That’s the #1 mistake domainers and online entrepreneurs make in my opinion, they perceive the Internet as nothing more than letters on a screen.

They don’t understand that behind those sequences of letters, there are *real* people. The proverbial end user isn’t a computer program, he/she isn’t a figment of your imagination either. Each end user is a real person, with real needs and financial possibilities.

It never ceases to amaze me how most domainers don’t understand that you can’t generalize.

They think a category killer is a category killer and that’s it.

Wrong!

It all depends on, you guessed it… the category!

Lots of domainers overpay for category killers, only to be surprised that the end users who contact them can in no way afford to pay more for the domain than the investor did.

Why?

Simply because the domainer overestimated the financial possibilities of the end users for that specific domain.

He or she didn’t understand that when it comes to category killers, not all categories are created equal.

Who are the end users you ultimately want to sell the domain to and what are their financial possibilities?

This is the first question domainers should ask themselves, yet most of them don’t focus on it all that much if at all. They just see a category killer that “sounds good” and start bidding.

Bad idea!

Before placing that first bid, analyze the industry in question.

The businesses.

The volume.

The profit margins.

It’s really not rocket science and based on your analysis, you will be able to figure out whether or not the domain in question has enough upside at the price you were thinking about paying for it.

Again, you’re a domainer and want to ultimately make money by selling to real people.

The sooner you get rid of the “letters on a screen” mentality and start understanding that each category/industry is different, that we’re talking about completely different people with completely different goals and financial possibilities, the better.