Before buying a domain name in private or at auction, I tend to do a fair amount of research. I would not call this research exhaustive, nor do I fully research every domain name I buy. One thing I try to do is see if the domain name was on the market before, and if so, at what price.
For a variety of reasons (including the emergence of Sedo’s network and Afternic’s GoDaddy listings as well as a greater interest in selling domain names), people have been adding buy it now prices to their inventory. Some of these domain names have the prices listed right on the landing page while others have the pricing information available on a marketplace. Prospective buyers don’t always need to inquire to get the price of a domain name – it is much easier to find prices these days.
Knowing the former owner’s asking price is an important data point for me when buying a domain name, so I try to do a domain name pricing history check when possible. If a domain name held a low asking price, there might not be enough margin in it for me, and I would need to raise the BIN price to justify buying it. I must ask myself why I would have better luck selling it than the former owner. Oftentimes, I can’t justify this and will pass on the auction. Conversely, if the domain name had a super high asking price, perhaps prospective buyers simply passed on the domain name and a lower price point would make the name appealing.
Here’s an example:
If I am looking at a domain name that is in an expiry auction with a high bid of $500, I probably won’t try to buy it if I can see the former owner had it priced at $2,000. My thinking would be that it’s not worth spending $500 to hope someone is willing to pay $2,000. More often than not, buyers try to negotiate that price, and if I come down at all, there is not much room, especially if the name is sold via third party. On the other hand, if I can see the former registrant was asking $50,000, perhaps this was a deterrent and a $12,000 asking price would be more realistic. Even if I would need to reduce the price by 20% to a prospective buyer, there is still room for a decent profit.
Finding the previous asking price is a bit complicated. Sometimes DomainTools will still have the old price indexed. Other times the marketplace will still have the listing active. Occasionally, the former registrant will have had the asking price listed on the domain name, so Archive.org or Screenshots.com will show that information. Dofo also seems to have asking price history for some domain names listed on Afternic and possibly Sedo.
I fully believe that timing is a critical factor in domain sales. Someone may own a domain name for ten years without an inquiry, let it expire, and the next person who picks it up gets an inquiry the next day. I would imagine this is uncommon, but it certainly happens. This would mean the pricing wasn’t an issue, but I would say this is a rare event. If I am in an auction and see the domain name pricing history, that can influence my bidding strategy.