One of the most interesting aspects I’ve noticed after starting the domain sales newsletter has been the fact that despite making it crystal clear just how important it is to price your inventory in the way that makes it attractive to other investors, a lot of people still submit unrealistically priced inventory.
In my opinion, one of the most important things you need to do as a domain investor is understand the nature of the sales method you have chosen. For example, if you have decided to sell domains through my newsletter, you need to also understand that you are selling to investors just like yourself.
The main advantage of this approach is represented by the fact that you can generate instant liquidity without having to wait for an end-user sale to come along, the main disadvantage however should be obvious: the fact that your pricing needs to be considerably more aggressive. Otherwise, other investors will simply ignore your domain and rightfully so.
You deserve it because you didn’t do your homework and are pitching in a completely wrong manner.
Another example would be represented by let’s say Flippa. Whenever you are selling on that platform, you are selling to webmasters. On the one hand, they are not traditional end users but on the other hand, they are for the most part willing to pay more than domain investors. A good Flippa strategy should keep this particularity in mind. On the one hand, you can aim for more than what you ask for when pitching to another domain investor but on the other hand, if you try to obtain as much as you would obtain from a traditional end user, you might drive people away because unlike traditional end users, Flippa members don’t *have* to develop just your domain, they have many other choices.
To help you understand what I mean by traditional end user, I will refer to the domain ChicagoPlumbing.com. A traditional end user would be an actual plumbing company from Chicago. For that end user, your domain represents the best possible solution by far. A webmaster would be someone who wants to buy the domain in order to turn it into a directory of Chicago plumbers or do something else with it. The fundamental difference between these two types of buyers is represented by the fact that while one of them is extremely motivated to buy your domain, the traditional end user, the other is not. The webmaster can simply start another project on another domain, depending on which opportunities are presented to the person in question. These two examples make it clear that each sales venue has its particularities. I could continue listing other examples but I’m sure it’s not necessary, as getting the point doesn’t exactly involve rocket science. There’s no such thing as a good type of sales platform or a bad type of sales platform, each option has its pros as well as cons.
At the certain point in your career, selling your entire portfolio to another domain investor may be the wisest decision. At a different point in your career, you may decide that only accepting end user prices is the best approach. Again, there is no right or wrong answer.
There is little need to make this post much longer. The only message I tried to get across is that if you don’t tailor your strategy to the particularities of each sales method, your results will obviously not exactly be stellar. If you’re selling to the domainers, price for domainers and you can move inventory quickly and allocate that capital elsewhere. If you’re selling to webmasters, then feel free to increase your price expectations but do not expect them to pay as much as traditional end users would. And, finally, as far as traditional end users are concerned, the sky is the limit. However, do keep in mind that not even traditional end-users are perpetual cash machines. That’s pretty much it, common sense at its finest 🙂
