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Is the Term “Domain Market” Appropriate?

Posted on 28 April 2014 by Andrei

I for one don’t think we can simply use the term “domain market” in a way which encompasses absolutely everything. For example, NNN dot coms and NNNN dot coms have done remarkably well lately. Other domain types haven’t. For some domains, there’s lots and lots of demand whereas for others, there is practically none.

Therefore, I’d say we’re better off being more specific and using terms such as “LLL dot com market” or “LL dot net market” because quite frankly, there’s no such thing as a “domain market” at this point. Over the next year, I’m reasonably confident that the performance of various domain markets will be all over the place: certain domain types will go up in value, certain domain types will stagnate and certain domain types will go down in value.

Now some of you are probably asking yourselves:

Isn’t it the same way with stocks? Why is the term “stock market” relevant whereas the term “domain market” isn’t?

There’s one fundamental distinction.

With stocks, liquidating a position (selling) is a piece of cake.

You log into your brokerage account, press a button and bam, problem solved.

Domains are more complicated in that respect.

Go through the DNJournal sales archive when you get a chance to. A lot of the domains which were sold for decent prices wouldn’t have found a buyer on the reseller market. In other words, if the owners would have tried to sell them to domainers, they wouldn’t have been successful due to lack of demand.

Short domains are the closest thing we have to the stock market in terms of liquidity, which further reinforces my point that the term “domain market” is not appropriate. Also, for a lot of domains, there really isn’t a “market” in the first place.

Sure, they might fetch decent prices if/when the right end comes along but if that doesn’t happen and the owner were to try selling on the reseller market, literally nobody would be interested.

All in all, I’d say the three questions below sum everything up nicely:

Short domain market?

Yes.

LLL dot com market?

Yes, even better since it’s more specific.

Domain market?

No.

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3 Comments For This Post

  1. Paul Says:

    Agreed, great post! Suprised not more comments and posts regarding this exact topic. I think it is very hard to have a market when all the big portfolio holders place ask prices out that are equivalent to what they think a developed business on the name would get. With parking revenues going down buying and selling domains to domaines is really a thing of the past, at least in the past you may be able to derive how much a name was worth through parking revenue but with the paradigm switching to asking for end user pricing all liquidity has dried up.

  2. Savio D'Silva Says:

    Well said Andrei. Numeric domains have seen a rise recently too. It is not easy to sell domains in the reseller market since the brokers and agents handling the sales aren’t as aggressive as those that exist in the stock market. Also, most domain investors lack proper selling skills as a result of which they aren’t able to handle negotiations and sales as well as other professionals who are highly experienced sellers.

  3. AbdulBasit Makrani Says:

    That’s right. There is market for LLL/NNN/NNNN/super premium domains but other than that there is not much liquidity in domain market.

 
 
         
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