Every auction venue deals with winning bidders that default and do not pay for auctions they win. I imagine every auction house has tools and processes in place to reduce the number of defaulting bidders, but I do not think it is possible to eliminate bidder defaults for a host of reasons.
Domain industry auction platforms that specialize in expiry domain name auctions have different policies regarding domain names that were not purchased by the high bidder. Here’s how I believe each operates when it comes to expired or deleted domain names:
- GoDaddy – Next highest bidder gets a day to decide whether to buy the domain name at a price as if the higher bidder did not exist. The domain name is offered to subsequent bidders when the higher bidder passes.
- NameJet and SnapNames – Domain name is re-auctioned or possibly kept by Web.com’s portfolio holding company.
- DropCatch.com – Domain name is re-auction.
When it comes to re-auctioning a domain name, some people have argued that only the original bidders should be eligible to participate. I tend to agree with this because it could benefit the auction house if a higher result is achieved if other bidders are given the opportunity to participate.
I am curious what readers think should happen with expired / pending delete domain name auctions if the winning bidder does not pay.