Domain Sales

Researching Source of Offer

It’s important that you do as much research on the source of your domain offers for a variety of reasons to see why the person wants to buy your domain name.   I think most of the reasons are obvious, but as ccTLDs continue to increase in popularity, there is one more thing to check before replying to the offer or inquiry.

If your .com domain name ends in a popular ccTLD extension, you should look to see if the ccTLD is developed, as many domain owners realize the importance of owning the corresponding .com domain name. Bit.ly is a very popular URL shortening service. Not only do they own the Liberian ccTLD (.LY), but they also own Bitly.com for protective purposes.

While many entrepreneurs on a shoestring budget will be happy to launch on a ccTLD that is more vanity than anything to do with the ccTLD, most will realize that they are losing traffic. In Bit.ly’s case, people continued to refer to the company as “Bitly” so visitors who think in .com as a default simply visited Bitly.com, which they are fortunate to own.

If your company owns a name like XXXXXXXXin.com or something like that, and you receive an inquiry, don’t just check USPTO, Google and other common places. You should also check the Whois for XXXXXXXX.in as well.

Classic Response to a Domain Inquiry

I get random legit email inquiries for some of my domain names, but many of my friends get a whole lot more of them than I do. They get annoying after a while, and instead of politely responding to a $500 offer for a domain name that is worth six figures, people are tempted to respond rudely, In my opinion, this does nothing effective. If a guy is offering $500 for a six figure domain name, he either thinks you are an idiot or he doesn’t have a clue about domain values.

I do have a response that I like to give to random legitimate inquiries, and I would like to share it. I think it may be a bit passive aggressive , but it helps educate, as people are far more knowledgeable about real estate than domain names. This response took a bit of time to construct, but it’s now easy to cut and paste (with the exception of the link that might be difficult to include in some email systems.

My response is built for an email that went something like this:

“I see you are the owner of XXXXX.com, and it isn’t developed yet. My company is in the process of developing a website which would be perfect for the domain name. I would like to offer you $x,xxx, which I believe is a fair price for XXXXX.com.”

My response:

Dear XXXXXX,

Thank you for your interest in XXXXXX.com. This is a domain name I bought for a specific purpose, but I haven’t yet had the opportunity to develop it as I am working on a number of projects. Unfortunately, I wouldn’t sell it anywhere near that price either because it’s worth much more.

When I visit Palm Beach, I always travel on South Ocean Drive. In between Mar a Lago and Sloan’s Curve, there is a beautiful undeveloped plot of land right on the Intercoastal Waterway, and it sits next to twenty and thirty million dollar houses (check it on Google Street View. Unfortunately, the owner hasn’t developed it. I, too, have plans to build a beautiful house (further inland) and it would be perfect for that plot of land because I can dock my boat right in the backyard.

If I approached the owner of that plot of land, and I said, “I looked at the MLS and your plot of land is worth about $4,000,000 – I would like to offer you what I believe is market value” – do you think he would sell it after years of not selling it (and by the looks of the trimmed lawn, it is well maintained)? I am sure he has been approached by many and has turned them all down as he presumably doesn’t need the cash and the land is a better investment than money in the bank earning less than the rate of inflation.

If I really want that plot of land, I will need to offer much more than its worth, in order to convince the owner to sell. Likewise, my domain name will be as difficult to acquire, especially because your initial valuation is so low. If you still wish to purchase my domain name, you are going to have to knock me down with an offer. Until that time, I wish you well in all of your endeavors online.

Bargain Domain Names

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I just created a new page on my blog called “Name Deals.” All names listed on that page are priced at under $50, and the list will be rotated and changed daily. I love researching and buying domain names, but I don’t have the time to develop everything I buy.

As with all of my domain sales, the first person to email me letting me know they want a particular name will get it. Payment should be made within 24 hours.

Who is Buying .Asia Domains?

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I know of someone with a large portfolio of premium English keyword .asia domain names who is looking to sell.   Send me a note or comment and I will put you in touch.   I’m not a domain broker, but happy to connect interest parties.

My Favorite Domain Tools

In addition to a variety of domain news sources, there are a number of domain tools that I use daily when buying and selling domain names, and I wanted to share some of them with you.   If you use other tools, I would be interested to know what you use, and what they do for you. Below are my favorites – although this list will probably grow as I think of other tools I use:

Whois Lookup (Whois.sc) – I think everyone has a favorite Whois look-up, and I use Whois.sc/domain.com in order to see who owns what.   On my Blackberry, I prefer iWhois.com because it loads faster for me.

Domain History Tool (Domain Tools) – This is imperative when buying an older domain name in order to make sure everything looks legit. The last thing you want to do is buy a stolen domain name, so this tool can help you see if something looks fishy.

Website History Check (Archive.org) – This allows you to see various websites that previously existed on a domain name.

Keyword Popularity (Google Adwords) – See how many searches are done monthly and on average via Google to see how people are searching and the exact terms they use.   This tool is also great for development to see what long tail keywords people are looking to find.

Domain Sales Data (DNSalePrice.com) – Although recorded domain sales don’t always mean that similar domain names will sell for the same prices, it’s a good sanity check.   DNJournal’s sales data is also great, but this tool has many more sales, as DNJ records the biggest sales.

Bulk Domain Search (Moniker) – Easy to use and register – and I don’t have to go through 10 pages of upsell junk that I don’t need.

Escrow (Escrow.com) – If I am 100% certain about the domain name’s provenance and not concerned about the seller, I like to use Escrow.com.   It’s simple to set up, I don’t have to wait to sign forms and fax paperwork, they’re very quick, and they clearly know a thing or two about great domain names. Escrow.com is also trusted by non-domainers, making transactions even easier.

Reverse IP (Domain Tools) I secretly love using this tool when buying domain names.   Frequently, people have multiple domain names on one IP address, and if I can see several great domain names owned by one company, I can make a larger bulk offer.

What other tools am I missing?

Does a Big Sale Raise Domain Values?

I am in the midst of a discussion with one of my blog readers, Bruce Gittleman (who gave me permission to use his name and domain names), and the discussion centers on whether Rick Schwartz’s pending sale of Candy.com will lift the values of four domain names Bruce owns, CandySweets.com (reg’d in 1999), WeLoveCandy.com, SheLovesCandy.com and BuyGreatCandy.com. There is a saying, “a rising tide lifts all boats,” and some people liken it to a big domain sale increasing the value of similar or related domain names, but I don’t think it applies in this situation.

After a large domain sale like Candy.com, world event like the election of President Obama, or tragedy like the tsunami in Thailand, people register thousands of domain names with the hopes of capitalizing on the increased publicity. It is my belief that 99.9% of these types of domain names do not sell. Although Bruce didn’t specifically register his brandable domain names because of Rick’s pending sale, if they are put up for sale now, they will compete with thousands of other similar names on sites like Ebay.

There are several reasons that I outlined why I think Bruce will be hardpressed to sell his domain names for a profit – especially given the current economic conditions:

  1. Since nobody has contacted Bruce since 1999 (assumption), chances are good that nobody will all of a sudden want them… so
  2. Bruce will have to contact candy companies on his own to sell/market them, which is   very time consuming
  3. It will be difficult finding someone who wants these, so Bruce will have to sell them on the concept rather than just on the value of the names alone.
  4. Once Bruce gets someone interested, he will then have to convince them to spend the money.   Bruce has already invested over $75 in renewal fees alone + the time it takes to convince them that they need the domain name
  5. It’s very difficult to convince a company to spend thousands of dollars on a brandable name, when they can just as easily spend $8 to register: TheyLoveCandy.com, SheLovesCandies.com, or another unregistered brandable domain name

There are always people who spend hundreds of dollars on “trendy” domain names that are mostly a waste of money, in my opinion. Instead of spending $800 dollars on 100 new registrations like these, it would be better to buy one $800 domain name that gets some traffic and actually has meaning, rather than creating brandable domain names that nobody cared to register in the past.

Generic domain names like Candy.com and Auction.com sell for 7 figures because everyone around the world knows them.   They haven’t been developed into businesses before, yet their brand value and goodwill is already immense. Additionally, the type-in traffic is and always will be strong, and this traffic can be converted into sales immediately after turning it into a business.

In my opinion, 99.99% of the new registrations that come after big sales are worthless. In general, I do think similar meaningful names like CandyBars.com and Auctions.com become worth more as domain names, but I really don’t think brandable names become more valuable.

What do you think?

BTW, I thank Bruce for being a good sport about this and allowing me to use him and his names as examples.   If the four names he owns are of interest to you or your company, drop me a note and I will put you in touch.

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