Many domain owners realize — too late — the value of a domain name after letting it go for too cheap, while others only remember to renew the domain after the precious gold has already landed in someone else’s hands. Just like money during a shopping spree, some domain names simply disappear, to the regret of their owners. And in the rare case of a domain owner maintaining their stash of great names and receiving numerous offers from buyers, it’s still too easy for owners to be cheated of their gleaming treasure. So without further ado, here are some tips for valuing domain names so you, too, can appraise domain names like Mark L. Walberg turning junk into gems on Antiques Roadshow.
But First, A Domain-Valuing Case Study
In March 2017, a domain owner sold DWN.com for only 2,999 euros using Sedo, even though today a three-letter .com name could fetch at least $30,000. This tragedy occurred even though for the past year, domain owners have been flooded with offers from brokers in a niche market (especially those from China) asking for four-letter or four-number .com domains. Unfortunately for this seller, her loss is the buyer’s gain.
Some DreamHost users are missing out too. In a survey conducted earlier this year, we found that of an astounding 46 percent of users who let their domains expire, most had simply forgotten to renew them even with a 30-day grace period and email reminders. That’s potential money down the drain.
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So How Can You Avoid Domain-Valuing Pitfalls?
While many appraisal websites — such as Estibot.com — will help owners appraise their domain names, there is, admittedly, still no way to find the exact value of a domain. After all, domain sellers and buyers use a plethora of variables to determine a domain’s proper price; there’s no perfect algorithm for appraisal just yet!
However, before you let your valuable assets slip through your fingers, you can make educated estimates on your domain portfolio with the following tips and recommended websites, collected from my nineteen years of experience in the domain industry.
Keep this in mind: any domain name has value if the owner is eager to sell and the buyer is willing to pay.
1. Do Your Research
Compare the most recent sales, specifically using a list of similar domains that have sold in the past few weeks, including high-value versus low-value domains. Here are some key resources to help you get started.
- Jamie Zoch of DotWeekly published Domain Movers, a series that outlined which domains corporate buyers were purchasing and reserving for upcoming product launches, company branding, movie titles, etc. The series is on hiatus now, but past articles are still helpful if you’re trying to predict what corporate buyers are going to do next.
- Andrew Allemann of Domain Name Wire provides a weekly list of end-user sales from the U.S. and European countries. It also shows domains matching company names and buyers who already own the domain name with a different extension.
- Ron Jackson of DN Journal publishes his comprehensive weekly Domain Sales Chart, outlining the selling prices of all domain extensions (.com, .net, .org, country codes, and new TLDs, for example), locations of sales, websites that conducted the sales, and names of the buyers. Ron compiles the chart using several domain brokers, websites, and individual sales.
- Russell Panella of ShortNames specializes in gathering domain sales for one-character, two-letter, three-letter, four-letter, and numeric domains, and compiles sales data from all venues — think GoDaddy, Namejet, DropCatch — and countries, including China.
2. Spot the Trends
Find the latest keyword registration trends that attract domain buyers and appeal to search engines like Google.
- Verisign updates a series of the top 10 trending keywords registered in English every month for .com and .net extensions, which can help owners pounce on the latest fads. For example, users registered many cryptocurrency-related domains in May 2017.
- Google AdWords Keyword Planner helps users find new keywords and search volume data. You can also check the cost per click, which is an important part of determining a domain’s value.
- Google Trends provides search trends popular within the past 24 hours and last seven days. Users can explore keywords in several categories, such as business, entertainment, health, top stories, and more. For example, before the 2016 election, many eagle-eyed entrepreneurs registered domains with a presidential candidate name.
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3. Think Simple
Purchase brandable, pronounceable, and easy to spell (and remember) one-word domains. Here are a few guidelines to live — and buy — by when scooping up domains.
- Domains should be easily pronounceable for both local and international audiences to increase marketing value. An easy-to-say domain will naturally have a higher value than its harder-to-pronounce peers. For example, garden.com is worth far more than aquaticgarden.com.
- Domains should be easy to remember and not conflict or be confused with another brand. For example, wallmart.com could be confused with the superstore’s website, walmart.com.
How Do You Value Your Domains?
These tips for valuing domain names are by no means complete. Each domain owner or buyer usually has their own set of important factors to look for. So tell us: how do you decide to pick up a domain for your portfolio? Do budget constraints or other limitations affect your decisions? And how much do you go with your gut?
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