Pricing domain names with a “minimum asking price” is an indication of least value.
It is not, however, a selling price, and some domain buyers don’t seem to understand that.
At a time and era that domain name valuation becomes relevant when it arrives from a human, as opposed to an automated system, domain buyers – often being end users – should be educated about this axiom as well.
A domain’s minimum asking price is not “sticker price” which it would be, if there was a “BIN” or Buy It Now tag on it.
By defining a minimum asking price, a domain investor is making it clear that below that threshold there will be no chance of a negotiation; in fact, it also acts as a clearance line keeping lowballers and time-wasters at bay.
For example, most domain selling venues, such as the Uniregistry Market that I’ve been using since 2012, won’t take in any offers below that minimum asking price, if it’s set.
Should an offer made at the minimum asking price be rejected automatically?
Of course not. However, the concept is to negotiate as high as possible in order to leave room for an agreement at a comfortable level and maximize one’s return on investment.
After an initial offer made at the minimum asking price, domain investors should respond with their maximum asking price.
This approach has a twofold effect:
- Shocks the buyer, indicating that they are dealing with someone who won’t take the first offer that arrives
- Filters out the riffraff that are looking for a deal, perhaps acting on behalf of the real buyer with deep pockets
By making it clear that a minimum asking price is not your selling price, you strengthen your negotiation skills, and max out your ROI.
Good info Theo.
Do you have a rule of thumb for what percentage above your min asking price that you peg your max asking price?
Would it be a fair generalization that parties typically setting mid way between the two?
Correction to last sentence: ‘typically settle’, not setting
In negotiation, you never let the buyer know the minimum. It’s best not to put any minimum offer to confuse potential buyers.I prefer to leave room for all and respond to serious end users only and give price personally when need be.Good luck
dee – As I explained in this article, the minimum price is there to filter out tire kickers and such spam. It’s not, however, a BIN and as such, you’re not obligated to sell at the “minimum price,” despite some buyers’ expectations.
Minimum asking price is just bad. Since it gives a measuring stick to a buyer. If they see 500 as minimum price, that means 500 is the price! It is well researched psychology fact, our mind looks for anchors. When buyers sees price, his anchor becomes that price. That why if i have minimum price, i put it in range where i would actually sell the name. So not 500, but 3000. So if ido get offer for 3k, i can accept it. While over and over is seen 500 offer, then negotiation going no where because buyer feels like he/she been lied too.
Here is their inner monologue”
This is scam, they had 500 and now its 3000, what a bs, i don’t need this name”.
Theo, there is huge problem with education, and it is not solution. Education implies effort and ability to reach people who will buy, as we all know, domain buyers come from everywhere and more often then not, it is their first time buying domain. So education is just out of the question.
The best we can do is remove minimum price or set it at level we willing to sell. I find that when you have 20$ minimum price, it still bad since now buyer thinks, well 20 maybe too low but 100 is not! We go back to anchor psychology, once the number in their minds, it is uphill battle to sell and re-educate.