I will not sugar-coat it: we are being hated upon, potentially by the entire world outside our little industry.
Domain investing is an open industry where anything goes; speculators, short term tasters, flippers, agonized penny stock traders, long term betters – anyone and their mother can become a ‘domainer’.
There are no tests to pass, no qualifications to prove, no background checks. It’s the good old Wild West in a digital format.
People hate our business model, and hate is a strong word.
I get such responses often, from offers made on domain names I own. Inquiries state it clearly: they hate our business model – because they don’t understand what we’re doing.
Because of the lack of any certification, we are not truly an industry, or a profession. We have to explain everything we do, each and every time we engage in a social or business interaction outside of our small community.
My response to these inquiries that display their hatred for our business model is simple.
I point them to resources explaining the basics of domain investing, and that record the pulse of the domain industry. Instead of agonizing over their statement, I attempt to educate them – even though I am certain that in one’s mind the final answer is given by the asking dollar figure for a domain.
“I hate your business model” is a strong statement that should not be answered aggressively or in an insulting manner, even if the statement insults you and your business.
A recent email expanded further on that, adding: “You buy up domains that you don’t use and sit on them, hoping for a investment backed business willing to pay thousands.”
For more information, I point these misguided souls to the DNS Buyer’s Guide, and DNJournal’s sales.
It’s about time education eradicates misconceptions and such unwarranted hatred, if we are to grow bigger and better.
TGIF.
Do people hate on the business model of American Pickers? (tv show). Scour for treasure, buy low, sell high. Gasp!! They aren’t actually using all of those antiques they buy, just sitting on them and waiting for someone else to pay them thousands of dollars. How do they sleep at night?
Mike – Ha! 😀 I love American Pickers. They have a great energy, although they most likely end up picking the equivalent of pigeon shit 😀
While RS might ask for six figures on any domain he owns and FS & MB may ask five figures for most of their domains, the vast majority of domain sales are under $5000 which compared to operating expenses in any normal business is really not a big deal. The perception however is that a domain should cost $50 max.
Perhaps the question for any business that questions a $5k asking price, “How much do you spend annually on marketing/advertising?” or “How much do you pay for office or mall space annually?” or “How much is your annual payroll?” or “How much do you spend on corporate travel per year?” or “What is your annual sales volume and what percentage of that would this domain acquisition be? ” etc…
Hate may be too strong, but their displeasure is well justified.
Each domain is unique, so it can be a rather unpleasant market in which to be a buyer, if you desire one particular name above all others.
You’ve got to not only beat all other offers, but pay whatever premium the seller thinks he deserves.
And how do we know that prices are often too high? Because many sellers sell only a tiny fraction of their domains each year. They sell to the desperate or rich, and anyone who simply wants to pay a fair price is shown the door.
One can argue that domains are undervalued, but when you have a monopoly over a particular name, you should not be allowed to make that call.
tewk – Anyone unwilling or unable to match the asking price due to budget constraints, is welcome to a) register another TLD or b) register a different domain altogether. The real estate analogy would be, someone wanting your beachfront real estate property for the price of a Detroit ghetto crack house. Too strong? It’s a good analogy, I think.
Buyers are welcome to register another, but that doesn’t reduce the frustration of eg. knowing that yours is very likely the best available offer but is being declined because the seller won’t get out of bed for that amount.
There are many buyers who want beachfront for Detroit prices, but they’re just not willing to pay market value. The ones who’ve cause for complaint are those willing to beat all other offers, yet who are still turned down.
The buyer who thinks a property is overpriced will probably find a similar one locally for a better price, but there is often no such thing as a similar alternative to a desired domain name.
New tlds will hopefully ease the situation though.
tewk – Frustration over the price of something is completely subjective. I might want a Porsche but can only afford a KIA, should I be ‘frustrated’ over this gross injustice when the car salesman turns my offer down?
My post isn’t about lowball offers, it’s about the lack of understanding about domaining by those outside of it. Pricing of domains is only one aspect of misunderstanding what domainers do.
It’s not so much the frustration at being unable to afford a Porsche that I’m referring to, it’s how do you feel if you’re willing to pay as much or more than anyone else, yet the dealers refuse to serve you unless you pay double…
That’s the sort of feeling some buyers have, but admittedly it’s tough to price domains so that may not be a fair comparison.
tewk – In the minds of many outsiders, any price over $50 is outrageous. Therefore, the issue isn’t really the 1x or 2x price the seller might want, but the perception by the buyer that it is ‘immoral’ or even ‘illegal’ to sell domains based on speculation.
Good post, OP.
An auto similarity: $50 wouldn’t eben buy the right to put registration plates on one’s car.
But they are quick to complain, having no idea that the domainers:
– spend their time to find and register DNs,
– fund the renewals
In the end, being a domainer is like being a real estate investor: we investigate the “environment” then buy DNs hoping that they will appreciate in value.
Like a property.
So, where were you prospective buyer, when I registered “your ideal” DN?
Having fun, or spending money on other investments?
Just because someone might want a name a domainer owns and is willing to pay what they consider to be a fair or even high price for it… Doesn’t always equal what the OWNER of the domain feels it’s worth or wants for it… if the buyer can’t afford the name – Oh Well… there will always eventually be someone that can afford the price… I don’t sit well with
price whiners… domain names are internet REAL ESTATE…
if a buyer wanted to buy a house and the seller wanted a
certain amount for it — whining wouldn’t bring a price down…
If a buyer doesn’t want it enough to pay the asking price…
Oh Well… they don’t deserve the domain… Next…
RE the Pickers TV Show…
Love that show…
any show related to picking catches my attention…
I have that on my To-Do Development List
for:
OhioPickers.com
ThriftPicker.com
AreaPicks.com
~Patricia Kaehler — DomainBELL
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I love having the availability of gtlds. Now, when someone makes a lowball offer, I can suggest they register the .tattoo version instead! Ha, gets em every time. They will always see the wisdom to pay for the .com when put in that light.