Domain Re-Selling Strategy

[moniker]

From my understanding re-selling domains is largely a waiting game. Meaning waiting for the buyer who really "appreciates" the value of the domain to come along - which - can take a long time. So I was thinking of an optimal strategy for re-selling:

1) Start every negotiation with an aggressive "great" price (start negotiation there) then compromise down to "good" price to close the deal.
2) If within period X (1 year for example), no buyer was willing to buy at the good ("reserve") price then cut both "start price" and "good price" by %Y (for example 20%);
3) keep cutting every year until someone buys.

Eventually, the name will get sold and you will get what the market is "willing to pay for it" and if there's any "asset appreciation" over the years - that should work in your favor too.

Is this a good strategy?

[urlurl]

almost like a dutch-auction

[Bill F.]

The thing about cutting the price will work for some domains that get lots of offers. But the question is how much you are leaving on the table. It may be that the domain has not sold because the right buyer hasn't yet approached you. In that case, you're simply giving away a good name at a good price. That's if it's a good name.

If it's a bad name, cutting the price won't likely bring any buyers either. So you're just slowly losing money in renewal fees.

To me, domains are not such a liquid market that price cuts make sense at any time except when you are ready to cut a name loose or need quick cash. What the market is willing to pay only applies to liquid markets (and perhaps the most liquid domains). "Asset appreciation" certainly does not work in your favor if the asset rapidly appreciates (as happens) while you are cutting the sale price.

I think you have to decide for each domain at renewal time what to do with it. Simply cutting the price across the board seems a poor way to maximize profits or cut losses.

[Anthony Ng]

From my understanding re-selling domains is largely a waiting game ...

3) keep cutting every year until someone buys.

I agree that domain name investtment is kind of a waiting game. However, you don't necessarily have to keep cutting prices.

The thing is, real-world markets are NOT perfect, that is, VERY few people (either buyers or sellers) know the market well enough to make an optimal decision.

A certain domain of yours or mine has not been sold for a "good" price could well be because the piece of information that it is for sale never reaches the potential buyers who are willing to pay for that price range (even with a full page ad on Wall Street Journal). It may not even be our fault, sometimes LUCK (chances) plays an important role in life.

[biggedon]

From my understanding re-selling domains is largely a waiting game. Meaning waiting for the buyer who really "appreciates" the value of the domain to come along - which - can take a long time. So I was thinking of an optimal strategy for re-selling:

1) Start every negotiation with an aggressive "great" price (start negotiation there) then compromise down to "good" price to close the deal.
2) If within period X (1 year for example), no buyer was willing to buy at the good ("reserve") price then cut both "start price" and "good price" by %Y (for example 20%);
3) keep cutting every year until someone buys.

Eventually, the name will get sold and you will get what the market is "willing to pay for it" and if there's any "asset appreciation" over the years - that should work in your favor too.

Is this a good strategy?

logically, your strategy is illogical


if, you understand that reselling is basically a waiting game, then you must be prepared to wait


that's the sign of a true investor


a flipper, on the other hand, is looking to resell in less than 1 yr.



even though both look to profit, the investor typically waits for the greatest return


while the flipper typically looks for the quickest profit


you have to figure where you fit, or where each domain in your portfolio fits




if you look at some big name sales, many owners held their names for years until the best price/offer/opportunity came along.


so if you have some half decent name that have received a few offers, then add 5 or more years reg time and let em sit.

cause you never know who's watching and waiting for you to drop them

[katherine]

The thing is, many domainers cannot afford to play this game because they don't own real strong domains, the kind that get unsolicited offers on a regular basis. In that scenario you can afford to hold until you receive a compelling offer.
But often you need to seize opportunities and consider any offer that comes in because it may be the last (or the best) and you need cash flow.
You need to keep expectations reasonable and be able to tell a 'decent' or 'acceptable' offer from a lowball offer.
The long-term hold strategy should apply to the top of the range domains.

Personally, I have some domains that I nearly wouldn't sell unless the price is substantial, and other names that I'm more willing to compromise on.
Domaining is a great type of investment but lacks liquidity.

imo...

[CureCancer]

are you the owner or rep of Moniker.com?

[moniker]

are you the owner or rep of Moniker.com?

No.

---------- Post added at 11:35 PM ---------- Previous post was at 11:33 PM ----------

So OK, it's a waiting game, but shouldn't you cut the price at some point if the domain is just not selling at the price u want?

Also my question assumes that the name gets at least a couple of inquires a month. So there's consistent interest and it's unlikely that any offer will be the last.

[james2002]

No.

---------- Post added at 11:35 PM ---------- Previous post was at 11:33 PM ----------

So OK, it's a waiting game, but shouldn't you cut the price at some point if the domain is just not selling at the price u want?

Also my question assumes that the name gets at least a couple of inquires a month. So there's consistent interest and it's unlikely that any offer will be the last.

If you can buy much better domains with the money, why not? You may send your domain list and I might be interested in some of them.

[Bill F.]

More than likely, the offers are coming from domainers looking for resale prices if they are coming in consistently. So, yes, if you cut the price eventually someone will bite at what they consider an acceptable resale price. As a flipping model it makes sense.

But certainly you would want to keep as many names as possible for end users and maximum sales prices. If you need cash flow, sell at resale prices. If not, sit tight. At least that's been my MO.