My domain valuation methodology: Part 1 – As a Buyer

I’ve no recollection of my first domain purchase but it probably happened on eBay, more than ten years ago.

Back in those days, eBay held a higher reputation than today, even with non-tangible goods such as domain names.

Since then, my domain acquisitions diversified and I’ve completely removed eBay from my list of options.

Nowadays, I buy domains from the following markets:

  • Domain forums
  • Via direct emails to the owner
  • Sedo
  • NameJet
  • GoDaddy TDNAM
  • From offers I receive via email

On occasion I might purchase domains on Bido, Afternic and domain conferences.

So what methodology do I use in order to price domains and place offers or bids accordingly?

Firstly, I’m a big fan of aged domains. If a domain is from 1999 and older, I’m interested. If it’s from 1995 and prior, I’m definitely interested.

Some aged domains might appear to be esoteric or might contain dashes. That’s when the visual and/or aural test kicks in.

Are these domains marketable? I add a point. Are they pronounceable? That’s a plus. Do they look “right” in print? Jot one point as well.

Obviously, if I can get any worthy domain for a huge discount, it’s always a great deal. Opportunities for discounts exist: the owner might be short in cash, they might be unaware of the domain’s worth or they might simply want to get out of business.

If a domain has potential and there is a danger of it being snapped by others, I “seize the day” and make an offer within 10% of the asking price; sometimes I might just pay the asking price outright. The latter method took my $2k investment in 360.org to a $25,500 sale a few months later.

Overall, I trust my “gut feeling” and although I do follow the market trends, I’m staying true to what I consider positive elements in a domain.

Lastly, never be ashamed to ask for a discount, provided of course that it does not blatantly disregard the street value of certain types of domains: generics and short ones.

Follow me on twitter at http://twitter.com/acroplex for updates.

Comments

  1. Good list. I think there’s a bit more you could go into regarding “aged” – are you looking for links, content, think that Google cares, etc. I am not disagreeing, I just think it’s a little vague as to why age matters for valuing a domain.

  2. Andrew – Aged domains can be simply that: having a registration date that predates a certain year. But you’re right, backlinks matter, keyword weight in Google searches etc.

  3. How do u defined aged and where do U find that information? If a name was first register in 1995 and been dropped and re-register a few times thru the years. Is that domain name considered aged as-of 1995?

    360.org – where was the name sold and what was your initial asking price?

    Thanks.

  4. Poor Uncle – Nice to see you around 🙂

    A domain that has dropped gets a new registration date; therefore it’s not aged anymore. If I may make an analogy, it’s like a 1967 Camaro that gets a new engine, new upholstery, tires and suspension. Not the same car anymore 🙂

    You can read about the sale of 360.org right here.

  5. Hi Acro – that was a nice story about your 360.org sale. Certainly took some gut, insight and persistence to get it done. Not a routine sale like I imagine.

  6. I am new to domain names and appreciating all the info I can get and learn from. I only have about 11 names and pretty much figuring out that they probably were not a good choice. But live and learn. Thank you for the story, I am absorbing all the info I can.

  7. A great story all the way from 2009! Will now take a look at what the buyer did with it…

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