Expired domains auction trickery won’t get you an accurate valuation

For several years now, some domainers attempt to gauge the value of their domains by engaging in a simple trickery.

By allowing their domains to expire and be entered into an auction, they perceive the winning bid to be an accurate representation of value.

This practice is not only frustrating for the winner of the auction, but it also produces false results.

Depending on the particular venue, the auction can be reversed in a handful of days at GoDaddy, or up to 42 days for eNom domains at NameJet auctions. I believe that expired domains at Fabulous are auctioned at NameJet and are retrievable by their registrants until the last moment.

Naturally, these auctions are advertised to domain investors primarily, and are heavily promoted by fellow domainers. The old phrase, “selling ice to the Eskimo” comes to play here.

With that in mind, it’s very rare than end-user buyers ever participate in these expiring auctions. Definitely not for the typical “coin domains” that some refer to as “liquid.”

Even if an end-user party followed a domain’s renewal year after year, in hopes that the registrant would not renew it, cases where the prospective buyer engaged the services of a drop-catching service, or an auction are extremely rare.

In fact, the failed “expiration for evaluation” trick, triggered another practice, that for years flourished on NameJet: front-running domains by contacting prospective buyers while the auction is on-going.

To get true valuation for one’s domain, the domain must be marketed as an asset for sale, across numerous venues. It must be promoted, advertised and carefully presented as a commodity with value, not as a leftover that was allowed to expire and drop.

Domain brokers can assist with that approach, as they maintain data on sales that were achieved under an NDA, as well as more detailed public data on their corporate buyers.

Domain valuation for the sake of selling a domain is not achievable when your asset is in expiration mode, particularly with a bidding page that shows current bid activity. A lot of buyers require privacy and often lack the basic trust to even create bidding accounts at domain auction venues.

The psychology of the end-user buyer is completely different than that of your typical domain investor, who is well known for being ‘stingy’ with their investment spending, on top of that.