Don't Be Greedy In Domain Business - You May End Up Losing Huge Amount Of Money

[Domain Author]

I happen to be present at the DOMAINX Conference that was recently held in Hyderabad. Here is something that I think is worth sharing.

One of the messages that was stressed upon multiple number of times by many veterans was that you need to "Stop Being Greedy" when dealing in domain names.
It is possible that sometimes someone approaches with a good offer for some of your names. You may know that the price that is offered is good enough for the domain and is much above what you expected. But now, you become greedy and start negotiating with the buyer to make a little more out of the sale. The consequences may be that you may end up not making any sale out of the name.

Here is a case study that was presented by Mr. Deepak Daftari

Mr. Daftari owned one of the best portfolios of .MOBI domain names at a time when the extension was on a boom. He had many premium names in his portfolio. One day, a buyer turned up and offered him $3 million for his entire portfolio.
Mr. Daftari, after having thought for sometime, evaluated and decided that his portfolio was worth much above what was offered to him. As a result, he denied the offer of $3 million for a portfolio of .MOBI domains.
As time passed, .mobi became less popular and as a result, his domains kept on diminishing in value. He said that his portfolio of the same .Mobi domains that had huge demand at that time, has no value today.
He regrets for NOT having accepted the offer of $3 million.

He concluded by giving us an advice that 'Don't be greedy' when dealing in domain names!! If the ROI is good enough(or Excellent), do not hesitate to make a deal!!
Always remember, a domain is worth only the price that a buyer is willing to pay for it!!

 

[Biggie]

Always remember, a domain is worth only the price that a buyer is willing to pay for it!!

lot more speculators lost money, other than him

go back and read some of the .mobi threads to get a real perspective. as convo got heated enough to produce steam.

some land-rushers who got early goodies, "made off" like Bernie Madoff, while others that held too long were forced to liquidate to latecomers or drop entirely.

still, I think a domain is worth more than "a buyer" is willing to pay for it, especially when there is more than "one potential" for the name.




imo...

 

[RON2]

Great post, D.A. There's a name for this. It's call the endowment effect. People will psychologically value something more than it's worth just because they own it. This has always been an issue in this business; just talk to any domainer about their portfolio and what it's worth as a whole. This is why people take offense at low domain appraisals. I don't think it's always greed that motivates it, but more like unrealistic optimism. Try to remain objective and remove your emotions from the deal.

 

[Biggie]

Try to remain objective and remove your emotions from the deal.

easier said than done, especially when you've held a domain for some time.

there's also the fact that many domains were originally purchased, based on an "emotional" feeling.

ie: they liked the way it sounded, they love the potential of this domain, had a gut feeling, etc, etc. or even a defensive registration so nobody else can get it.

and don't forget the "after-effects" of a sale, when "regret" can set in. particularly when one "feels" they left some duckies on the table.

which gets into the "greedy or needy" area



imo.....

 

[Domain Author]

and don't forget the "after-effects" of a sale, when "regret" can set in. particularly when one "feels" they left some duckies on the table.

It happened with me a couple of days back.
I hand-registered this really cool and brandable name. After registering, I sent out some emails to 11 potential buyers for the domain. There was no reply from them for the next 1 week. So I put the name on auction expecting that the auction would end up in high $XX to low $XXX. On the last day of auction, I got a reply for the email saying that they are interested in the name and would be offering $400 for the domain name.
However, the domain sold on auction for just $8 on the auction.
Since the auction, I have received 2 more replies with offers, for the domain.

Hard Luck on this deal!!

 

[flippawilson]

It happened with me a couple of days back.
I hand-registered this really cool and brandable name. After registering, I sent out some emails to 11 potential buyers for the domain. There was no reply from them for the next 1 week. So I put the name on auction expecting that the auction would end up in high $XX to low $XXX. On the last day of auction, I got a reply for the email saying that they are interested in the name and would be offering $400 for the domain name.
However, the domain sold on auction for just $8 on the auction.
Since the auction, I have received 2 more replies with offers, for the domain.

Hard Luck on this deal!!

Man, that hurts just reading it.