Oftentimes, after closing a nice domain sale to an end user buyer, I’ll research similar domain names to see if I can buy something to re-sell to that person or company. I figure that if this buyer is willing to pay retail pricing for the domain name I offered, I could probably sell other domain names to the company at a similar price level (assuming it wasn’t an inquiry related to a specific product or service).
Most of the time, the domain names that have aftermarket value are already owned by others, and sometimes they are developed websites. Depending on the owners of interesting domain names and how they are being used, I might send inquiry emails to see if they are potentially for sale, and if so, for how much. If I can buy a domain name at a good price that I think would have value to my other client, I would take the risk and purchase the domain name for re-sale purposes.
This sounds very good in theory, but most of the time I am not able to buy similar domain names for fair prices. When that happens, I like to add some of these domain names to my domain monitor list at DomainTools. When a domain name expires, changes DNS, transfers, or has other updates, I get an email from DomainTools letting me know about the update. In the case of an expiration, this is helpful because I can then backorder it, which may yield a better price than had I acquired it from the owner.
There are a few things to consider with this strategy:
- Domain buyer may not have interest in other domain names
- Timing may be critical because a year later the buyer may not be buying
- My perception of a valuable domain name may be different from prospects’
- There should be multiple prospects when speculating on domain names like this
One thing you can do if you don’t want to take on the added risk is to let your buyer know about available domain names and ask for a commission to close a deal. If you can buy a similar domain name for $5,000 but don’t want to spend $5,000 for the chance to sell it profitably, you can let the buyer know it’s available and obtain a 15% commission for that deal. Of course, you run into the issue of the buyer going to the seller and not paying you for notifying him of the domain name.
Selling to people and companies who have bought from you before is a great way to drive revenue. The Domain Monitor tool allows me to stay on top of names that might be of interest to companies that have bought from my company, and I get excited when I receive Domain Monitor emails in the morning.
This is a well written piece. It’s especially satisfying to do business with someone on a repeat basis. I have had buyers who decided to start investing in domains themselves and ones have have directed me to good deals. This isn’t the case all the time, but it is nice when it happens. Also, after already completely a sale, you are that much more experienced with the particular industry that the end user operates in which gives u a more advantageous position in achieving future sales.
Hey Elliot, great article! Just wanted to mention that if you’re looking for a service that monitors more TLDs, we actually just updated our watch list. Our watch list will track any TLD that we offer (30+) and notify customers when a domain goes from registered to unregistered, unregistered to registered, and enters our marketplace, expired auctions, or backorders. We are also planning to add more features next year, so you will be able to track DNS, expiration, and registrar changes as well.
Didn’t know that – thank you!