Every month I contact domain owners through their Whois email for some domains that I either want to develop or where I see a trend and think the domain will become more valuable in the near future. My contact email is very simple. I tell them I am interested in their domain. I ask if it is for sale. And I ask what their price expectations are for the domain. In about 33% of the replies I get the question “What are you going to do with this domain”. I’ve read a lot of blog posts or forum comments from domainers saying they want to know why a person wants their domain. I agree, it is good to know, but let’s take the side of the person acquiring the domain… it’s really none of domain owner’s business why you want the domain and it can kill a potential sale.

If I tell someone that I want to develop the domain they think they can increase the price because I’m going to create the next Facebook and their domain is what is going to get me there. If I tell them I think the domain’s value is going to increase in the near future they are either going to increase the price or hold onto the domain. Unless I make up a lie (which I do not do) and say something along the lines of “I’m making a website for my wife” or “I want to start a personal blog” the domain owner is going to jack up the price. A lot of domainers have an attitude like they are entitled to knowing the interested party’s plans… but you really don’t. If someone wants to buy a parcel of land they do not have to tell the landowner if they want to build a house or a store or a complex. It’s none of the seller’s business. Why do you think that when companies go to buy domains they don’t send an email out from their corporate address. The know once you see that corporate email address the price just tripled. Instead they use a third party to make the acquisition for them in a lot of instances. Because domainers have the mindset that the value of an asset depends on who is interested in it. This is not true. The value of the asset does not change, only the domainer’s perception of the value.

I reply that my intentions for the domain are personal. This turns off some domain owners and they walk away. Other domain owners continue to push for an answer, at which time I walk away from the conversation and they lose a potential sale. And other domain owners accept my answer and we continue talking.

It is my opinion that it is a poor way to do business to push an interested buyer for information if they do not want to give it. Unless this method allows you catch the whale one day, you’re going to lose sales along the way, and if that whale never comes then over the long run you’re only hurting yourself. Unless you own a super generic dot com domain you should not forget that cash in your hand today is guaranteed and tomorrow’s dream of a huge sale price may never be realized.

8 comments on “What Are You Going to do with this Domain?

  • I use to think like you too.
    But having read so much opinions from expert domain sellers…I come to the conclusion that it is absolutely important to know who is the buyer & what they will do with the domain name. At the end of the day you are trying to get the most money for your asset. The value of your domain names…like anything else…is decided by how much someone is willing to pay for it. If a buyer has deep pocket & has a big idea….logic say he will be willing to pay more. And, that’s all there is to it. Realize this – your domain name is one of a kind.

    p.s. I only sold one name..a .info for $108. So take my comment with a big gain of salt. 🙂

    • Well you will always read about the domain sales that occur, but you’ll never read about the domain sales that were missed out on. The pro’s have top quality names. If you own real estate on Broadway you can be more picky and pushy. But most people don’t have Broadway type domains. And the pro’s can financially afford to sit back and do things their own way because they’ve made 7 or 8 or 9 figures in domain names already. The other 98% of domainers who are not pro’s but try to replicate the pro’s strategy may be hurting themselves IMO.

  • True, agree.
    But, it doesn’t matter if you are a newbie or a pro, it never hurt to know as much information about the buyer and his intent as possible. I think that is pretty basic logic. It doesn’t matter you are selling domain names or collectibles.

    And like anything else, there is always a fine line between leaving money on the table, and being too greedy and lose the sale.

    For us newbies, we will worry about getting offers before we worry about negotiations. 🙂

  • I never sell until I know who I am selling to. If someone can’t be honest with who they are then I am not interested in doing business with them.

    I’m not so crass to just asked what they want with the domain. Obviously they want to do “something” with it. But if they want to remain anonymous, unless we are talking serious money. The sale ain’t going to happen. Period.

    I decide that. Not the buyer.

  • As best I can tell, after observing this issue debated for years, that right approach is “whatever works for you”. What may work for Rick or Mike or anyone else (I’ve never been privy to their negotiations) just may not work for me, no matter how well rationalized or seasoned their approach.

    I don’t feel the need to know my prospective buyer’s identity or their mission. From my POV the knowledge I need is “what is a reasonable approximation of the market value of my domain(s)” – no matter who is the buyer.

    I’ve sold to some fairly well funded buyers and never once felt regret at the final price of the deal.

    Jeff, a/k/a Webwork @ WebmasterWorld

  • It never hurts to ask. I also sometimes ask the buyer to identify themselves or their company. The worst they can say is no. The people who ask you this or push for the info can probably afford to lose the sale. If you have a great domain and a company is going to build a business on it, it also doesn’t hurt to ask for equity in the company. Why not?

    • I agree, asking never hurts. But in my experience, a lot of times I’m met with this attitude like they are the boss since they own the domain and I’m a little employee and it is very offputting to the point where I’d rather not give them any of my money and I look elsewhere. In most industries, salesman who are selling a product really want to make that sale. They can be a little pushy, but they are usually polite and accomodating. In this industry, you find a lot of the sellers are anything but. And that might play into the fact why the domain industry isn’t viewed with a halo above its head.

  • I saw one of those those many aggregated articles on Owen Frager’s blog from Wired. It argued “Back in 2000, or even in 2004, a premium domain name made more sense ? it was the primary web currency. But in the age of Google, Tumblr, Facebook and abounding App Stores, this just isn?t the case any more.

    Tell those with crazy price expectations that.

Leave a Reply