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.
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:
- Since nobody has contacted Bruce since 1999 (assumption), chances are good that nobody will all of a sudden want them… so
- Bruce will have to contact candy companies on his own to sell/market them, which is very time consuming
- 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.
- 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
- 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.
Schwartz Set to Sell Candy.com for $3m
Rick Schwartz has announced that he reached a deal is set to sell Candy.com for $3,000,000 + an ongoing percentage of sales. The domain name was is said to be purchased by an undisclosed US candy maker.
Several months ago, I believe Rick had been forwarding traffic from Candy.com to Hersheys.com, but I don’t know if this might be a precursor to the sale.
The recent million dollar + sales of names like Auction.com, Toys.com and Candy.com show that the domain market is still strong at the top. Brands are great, but one word category killer .com domain names that get significant type-in traffic will always get type in traffic, and these domain names can consistently drive revenue for a company.
***Update***
Although the title of Rick’s article says “Rick scores a sweet deal,” indicating that a deal was finalized, some of the content from inside the article indicate that the deal might not be completely closed yet. “In what will be another landmark deal, I am able to report that Candy.com is set to sell for $3M plus an ongoing percentage of sales to a US based candy company.” I don’t think Rick would have reported this on his blog if he wasn’t certain it would close, but I wanted to post this update.
Liquidating Your Domain Names
Say that you need to cash out your domain investments ASAP. Perhaps you need to pay some bills, and you can’t afford to hold on to some of your domain names any more. Where do you turn? Right now, I don’t think there are any absolute reliable options, but I do think Bido is going to change this.
If you put your domain name up for sale on a domain forum, it’s unlikely to sell unless it’s a great name and you price it under market value. What happens is that you list your name, and if it’s not snapped up in the first several minutes, others will pass it over, and eventually it will end up on page 5 – the annals of the domain forum. You then have to lower your price, and wait and hope that someone sees it the second time around. This is no way to liquidate a domain name because it isn’t quick and you aren’t guaranteed to sell it for what the market will yield.
When you put a domain name for sale on a site like Sedo or Afternic, you are competing with hundreds of thousands of other domain names, and a quick sale is very unlikely. It’s difficult (or expensive) to stand out on one of the leading aftermarket sales sites. These sites may be good for selling a domain name, but I don’t think they’re the right venue for a quick liquidation sale.
Auctions are also good spots to sell domain names, but they aren’t close to a sure bet, and you’ll end up locking up your domain name for weeks due to auction house exclusivity. Domain brokers can be great, too – but again, you have to work with exclusivity, and competition from other listings.
So after all of this, I really think Bido is going to be a great place to sell your names quickly. People have been commenting that the sales are far from stellar. I disagree. The names for the most part have been far from stellar, so the sales prices are in line with expectations.
Yesterday, ZJP.com sold for $4,055. I believe this is in line with what other 3 letter domain names are selling for now, and it shows that the market will set the price if the starting price is below market value, which is true with Bido’s $1 auction starts. Especially at this time, you can’t expect to get end user prices by selling to domain investors.
Domainers watch Bido and observe the auctions – whether the domains are great quality or poor quality. Domainers can bring liquidity to the marketplace, and if you need cash, selling to a domain investor is usually the quickest way to make a sale. Bido offers a great platform for domain investors to get liquidity. I would imagine they will open up for more auctions soon, and that should make it easier for people to sell their names.