People are getting fooled by GoDaddy appraisal

[Arpit131]

I have been watching a lot of posts referring to Godaddy appraisals.
They have a typical appraisal range of $1399 and above for very crappy names. A lot of these can be found in n number of facebook groups where people expect to sell domains for $4500 kind of range in reseller market!

A lot of newbies are falling in trap by seeing that an available name which has a 4-figure estimated value is available for registration fee.

This is where they tend to purchase 10 names and above for $10+ each. Then they wonder why they are not able to sell it.

Do you trust Godaddy appraisals even 1%?

I feel that it is misleading newbies and a lot of domainers into trap with the appraisal value.

Thoughts are appreciated!

 

[NickB]

I fell for this when I first started and it cost me quite a bit of money, they should have a disclaimer CLEARLY showing under the "appraisal" stating that the figure quoted might not be accurate and you might end up with significantly less or more at the point of selling.

They should point out the name might not even sell at all and that it is high risk to try and sell domain names as an investment

Would they do the above? No bloody chance as it would impact on their bottom line...

Do I trust it? No, not even 1%.........but I had to learn this the hard way....

 

[BRANDERX]

The concept is damaging to domain investing in general, not just to newbies.

imo

 

[DN_Hunter]

I think the GD Appraisal Tool is useful for the Comps it shows (GD has access to some sales that are not listed elsewhere). But I see that it could be dangerous if newbies are using it to make decisions on buying reg-fee names (in the hopes it is worth $x,xxx or more). I fell into this trap about 10 years ago using the Estibot tool (back when it was totally free for as many names as I wanted to check).

 

[karmaco]

I think the tool is helpful for comps and for finding out potentially valuable keywords and what they have generally sold for.

You should not make all your decisions by the number it shoots out. Sometimes it’s too low especially on things that are on the horizon without established selling patterns or on made up brandables forget it

I don’t think anyone is being mislead per say. It’s a hell of a lot more accurate than Estibot which values a lot of trash as good and good as worthless.

After awhile you begin to have a feel for what is a good name and what is not no matter what the supposed valuation is.

 

[Recons.Com]

Worse, people are sweeping up anything valued above $1700 (just couple of months ago it was above 2k, and a year ago above 2.5k).

Many will burn badly with it.

Still remember the time suckers falling for GD showing pagerank and having bidding wars over those, then it was traffic, anything with above 50 had someone bidding right away, now it is Gd magic number.

Someone might bring class action lawsuit against them eventually for misrepresentation.

 

[DomainRecap]

It's like any other tool that you can take parts of to use in your overall investment strategy. I like the sale history they list for comparable domains, as well as if the domain has sold before on GD, and I do think they hit the mark in overall terms of "X domain is worth more than Y domain" far more times than they're wrong.

Anyone who is looking at a $10 hand reg with a valuation of $1,583 USD and thinking they'll get that tomorrow doesn't understand appraisals - these are just estimates of what an item may sell for, but you may also have to wait years or even decades to sell it.

No one has a "magic formula" that tells you what all domains will sell for down to the single-dollar and no one ever will. Trends change, the economy changes, and the world is in constant flux.

I find it useful for my purposes as I ignore the raw dollar value and concentrate on the underlying data. For example, I found a 5-letter domain I liked (I have to like a domain to buy it), watched it, compared the comp sales, and then noticed it had previously sold for ~$2K+ and had been off the market for a while. I ended up getting it for $25 or so + reg and maybe 8-9 months later ended up selling it for $1500.

So to me, if you just use GoDaddy appraisals as just one more tool in your shed, and not base your decision on the raw and very specific $$$ amount, then it can pay off.

 

[DomainRecap]

Worse, people are sweeping up anything valued above $1700 (just couple of months ago it was above 2k, and a year ago above 2.5k).

Most of this is GoDaddy "partners" using an algorithm (that includes appraisal valuation) to create a "line in the sand" and auto-bid on anything above it.

 

[domainshop1]

Most of this is GoDaddy "partners" using an algorithm (that includes appraisal valuation) to create a "line in the sand" and auto-bid on anything above it.

It's like any other tool that you can take parts of to use in your overall investment strategy. I like the sale history they list for comparable domains, as well as if the domain has sold before on GD, and I do think they hit the mark in overall terms of "X domain is worth more than Y domain" far more times than they're wrong.

Anyone who is looking at a $10 hand reg with a valuation of $1,583 USD and thinking they'll get that tomorrow doesn't understand appraisals - these are just estimates of what an item may sell for, but you may also have to wait years or even decades to sell it.

No one has a "magic formula" that tells you what all domains will sell for down to the single-dollar and no one ever will. Trends change, the economy changes, and the world is in constant flux.

I find it useful for my purposes as I ignore the raw dollar value and concentrate on the underlying data. For example, I found a 5-letter domain I liked (I have to like a domain to buy it), watched it, compared the comp sales, and then noticed it had previously sold for ~$2K+ and had been off the market for a while. I ended up getting it for $25 or so + reg and maybe 8-9 months later ended up selling it for $1500.

So to me, if you just use GoDaddy appraisals as just one more tool in your shed, and not base your decision on the raw and very specific $$$ amount, then it can pay off.

I totally agree with you.well Calculated

 

[Bob Hawkes]

I think the essential problem is that especially those new to domain investing don't realize the low sell through rate. I actually don't disbelieve Paul Nick's data that 60% of the time sales are within $1000 of GoValue appraisal (although that is not as impressive as first glance). I think i before someone invested in a domain name they had to certify that they understood the following disclaimer that I made up.

Many domain names never sell. There is no guaranteed return on any domain name investment, and you may well lose everything that you have invested. Domain names have a carrying charge of the renewal fee each year. These charges may go up over time. The appraisal is uncertain and is no guarantee of value. If you were to actively try to sell the domain for 100 years there is about a 60% chance it will sell at a price within $1000 of the appraised value.
​

Bob

 

[DomainRecap]

If you were to actively try to sell the domain for 100 years there is about a 60% chance it will sell at a price within $1000 of the appraised value.

​

Bob

Time to take my vitamins.

 

[NYJimbo]

Pretty much any noob will fall for it, they simply dont know better. Whats worse is that Estibot and others charge for this service and offer bulk appraisal tools which let you dump large groups of names and sort by appraised price so you end up grabbing the top priced domains. I know when I got "serious" in domaining I thought paying for these services was the "pro" thing to do.

GD appraisal does have some value, but you have to get a feel for it and understand its limitations.

Many new domainers get an appraisal for something as low as $900 and figure "Well, if I put it up for sale for $450, it's got to sell, right ?". It just dont work that way, but they dont know that until they get burned or come to a place like Namepros and learn.

 

[NYJimbo]

If you were to actively try to sell the domain for 100 years there is about a 60% chance it will sell at a price within $1000 of the appraised value.

A different appraiser here has a l̶a̶u̶g̶h̶a̶b̶l̶e̶ interesting way of doing it. You get an astronomical valuation like $35,000 but if you scroll down you see a qualifier that reads something like "18.2% chance of selling in 20 years".

 

[Bob Hawkes]

"18.2% chance of selling in 20 years"

Why am I sceptical that the number is not known to the 18.2% precision! Although seriously I did not realize that anyone was already stating it this way, so it is a good start, I guess. Thanks for sharing!

 

[NYJimbo]

Why am I sceptical that the number is not known to the 18.2% precision! Although seriously I did not realize that anyone was already stating it this way, so it is a good start, I guess. Thanks for sharing!

Yeah its a service that you post your "name" and it tells you it's "worth".

 

[DotKing]

GD appraisal tool is very useful for them. Reputation, good manners and honesty is not.

 

[Internet.Domains]

It's been said the appraisal tool is AI......If it is AI, it's safe to say AI has a long way to go. A reeeaaaaalllly long way to goooooo.

 

[Bob Hawkes]

In addition to useful comparator sales that we don't have in NameBio (I wish they gave date of sale though!), I think that GoDaddy GoValue has (arguably perhaps) helped the domain industry in one other way. As we all know even owners of significant businesses often think that a good domain should sell for $100. GoValue I think it has helped see more realistic valuations, provided the considerable uncertainty in the tool is understood. A related issue is with organizations where some sort of board have to approve a domain purchase. They are used to getting competing bids, appraisals, comparative analysis, etc on other purchases. Sometimes the GoValue appraisal can be helpful in showing that a price is justified. I generally try to price domains less than GV appraisal so that I will have this backup should a justification of price be requested.
Bob

 

[NYJimbo]

Sometimes the GoValue appraisal can be helpful in showing that a price is justified. I generally try to price domains less than GV appraisal so that I will have this backup should a justification of price be requested.
Bob

But sometimes it does the exact opposite. I was trying to sell a medical instrument name to a client who REALLY wanted it, but refused to pay penny more than the $325 that GD said it was worth.

We've all seen valuable names get the "Less than $100" thing too.

 

[Bob Hawkes]

But sometimes it does the exact opposite. I was trying to sell a medical instrument name to a client who REALLY wanted it, but refused to pay penny more than the $325 that GD said it was worth.

I agree entirely. I think we need to follow the tool and limitations even if for no other reason than to counter arguments like that by understanding some cases where the tool is way off. Excellent point, @NYJimbo
Bob

 

[Internet.Domains]

But sometimes it does the exact opposite. I was trying to sell a medical instrument name to a client who REALLY wanted it, but refused to pay penny more than the $325 that GD said it was worth.

We've all seen valuable names get the "Less than $100" thing too.

On the other side of the coin I offered to by a domain from the Namefind portfolio of Godaddy. The domain appraised, by their own AI tool at $5000. They would not accept that price. Their counter offer was mid 5 figure range......Go figure.

 

[PeakDots]

When I first started I used appraisal tools such as GD,Free Valuator, Estibot etc. Appraisals were all over the place.

Then I learned. I use GD tool for comparable sales now and that's about it.

This is where knowing your niche and knowing what your name is worth comes into play.
And a buyer also knowing the value.

Just look at the recent sale of CBDoil (com) for 500k.
GD appraisal is a little over 16k

These tools can also hurt a seller if a buyer wants to go by these appraisal tools.
Some names are undervalued. Imo

 

[NYJimbo]

Then I learned. I use GD tool for comparable sales now and that's about it.

True, but in some cases you have to check the date of a sale. If a trend was going on during let's say, 2007 and a slew of that trends names sold for $xxxx but that trend is over, the 12 year old sale price is listed without the date. People appraise names like it and see $xxxx comparable sales prices and think they are on to something. But those names are now worth low $xxx at best.

 

[NYJimbo]

This is available ! :

monkey.accountants

Estimated Value: $1,723

You know the saying, "Put 100 monkeys and 100 adding machines in a room and ..."

 

[Bob Hawkes]

This is available ! :

monkey.accountants

Estimated Value: $1,723

It is actually fairly cute (in my out of mainstream sort of way of thinking). Monkey+something as a com has sold many times - e.g. MonkeyManagement sold twice for $3500+ (in .com), and MonkeyTravel for $2900. I think that if you tried to sell it for 100 years there is a 60% chance you would find a buyer between $700 and $2700. Unlike Monkey.shop and Monkey.website, not even a registry premium . I am working on my taxes, wonder if I can find a monkey accountant? In case wondering MonkeyManagement is on a site for a trainer/author/speaker with book by same title.
Bob

ps here is a picture of a Monkey.accountant from Yelp site to rate accountants. Just as I imagined one.