Stats & insights from the BrandBucket executive team
Hi,
You are receiving this newsletter as someone that has registered as a domain seller on BrandBucket.com. Below you will find statistics of interest to the BrandBucket community of domain investors, and some insights from our team. Enjoy!
2022 Year In ReviewThe BrandBucket marketplace continues to show healthy year-over-year sales growth. As we enter 2023, there is a lot of uncertainty surrounding the health of the economy. The past few months has been heavy with layoffs, and 200,000 jobs have been lost from the tech sector alone. This is an uncomfortable and shaky time for many, but a silver lining for the domain aftermarket is that this year and next there will be many tech-savvy and determined people choosing to start their own business.
BrandBucket grew out from the shadow of the 2008 recession; we speak the language of the bootstrapped entrepreneur, and we are excited for the new wave of innovators. Our deep roots in the tech industry, relationships with venture capital partners, and word-of-mouth marketing from sixteen years of satisfied customers will continue to bolster sales.
Numbers of Note$3160 -- The average sale price, looking only at domain sales under $10,000. Compared to an average of just under $3000 in 2021, this is a larger jump than previous years. Two of the factors that contributed to the improvement: we implemented annual price increases for domains that remain on the market, and concentrating our marketing efforts on buyers looking for quality names.
95% -- The percentage of transactions below $10,000 in 2022.
Why do we look closely at the sub-$10,000 market? First, this range has always been BrandBucket's sweet spot. We were the first marketplace to elevate potential brand names, market them to startups, and price them at a fair value (compared to historical measures of pricing that relied mostly on factors like search volume, traffic and age). Second, these sales typically have the highest margins, which allows our sellers to become profitable sooner.
60% -- The percentage of 6-figure sales paid as a lease-to-own rather than purchased outright. Startups, even those with funding and deep pockets, appreciate being able to spread out (and expense) their domain payments.
Seller StatsSeveral hundred unique sellers experienced the excitement of receiving the "your name has been sold on BrandBucket" email this past year. An even larger number had at least one payout, as lease-to-own plans continue to churn out monthly payments that help cover renewal costs and new domain acquisitions. 99 people had their first ever sale in 2022.
For serious domain investors, actively growing and pruning a portfolio helps maintain sales consistency as markets change and knowledge increases. Nearly 50% of our active sellers took advantage of BrandBucket's liquidation option for at least one domain. In addition, many sellers swapped names on BrandBucket's wholesale market, where prices averaged higher than industry norms (bolstered by the underlying guaranteed liquidation price.) We encourage every investor to take advantage of liquidations and the wholesale market as a key part of their sales strategy, since it is possible to recoup some of, all of, or more than the original registration cost of domains being dropped.
Lease-to-OwnIn 2022, almost 18% of domains sold were via the lease-to-own option. This is up from 11% in 2021.
Across the industry, the majority of lease cancellations happen in the first month. This is to be expected, with buyers "kicking the tires", reserving a name or two during trademark checks, or simply getting cold feet. However, from our findings, BrandBucket's first-month cancellation rate is lower than industry average due to front-loading the first month's payment.
Other statistics of interest:
- 9 out of 10 leases that continue past the first month will end up paid in full.
- The average value of leased domains in 2022 was $5875.
- On average, sellers that saw their leases complete (either by reaching month 12 or being bought out early) earned an extra 14% over their domain's list price.
Buyer StatsIn 2022, 99.3% of domains sold under $10,000 were at full listing price. 97.6% of all sales were at full listing price. This points to BrandBucket's pricing being aligned with buyers' expectations, and our messaging works to promote the "no haggle" experience. Our sellers ultimately benefit by not having their profits chipped away by discounts.
Repeat buyers and referrals remain a strong component of our business. In 2022, we saw a trend of increasing transaction value with each subsequent purchase from our repeat customers.
Name Trends"Keyword" domains to "invented" domains were sold in 2022 at a ratio of roughly 2:1. We saw fairly even distribution of sales among the keyword types: single word, misspelled single word, single word with suffix, single word with prefix, double word, and phrase. Invented names continue to catch the eye of serial entrepreneurs and experienced marketers that plan to build a lasting brand that had room to expand and pivot as they grow.
Now for a look at age -- the average registration age for names sold in 2022 was 84 months (7 years). 23% of sales were names older than 10 years, while 10% were one year or younger. We've found that on the most part, buyers don't pay attention to a domain's age if the name is a good fit; however, buyers that are domain savvy are more open to paying a premium for a domain that has been unavailable for a while.
Regarding marketplace listing age: In 2022, 26% of domains sold were within their first year of listing, 35% were between one and three years of listing, 17% were between three and five years, and 22% were listed for five years or longer. Ultimately, patience is necessary with brandable names, since you never know when the right buyer with the idea that is a perfect match for your name is going to come along.
New & UpcomingIn the past six months, we have rolled out many updates to the marketplace and platform, including the following notable changes:
- Testing and launch of new domain landers.
- Multiple new localized payment options.
- Improvements on buyer profiling and smart retargeting.
- A new co-brokerage fee policy for sales on other marketplaces.
We are excited for several new initiatives to launch this year. The primary objectives linking all of our 2023 projects is to increase the exposure of every name listed on BrandBucket, and to provide sellers new ways to monetize their inventory.
A Note From the FounderThank you to our sellers for your continued support, and thank you to my team. We welcomed new team members last year, and celebrated our veteran staff through anniversaries, marriages, and new babies!
As the founder, I continue to keep a watchful eye on the core virtues that make BrandBucket unique and successful:
1. Build for the long term.
We are always thinking about the next five years. Everything that we add, change, and trim from BrandBucket has been thoughtfully considered and measured to ensure the longevity of the marketplace. We want to maintain and grow the revenue for our sellers. We consider every buyer to be a long-term relationship.
Many companies in the domain industry have come and gone. Running a marketplace in any industry is particularly complicated. We have always done the right thing for both sellers and buyers, and we try to maintain proper equilibrium between the two. By focusing on resiliency, building intelligent systems, and investing in sustainable marketing, we are making sure to be here and healthy this year and next.
2. Maintain quality and consistency.
The hallmark of BrandBucket, and the aspect that is the most loved and appreciated by buyers is the overall high-quality of inventory, and consistent pricing across the entire collection. This curation takes an incredible amount of effort, but it is something that we will never outsource, take shortcuts on, or quit doing completely.
Curation is the future of eCommerce. In a world where shoppers are presented with an increasing amount of low-quality options, people are becoming increasingly fed up with digging through the mine to find the diamond. Any shopping site that can save people time, and where buyers come out of the purchase feeling exhilarated rather than exhausted, will gain a loyal customer base.
3. Don't dilute the brand.
I believe strongly in the philosophy "Do one thing and do it well." When our customers talk to their friends, can they explain what we do in one sentence? As we develop new ideas and seek new customers, we prefer to expand horizontally rather than vertically, via partnerships and properties that work together. And while a lot has changed behind the scenes, the core buyer experience remains the same.
4. Keep it simple for our sellers.
Many types of domain sellers utilize BrandBucket -- entrepreneurs that own a handful of unused domains, hobbyists, domaining as a side-hustle, and full-time domain investors. The one thing they have in common is that they all have work that they do on a daily basis that adds a lot of future value, and work that does not add much value at all. Focusing more of the first type of work -- building a business, researching and learning, supporting a family, and acquiring new inventory -- is the key to future success.
BrandBucket was built as a full-service, hands-off marketplace to help reduce the daily noise of domain sales. We don't distract sellers with lowball offers, lengthy negotiations, or vanishing buyers. The sales team works to get you your full price, and follows up with every lead for months and years. The on-page content, meta data, and logos are human crafted, and we take care of these details as your partner so that you can spend your time building value rather than tinkering with minor details.
Here's to a great 2023! If you have any questions about this newsletter or about BrandBucket, feel free to reach out to [email protected] and you'll get answers in a jiffy.
Cheers,
Margot Bushnaq |