Tag - Domain Sales

Premium Domain Names

3 Reasons Why Your Domains Aren’t Selling

Many people enter the domain industry thinking they can accumulate hand registered domains and turn them into quick cash.  Hell, I was one of those people.  Maybe you have had some luck with a few of your names but now you hit a dry spell.  No bites in weeks, or maybe months.  If you could just land another buyer, you’d be back on track to that fortune you’re hoping to make.  So let’s take a step back and see why your domain names aren’t selling.  Let me preface by stating this is all coming from my own, hands-on, personal experience.

Reason 1 – Your Domains Suck!

Alright, that’s a little harsh, and I’m typically a “sugar coat the difficult messages” kind of guy.  But we’re trying to be honest here, right?  Let me ask you this.  Did you do your homework on each of the domains you registered?  Did you look at the global monthly search volume to see if there are a decent amount of exact match searches?  Did you check Estibot for a value estimate to get a “feel” for the value of the name?  Did you do a Google search for the exact term to see if others are investing advertising dollars on these key terms?  Did you find websites based on the key terms that lead you to believe there is a market for this name?  While none of these in part or in whole is a conclusive formula, these are the basics.

If you haven’t done this, why not go back and do it now.  See which of your names score higher and put your effort in them.  Put your focus on where you will get the best bang for your buck.  Don’t hesitate to cut your loses.  Even if you don’t have ANY quality domains.  Start over if you need to, but don’t waste your time trying to sell names that no one wants to buy.

Reason 2 – You’re Not Trying Hard Enough!

Let’s assume your names are decent enough that you get past reason 1.  The next reason your domains aren’t selling is because you’re not trying hard enough.  This isn’t like Apple selling iPhones, people aren’t lining up to buy your domains.  If they are, I doubt you’d be reading a post with this title.  Unless you have incredible names, more than likely you are going to have to pursue the buyer as opposed to the buyer pursuing you.  Sure, it happens, but not as often as we’d all like.  You have to put some effort into it.  Get them on all the right venues, contact businesses in the market related to the name, find non-domain related forums on the term and build up some rapport, reach out to others who have experience selling similar names.  There are many ways, but you need to work to get your product out there.

Keep in mind, if you are suffering from Reason 1, even if you try hard, no amount of effort is going to pay off.  Especially in the long haul and you’ll be muddying the waters for when it comes time to sell quality names.

Reason 3 – You’re Not Good At Reason 2!

If your names are decent and you’re working hard to sell them, but you still can’t, then you’re not very good at selling domain names.   But fear not, as with anything, the more you try and fail the better you get.  You can shorten the learning curve by studying sales, reading books, following forums and blogs, and asking questions of more experienced forum members.

In my experience, these are the reasons I have found that domains don’t sell.  The good news is that you can act upon each one of these to make improvements and work smarter toward your ultimate goal.

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Strategy of a domain sale

Over the past couple of weeks, I’ve had an interesting conversation with Spencer Yao of smallbusiness-domain.com, a provider of domain name, web hosting, and e-commerce reviews, rankings, comparisons, & coupons.  Spencer was telling me about a recent domain sale his company was involved in.  He walked me through the life cycle from the initial purchase to the sale.  Spencer’s scenario provides some good food for thought when buying domain names with the intent to sell and I asked him to summarize his experience to share with you.

Back in mid 2009, we were approached by a seller looking to quickly dispose of some premium domain names in the beauty and apparel vertical. The acquisition was opportunistic and serendipitous and we did not have much time to decide because the seller wanted to move fast.  Although we had no direct experience in this beauty/apparel category (our group had substantial technical and monetization experience), we purchased one of the better domains because we thought it was truly “premium”, had decent type-in traffic, mapped to a common search term with clear commercial intent, and at an adequate discount to mitigate the risk.  Unfortunately, we cannot disclose the name, but that does not change the content of this article.

Below is a summary of our strategies to maximize value and eventual exit for the domain.

  Description Upside Risks Results
Strategy 1 Build an ecommerce site similar to Diapers.com or Hammocks.com Highest potential reward and risk. Requires most technical & financial resources. We had no direct industry experience in this vertical. Industry was too low margin and fragmented to support such a business.
Strategy 2 Turnkey site based on shopping engine listings. Hope premium domain name helps in SEO results. Much less work and maintenance than Scenario 1. Use API to auto generate sub categories and pages. Development costs to properly access & publish API. Little to no original content. Hard to monetize. Parked domain generated more revenue even though site had hundreds of pages.
Strategy 3 Park, hold, and sell the domain. Little to no work involved Not adding any value to the domain. Hope we paid a low enough price to hold and wait for a buyer Last resort. Chose this scenario after exploring #1 and building #2.

We determined Strategy 1 was not feasible after 4-6 weeks of post purchase research – this sub-category within Beauty/Apparel was too low margin to support an ecommerce business like Diapers.com or Hammocks.com   It took us 4-6 months to build out and vet Strategy 2 – we determined that parking the domain generated more revenue with lower costs than the turnkey site.

Unfortunately, we were left with Strategy 3, which meant parking the domain and hoping for a buyer.  To try and garner as many buyers as possible we looked at the following services:

  • Domain Listing Services like Sedo and BuyDomains. We found these services provided little to no value even though they charged a substantial commission for listing a domain in their database.
  • Domain Brokers.  We retained several brokers who actively marketed the domain and emailed buyers on our behalf.  Through several cycles, we received a handful of offers for about 50% to 80% of our target price which did not include the 10%-15% commission the broker earned if the sale was completed.  The offers were from domain speculators who wanted to sit on the domain and flip it.  This meant it would be hard for us to achieve “full value” through a broker.
  • “For Sale” sign on the parked page.  This is how we eventually sold the domain at our target price to a buyer who wanted to develop it into a website.  The upside was that we received full price without having to pay a commission, but the downside was we held the domain for over 3 years before selling it.

In summary, we purchased the domain (for mid to low 5 figures) and sold it for 30%-35% more than we paid, not including the work we put into Strategies 1 & 2.  Comparing this to an investment benchmark such as the S&P 500 (which gained 39% over the same 3 year period), meant we were better off taking those funds and investing them in the market.  However, since we were forced into Strategy 3, we were happy to make a slight “profit”. We could have waited for a buyer willing to pay more, but that could have taken years to achieve.

Lessons Learned

If you are going to invest substantial dollars into a domain name, we learned the following valuable lessons: 1) Have a concrete development plan to turn the domain into a viable website. Direct industry experience is essential. 2) For maximum price, be prepared to sell the domain yourself and wait years for the right buyer. If you need liquidity in less than 6 months, use a domain broker and be willing to take 35 cents to 70 cents on the dollar.3) The market for premium domains seems to have peaked around 2007-2008 and has yet to recover to those levels. You have to consider this when looking at pre 2008 domain sales for comparison.

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Take the risk out of domaining and boost your sales!

I have to admit, when I started domaining, I disregarded the advice of the pros and the veterans.  They all suggested saving my money and instead of buying a pile of worthless hand regs and low dollar domains, to instead save an buy a good  premium domain.  In hindsight, that would have been the way to go.  I wasted a great deal of time and money.  Initially, I thought it was too risky to put that much money into a domain.  However, it wasn’t a total loss.  While using the low end domains, I learned about contacting end users, what other domainers were interested in, and how to gauge the value of a domain name.

Another thing I learned was that people were hesitant to pay a premium for domains.  Not just me.  Sure, we all want to get a great deal and, at a minimum, not to get screwed in the process.

Think about how much more willing you would be to buy if you knew there was no risk.  Think about how much easier it would be to sell if you could assure your buyer that there was zero risk in the transaction for them.  How do you achieve that?   Well, you as the seller take on the risk.

Here’s what I mean.  I recently found myself in a situation where I was contacting end users on a particular domain.  There was a single company that responded and was interested.  With all the effort I put in and only had a single bite, I wanted to maximize the opportunity and make the sale.  After several conversations it became clear that the main contact was afraid to pull the trigger.  I got the sense that he was feeling he was taking a risk with the name… that it might not do for his business what he hoped it would and the investment would be lost.

Once I realized that, I decided to take a bold step.  I decided to offer him a risk free transaction.  I put in writing that if he was not satisfied with the name 90 days from the date of the transaction, I would purchase the name back at the same price.  BAM!  Risk removed.

Yes, there are some drawbacks to this approach.  Primarily, you might end up with the domain again and be starting from scratch.  But here’s my logic:

  • First, I don’t generally buy domains (anymore) that I don’t personally have an interest in myself.  So if it ends up back in my portfolio, I am comfortable with that.
  • Second, when I contact end users, I am setting the value on the domain that I am willing to sell at.  That said, this process helps ensure a fair prices, since I may end up re-purchasing the name.
  • Third, and most importantly, I am confident that they will find value in the name.

I’m not planning on using this approach in all situations.  For example:

  • I would not do this with a domain I did not find value in… which I shouldn’t be selling in the first place.
  • I would not knowingly offer this to a fellow domain investor who would likely look to resell at a profit and return to me if he was unsuccessful.

This approach has worked for me and I will continue to implement it where it makes sense.  There’s no reason it can’t work for you as well.

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Domain Sales Email – From a Domainer to a Domainer

I like to share some of the domain sales emails I receive.  The thought is that there just might be something you can gain from some of these as examples of what to do, or what not to do, in your own emails.  This particular email looks to have been sent knowing that I am a domain owner as well.  I don’t typically try to target domain owners in sales emails.  I think there are better venues for that.  I tend to reserve emails more for end user sales.  Maybe I would if I had a business relationship with another domainer and thought that they may truly have an interest in a domain, but not out of the blue.

The major piece I feel this email lacks is that it doesn’t indicate at all why I might be interested in this domain.  Are there high monthly searches, do I have a similar domain, is this my niche, etc.  The email should not point out the main reason for contact as “I am selling this domain,” but instead, why it will benefit the person you are contacting.

Good afternoon,

I am contacting your company because I am selling the following domain name:

www.radioelectronics.net

Please let me know if you would be interested in this domain.

Thanks, and best regards,

Sergei Shevchenko

Domain Owner

xxxx@gmail.com
www.radioelectronics.net

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Mike Mann – Domains, Advice, Opportunity

Several days back, I interviewed Ari Rabban of Phone.com.  During that interview, I came to realize that Phone.com was one of Mike Mann’s companies.  Mike has quite a history in the domain industry.  Most recently, he’s held the first reported aftermarket .CO sale of Flying.CO for $3,500, and has since sold Auctions.CO for $15,000 as Fusible.com recently reported.  Mike is said to have one of the best .CO portfolios in the industry.  Mann dominated the domain headlines when sex.com hit the market along with the controversy that entangles that domain.  Some of Mike’s other properties include, DomainMarket.com, SEO.com, and Skateboards.com among countless others.

Sullivan:  You serves as Chairman of Grassroots.org (a 501c3), a global network providing free services to other nonprofits and promoting social action.  I’ve seen the logo on many sites.  What’s the goal of the organization and how can others help the cause?

Mann: Grassroots.org provides free technology and consulting services to 501c3 charities, about 4000 so far, the object is to adopt 10,000 charities and provide each $10,000 year of free services until we are providing $100M per year of value to the nonprofit community through Grassroots.org. We engage in many other innovative charitable ventures as well. Grassroots.org is mostly funded by our charitable umbrella fund Make Change! Trust.

Sullivan:  You have several charitable organizations listed at MikeMann.com in addition to Grassroots.org.  The others are MakeChangeTrust.org, Relief.org, Interns.org.  What is your involvement in these organizations and what drew you to the non profit sector?

Mann: They are all ours, Relief is barely built yet and needs help. Interns.org is a recruiting site for other charities including our own.

Sullivan:  DomainMarket.com has over 139,000 domains.  Are all the domains owned by you or is this an open listing for domainers?

Mann: All ours

SEO.com

Sullivan:  What’s the secret to developing a phenomenal portfolio.  You seem to have proven with .CO that it can happen today and is not just for those with foresight in the 90’s.

Mann: Its really a grind of studying lists of domains, aggregating and studying data, buying and selling and buying and selling, beating down competitors over an extended period.

Sullivan:  You’re not only an entrepreneur and a philanthropist, you’re also an author  Make Millions and Make Change!: Secrets to Business and Personal Success (aff). One reviewer on Amazon entitled the review “A mix of common sense + ingenious tactics.”  I’m now looking forward to reading the book.  What can readers expect to learn from the book?

Mann: This is actually a real and relatively simple formula to ensure you can make millions and in fact change the world. I am sure. But you have to read it and pay attention or its merely theoretical.

Sullivan:  Tell me how and when you got involved in domains.

Mann: I had some left over names from my ISP days like menus.com government.net etc, once I sold menus.com for 25K I realized that I needed a lot of domains since it had only cost me $70 per year. So aside from noncompete periods I have bought as many as possible ever since as long as they seem to be below my estimated FMV.

Sullivan:  What was your goal when you founded BuyDomains.com in 1998?  Did you accomplish that goal and what made you decide to sell the majority of your interest in the company?

Mann: Our goals was to sell $500 per day worth of domains, 1 name, that cost us $70 per year, we rather blew that way out of the water as I intend to do in all business venues if possible. We sold some stock because finally someone realized what an enormous bargain it was, the many other suckers bid way too low. DomainMarket.com is like BuyDomains.com was at the time but very light overhead. We own fantastic assets right now that are growing precipitously, see MikeMann.com and click around.

Sullivan:  Tell me about AUX.com.  A small sample of domains listed here include Crime.org, Favorites.com, and AutoServices.com.  Is your goal to find partners for charitable as well as for profit ventures?  What is the process if someone is interested in working on one of these domains?

Mann:  Our goals is “to find partners for charitable as well as for profit ventures” If someone wants to help us with anything they can contact me on facebook or email me. Contact info on my site.

Sullivan:  As a role model for new domainers, what advice do you have for someone looking to make their way in the industry today?

Mann: Frankly, Frank and some fairly frank fellows are ferocious to compete with. I would focus on just building one name following best practices from MakeMillions.com and InternetApplications.com

Sullivan:  What else do you have for us as far as information or insight?

Mann: I think there is tremendous opportunity ahead in building and managing internet technologies and brands, everyone should engage in best practices for the network and the clients for the long term. Thanks for promoting our charity work. Cheers.

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3 Things NOT To Say In a Domain Sales Letter

It’s great to find sample sales letters that other domain owners use when selling to end users.  Some are excellent and can be used in almost every situation.  Others, are poorly written and ineffective.  I’ve noticed some trends in the letters I have received and it amazes me that the authors of these emails don’t see this as obvious.  I thought I’d pass these along in case anyone else is using these strategies or would like to debate their effectiveness.

3 Things Not to Say in a Domain Sales Letter

1.  I was going to develop this domain, but I currently don’t have time.

Really?  The domain is that good that you’re asking $xxx to $x,xxx and you don’t have time to develop it?  I understand that you don’t want to say, “hey I bought this and I’m looking to flip it,” but saying you don’t have time to develop it sounds more like “it’s not a good name and I’m trying to sell it.”  Try something like “This no longer fits into our business model for development”  to sound a little more professional about the transaction.

2.  This domain is better than the one you are currently using.

Ok, I’d like to sell you this domain, but first let me slap you in the face.  The fact may be that you do have a better domain you are offering, but stating that bluntly isn’t going to impress your potential buyer.  Instead, use data and bullet points that clearly outline the metrics you are trying to get across.  Let the buyer read this and easily come to the same conclusion that you would like to scream out loud.

3.  Here’s a link to (insert your favorite online appraisal tool) that shows this domain is worth $8,000.

While we all know the uses and limitations of automated appraisal tools, to an end user that is not apart of the domain industry, it will come across looking like a scam.  Most people have never heard of these, and if they have, they likely know that they have their limitations.  Anyone could quickly build a page that says their domain is worth any amount of money.  If an end user isn’t familiar with the tools you’re linking to, that’s exactly what they’ll think you did.  They’ll interpret it as a scam.

It’s the little things you can do to tweak your emails to make them more effective.  Words have the ability to influence or deter, so use them wisely and achieve the greatest impact.  If you have any good sales emails you use or have received and would like to share them, send them to me and maybe I’ll post them.  If you have one you’d like critiqued, send it as well.

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Increase Your Domain Sales Through Credibility

I’m always looking for new and more effective ways to sell domains.  Most of my sales have been the result of emails sent to potential end users.  The challenge with this method is that I have no prior relationship built with the individual I am contacting.  There is not much to differentiate my email from the overseas discount Viagra emails or the solicitation from the Prince of Egypt who is looking to transfer $10,000,000 into their bank account to protect it from the uprising coup looking to take over the county.

It helps to include a legitimate business name and phone number in the signature line, but that’s not necessarily enough.  How can you increase your credibility in the few seconds you have before the recipients hits the delete button?  Testimonials.

A testimonial is an age old marketing tool that can lend credibility to you, your email, and what you are offering if presented properly.  It lets the reader know that others have had good experiences with you or agree with your perspective.  People look to others for advice all the time, it’s our nature.  Let’s face it, we’re easily influenced… and we want to be.

There are two sources of testimonials I would recommend for domains:

1. Satisfied Customers –
The first source is a testimonial from a satisfied customer.  “I bought SugarFreeBubbleGum.com from Mike and the sales of my product doubled last year. – John Doe, Bubble Gum, Inc.”  Anyone reading this, if even just slightly interested, would now start to consider what this could do for their business.

2. Expert Resources –
Let’s say you haven’t yet sold any domains or if you have, they are not to credible sources.  Maybe other domainers have bought from you and that might not fly as a testimonial.  No need to fake it, that would be more harmful to you than beneficial. Instead, look to expert resources for testimonials.  The testimonial doesn’t need to be specific to your domains or to a purchase from you.  It can be about the general value of the type of domain you are selling.  “Keyword domains are a businesses best asset when looking to maximize online exposure. – Mike Sullivan, SullysBlog.com”  (I’m sure there are better sources than me if you look around a bit).  It also doesn’t have to be an individual, it can be from an organization.  If you are looking to sell a geo domain, you might want to find a testimonial from Associated Cities to support the benefits of such a name.

I recently requested testimonials from a couple high profile clients.  I’m still waiting to hear back, but these will look great on any sales letter I send out.  Give it a shot and post a comment to let us know how it works for you.  If you’ve already employed this technique, I’d like to hear from you too.

SUGARFREEBUBBLEGUM.COM
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Domain Sales Letter Revealed

It’s been said that when you write an email, you should be prepared for the whole world to read it.  Probably a good philosophy since I’m sharing one I receive just the other day. This unsolicited email came from another domainer looking to sell me a name.  I was targeted as a result of my domain appearing as a result in a Google search for the keyword terms.  If I had to guess, this is a modified version torn right out of the book of Elliot’s suggested email templates for domain sales.  I’ve sent out many similar emails myself, so I know the format well.

It’s interesting being on the receiving end of such an email.  I don’t have much in the way of critiquing this one, other than the Google search volume that is stated below is the “broad” selection, not the “exact.”  Other than that, it’s not bad.  Maybe a little too long for some, but not for my tastes.  One other suggestion I might make is to try to establish the value you are bring in the opening paragraph.  That might be as far as many recipients will read, so best to capture them right away with what you can do for them.  I also like to include the price.

Hello,

I am contacting you because coolbars.com appears for the search term
“club suppliers”. I thought that you might be interested in knowing that
I am selling my domain name ClubSuppliers.com, since I do not currently
have the time to develop it myself.

ClubSuppliers.com is very well suited for your industry and owning such a
name will attract relevant customers and could give you an advantage
over competitors in the field.

Currently, Google shows a monthly search volume of 1000 for
club suppliers. Furthermore, if you add content to the website, Google
will boost your ranking for this search.

However, you can also choose not to develop the website and just have
this domain take visitors directly to your existing website. Not only
can owning this domain benefit you through additional online marketing
and search engine pick up like Google, Yahoo, etc., but it will also
grow in value as these types of .coms are becoming much harder to come
by and expensive to purchase.

I am offering “ClubSuppliers.com” at a very good price. Please let me know
if you’d like more info or to buy it. I thank you for your
consideration and look forward to hearing back from you soon.

Warm regards,

Elizabeth

By the way, my domain, CoolBars.com, has been sitting idle for a few years.  I recently had a new logo created and I’m looking to relaunch the site soon in a new format.  I’ll post more information on that when I get closer.  I’ll post any other emails I come across that might be valuable.  If you have any good ones you’ve had success with and would like to share, let me know and maybe I’ll post it.

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5 Ways to Sabotage Your Domain Sales

I’m always looking for good ways to increase opportunities for domain sales.  We all know, it’s not as easy as it sometimes looks.  While pursuing positive means for improving sales, I always find more experience in “what not to do.”  Sometimes I find these things in my own experiences and other times I pick them up from what I see others doing.  If any one of these items can save you some time, then it’s equally as helpful as “what to do.”  These 5 Ways to Sabotage Your Domain Sales come in no particular order.

1. Panic

Don’t freak out when an unsolicited offer or inquiry comes in.  Just because someone is asking about your domain does not mean they are willing to pay top dollar for it.  Often times, they are just curious and not even serious players.  If you take the price too high just because you think someone is interested, they’ll quickly back away.  It’s important to have a predetermined price you are looking for.  That way, you know what you will be satisfied with and not have any regrets over a lost sale or a completed deal.

2. Do Nothing

Unless you have category killer names you should be taking some type of proactive action to sell or develop your names.  It’s not likely that buyers will be knocking on your door to make you an offer on ReusableExamGloves.com.  However, if that happened to be a real niche, a little research and a couple of dozen emails might land you a few bucks.  Alternatively, investing a little time into developing a site about the benefits (or dangers) of this product with a few affiliate links could also produce a small revenue.   That name might then pay for itself, at a minimum, while increasing some traffic numbers for a future sale.

3.  Over Promote

I often get Twitter followers who only tweet the domains they have for sale.  I rarely follow these people back.  I don’t recommend using Twitter or other social media outlets as a feed for strictly advertising the sale of your domains.  No one wants to see that.  Mix it up with some valuable information sharing or even some personal comments.  Another aspect of this is pimping your domain name to every domain forum, auction site, spam blitz and any other means you can find.  If the name is seen frequently and doesn’t generate interest, it might just die on the vine from over exposure.

4. Misrepresent

This goes without saying.  Well, no it doesn’t so I’ll say it.  Never, never, never misrepresent your domain’s search, visitation, or monetization statistics.  There is no better way to quickly develop a bad reputation.  That said, every buyer needs to do their due diligence and shouldn’t blindly trust the stats provided.

5.  Price Shift

It hasn’t happened to me, but I have heard and read many stories where a domain had a set asking price and when an offer arrived, the seller upped the price.   A more common example is when a seller accepts an offer and then reneges to accept a second, higher offer.  This will not only lead to legal issues, but word travels.

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BargainDomains.com Gave me a 600% Return

Every so often I drop a couple names into BargainDomains.com to see if they’ll sell quickly at a discounted price.  Francois made it easy to do by placing a “Sell It” button right next to the data results of a domain entered into the valuation tool, Valuate.com.  Up until now, I haven’t had much luck.  I recently logged into Bargain Domains to see which names I still had listed there.  To my delight, one of the domains was listed as “in auction.”  That means that my minimum reserve price was met or exceeded.

I picked up the domain WoodenSledge.com as a hand registered name a few months back after seeing it on Arbel Arif’s PickUpNames.  The name appraises at $1,200 on Valuate.com and I set my minimum at $60.  I paid less than $10 for the name when I registered it, so a return of 600% is acceptable, wouldn’t you agree?  There was one bid placed for $60, so all is well.  Sure the domain could have sold for more, but I am pleased with the result.

I like BargainDomains.com, especially for hand regs.  It offers a fair and reasonable price to buyers.  In fact, I have now been paying closer attention to the names listed there and I see some I like.  I just might place some bids because I think there are some deals to be had.

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Selling at Flippa, What’s the Deal?

With all the news about recent sales at Flippa.com, have you thought about trying it out for some of you revenue generating names? While I have known of the site for some time, I have not yet listed any domains there. I spoke with Dave Slutzkin, General Manager at Flippa, to get a better feel for the service and to find out some interesting facts.

Mike: Where did Flippa originate and who are the people behind the site?

Dave: Flippa was born out of SitePoint in mid-2009, the second SitePoint child following the creation of 99designs in early 2008. The creators and owners are the same as for the other two sites in the group – Mark Harbottle and Matt Mickiewicz are the founders, and Leni Mayo and Andrew Walsh are internet veterans who serve on the board.

Mike: Flippa has made headlines recently, with record breaking weekly sales. What do you attribute the recent increase to? Is it higher sale prices or greater volume of sales overall?

Dave: It’s a bit of both. Certainly that week saw some very impressive sales close, but we’ve also seen big numbers of sales in the last few weeks, since the northern summer ended and our users started to return their focus to indoor pursuits.

Mike: How does a website owner go about selling their site through your service? Are there specific requirements that need to be met around revenue and traffic volume or other criteria?

Dave: Selling is easy on Flippa. There are no specific requirements for the site except that the seller actually owns it and can make some very basic technical changes so that we’re satisfied of that. Apart from that, you can sell a site which you started yesterday, or you can sell youtube.com – well, if you happened to own youtube.com. Mike, you could have SullysBlog.com listed in half an hour, and most of the time would be taken by writing some listing text to let potential buyers know why they should purchase your site.

Mike: What advantages does a site owner gain by listing with Flippa as opposed to posting on some of the domain forums or hiring a broker?

Dave: A single listing on Flippa is significantly more affordable than a broker, who will often charge an up-front fee plus a large percentage of the final sale price. Brokers can be useful at the very high end of the market, but below that it’s much more cost-effective to run certain elements of the sale yourself in conjunction with Flippa.

At the other end of the market, domain forums and listing sites are missing something that Flippa has in spades – an audience full of savvy buyers who are looking to purchase great websites.

Mike: What is the highest public sale price a site has gone for on Flippa? What was the domain?

Dave: The highest sale price that I can publicly disclose is for retweet.com: http://flippa.com/auctions/85167/Retweet-com

This sold for $250,000, a price which both the seller and buyer were very happy with – the perfect situation! We’ve had some other bigger sales, but under our private sale model, which keeps the final price undisclosed. A significant fraction of large sellers choose this model as it has some confidentiality benefits.

Mike: What are some of the more interesting sites you have seen listed and sold through Flippa?

Dave: The most recent one which comes to mind is a site called ReadPrint.com: http://flippa.com/auctions/101723/ReadPrint-com-As-seen-on-BBC-World-News-117K-profit-last-12months-was-PR7

This is a high-profile site with decent traffic – 450k unique visitors per month – driven by an enormous library of quality content which they’ve built up over almost seven years. It was pulling in decent revenue – $5k a month – but they’d by no means fully exploited the potential of the content.

This sort of sale fascinates me because there’s a great business waiting to emerge from this established but still fledgling site – the sort of challenge which I love myself! (I often have to restrain myself from picking up a bargain that catches my eye on Flippa – not enough hours in the day…)

Mike: Do you find certain types of sites sell better than others? For example, do sites with generic domains sell better than those with brandable domains? Other than dot com, what is the next best selling TLD?

Dave: Most of the sites which sell best have provable revenue – this is something buyers find extremely attractive. On top of that, buyers love unexploited potential. For instance, an ugly, unwieldy site with good search engine rankings and lots of traffic will attract those who have skills in design and conversion optimisation, to make it all it can be. Generally we feel that’s something Flippa does well – put sites together with those who can move them to the next stage of their evolution.

On your questions, we don’t see a lot of difference between generic and brandable domains, as it’s often about the business the seller has put behind it. As to TLDs, .net is listed more than .org, though .org actually has a better sell-through rate – make of that what you will!

Mike: Do you feel that developed domains are the best way to sell? That is, is it better to start with a domain and then add value before reselling it?

Dave: Yes, of course, because the less developed a domain is, the more potential is sitting there on the table, and it’s hard to get buyers to pay as much for potential as you want.

But it’s all about time, isn’t it? Most of us have more domains than we could ever fully develop in a lifetime!

So one good in-between option, after parking, is to work out a way of throwing together mini-sites which can give you a really good sense of the potential of your domains. At that point, having boot-strapped the process, you’ll get a better idea of what the domain is worth with a site on it. Then you can decide if it’s better to hang onto the partially-developed domain and earn a bit monthly, or to hand it over to someone who can better exploit it – and bank a lump sum up-front.

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Package Domains for Bulk Sale

I’ve had some success packaging domains together in a bundle for sale to end users.  In my experience, this has worked out better as a secondary sale to end users who have previously purchased single domains.  This made contacting them with the offer that much easier.  I typically start out these types of emails with the following.

“As someone who has purchased a domain name for this industry in the past, I’d like to give you the first opportunity to purchase the following names.  The price for the package is $x,xxx and the domains will not be sold individually.”

The immediate reaction will be to take the bulk price and divide by the number of domains to get a unit price.  This has it’s advantages and disadvantages.  The domains in the group will be of varying quality, so it makes the good names look like they are being offered at a great price but can make the buyer question the lesser quality names.  I’m not at all suggesting that you throw in junk names.  If you do, the buyer will probably counter with an offer to buy just the better names and at the unit price they calculated or below (I’ve burned myself doing this).  You’ll end up doing your client and yourself a disservice.

If the lesser quality names are decent, they will hold their own as part of the package and the buyer’s desire to obtain the better quality names will result in a sale (this has also happened to me).  This method makes it easier to sell multiple related domains in one sale as opposed to multiple individual sales.  Efficiency lets you sell at a better price.

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Turning a “No” Into An Opportunity

I’m in the process of marketing one of my domain names to some large corporations.  Because I am still in discussions, I’m not going to mention any names, but it won’t reduce the value of what I am going to share here.

I initially contacted the marketing manager of a particular corporation with an industry relevant domain.  I kept the initial email brief, respecting his time and not wanting to burden him with statistics that he may not have had interest in.  He responded with a quick “xxxxx.com is a better name, do you own that?”  My initial thought was that his response was a “not interested” reply and I should move on because I don’t own the domain he countered with.   But at second glance, I saw this as an opportunity.

I did the standard research on the domain he sent, and it had far less global search volume than the domain I was pitching.  I compared the two on Google Trends and the graphical depiction was clearly in my favor.  I compiled the information and sent it back to the executive, along with my perspective.   It took only a few minutes of my time.  Within 30 minutes, he responded back impressed the information I provided and the insight I gave him into his own industry.  He took the information back to his team for further consideration.

This exchange may not result in a sale and that’s fine.  More important here is the trust and relationship I have developed with this individual and the potential this holds for the future.  We now are a part of each others network and can connect each other to people and opportunities we may not have otherwise been able to reach.

Make every interaction count, remain professional and build for the future.  Domaining is like any other business and relationships make all the difference.

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25000 unique visitors per day

I reached out to Andy Schepper,VP of Operations at Summit Sports Inc.  once I saw the long list of sports related domains the company owns.  Andy gave me his perspective on generic, keyword domains over brandable names, as well as a peek into the companies marketing and business logic.

Mike:  Summit Sports, Inc. owns a great list of premium domain names such as skis.com, hockey.us and inlineskates.net.  How important have these domains been to your business model?

Andy:  Summit Sports in a specialty sporting goods retailer.  These category specific domain names have given us the ability to create a specialty store shopping experience online.

Mike:  Can you share the volume of traffic any of your sites receive?  Do you happen to know what percentage of your traffic comes from direct navigation (type-in traffic)?

Andy:  In season some of our higher volume sites will see 25,000+ unique visitors per day.  Direct traffic typically accounts for 10-20% of our traffic.

Mike:  How did Summit come to acquire these names?  Are you the original registrant or were they purchased on the after market?

Andy:  Most of the domain names that we own were purchased.  We have purchased them through many different sources including: private individuals and online auctions.

Mike:  What type of online marketing strategies do you follow for these sites?  What about offline or traditional marketing?

Andy:  Our marketing strategy both online and offline is the same.  Our goal is to create an online shopping experience as good, or better than an in store shopping experience.  Therefore, we are very specific in both our marketing and site content to maintain the specialty store emphasis.  We participate in every from of online marketing and we also use many traditional forms of advertising including print and billboards.

Mike:  Is Summit actively pursuing additional sport related domains?

Andy:   We are always looking for new sporting goods categories to expand into and grow our business.  We own several hundred additional sports related domains that we have not yet launched sites for.

Mike:  Would you consider selling any of your domains at any point?  Have you received any unsolicited offers?  Have you thought about venturing outside of sports?

Andy:  Currently we do not have any of our websites listed for sale.  We do receive unsolicited offers on a regular basis.  We will be using our sporting expertise to focus on launching site for the domains that we already own in the future.

Mike:  What made you chose the generic keywords over something more brandable like “SummitSkates.com?”

Andy:  As I have mentioned, we are a specialty sporting goods retailer and how much more of a niche site domain can you get than the search term itself.  Many people who are shopping online type in the keyword of what they are shopping for followed by .com or .net to see what comes up.  I even do it to this day.  Most recently I was shopping for a new digital camera and visited both cameras.com and digitalcameras.com.

Mike:  What advice do you have for others starting new businesses and selecting a domain name?  Do you have .com, .net and .us.  Have you found them all to be valuable?

Andy:  Your domain alone will not be the success or failure of your business.  As far as domain extensions are concerned .com is still king.  We have also had great success with .net sites over the last few years.  Our .us and .biz sites are very new but showing some early successes.

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Dutch Boyd, Poker Player, Domainer

Dutch Boyd is a professional poker player and a “part-time” domainer as he describes on his blog, DutchBoyd.com.  He has won 2 WSOP bracelets and has some other interesting facts on his resume.  Dutch has a bit of a roller coaster of a past with some highs and lows.  Coming off his latest WSOP and focusing on domain development for some items in his portfolio, I’d say he’s on a high at the moment.  He took a few minutes to share some information about himself.

Mike:  Looking at your bio on DutchBoyd.com, there are a few interesting facts.  First, you are the 2nd youngest law school graduate ever, starting college at age 12.  Tell me more about your early years that led you to college at such a young age.  What attracted you to Law School?

Dutch:  I pretty much just fell into it.  I was going to middle school in a really small town in Missouri.  Less than a thousand people.  When I was 11 and going to middle school I took the ACT as part of an enrichment class I was in.  I ended up scoring a 23 on it out of 36, which isn’t exactly stellar, but it beat out the average score of the high school seniors.  There was an open admissions policy at the local community college.  They’d let anyone in who scored higher than an 18.  My mom asked if I wanted to start taking classes there instead of going to middle school.  When she explained that going full-time and taking 12 hours meant sitting in class for two hours a day instead of eight, I jumped at it.  I dropped out of middle school and started going to college part-time in January 2003 a few weeks after I turned 12.

I only took 6 hours that first semester because we didn’t really know how I’d manage college… but I did fine.  Went half-time that summer and then started full-time in the fall.  After I got my associates degree at the community college, I transferred to Central Missouri State and started working on my Bachelor’s in Computer Science.  In my junior year, I took the LSAT, which is the test you take to get into Law School.  I kicked ass on it and got a 165 out of 180.  Which is a pretty decent score for anybody… and I was 14. So I was going to be able to get into most any state law school.  I applied and got accepted to Missouri University in Columbia and started law school at 15 after finishing up my BA.  I can’t say I was superpassionate about law… it was just going to be a job for me.  I was a teenager and didn’t really know what I wanted to do.  I didn’t really find anything I was super passionate about until I discovered poker.

Mike:  How did you get involved in poker?
Dutch:  I always really loved all games growing up… Scrabble, Monopoly, Nintendo.  I remember the first hand of poker I was ever dealt was when I was 10 and visiting my grandma for a weekend with my little brother.  She pulled out a deck of cards and a big back of tootsie rolls and sat down on the living room floor with us and divvied the candy up.  Then she dealt us each five cards and taught us how to play Five Card Draw.  It was an awesome night.
I didn’t really get into poker, though, until law school.  I think I must have been in my third year when Rounders came out in theaters.  The movie, which stars Matt Damon and Ed Norton, focuses on Damon’s character who is a law student who plays pro poker in some of the underground cardrooms in New York.  That movie changed my life.  Up until then, I had never even heard of Texas Holdem and I certainly didn’t know people were playing cards for a living.  And then this movie comes along with my favorite actor playing a law student who drops out to be a poker pro.  It struck a chord and felt like a calling.  I went to the library and checked out every single book I could find about poker.  Then I searched on the Internet and found a couple places to play online.  I missed a lot of classes that last year.  I was hooked.
After I finished law school I moved out to San Jose to live with my brother who was working a Silicon Valley job.  I started playing at some of the bricks and mortar cardrooms around the valley like Bay 101, Lucky Chances, and Garden City.  I was underage, but very rarely got carded… when I finally turned 21 I got a job as a prop player at Garden City.  That’s where I’d say I really grinded my teeth and came into my own as a poker player.  After a little time there, I started following the tournament trail and doing pretty well.  I made a really deep run in the World Series main event in 2003, finishing 12th and bluffing all my chips off in front of the ESPN cameras to the eventual winner, Chris Moneymaker.  I won my first World Series bracelet in 2006 and my second this summer.
Mike:  You’re also a domainer, how long have you been involved in the domaining industry?  How did you get started?
Dutch:  I registered my first domain in 1999.  My little brother and I decided to try to make an online poker site and we picked up PokerSpot.com for the project.  We spent about two years on the project and were definitely over our heads.  For awhile it was looking like the site was going to be huge, but it eventually failed and I went back to the felt.  I registered a lot of really good poker domain names back then… but I didn’t know what I was doing and let all of them expire.In 2003 after I had my deep run in the WSOP main event, I ended up cashing for about $80k.  I still thought there was a lot of potential in domain names and the Internet and I used about $15k going on a hand-regging spree.  All the great poker domains were already taken, but I did manage to handreg some real gems.
About six months later, one of the Fabulous.com guys emailed me and invited me to park the portfolio with them.  I had never heard of parking domain names and up until then all of my domains were basically just a big $15/yr money hole.  I started parking them and couldn’t believe how much those clicks paid.  It still boggles my mind that people actually click on parking page links… but enough do that it started paying the bills and definitely was more consistent money than poker.I fell in love with domaining then… and for the first time since I discovered poker, I found something that I was really passionate about.  I’ve been pouring over drop lists ever since!
Mike:  Do you have any developed domains, or are you primarily an investor?
Dutch:  I have a few good developed domains… PokerTells.com is one that I’m pretty proud of.  One of my handregs.  Also worked up my own parking pages that I think look pretty good… you can see an example at PokerTilt.com.  Primarily, though, I fall into the trap that I think most of us do… the acquisition is the fun part for me.  I kind of feel like we’re in this golden age of domaining where there are so many great acquisition opportunities.
For awhile, I decided that most of my time was best used picking up new domains instead of developing the ones I have.   I will say, though, that I’m starting to spend a lot more time developing then I used to.  I recently started kind of getting into the mindset that if a domain isn’t at least making it’s regfee every year then it’s not worth having… so I turned off my autorenew and started saying goodbye to a lot of my domains. That really got me in the developer mindset and now I’ve been trying to turn all these little $8 moneypits into small profits.  Started building out really ugly mini-sites… WatchNecklace.com and WannaBeAModel.com were my first couple of attempts.  Those domains were making a couple bucks a year parked, but fell short of the reg fee.  So I slapped up the mini-sites and now they are each making several times what they cost me.  They’re very ugly sites, but they’re making a few bucks a month and I don’t have to do anything with them.
My newer efforts are a little more polished.  A couple examples are ArcadeNinjas.com, which I handregged a few months ago and tried parking with no luck… so I ran a $30 logo contest on NamePros and bought a $10 arcade script.  It’s not making me millions, but it made $2.64 in the last week on adsense… so it’s no longer a money pit and it’s worth keeping.
VegasAnswers.com went a similar path (although I still haven’t done a logo contest for it and did the ugly logo myself).  Handregged… installed a script… turned a domain that makes less than $regfee a year into one that makes greater than $regfee a year.
Mike:  What are some of the names you have in your portfolio?

Dutch:  I’m sitting on about a thousand domains right now.  My best one is hands down Cured.com.  I picked it up for a grand last year from the original owner when it expired and was in the redemption period.  Sold it on sedo about a month ago for $25k.

I’ve got a lot of good poker ones… HeadsupPoker.com, PocketJacks.com, Checkraiser.com.  Some better non-poker ones are Player.tv and PrisonLife.com.

My favorite domain in my port right now is probably Nineball.com.

Mike:  Can you share the some of the other names you have sold and at what price?

My biggest sale so far (that went through 🙂 was PokerHost.net for $10k.  There was a company who started a site at PokerHost.com and I had registered PokerHost.net when I tried registering the .com and it was already taken.  They actually tried to take it through a UDRP, but they had started their site well after I had registered my .net so they lost their case after I pointed that out in my response.  I sold UniversityPokerTour.com for $5k, CruisePoker.com for $2k, PokerMax.com for $3k, ReviewPoker.com for $2k… a lot of $1k domains.  I’ve got about five on the top 100 list of poker domains that have sold.

Honestly, though, I can’t really say that I’ve sold a lot of domains. Probably less than hundred in my domaining career and the bulk of those for less than a hundred to other domainers on the forums.

Mike:   Which do you find more fulfilling, domaining or poker and why?

Dutch:  I definitely see more of a future in domaining.  Even though an hour grinding online pays better than an hour spent domaining, I love the whole passive income aspect of setting up a mini-site and watching it turn a profit.  I don’t think a lot of people, even domainers, really get how much of a future there is in what we are doing.  The kids growing up right now that are natives to the Internet… in ten years they’re going to be dropping out of Harvard and coming up with the next killer app and they’re going to need a domain name for it.  The old guard who balks at spending seven or eight figures on category killer domains… they’re going to be replaced by these kids who aren’t going to argue that a domain like Candy.com or Sex.com is worth eight figures.

Domaining is also much more of a socially positive endeavor than poker. Every dollar I take at the poker tables comes out of the pocket of someone else.  It’s an even sum game until you factor in the rake and then it’s a negative sum game.  Domaining is different than poker in that respect… it’s a positive sum game and something I can feel better about doing.  There are no losers with what we do.

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Twitter Template

Last month, I posted an article on “The Power of the Twitter Background,” which was basically about how to make the most of your background to promote your image.  I have gotten a couple of emails on this, so I thought it would be helpful to provide a little more information.  There are a some services that allow you to make custom or semi-custom twitter backgrounds for free.  I haven’t used these, so I am just providing these without reviewed.  One free site is twitbacks, which after signing up, allows you to created  a branded background.  There are plenty more free sites, so do some searching and see what you find.

A site that customizes for a fee is mytweetspace.com.  I have actually heard some good feedback about this site, so might be worth a try.  Personalized backgrounds under 5 bucks and custom backgrounds under $80.

If you are at all creative, you can download my background here as a Photoshop file and customized it to your liking.  The benefit of downloading mine as a template is only that is shows  the positioning for the right and left sidebars.  Enjoy.  Feel free to ask if you have any questions.

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Register.com Sells for $135 million

I haven’t posted specific news article in the past.  These are usually picked up by other blogs and I don’t like to repeat content.  But here is one that I just came across that I thought I’d share. Web.com Group Inc. has disclosed that it has agreed to purchase Register.com for $135 Million.  It was described as a cost cutting strategy that will add more exposure to each companies customers for additional sales.  When the dust settles, the company will have 1 million paying subscribers.

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Relationships in Domaining

Earlier this month, I posted about how I contacted someone who bought one of my domains on Snapnames.  That person ended up buying a handful of additional related domains from me.  As I think about that, if I look at my most recent 5 clients (and I call them clients as opposed to customers because I see it as a long term relationship), 2 of them have made multiple purchases from me, 1 will likely make future purchases, and the last 2 were each probably a one time deal.  I’m not a domaining expert (I’m working on it), and I am no salesman by any means.  But helping your existing clients to see how they can use the domains to their advantage will only help you with future sales.

Give them advice on how to park the name until they are ready to use it.  Ask them if they plan to develop the domain, create a sales page, or point it to their existing site.  In any case, you may have some advice for them on how to best go about that.  If you are lucky enough that they already have a good understanding of the value of domains, just maintaining a good relationship with them can lead to another sale.  Most of my sales come from hand regs, so the values are not astronomical, but overtime I’m banking on good relationships improving my bottom line.

Photo credits: http://www.flickr.com/photos/aroberts
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The Power of The Twitter Background

I’ll admit I’m pretty new to Twitter.  In fact, I actually kind of resisted it for the longest time.  I just didn’t get it.  But once I spent a little time following people, I realized what an amazing tool it was.  If you’re a domainer it’s a must!  In fact, if you own a business, work for a business, freelance, or have absolutely any need to network at all (and who doesn’t?), Twitter is a must.

But let me focus in… I recently realized the value of the Twitter background.  Just like a web page, your Twitter page has a background image that you can control.  Twitter offers some colors and patterns, and there are also some other free service that offer the same.  Let me tell you, if you are using those, you are missing out on a huge marketing opportunity.  Think about it… that space has enormous value.

I happened to notice how some of the people I was following had made great use of this space.  Here are some good examples:

@BuyDomains tiles their logo and domain name across the page.  No mistaking that.
@iDotz clearly states their business in the left column of their page.
@gdomains has a background that is super clean and elegant.  I really like this because they utilize both the left and right columns of the page.
@mashable, with Pete Cashmore looking a little like Justin Timberlake in this pic, or is it just me?
@ChattyGalBlog makes good use of her background to promote her blog and gain some personal identity.

As a domainer, you can use this space to list some of your domain names that are for sale, or draw attention to your website where a complete list can be found.  I just created a simple background and popped it onto my Twitter page just  before publishing this post.  It’s a plain and simple background, but I didn’t want to waste any time capitalizing on the space.  In time, I’ll make some updates and include a more professionally designed background, but for now, it will do.  I may even add a few sites for sale.  Tell me what YOU think of my simple background.

Use this competitive advantage.  Have a look, the majority of Tweeters aren’t.

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Counter Offers Are Binding

It has happened to me on more than one occasion.  Twice to be exact.  I contact a potential buyer with an offer on a domain name.  They reply with a counter offer, “I’ll give you $x. ”  Maybe some additional negotiations take place, maybe not.  At the end of the day, the potential buyer has made a counter offer.  When I reply and accept that offer, the deal is binding.

Apparently, there are some business people that do not understand this element of contract law.  They make a counter offer with little or no intention of following through on the deal.   Maybe they are practicing their negotiating skills on my time.  Maybe they are just curious as to what my reaction to the offer will be.  Regardless, they don’t complete the deal.

What options do I have?  Not many, really.  The level of dollars involved in these offers are not high, so it’s not worth pursuing legal action.  Besides, I don’t want to develop a reputation as a lawsuit happy, crazy man that others wont want to come near.  It’s really just frustrating more than anything.  I considered adding a small reminder to my emails solicitations reminding “Acceptance of a counter offer represents a binding agreement.”  But I really don’t want to encourage counter offers.

It may just be a couple of bad apples, and I happened to pick them off the tree.  For now, I’ll just accept the fact that this happens and focus on finding a serious buyer when it does.

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