Typically, end users are the type of buyers that pay the highest prices for domain names. Scrolling through NameBio, you’ll see numerous examples of startups to corporations paying five, six, or seven figures for the best names. End users aren’t necessarily domain experts, and many of them may wonder why a string of characters is worth thousands of dollars.
Since domain brokers traditionally work with some of the most valuable domains that are available for purchase, we were curious about how they educate potential buyers on the value of a good domain name.
@Joe Uddeme, Founder of NameExperts LLC
@Jen Sale, COO of Evergreen.com
@Bill Sweetman, CEO of NameNinja
George Hong, CEO of @GUTA
@Giuseppe Graziano, CEO of GGRG
Kevin Fink (@iHaveThisIdea), COO of Starfire Web Holdings
@Dave Evanson, Senior Broker at @Sedo
@Hobi Michalec, Co-founder of Lumis Group
These responses have been edited for clarity.
Since domain brokers traditionally work with some of the most valuable domains that are available for purchase, we were curious about how they educate potential buyers on the value of a good domain name.
How do you lessen the learning curve (speed up the learning process) for potential buyers?
@Joe Uddeme, Founder of NameExperts LLC
Most buyers are already educated. The ones that need extra assistance are typically pointed to DNJournal or NameBio to see historical domain name sales that help set the expectation for the buyer/seller.
@Jen Sale, COO of Evergreen.com
Let’s be honest. It’s difficult to sell a property to an end-user who was most likely not even in the market to buy said property because they already have one that they are quite happy with (even if you think it’s rubbish).
That said, related articles, case studies, and comps (comparable sales) can help educate a buyer on the importance of investing in a domain upgrade and/or expanding their portfolio. If they don’t own the exact match .COM of their brand name (and that’s what you’re selling), then you can help them understand traffic and email loss, as well as potential spoofing and security risks that can be mitigated by owning it.
@Bill Sweetman, CEO of NameNinja
From my Buyer Broker perspective, I often show buyers comparable domains that have sold, which is usually an eye-opening experience for people, and I also discuss the long-term risks and impact of them *not* owning the domain name.
Sometimes, I find it useful to show buyers what their competitors are doing with regards to domain names. For instance, if one of their major competitors is using generic domains in a clever way, then I will bring that to the attention of my buyer client.
George Hong, CEO of @GUTA
Potential buyers buy domain names for different reasons. Domain names have a wide variety of applications, usages, and attributes, such as:
- URLs for websites
- Personalized email addresses
- Advertisement/brand name enhancements
- Digital investment assets that can be managed, transferred, and traded from anywhere in the world, can be used as collateral to secure short-term loans, etc.
For each application, usage, and attribute, there are many success stories and publicly reported sales, as well as privately brokered sales. Pick the ones that cater to the needs of the potential buyers and present those to them.
@Giuseppe Graziano, CEO of GGRG
We provide our research reports like the LXDO report, which we produce in collaboration with Intelium (the creators of the appraisal software Estibot) and Escrow.com. We put a lot of work into these reports, which explain to an industry outsider the sales volume, the turnover, and the market valuations of the domain names we typically broker.
Kevin Fink (@iHaveThisIdea), COO of Starfire Web Holdings
This is easier said than done, but in most of our cases, it’s moot. The prospect is either entirely disinterested or has a range of interest that is dictated by the price and their long-term motivations. While we do try and extend the conversation to see what might be holding them back, we won't nag someone who is disinterested. We ask if they are seeking any other particular assets in hopes we can find a way to work together in the future.
For those most interested, it comes down to pricing and terms. If the asset at hand is something that will complement -- or even dictate -- their brand awareness, act as a marketing/SEO booster, or help them lower costs in any area of their business, then that is the conversation we want to be having.
@Dave Evanson, Senior Broker at @Sedo
Buyers have different levels of sophistication when it comes to domains. After assessing a buyer’s level, it may be necessary to provide background and data on domains with the intent of pushing toward closing a deal. I find that using comps and a case study or two can be fruitful.
Sometimes, depending on the buyer’s business model, an incremental analysis showing the value of additional converted leads can help seal the deal.
@Hobi Michalec, Co-founder of Lumis Group
Get them on the phone. Sending an email with why they should pay more has a fairly strong chance of being misinterpreted or rubbing someone the wrong way. Better yet, get a brand or industry competitor interested and then get them on the phone.
These responses have been edited for clarity.