News, Notes, Thoughts, & Tidbits

I have become much less active in bidding within the popular domains that are being auctioned. Prices have gone up, up, up and I’m really struggling to understand how the buyers are going to be flipping these domains for a decent profit. I have a handful of bidder alias names on Namejet in my head that are responsible for driving up the prices of probably 75% of the names I backorder. I honestly have no clue what their business model is because these guys are dropping six figures every month or two it seems like and if I go back in the auction history and look up domains they have purchased in the past they are sitting there parked today… and we all know the state of domain parking nowadays. There’s a handful of people who are either going to cash in big in the future or get their asses handed to them.  If you feel like it has gotten much harder to find good value at auctions nowadays you are not alone.  Instead of overpaying and spending $10k on a domain that I’m going to struggle to resell and could take years I’d much rather go after the lower hanging fruit to keep the inventory churning and cash flow going.

Another note on Namejet, can they give a filter to remove Reserve Price domains from the search results, and can they give an option to remove domains I already have on backorder from the search results.  Seriously, it would make scanning the list much easier if I don’t have to see things I already have a backorder on.  And I’m not interested in seeing pages of reserve price domains which I know are being sold by domainers at reserves that I most likely won’t want to pay.  Also, when I go to place my backorders I’ve had it happen multiple times where I hit the submit button and the site spins its wheels and after a minute or two it redirects me to their error page.  WTF.  To me, Namejet has gotten much more about their bottom line and much less about customer experience/satisfaction.

I wrote a time or two ago that I liked the site Expire.com and I would check out their auctions close to every day.  Yeah, that has stopped after a month.  I thought there’d be some value domains in there to jump on but after a month of checking out the site I more believe that it is domains that they are probably considering dropping.  I haven’t once seen a domain I’d want to spend $500 on, and maybe 2 or 3 times there was a domain I would have taken a $100 shot on but someone was faster to the draw and bought them when they hit $100.  Out of the 75 domains listed on the site as of this moment only 1 has sold.  There’s a reason for that.

I feel like there’s something fishy going on at GoDaddy auctions with LLLL.com domains.  In the past 2-3 months I’ve noticed (what I would consider) undesireable LLLL.com domains (having letters like q, z, x, w) that have sold for $1,500 and up (some over $2,500).  And usually the bidding that brings these prices up happens the first day the domain appears on the site between two people (or one person with two accounts perhaps?).  These are domains you’d struggle to get $100 for on the domain forums.  I know LLLL.com domains have risen in value, but when the crappy letters are significantly outpricing the quality letters there’s something going on there that I don’t quite understand.  I know that maybe there may be meaning (to someone) for some of these, or maybe they have a high pagerank, but right now on GoDaddy I see ZJGS.com at $1,580 with 5 days to go and every bid on that domain happened the first day it hit the auction listings.  QSBB.com is at $1,525 with 5 days to go and again every bid on that domain was made the first day it hit the auction listing.  ZFFD.com is at $1,500 with one day to go.  And then the ones with quality letters are all sub-$300 like BGTP.com at $266 with 1 hour to go.  I’m not going to do exhaustive research into these domains but this type of pattern is quite strange.

I think the gTLDs are taking some business away from domain sellers.  The area I think this is happening in is the people who would have historically paid $500-$5,000 for a .com domain I believe are more willing to hand register a gTLD.  Before, outside of .net and .org there wasn’t that many acceptable alternatives for people to pick from, but now they have a bunch of extra options.  This is just my personal belief based on some interactions I’ve had with some buyers.  Small sample size + my gut = take it for whatever its worth.

I had talked about the domain 2-2.com that I picked up maybe year (or less) ago.  I thought a repeating numerical (despite the dash) would have some value in their crazy numerical domain world we live in.  4.cn told me they won’t auction it because of the dash and two brokers I talked to weren’t interested in listing it email newsletter.  I’m not too familiar with numeric domains but I tried to think about it from a letter domain.  Would I rather have a domain like C-C.com or would I rather have a domain like CKLM.com.  I’d much prefer the first one every time because it is shorter, easier to remember, and would have a potentially larger end user base I could try to sell to.  I guess this doesn’t equate to numerics because random NNNN.com’s are selling for low five figures and no one wants to touch 2-2.com (and I never mentioned price so it wasn’t a pricing thing).  Lesson learned.

There was news that came out that said the state of Texas passed a vote that got them one step closer to legalizing recreational marijuana.  I have a ton of marijuana geographic domains and I remember about a year or two ago someone was inquiring about a domain and they told me that my Texas related ones would be worthless because they live in Texas and Texas would never legalize.  This is why you shouldn’t listen to the peanut gallery.  If they do legalize I have Dallas, Houston, San Antonio, etc… domains that should bring in four figures+ a pop.

 

Namejet’s Help Desk Not Being Very Helpful

We all add a backorder (or a few) at a point in time that later down the road we decide we no longer want. I have 30,531 domains on backorder at Namejet so it’s not really reasonable for me to go through them all and remove the ones I don’t want, so what I do is sort them by the dropping date and the ones that are dropping soon I will scan and if there happens to be one I no longer want I remove it. Pretty simple, except…

I have a backorder for a domain and I put the backorder in at $79 which is above the minimum bid of $69. I put this backorder in May of 2013. Things change, I no longer want the backorder, it was two years ago after all and I’m hopefully a little wiser now. But when I go to my backorders the option to select this domain in order to remove it is grayed out. Meaning I do not have the ability to remove this domain. There’s only 2 bidders and so there’s a 50/50 chance I’ll be throwing away $79 if I don’t remove the backorder. And to be clear, the auction has not started yet. It was days away when I contacted them.

So I reached out to Namejet’s Help Desk, key word here being “help”, asking them to remove this backorder because I no longer want it. They informed me that they can not remove the backorder and because the domain status is not “wish list” but rather “Pre-release” AND because my bid is above the minimum bid that I neither can remove it. Basically they are telling me there is no option to remove the backorder and I’m calling bullshit on them. I’ve always been pro-Namejet when I mention them previously on this blog because I like the site and the platform, so you would think they’d be a little more helpful and would value a customer who has used them for years and has over 30,000 backorders placed with them, but nope, that $79 backorder is more important to them than keeping me happy.

Poor customer service Namejet, very poor policy and again, very poor customer service. Hope the $79 is worth having a dissatisfied customer.

GoDaddy’s $28M Marchex Purchase Has a Minimum $110M Offer Price

The minimum offer price on the domains that Godaddy purchased from Marchex has come out and 99.99% of the domains are priced with minimum offers and the sum of those is a little over $110,000,000. Read more…

Numeric Domains Flying High at GoDaddy

Numeric domains are very hot nowadays and looking at GoDaddy auctions it looks like the market for NNNNN.com domains is up significantly even though there’s one hundred thousand of them.  Here’s some of the top numeric auctions, middle of the road, and ones at the bottom (all these domains will sell, nothing here that is sitting below a reserve):

88777.com  $15,250

2167.com  $13,250

32518.com $672

23690.com $481

38590.com  $453

71355.com $265

25874.com $12

64565.com $12

67011.com $12

84173.com $12

Even NNNN.net domains are pulling in respectable figures with a lot of time left to go:

6667.net $560

1498.net $391

If you got into NNNNN.com domains not even two years ago you could have been buying a lot of them for sub $100 when they were expiring.  I’m sure someone out there made a killing on these.

 

Sedo’s “Handpicked Generic dotCom Domains” Auction – So Bad I Was Making Sure Today Wasn’t April 1st

Sedo has a running auction they are calling “Handpicked Generic dotCom Domains”.  See the screenshot:

sedo

Excited to check it out?  Handpicked says that Sedo created an auction and someone handpicked the domains in it.  It also refers to them as generic which probably won’t mean the same thing to you or I when we think of a ‘generic’ domain once you see them.  I got suckered into clicking the link to check out these domains because surely if Sedo is marketing something as a hand picked auction it would have to have some quality domains and I actually am in the market to buy.  But what did I find?  First I laughed.  Then I checked if it was April Fool’s Day and this was a joke.  Then I shook my head, and then I bowed my head in memory of the few seconds that Sedo got me to throw away.  I’m not going to link to the auction because I’d be doing you a disservice by taking you there.  How would you like that handpicked generic domain PriceSearchings.com?  Or happy-office.com?  Like the hyphens, they handpicked pretty-child.com. Read more…

10 Random Domain Thoughts

Here’s 10 random domain thoughts I’ve had over the past week:

1.  The prices on Namejet have been rising.  Domains that would have sold for $2k a year ago seem to be selling for double that or more today.  Two word .com prices have really skyrocketed as well.  There’s a couple guys really driving up the prices and I honestly have no clue what they are doing.  I went back through 25 domains that sold in the past three months to a few of these guys that are driving up the prices, more than half of them are not being used in any sensible form:  a good number of them do not resolve, and some still forward to their Namejet page (what?).  If you spent $10k on a domain a few months ago why in the world is it still forwarding to its Namejet page?  I don’t get it at all.  So after some digging I landed on Cheese.com (was not a Namejet auction).  Great domain, the site that is up is pretty decent, but I don’t see any monetization at all.  No ads, no email capture box, nothing.  Color me confused.

2.  Marijuana domains are on the rise.  I have close to 400 marijuana/weed/cannabis related domain names.  A lot of geographic ones and to a lesser extent brandable ones.  The amount of inquiries has really started to grow and in the past 2 months I’ve sold 5 of them compared to selling 5 in the past 2 years prior to that.  I could have sold more recently but my minimum is four figures for 99% of them.

3.  I find myself reading significantly less of the domain blogs.  Part of it is because you learn more over time so a lot of the articles are less valuable to me today then they would have been years ago.  Also I get annoyed with the fluff posts out there (and there’s a lot) that people write because they have advertisers paying a flat rate for banners and they need to get those pageviews to justify the banner prices.  On the bright side, this gives me some extra time to spend in finding more domains to buy.

4.  Numeric domains are on fire as are LLL.com’s.  Unfortunately I sold my NNNN.com domains about a year and a half to two years ago.  Would have been an extra $35-45k today.  Live and learn.

5.  I bought the domain Clickbait.com (direct from owner) in the past year because I wanted to start a site on it.  I leaped before I looked though because once I started researching the competitors and how much time/effort goes into the type of site I wanted to start there was no way I could do it (time constraints) so I parked the domain.  Lesson learned.  It does get a ton of purchase inquiries so ideally it will sell at some point this year.

6.  Can I see a raise of hands for how many people have profited after 1 year with the gTLDs?  There’s a plethora of extensions in the market, significantly more to come, and I don’t see any rising demand.  Remember all those people spending big bucks on the early access purchases for thousands a pop?  I am actually one of those people, but just for one domain.  I picked up Reputation.Management for around $3k.  No offers on it after one full year even though I think it is a pretty solid name in a highly competitive market.  I renewed it because at this point why not, but I’m glad after I picked up around 10-15 gTLDs I decided I was wasting my money and stopped.  .Com is 98% of my purchases today.

7.  Speaking of gTLDs what the heck was all the hoopla about Credit.Club?  Does anyone really believe that is a six figure domain (not unless you’re bringing it out to 4 decimal places)?  Does anyone believe that there is any competition for that term (which there’s not)?  Here’s a screenshot of how many searches the term gets a month.

credit_club

The real search term here is “credit”.  Where does credit.club rank for this term?  I went ten pages deep and didn’t see it but I have a feeling you could go 100 pages deep and still won’t find it.

8.  Does anyone else have to jump through hoops to transfer a domain away from Register.com?  It is ridiculous (and sad) how hard it is.  I only have a domain there when I win a Namejet auction for a domain that is through them, but when I see the domain is at Register.com I know I’m in for a hassle.

9.  I like Expire.com.  I haven’t bought anything there, but I check it out every few days.  It is a very clear and simple site, and I think going from $500 to $100 is a smart approach to moving some domains.  If I had a huge inventory of domains I’d set up something similar, but I have around 1,000 and I’m not willing to part with them for this range of prices so it won’t work for me today.

10.  I bought the domain 2-2.com in the past year through an Afternic broker because I saw how hot numerics are, the price was much lower than I was expecting it to be, and it is repeating numbers.  There’s only 10 N-N.com domains with repeating numbers.  In the past week I just listed it at 4.cn and I submitted it to their reserve auction platform so I need to hear back on if it gets accepted or not, but it will be interesting to see how big that dash is in a very short numeric domain in the Asian market.

Why I Am Done Wasting Time with Sedo’s GreatDomains Auction

I decided to submit two domains to the Great Domains auction.  I’m no longer a fan of these auctions but what the hell, if you put a reserve on them then where’s the harm and its been a while since I submitted any domains to one.  I submitted a N-N.com domain (number dash number domain for a repeating number, only 10 of these in the world) and a one word .com domain that has become very popular in the past two years and I get weekly offers on.  After a few days I get a notice saying they were rejected for the auction because the domains were not quality enough.  So I said to myself “Man, they must have a ton of great domains submitted by people if these got rejected for quality”.  I went over to GreatDomains.com to check out the upcoming auction inventory and needless to say as usual there is a lot of crap in there at reserves that Roseann Barr couldn’t eat her way out of.  I don’t know who oversees this program and who approves the domains but lesson learned, I won’t waste anymore of my time on Sedo’s GreatDomains.

CEO of Namecheap Does “Ask Me Anything” on Reddit

The founder of Namecheap does an AMA on Reddit and while I only scanned the comments (because I don’t do any business with Namecheap so I don’t have a huge interest in them) I did find it interesting that Reddit was giving a lot of good and solid feedback.  This is definitely a tool that more companies should use to get some valuable (and free) feedback from their customers.  You can find the AMA here: http://www.reddit.com/r/IAmA/comments/2tuiuk/im_richard_kirkendall_founder_ceo_of_namecheap/

Just Like Poker You Need to Know When to Hold’em and When to Fold’em

I listed a few domains for sale (with reserve prices) on GoDaddy recently through their 7 day auction format. My reserve prices on these domains were about what I paid for the domains so I was willing to take a little loss on them (after commission). A few ended up selling and a few didn’t. One of the things I hate the most about domaining is selling a domain for a loss. Even if I sell a domain for a small profit but I’ve held it for a year(s) I feel like I took a loss on it because of opportunity cost. But sometimes selling a domain for a loss is a smart move as counter intuitive as that sounds.

Here’s my reasoning:

1.  While when I buy a domain I believe I am getting a good price on the buy, but you can’t always be right so what I thought was a good price maybe wasn’t a good price.  And if I keep sitting on a domain thinking I’m right I may be holding it for 20 years and never sell it for a profit.  This is the equivalent of putting cash under your mattress which you probably know isn’t a wise financial move.

2.  It is OK to swing and miss on a domain as long as your hit to strikeout ratio keeps you in the black.  So you get a few buys wrong, sitting on them forever will only compound your issue.  I’m going to take the funds from these GoDaddy sales and put it towards new purchases (at bats).

3.  I didn’t just sit on these domains and sell them after no offer came in.  I reached out to many different places that I thought may have a use for the domains but was not able to sell any.  This doesn’t mean there is not a buyer out there, it just means I wasn’t able to find one.  But you should always make the effort before you’re willing to accept a break even or loss on a domain, otherwise you’re just being lazy.

4.  When I sell a domain my ROI is usually a healthy percentage or price gain.  This allows me to afford to sell domains I can’t move for break even or a small loss.  If you are only scratching out small profits on your sales you aren’t leaving yourself room to sell the ones you can’t move for a small loss unless you are doing this for the fun of it and are happy to break even in total.

5.  I have turned breakeven/unprofitable sales like this into second sales.  If I have 20 domains in the finance niche, and I sell one at breakeven or a small loss, I now will be able to contact the person who bought this domain and see if I can move any of my 19 other domains in this niche for a profit.  Now I have a small loser sale and a decent size winner sale if I’m able to get that second sale.

I’ve reached out to many people over the years to inquire about their domain.  A fair chunk of them (after exchanging emails) wanted to sell their domain but they were stuck on the point that they paid a certain amount for the domain however long ago and so they will not go below that price.  Things change, or maybe they paid $20 for a $10 bill, or whatever but if you realize you can’t win them all and you’re able to accept breakeven or a small loss every now and again it will only help your profitability in the long run.

What is the Domain Market Telling Us?

There’s been two sales of domain names that have happened recently and both of them had me trying to read between the lines and see if there is more to them then meets the eye. I think it is a smart move for anyone to do this instead of solely relying on articles that are written because reading the articles puts you on par with everyone else who is literate and you always want to be one step ahead when possible.

The first sale was the sale of Media Options domains through Namejet. This was publicized on the Namejet site with one of their big rotating banners so without evening needing to do a Whois lookup you could tell Media Options was unloading domains. There’s two questions that instantly came to mind when I first saw this:

1. Why is a successful brokerage selling domains in a venue that is filled with resellers and not end users?

2. Why are they selling these specific domains and what does it say about these domains?

One group of people who have a very good pulse on the domain market are the large brokers. They are dealing with a steady stream of high quality domains and they are in constant communication with end users so they understand the end user sentiment better than any other group IMO. The domains that Media Options were selling through Namejet had a lot of high quality domains (good LLL.com’s in particular). So why sell them now at Namejet? My guess is that they believe the LLL.com market is at a peak. That’s not too hard to believe given that I’ve seen crappy letter LLL.com’s selling for high four figures consistently now. A year ago they would have been getting $3,000-$4,500. What can I take away from this? If I have any LLL.com’s that now is the time to sell them, and if I’m buying LLL.com’s then I may want to hold off a bit because I may be buying at the top if I buy today.

Secondly, why these specific domains? Do I think an established brokerage would auction off high quality domains without first attempting to sell them directly to end users. My guess is no. For myself, before I send a high quality domain to any auction I have exhausted my attempts of finding an end user for it. That doesn’t mean that an end user doesn’t exist out there, it just means I don’t have a high confidence level of finding one. If a brokerage is selling a quality LLL.com domain through Namejet I would assume they have done the reaching out and couldn’t find an end user. Because this is their 9 to 5 full time job they already have a solid contact list and more experience finding end users, so if they couldn’t find an end user for a domain then what does that say about my chances of finding one for that domain? Even though there were some nice domains being sold I personally stayed away from buying any because of both reasonings I came up with.

The second sale is this BuyDomains sale of 950k+ domains for a price of under $50 a domain. Unless BuyDomains needed cash quick, or unless the portfolio was filled with complete trash, this sale is pretty troubling if you’re a domain investor. Having a million domain portfolio gives you a look at lots of useful information and a gives you a good beat on the aftermarket. What is the average selling price now compared to the past, what is the number of inquiries coming in now compared to the past, what is the close rate now compared to the past, etc… I would assume that a lot of these statistics came into play when BuyDomains was calculating how much they’d let their portfolio go for and if they were happy with less than $50/domain on average that is not a good sign. When I think about this in the macro sense of the domain market I may now be more inclined to accept a $2k offer on a domain instead of holding out for $4k as an example. There’s quite a few levels of thinking I’ve done about this sale and I’m not going to share them all here, but if you see something like this and you’re not questioning what it means in the market and what it means for you then you’re going to fall behind.

Whenever I see a solid domain on Namejet with a reserve price I do a Whois lookup and I have seen quite a few well known names selling their domains on Namejet. I personally think the gTLDs have a lot of people spooked. I think domain investors are questioning now what impact on .com prices will the gTLDs have. And what impact on demand they will have. I personally think very few gTLDs will find long term success. I think that people won’t be able to remember if that new site was Car.deals or Car.NYC or Car.directory or Car.online or Car.web. Too much fragmentation in an already fragmented internet. There may be some short term pressure on .com domains until it all shakes out and the market can begin to see a clear direction but now may be the time to start placing all your chips down on one direction or the other if you want to try to cash out big in the next five years.