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!

 

[NYJimbo]

(in my out of mainstream sort of way of thinking)

You know you are just encouraging people to waste money.

 

[ET76]

Do you trust Godaddy appraisals even 1%?

I don't trust any automated appraisal

 

[Bob Hawkes]

You know you are just encouraging people to waste money.

OK just to be clear, I don't recommend monkey.accountants as a good domain investment , the exact word monkey has never sold in a new gTLD, and even in .com Monkey Books sold for $15 a few years ago and Monkey Charge (com) sold last week for $10. By the way monkey with the singular accountant is indeed a registry premium.
Bob

ps I think I have helped take this thread off track. Sorry. This is my last post re monkey accountants. (at least today )

 

[dande]

Automated Appraisal tools are never built to benefit domainers. They are built to screw us, and help enrich the owners. Take estibot for example, is has never helped anyone predict prices accurately. Yet. we have made it so popular that the platform may well worth millions of USD in market valuation.

 

[biggie]

You know you are just encouraging people to waste money.

I agree

cuz newbies on hear and read, what they want to hear and read
and rarely will they question what they think is questionable.

as for appraisal tools in general, the reliance on them, gives them power over you

and if that reliance continues as is, "then the appraisal tool will become a standard, by which you must price your domains in accordance with"

still, there is a difference in using such tools to estimate or check the tools valuation of a domain that you KNOW has value, versus using it to discern IF a domain has value

the latter, is the fault of the user, not the tool.

imo...

 

[DomainRecap]

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.

I agree, and a company any large as GoDaddy providing this type of tool really undercuts those who actually believe that you are somehow obligated to sell them a domain at registration fees.

And I also agree with you that it's the concept of having a highly visible domain name valuation tool that is key, not the specific amounts it provides.

 

[DomainRecap]

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.

But come on, that's just a cheap SOB who is trying to use grade school negotiating tactics to get a lower price, and it's not like he's absolutely tied to GD like it's his or her God. If not GD, then Estibot or other valuation tools could be used, but at the end of the day, it's still lowballing.

If they REALLY wanted the domain, and actually have the capital to run an actual business, then they know the deal and would pay the asked amount or at least stop the "it's cuz GD says so" idiot-lowballing.

 

[NYJimbo]

But come on, that's just a cheap SOB who is trying to use grade school negotiating tactics to get a lower price, and it's not like he's absolutely tied to GD like it's his or her God. If not GD, then Estibot or other valuation tools could be used, but at the end of the day, it's still lowballing.

If they REALLY wanted the domain, and actually have the capital to run an actual business, then they know the deal and would pay the asked amount or at least stop the "it's cuz GD says so" idiot-lowballing.

Yeah, I get all that. But he is using GD appraisals like a weapon. A lot of people do it.

 

[DomainRecap]

Yeah, I get all that. But he is using GD appraisals like a weapon.

Sure, but if GD dropped their valuation tool, then off to Estibot they go or whatever valuation tool gives them the best ability to lowball you.

And if all the valuation tools suddenly disappeared, then the lowballers would then cherry-pick past sales at Namebio that matched their price range, or find similar domain auctions at GD, SN, DD, or NJ that slipped through the cracks.

It's the lowballers that are the problem, not the tools.

 

[Fadi H]

"Found money is the best money.

Your domain could be the name of the next big start-up or brand. But how do you find out what it’s worth? GoDaddy Domain Appraisals gives you the most accurate estimate available. Our exclusive algorithm combines machine learning with real-market sales data compiled from our 20 years of experience. After all, we manage millions of domains as the world’s largest domain registrar and we’re the largest aftermarket name seller, so we have experience in the field. You’ll even get back samples of comparable domains and their values to help you decide what step to take next.

And it's all free."

The above is stated on GoDaddy's appraisal page, I think it plays a factor for newbies to spend their hardly bargained money after reading this. But well, Many has fallen on the automated appraisals trap including me, it's the inviting door to enter this industry for many. Who got the spirit of a domainer will take the lesson and keep on the challenge. The ones who still believing in the found money will spend some time trying to sell their crappy names and then most likely quit, Registrars will keep the profit in any case and things goes on...

 

[ResoluteDomains]

I do not like it because on more than one occasion I've had potential buyers refer to the "godaddy valuation" as some sort of defacto-standard price system causing them to way under-bid the domain. They were thinking that the value GD came up with was the best price anyone could get but they werent even willing to offer that, they were going with some 20-40% of that number instead of knowing what value the domain brought to their business. Its a dangerous tool.

 

[DomainRecap]

I do not like it because on more than one occasion I've had potential buyers refer to the "godaddy valuation" as some sort of defacto-standard price system causing them to way under-bid the domain. They were thinking that the value GD came up with was the best price anyone could get but they werent even willing to offer that, they were going with some 20-40% of that number instead of knowing what value the domain brought to their business. Its a dangerous tool.

I just want to be sure what we're talking about here.

Do you actually believe that if the GD Appraisal Tool did not exist, that this buyer would have just smiled and paid your full asking amount?

 

[ResoluteDomains]

I just want to be sure what we're talking about here.

Do you actually believe that if the GD Appraisal Tool did not exist, that this buyer would have just smiled and paid your full asking amount?

No, where did I say that?

 

[Bob Hawkes]

If the tool was more precise, would we be more accepted? (I presume yes, but perhaps there is a feeling that appraisal tools in general are a bad thing?) I really think that the tool could readily be much better than it is - I mean look at how good AI is in many things in our everyday life. If we ever got to a point that valuations were very good, it would make the whole industry open to other things, such as mutual fund type holdings of domain names.
Bob

 

[ResoluteDomains]

If the tool was more precise, would we be more accepted? (I presume yes, but perhaps there is a feeling that appraisal tools in general are a bad thing?) I really think that the tool could readily be much better than it is - I mean look at how good AI is in many things in our everyday life. If we ever got to a point that valuations were very good, it would make the whole industry open to other things, such as mutual fund type holdings of domain names.
Bob

I dont see how any automated domain appraisal tool could ever be precise.

Appraisal tools for physical real-estate have been around for several years and are still being tweaked. Many realtors dont even wish to discuss those automated tool values. However, like you said (with respect to AI ) I think if anything could become more precise its appraised values of real estate. Within developments there are generally are many of the same exact homes. They very similar property dimensions, same age, but one may have new carpets, roof, AC, water-heater whereas another may not. So I can see how they generate those values based on what has sold that is exactly like or very similar...

However, there is only one domain name of its kind. Personally I think its extremely difficult to comp a domain with others. Perhaps in a very large group like 4-character or 3-character dot coms, its easy but the true value of many domains is what value it brings to the buyer for their business or personal use and estibot or GD cant ever fully know that. IMO.

 

[DomainRecap]

No, where did I say that?

That's why I asked, as it's pretty obvious the guy's a lowballer who is clearly abusing the GD valuation as a way to get your domain for a cheaper price.

I've seen it all, people pretending to be college students, researchers, not-for-profit charities, etc. and I'm not going to start blaming colleges, research facilities, or charities for this behavior.

 

[DomainRecap]

If the tool was more precise, would we be more accepted?

Nope, as the entire concept of a precise domain valuation tool in an industry this volatile is impossible.

I'd actually like to see GoDaddy move in the opposite direction, and move to ranges, for example something like Copper, Bronze, Silver, Gold, Platinum, etc. with wider price ranges and more flexibility.

 

[Ostrados]

GD Appraisal is not reliable, Estibot is even worse, at least GD gives valuable data of comparable sales.

Estibot tends to overvalue domains with high search volume and undervalue domains with good comparable sales, GD is the opposite it tends to undervalue domains with high search and overvalue domains with high comparable sales.

Also I noticed many times with brandable and invented names, that most of the time Estibot gives them value under 100 but GD almost always gives them $1000+ even with junk names! Which gives you a clear idea about the big blunder of these tools!

Even human appraisals are not accurate half of the time, if the owner of CBDOil posted the domain at NP appraisal section, I am pretty sure he will get $5k-$10k appraisal at most. Who imagined that this domain will sell for $500k?

The problem is that there is no clear criteria of how to valuate a domain, there are many factors to consider, but the exact formula is unknown and may never be found, or maybe the formula does not exist at all.

Even if you get the most accurate human appraisal from the top pros, at the end domain value is what the end user is willing to pay for it.

 

[ResoluteDomains]

That's why I asked, as it's pretty obvious the guy's a lowballer who is clearly abusing the GD valuation as a way to get your domain for a cheaper price.

I've seen it all, people pretending to be college students, researchers, not-for-profit charities, etc. and I'm not going to start blaming colleges, research facilities, or charities for this behavior.

I've seen it all too. Been there, been cursed at and even threatened. If I could write, I'd write a book about it. Not sure who'd buy it though.

When I get the "college student" I always suggest that they could probably ask their department head for permission to spend more than $20 for a domain. I have a 100% rate of failure with that, however.

I dont blame the buyer either. What I was saying, and I think we agree, was that if these valuations were not available then it may not cloud a buyer's judgement / perception of what they would be prepared to spend for that particular name.

I dont blame them. If I had budgeted $3500 for a domain that I needed for a business I wanted to start but then saw a $1500 GD valuation on it, I'd also start my bidding at $1000 and hopefully "save" $2500. Like I said, its dangerous (to us sellers).

There is another thread where this is being discussed, sounds like these two threads are naturally merging..

 

[biggie]

And if all the valuation tools suddenly disappeared, .

what you think we did as domainers, before valuation tools were invented?

before the past sales lists were categorized for you to browse?

back then, when lowball offers were made, they were refused by sellers who wanted more
that's why many names are held for 10+ years or more before being sold

same thing now, if you know the value and have confidence in what you own, then you refuse to sell, until you get offer you like.

imo...

 

[Ostrados]

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.

What does that mean "60% chance to sell within $1000 of the appraisal value"?
+-1000 error margin or something else?

 

[Bob Hawkes]

What does that mean "60% chance to sell within $1000 of the appraisal value"?
+-1000 error margin or something else?

Hi,

It was just my very rough interpretation of the following.

• Paul said at NamesCon that about 60% of the time that they are within $1000.
• Different methods lead to different sell through rates, but particularly for a not very experienced domain investor I suspect that (for a sale at near appraisal value) the number is 1/100 or 1/200 per year per domain name.
• If the chance is say 1/200 then after 100 years you would have a 50/50 chance (approximately) of selling.

Clearly none of these are precise and don't precisely lead to my statement, but I think the statement gives an order of probability. I think most who register a bunch have an inflated sense of how fast and easy they would sell. Some statement incorporating both the typical industry wide sell through rate and the idea that about 60% of the time they are within $1000 would make the person realize the true situation better.

I personally find that GoValue with certain types of domains does a half-decent job, but what people don't fully realize, often, is that even if the domain name does have a probable sales value of say $1500 the odds that it would sell at that price only after many decades.

Bob

 

[Ostrados]

Hi,

It was just my very rough interpretation of the following.

• Paul said at NamesCon that about 60% of the time that they are within $1000.
• Different methods lead to different sell through rates, but particularly for a not very experienced domain investor I suspect that (for a sale at near appraisal value) the number is 1/100 or 1/200 per year per domain name.
• If the chance is say 1/200 then after 100 years you would have a 50/50 chance (approximately) of selling.

Clearly none of these are precise and don't precisely lead to my statement, but I think the statement gives an order of probability. I think most who register a bunch have an inflated sense of how fast and easy they would sell. Some statement incorporating both the typical industry wide sell through rate and the idea that about 60% of the time they are within $1000 would make the person realize the true situation better.

I personally find that GoValue with certain types of domains does a half-decent job, but what people don't fully realize, often, is that even if the domain name does have a probable sales value of say $1500 the odds that it would sell at that price only after many decades.

Bob

I found this video from NameCon:

At min 25:33 he says:
60% of sales were withing $1000 of GD appraisal
89% of sales were withing $2000 of GD appraisal

I still not sure what he means by within $1000 and within $2000? And how is this related to selling chance?

 

[Bob Hawkes]

Estibot tends to overvalue domains with high search volume and undervalue domains with good comparable sales, GD is the opposite it tends to undervalue domains with high search and overvalue domains with high comparable sales.

Also I noticed many times with brandable and invented names, that most of the time Estibot gives them value under 100 but GD almost always gives them $1000+ even with junk names! Which gives you a clear idea about the big blunder of these tools!

I have used both instruments many times and this TOTALLY describes my thoughts as well. I think some users don't realized the different emphasis in the two. And re brandables, I think neither are of any help really.

If they instead of stating a value gave a range, it would at least better demonstrate the uncertainty in the values given. That is rather than GoValue say it is worth $1485 (which sounds very precise, but isn't) they said their estimate of value is say $200 to $2500 that would be an improvement (although then some people would look at the high end and some end users trying to bargain down would state the low end ).

Bob

 

[Bob Hawkes]

I found this video from NameCons:

He says 60% of sales where withing $1000 of GD appraisal
89% of sales where withing $2000 of GD appraisal

I still not sure what he means by within $1000 and within $2000? And how is this related to selling chance?

What he means is when GoDaddy/Afternic sell a domain they keep stats on the sale price and the appraisal price. 60% of the time they are within $1000 (and almost 90% within $2000). That means if say their appraisal was say $2400 then 6 times out of 10 the selling price turns out to be between $1400 and $3400. That is not as impressive as it sounds, since most sales are less than $3000 so it is easy to be within $1000 with an instrument that says tons of names are worth about $1000.

The same presentation also pointed out that completed sales went up significantly immediately after they started showing appraisal values.

The sell through rate was not part directly of that, but if you look overall it is clear to be something the order of 1/100 per year. He used some assumption in his models to make a business selling domains, later in the presentation, but did not give the assumption as I remember from my notes.

Bob