It’s Silly to Buy Something That is Much Harder to Sell

Making a living as a domain name investor is not as easy as it may seem to be from the outside. Serious domain investors spend tens or hundreds of thousands of dollars (or more) on their domain name investments. Those who are most successful know what to buy and how much they can afford to spend, but even with that knowledge, it can take a considerable amount of time to profitably sell these domain names.

Buying domain names that have value has become more challenging with more competition vying for similar types of domain names. In addition, it has become far more expensive. The cost to buy good to great domain names has gone up considerably. This is a challenge faced by everyone still building their domain name portfolios, including veteran domain name investors.

This has also made it even more difficult for people who are new to the business of domain name investing or for those who have a small bankroll. As a result of the increased competition and pricing for good .com domain names, many people seem to turn to the less expensive new gTLD domain names as an investment. I think this is silly.

I would argue that selling new gTLD domain names to businesses is much more difficult than selling .com domain names. For better or worse, .com is generally more known, trusted, and accepted around the world. I think people who want to sell new gTLD domain names face more obstacles. Sure, it might cost less to register some new gTLD domain names, but selling those are far more difficult. Couple this with the fact that many new domain investors have no idea about selling domain names and this make it a losing proposition.

I have seen quite a few people commenting about how tough the domain name investment business is, and I am sure there are many more people who have silently left the business without much of a goodbye.

Selling .com domain names is tough. Even great .com domain names are difficult to sell for optimal value. I can’t imagine what it would be like to try and sell a bunch of new gTLD domain names in order to participate in the space.

Elliot Silver
Elliot Silver
About The Author: Elliot Silver is an Internet entrepreneur and publisher of DomainInvesting.com. Elliot is also the founder and President of Top Notch Domains, LLC, a company that has closed eight figures in deals. Please read the DomainInvesting.com Terms of Use page for additional information about the publisher, website comment policy, disclosures, and conflicts of interest. Reach out to Elliot: Twitter | Facebook | LinkedIn

33 COMMENTS

  1. It’s harder because half of the people entering the domain industry aren’t really looking to become investors or aren’t really looking to hold good names. They are looking for instant fortune or to become over night millionaires. Most of these people complaining about selling new gTLD’s are buying crappy ones. The same thing happens to people who buy crappy .com’s and try to sell them. Let’s face it selling crappy domains is hard regardless of the extension. Is it easier to sell a crappy .com than a crappy new gTLD? Probably, but why register, buy or own the crappy domain in the first place? Most people don’t want to take the time to learn the business and what they do learn or hear is regurgitated (FUD) about buying anything other than .com. The domain name space needs to move forward and evolve. Ford was the first automobile to be commercialized, but thank goodness not everyone is running around saying, Ford is the only car one can own to get them from point a to point b (analogy of course) of what everyone in the domain space saying .com is the only way sounds like.

    • Exactly get rich quick they have no idea you may end up owning for years, pay 20 % commission, or spend countless hours negotiating deals that fall apart.

      Not easy money here

    • You had me until the “Ford” comparison. Ford manufactured commoditized products. All domain names are inherently unique regardless of whether they are .com or not and therefore very different from transport vehicles. If you have to make a comparison in physical terms than real estate is much more comparable to domains. Neighborhoods can change over time but prime property in crowded places has always gone up over time. .com is international, new gTLDs not so much. Safer to stick to international in a global economy, especially given instability of renewal rates with new Gs.

    • You get the point though. Also, new gTLD’s are new. That old saying nothing else can be international except .com is another one of those dogmatic expressions regurgitated all to much. With .global, .company, .international, club and more, how can we still sit around and believe the early 2000’s way of thinking that .com is the only way to be found on the internet?

    • The question is do you know how to translate those long English word extensions into Mandarin Chinese or Hindi? Me neither. .Com needs no translation anywhere in the world.

      Im not saying some of those new Gs can’t pick up traction. Just not a risk I’m willing to take anymore w/premium renewals. I already took my loss on that hedge. At this point the chances of new Gs rising and .coms falling is very, very low imo. Seems more reasonable to assume that new Gs appreciation depends upon premium .coms becoming too expensive.

      You seem to be on the right track overall, and perhaps you have a profitable strategy with new Gs. Stick to what works for you.

    • My suggestion if worried about the premium renewals is, don’t register those ones. There are new gTLD’s without super high renewal rates. I picked up Message.company for $6.15 a year. Not all new g’s have a .car / .cars renewal price tag.

    • “The domain name space needs to move forward and evolve. Ford was the first automobile to be commercialized, but thank goodness not everyone is running around saying, Ford is the only car one can own to get them from point a to point b (analogy of course) of what everyone in the domain space saying .com is the only way sounds like.”

      ////////////////////////////////////

      Most cars work in much the same way, the badge doesn’t mean that much in terms of basic usage. That is not similar to domains where .com is what consumers expect a business to have.

      There is a 1001 analogies that could be brought up either way. May try selling non qwerty keyboard and see how that goes? How about selling a car with 6 wheels (maybe it handles better?). If any of these ideas were genuine improvements that would have taken off by now, ditto for ntld’s.

      The fact is new tlds have been for nearly 20 years and the market has not improved since the original .biz, .info, .pro, .jobs launches.

      There is infinite supply of usable .com’s.

    • I’m sorry, but .biz, info are a little different. They were trying to be cool catchy and slang-ish but never caught on. We cannot, I repeat cannot keep the same ideology that .com is the only extension that works. My comparison to Ford wasn’t to it making millions of autos, but Ford is only one brand that makes millions of autos. You can say that every .com is unique, but at the same time, every other domain with an extension is unique. No one else but the guy who bought Home.loans will own it, unless someone else acquires it from him. Every time I hear .com, .com, .com like it’s the only word some of the people who visit almost all domain blogs say, I feel like we are living in the movie Groundhogs Day before he finally figured out how to move forward.

      .com was has been great. We don’t have to pitch .com against other extensions. It’s not that the new gTLD’s suck, it’s that people in this industry don’t want it to move forward. They would like it be stuck in the early 2000’s. If as many people who regurgitated the .com agenda started using and promoting new gTLD’s the change you would see in the evolution of the internet name space would be monumental.

    • the people running the new gtlds suck, basically. they set up their registries so they are the domainers. any domainer out there doesn’t or shouldn’t like the way they are being run. if they were run like .com,net, etc i imagine there would probably be more people using them by now but they’re not. they are created not to fill a need but to fill the pockets of those running them.

    • @JZ, So that part may need some change. I’d expect some consolidation over the years. Donuts already acquired Rightside. I do like the way Donuts runs their new gTLD strings. Also .club does a pretty phenomenal job. Probably my favorite of all of the new g operators are those two. However it takes time for these things to be ironed out and I suspect that is also what some investors are afraid of. .com took a while in the beginning to iron out their quirks as well though. They had much higher registration and renewal fees in the early days, but eventually got to a reasonable place. I could see this happening in the new extension space.

    • I’d like to see no premium renewals, no premium registration pricing at all, no domains held back aside from blocked ones. we’ll never see this happen though.

    • “It’s not that the new gTLD’s suck, it’s that people in this industry don’t want it to move forward. They would like it be stuck in the early 2000’s. If as many people who regurgitated the .com agenda started using and promoting new gTLD’s the change you would see in the evolution of the internet name space would be monumental.”

      //////////////////

      Jason, There is no point blaming the industry for the lack of traction, domainers have no effect on whether an extension lives or dies. Ultimately consumers choose, if it doesn’t work for them those names won’t get sold, and that is what has been happening for ntlds for almost 20 years.

      There has simply been no uptake of these names, they aren’t needed or desirable. Go beyond the domain industry and there is no interest, so domainers can either go with the flow of consumer demand (.com) or attempt to go against it (new tlds).

      Good luck to anyone hoping to “educate” consumers or thinking that advertising would somehow change things.

    • You know this stuff is barely even profitable for registries. They massively overestimated what demand would be. Why would the burn down whatever business they have to make it easier for domainers?

    • Maybe Jason has a niche that works for him. Unfortunately almost everyone learns the hard way that “hope is not a strategy”. The trend is your friend until it isn’t, but going against the trend often leads to losses. Better to just watch from afar. Ive learned this lesson my fair share of time.

    • @RP, I’ve learned the lesson of bad domain investments early on as well, but most of my bad investments were made on bad .com domains (that I’ve dropped over the years)…. New gTLD’s won’t be the best investment for everyone, but neither are bad .com domains. I still obviously have some .com’s and I’ve dropped the ones I realized were bad. My stance isn’t to go against or hate on .com, it’s more less to open up investors, businesses, end users, and developers eyes that there is more out there. I’m not just a domain investor I’m a developer as well. Many people who invest in domains are more than just domain investors. If those who were developers started developing bad ass web sites and web based applications on awesome new gTLD’s it could change a a lot of perspectives. Let’s expand the canvas. Since most of the people who were born after 1990 grew up with a computer, ipad, tablet, mobile phone in their home from the day they were born, it’ll be a lot easier for younger generations to adopt these newer extensions and in fact they may even begin to prefer them as a change.

    • Jason, people born after 1990 grew up with .com. Instagram.com, Facebook.com, Google.com, they don’t know anything else. Why would they adapt to unfamiliar new extensions more than anyone else?

      Whilst you may have bought bad .com domains that doesn’t mean people should invest in new tlds. People need to look at the reality of the marketplace rather than hoping for change or hoping to “educate” people. 99% of domains are worthless but of the 1% it is mostly .com.

      None of us have any ability to effect change on what business uses. If feels like people are hoping to turn sand into diamonds here.

      It all comes back to the title of this blog post,

      “It’s Silly to Buy Something That is Much Harder to Sell”

  2. You get the point though. Also, new gTLD’s are new. That old saying nothing else can be international except .com is another one of those dogmatic expressions regurgitated all to much. With .global, .company, .international, club and more, how can we still sit around and believe the early 2000’s way of thinking that .com is the only way to be found on the internet?

  3. Exactly.

    Just like I said at TD. Focus on .com and leave the new TLDs to end users unless you are a fat cat who can afford to gamble.

    That’s why while a rare exception like Home.Loans may really and truly be worth $500k or $1m to a qualified end user, as a “domainer” or domain investor you are crazy to spend much for ones like that instead of more sellable .coms unless you are one of the fat cats who can afford to gamble.

    And some people probably still won’t get what I’m saying while I agree with every word Elliot wrote up there this time.

    • (Exception: some new TLD domains worth having have certainly been available at reg fees which are either okay or not too horrible, but still a gamble if all you are seeking is to sell them. Expensive lottery tickets indeed if all you do is sell.)

  4. I think it depends on 1. Whether you are looking for one word dot-coms 2. two word dot-coms (brandbucket type names). 3. Acornyms (liquid names).

    The narrative you tell yourself is critical, if you think it’s impossible you will create that scenario.

    • That’s delusional thinking along with all the bullsh*t happy speak, positive talk, and “positive confession” nonsense some people believe in.

    • Ironically, however, the reverse appears to be true in that people in “domaining” may have negative influence on the market by continually chanting negative things which are simply not true. But no amount of telling yourself any “narrative” is going to change things which are true. And what Elliot posted here is true enough. I have some very good new TLDs myself, but I also have no illusions about trying to sell them.

  5. For non-Americans or people with limited budgets, I think it might be better to invest in ccTLDs. Still plenty of opportunities there.

    You can register .in domains for less than .com or still buy some pretty good keywords in the aftermarket for an affordable price. Not to speak of .mx, .ph, ng. and .ke that could give a good return on investment in the long run.

  6. “Selling .com domain names is tough. Even great .com domain names are difficult to sell for optimal value. I can’t imagine what it would be like to try and sell a bunch of new gTLD domain names in order to participate in the space.”

    Amen, Elliot. Like you, I can’t even fathom how difficult it must be to sell these domains.

  7. “Selling .com domain names is tough. Even great .com domain names are difficult to sell for optimal value. I can’t imagine what it would be like to try and sell a bunch of new gTLD domain names in order to participate in the space.”

    Amen

  8. Jason you have it wrong on so many levels, as many smart industry veterans have stated here, NEW GTLD’s are not NEW!

    We have already seen this with .info, .biz, .mobi etc… they have all failed to hold market values, and demand among top tier Fortune 2000 companies. They are an afterthought. Smart money knew this before the gtld’s launched, I mean if you own a business, .biz is a great catchy extension, why did it never catch on? Single word .biz can be had for less than $250 everyday of the week.

    If .biz was to launch under then fan fare of 2014 when the other GTLD’s launched in January in EAP, it would be highly sought after by the uneducated batch of people who were chasing 1995 dreams in 2014.

    The premium revenue model is not going to change, nor is the fact we have to many different operators operating under to many different rules across 1000 different extensions. It just don’t work, it will not work, and in 2018 we continue to see the real cream rise to the top.

    End users do not always understand domain names, just because they pay alot for a gtld doesn’t make them the smartest person in the room, maybe the most uneducated, and are compensating for it, by throwing money at it.

    It has nothing to do with IPADS, APP’s which many people said 5 years ago were going to kill domains, half the time, I can’t get an app to do what I want, I have to directly log in to complete a task. We saw when TheDomains twitter was hijacked, and they lost all access to their customers, and content, and twitter couldn’t care less, they had to file legal action to get them to notice.

    You have to control your own content, gtld’s are what we like to call a gimmick, for the feable few who believe, and the registries did a great job in making people think they were going to sell.

    We see Frank Schilling call .com the AM dial, yet he spends millions on namejet buy .com’s every year, WHY? He has tens of millions of gtld combinations he can sell, why would he keep buying more .com’s when he can create infinite GTLD extensions, WHY OH WHY?

  9. Jason you have it wrong on so many levels, as many smart industry veterans have stated here, NEW GTLD’s are not NEW!

    We have already seen this with .info, .biz, .mobi etc… they have all failed to hold market values, and demand among top tier Fortune 2000 companies. They are an afterthought. Smart money knew this before the gtld’s launched, I mean if you own a business, .biz is a great catchy extension, why did it never catch on? Single word .biz can be had for less than $250 everyday of the week.

    If .biz was to launch under then fan fare of 2014 when the other GTLD’s launched in January in EAP, it would be highly sought after by the uneducated batch of people who were chasing 1995 dreams in 2014…

    The premium revenue model is not going to change, nor is the fact we have to many different operators operating under to many different rules across 1000 different extensions. It just don’t work, it will not work, and in 2018 we continue to see the real cream rise to the top.

    End users do not always understand domain names, just because they pay alot for a gtld doesn’t make them the smartest person in the room, maybe the most uneducated, and are compensating for it, by throwing money at it.

    It has nothing to do with IPADS, APP’s which many people said 5 years ago were going to kill domains, half the time, I can’t get an app to do what I want, I have to directly log in to complete a task. We saw when TheDomains twitter was hijacked, and they lost all access to their customers, and content, and twitter couldn’t care less, they had to file legal action to get them to notice.

    You have to control your own content, gtld’s are what we like to call a gimmick, for the feable few who believe, and the registries did a great job in making people think they were going to sell.

    We see Frank Schilling call .com the AM dial, yet he spends millions on namejet buy .com’s every year, WHY? He has tens of millions of gtld combinations he can sell, why would he keep buying more .com’s when he can create infinite GTLD extensions, WHY OH WHY?

  10. While I don’ disagree with Elliot on the key points (domain selling is hard, the evidence supports the fact that generally selling .com is easier and more lucrative), I feel that calling those who invest in ngTLD “silly” is maybe slightly harsh 🙂 (of course I am one of those politically correct Canadians).

    I think there can be good reasons to invest in ngTLDs, among them:
    (a) The investor is primarily interested in developing and encouraging use of domain name phrases, which don’t really work with .com but are ideally suited to some of the new gTLDs.
    (b) The investor seeks to primarily serve end users who are in the NGO/organization space. While clearly .org are suitable, and .net to some degree, also are a number of the new gTLD. Many of these organizations do not want to be associated with .com or .biz (I know some are OK with it).
    (c) It is best to sell what you know, and it is natural for those with expertise in an area of one of the new gTLDs to include them in their portfolio.
    (d) If the goal of the investor is to set up a diversified, creative portfolio without risking too much money, this is more possible with new gTLDs if one selects carefully. Yes, the odds are probably better of making money from one high value .com but then all of your work and risk is in a single name and you don’t have the fun of developing a creative set of possible names for end users.

    Most businesses fail, but if everyone took the lowest risk, easiest route of never gambling on something new we would not have innovative businesses. Yes, for every Apple for Amazon there are thousands of failed ideas, but occasionally one takes off!

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