I was evaluating a domain name today, and I searched my email archive because it seemed familiar. The first email that mentioned it was from the owner who was asking if I’d broker his domain name and he provided his asking price because I was interested in buying it. I directed him to a domain broker since I don’t broker names, and two emails later in my archive (about a year in between emails), I saw the name listed as sold for about a quarter of the asking price. It’s too bad he didn’t tell me about the price drop!
If you are contemplating reducing the price of a domain name, it’s important to reach back to anyone who expressed an interest in the domain name, even if you think it’s a longshot. People’s circumstances change, as does the market, and someone who may not have wanted to make a lowball offer may see your new price and be interested in working out a deal at a later date.
One thing that I really like about Sedo is that they send an email if a person reduces their price on a domain name I had inquired about. The email says, “The owner of [redacted.com] has reduced their sales price considerably, and the domain is now available for purchase on Sedo’s Domain Marketplace for a Buy Now price of X USD.” This is great for a seller because it gives the buyer a chance to re-evaluate at a lower price and it also makes the buyer aware that anyone else can buy it too, so it’s an opportunity that needs to be considered quickly.
It’s great when a domain brokerage or marketplace contacts previously interested parties automatically. Domain investors should also be proactive about this. A simple email stating something like “I have received an offer of $x to sell DomainName, and I am considering a sale at the price. Would you have an interest in beating this offer? I intend to make a decision in the next 24 hours, so be in touch ASAP if you’d like to discuss DomainName.” This simple email may not lead to a higher sales price, but it could result in a bidding war if you have two interested parties, especially if it is a competitive market.
In looking at the domain name I referenced before, I probably would not have bought it at the price at which it sold. However, the owner should have considered reaching out to me before agreeing to sell it, because it was a drastic enough price differential that I may have been interested.
There can be a bit of optimism when one receives that, “How much?” inquiry but quite often when one quotes a price they either don’t respond or respond, “Sorry, I am not interested.” Actually they were interested or they wouldn’t have asked “How much?” but their willingness to pay for a domain may be quite different than the seller’s price expectation (even if modest in relation to a business’ normal operating expenses). Is it likely a waste of time to ask, “How much would you be willing to pay?”
I don’t get it, the owner sold it, why would he give you preference if you are no longer interested. Most likely they had an active negotiation, where they were presented a price, and who knows what their financial situation was for them to accept it. They had an offer in front of them, and chose to take it, instead of chasing down someone who was at one point somewhat interested, but not invested enough to pull the trigger. I commend the seller for asking a high price for their domain upfront, to many domainers are selling themselves short.
He was originally asking close to $1m and sold it around $250k within a year through a broker. He may have gotten $250k from me had he come out and asked for that, and he wouldn’t have to pay a broker fee.
Similarly, he may have told me he had a $250k offer and I have x hours to match or beat that. I could have said no or not replied, and at least he would have made an effort to increase his bottom line. At the very least, the broker/brokerage should have been told about previous leads and been informed that a deal could be pending.
It’s not like he was asking $1m and had a $850k offer. We are talking a massive price difference within a year.
OK, that is a big money domain, and if it was done via sedo, best thing would be to push it into auction, then contact everyone involved.
Only name that remotely sounds familiar to what started high, and recently sold was gab.com, which has come down quite a bit in price. Saving house commissions at that price point helps, sometimes when brokers are involved, and offers have time limits things can get confusing. If that is the domain, $1M would have to be well funded end user, they got a decent price for it.
I didn’t say what broker or brokerage, and the deal closed a couple years ago or maybe even a few years ago. Sorry that I wasn’t very clear when I first wrote this.
Yes, quite a big drop for gab.com! Last year, it was asking 750k, then dropped to 350k, and finally sold this year for 200k.
Just so we are clear, that isn’t the name I was referencing. The name I wrote about sold at least 2 but probably 3 or 4 years ago and is developed already.
Sorry Elliot, but you would not have paid $ 250K. He knew that. You are a domainer, so he did not think even to ask you. Come on, be honest.
You may be right, but I can’t speculate on an opportunity I didn’t receive from a couple/few years ago.
If an opportunity came along today, I would pay that much if I thought it was a great deal (ie a $250k price on a name I think is clearly worth 7 figures to the right buyer).
As an aside, the owner of the name I was discussing approached me about the domain name out of the blue, so he clearly knew that I was a domain investor when he tried to sell it.
From a strategic stance you made the right move staying on the low end, as an investory, carrying costs on $250K are not easy, all the while, having the risk of bogus udrp’s lurking, you need to price everything into your final formula. You yourself wrote many articles about following up with past offers, maybe you failed on that stance.
Those are all risks that I consider when buying any domain name, especially those that are of higher value.
One thing I failed to mention was that between the emails I had archived that mentioned my name, about a year had passed. If I really wanted to buy the name, I should have followed up, but the original asking price scared me off. My article may not have been clear about that, but the point was more about following up with potential buyers to notify them of a price drop.