“Domainer to Domainer” Sales and End User Sales = Two COMPLETELY Different Things

Yeah, I know: comparable sales, search volumes, domain age, price trends, whatever. These are all common sense metrics… but only when selling to another domainer.

Why? Because we need to make the distinction between end user sales and domainer to domainer sales since these two types of buyers have completely different goals.

On the one hand, domainers want to ultimately sell the domain for more than what they paid for it, great. For this reason, metrics such as comparable sales and search volumes make sense.

What about End Users?

When it comes to end users, all of the previously mentioned metrics become irrelevant because you can’t just put a price tag on a domain and say that it is accurate for all potential end users.

The domain BestToys.com might be worth considerably more to end user A than to end user B or the other way around, let me explain why.

If end user A is a small local toy store owner who simply wants a domain people can remember and does not want to expand, then paying let’s say $200k doesn’t make sense. In other words, the domain just isn’t worth $200k to that specific end user.

On the other hand, if end user B is a well funded toy company owner who wants to spend $100 million on TV ads, the domain in question is easily worth $200k to him/her.

Why?

Let’s take things one step further and assume that end user B spends $100 million on lots of TV ads and imagine two scenarios.

Scanario1) He uses a hard to remember hand regged domain

The result: 50 million visitors ($2 per visitor)

Scenario2) He buys BestToys.com for $200,000

The result: 100 million visitors (just $1 per visitor) because more people remembered the domain and, of course, because a good domain gives you an instant credibility boost

Worth It or Not?

What do you think? Is spending $200k on a domain that gets you twice as much traffic for your effort and helps you save tens of millions of dollars worth it if you’re working with a huge budget? Of course it is!

Now the above example is obviously extremely simplistic but I’m sure you get the point. The bottom line is that as a domainer, trying to find a “one size fits all” end user pricing solution is just plain wrong. Yes, you can definitely say things like “this domain is worth $x” when selling to or buying from a domainer (especially liquid domains such as three letter domains or CVCV dot coms, for example) but NOT when selling to an end user.

One of the joys of being a moderator at one of the most popular domaining forum — DNForum — is that you get swamped with private messages from people. One of the question which I get asked the most is How to Sell a Domain Name.

In this post I am going to talk about the strategies I use to sell a domain name or website. Let’s get started, shall we?

There are a few things that I must tell you before we get started.

1. DO NOT buy any eBook — I have read most of the eBooks currently available in the market and they are mostly useless and provide obsolete information.

2. Subscribe to DomainingTips.com Newsletter — As the moderator of one of the biggest and most influential domaining forum (DNForum), I have access to some of the biggest players in the industry.

Subscription to the newsletter is absolutely free and you also get a free copy of my guide “8 Things You Must Know About Making Money From Domain Name”. Click here to subscribe. You will be glad that you did.

There are two kind of people who buy domain names — 1. Resellers and 2. End Users.

Resellers are the people who buy domains and sites with the sole purpose of reselling them. They are not interested in keeping their inventory forever and are, usually, not interested in developing the domain name.

End Users are the people who are interested in developing and running the domain. Unlike resellers, they plan to use the domain for development or promotion purposes and don’t plan to sell it as soon as they find a buyer. An end user can be an individual or a company.

A lot of times people will list a domain for sale and get discouraged when no one makes an offer or buys what they are selling. Most of the times it turns out that they were trying to sell to wrong people.

Let’s see what actually sells and who buys it.

1. Generic Domains. These are domains like hotels.com, cars.com, search.com, poker.com, loan.com, coupons.com etc.

The reason why these domains are valuable is because a lot of people will never use a search engine to find things but instead just type [keyword].com — which translates into highly targeted traffic.

End-Users pay big bucks for these type of names. Resellers are also willing to offer big bucks for them in hope of selling them for even bigger bucks.

2. Revenue Domains. These are the names which make revenue from parking traffic. If you have this kind of domain then resellers would totally jump at it and offer you 12-15 months of revenue for it.

3. Brandable Domains. These are the brandable names like NewYorkHotels.com or MiamiRealtors.com. The target for these types of domains is usually end users. Resellers don’t shell much money for them usually.

4. Developed Sites - There is yet another category which is domains with websites. They are much easier to sell as they usually have traffic and revenue attached to them by the virtue of their search engine rankings.

Resellers buy sites which don’t take much effort to run or promote. End users look for sites with long-term potential — which may even mean putting effort into running the site or promoting it.

Now you know the kind of domains which sell and who buys them, however, the bigger question is where to sell them. Let’s talk about various ways –

1. Domain Forums. Domain forums are the most popular way to sell domains. Places like DNForum (one of the biggest and most influential), SitePoint, WickedFire and NamePros (mostly newbies hangout here) are popular to sell domains. However, the people who hangout on these sites are mostly resellers and only a small proportion are end-users.

2. Online Auctions. There are lot of online auction sites like sedo.com where you can sell domains and you can even auction domains on forums like DNForum.com.

eBay also has a domain auction section, however, it is usually the newbies which make up the bulk of audience there and it is turnkey sites and cheap domains which sell best there. There have been a lot of reports of scams on eBay — therefore, I don’t recommend selling on eBay.

3. Domain Brokers. These are the people and companies who take a percentage cut — usually 15-20% of the final value — for selling your domain.

If you have a good domain which you hope to sell for bigger bucks and are ready to pay to brokerage, it is usually a good idea to involve brokers. They usually have lot of contacts and experience in selling domains. Think of them like real-estate agents except they focus on virtual real-estate.

4. Live Auctions. This is a newer trend where companies like Moniker.com are conducting live auctions for domains at various industry events. This is where a lot of end users and big guys hang out and where the big-buck deals take place.

Obviously, these companies are choosy about the domains that they include in the auction. However, you should never hesitate to submit your names for auction — you never know it may sell. Newsletter Subscribers will get regular updates about upcoming auctions and submission deadlines.

5. Everyone You Know. Tell everyone you already know — including your old customers and your friends — that you have a domain for sale. There is a chance that they themselves or someone they know may be interested in your domain. I have sold a whole lot of domains this way.

This was something which I never used to tell earlier, however, when I told it to some of my friends who had the same clients as me, I found that it didn’t make much of difference to my success rate. I found that success rate with this tactic depended on lot of factors which I regularly talk in the newsletter.

I hope you found this guide useful. If you have any comments or suggestions, feel free to contact me by email (lord [at] lordbrar.com), AIM (lordbrar) or MSN (lord [at] lordbrar.com). You can also check some more tips on How to Sell a Domain Name.