,000 from a company specializing in link wheel services (offer from this morning). I would possibly consider offers above $1,000 but below my asking price, but to buy it now without having to wait to see if better offers are received, the price is $2,800. The domain name is currently registered at Enom.

I would imagine this domain name can be used by a company that sells a link wheel service or by someone who wants to open an affiliate account with a company that offers this type of product.

This is a first come, first served opportunity.

Why A Domain Broker Won’t Sell Your Domain Name

Elliot Silver
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29

I’m often either asked to broker domain names (which I don’t do) or asked why a domain broker isn’t willing to put the effort into selling someone’s domain names. There are several reasons why a domain broker may not sell particular domain name(s), and I want to give you three possible reasons.

1) Your names aren’t very good. Let’s face it. We don’t all own spectacular domain names. Even the most successful domain investors own some domain names that probably aren’t worth much. It wouldn’t make sense for a domain broker to try and sell a domain name when he or she doesn’t think anyone would want to buy it.

2) The domain name isn’t valuable enough. I enjoy making domain sales of all sizes. It’s exciting to sell a $2,000 domain name the same way it’s exciting to sell a $20,000 domain name. For a domain broker with a fair amount of inventory, it doesn’t make sense to try and sell a $2,000 domain name, on which he may only make $200 – $400 in commission if it sells, when he has other valuable domain names he can sell. Would you spend effort to earn $400 when you can expend the same effort to potentially earn $10,000 or more? Personally, I’d rater have a broker be honest with me and not take on one of my names than lock my name up when he has no intention of marketing it.

3) Your asking price is way too high. I see this quite a bit. Someone offering a whopping 40% commission as enticement to try and sell their domain name for them. The problem is that if their asking price is too high, 40% commission on no sale equals $0. If the bottom line price is way over the market value, and the owner isn’t willing to show flexibility, there’s little reason to try and sell the domain name.

If a domain broker won’t work with you, here are some suggestions on how to sell domain names on your own.

Want to Sell Domain Names Quickly?

Elliot Silver
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20

Want to sell your domain names quickly? Someone in the domain business needs to hire this guy. 🙂  He is going places for sure, and I respect the fact that he seems to have mastered the art of the cold call sales pitch.

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