A Beginner’s Guide to Domain Auctions

Finding the perfect domain name might be getting easier thanks to hundreds of new generic top-level domains (gTLDs) rolling out in 2014, but if you’ve ever set up a website for personal or commercial use, you’re probably familiar with the frustrating feeling that comes with finding out the domain name you want isn’t available. There’s no need to despair, though—your perfect name might belong to someone else, but that’s not necessarily a reason to give up on the dream of owning it. Domain auctions are a great way to score (or sell, if that’s your intention) previously-owned domain names in the global marketplace.

If you’re in the market to buy or sell a domain name, sites such as GreatDomains, Bido.com, and Afternic are ready and waiting to help make it happen. These sites (and hundreds like them) operate in a fashion similar to popular online auction sites such as eBay. Because thousands of domain names are purchased and dropped(or deregistered), on a daily basis, the pool of names available for resale swells and contracts almost constantly.

Depending on the site they choose, sellers will generally be charged a listing fee (and possibly a sales commission). They can list their domain names and choose from various pricing options, including setting a reserve (i.e., a minimum acceptable amount for sale, invisible to bidders), minimum offer (the absolute minimum price a buyer must submit in order to bid), and more. On the other side of the equation, some sites, such as NameJet, offer buyers interested in making high-value purchases a bidder verification service in order to review their eligibility and allow them to secure high-dollar bidding privileges.

Buying or selling, it’s important for all parties involved to protect their assets. If you’re buying, make sure you have the latest records on the availability of your name, and choose a reputable auction site that offers some measure of buyer protection (eBay, for example, extends its buyer protection plan to those who purchase domains on their site). Buyers and sellers alike may want to take advantage of an third-party plan such as Escrow.com’s Domain and Website Escrow Service to protect both parties while payment clears and the domain is transferred.

Discovering your domain name is unavailable doesn’t have to be the end of the road for your website. With some careful searching, judicious bidding, and a little luck, you might be able to snag your first-choice domain name from a second-hand source.

Domain Auctions

Beginner’s Guide to Domain Auctions

Whether you’re in the market to buy a new domain, or you’re looking to get in the business of selling domains for profit, domain auctions are a key tool. This quick reference guide can get you started on the right track.

Buying Domains at Auction

Visit a domain auction website to search domains.

  • Options include:
    • AfterNic.com
    • Sedo.com
    • SnapNames.com
    • NameJet.com
    • Flippa.com
      • Listing fees start at $9
      • They charge a 15% sale commission, capped at $2,000.
      • This one also has full websites for sale.
    • eBay
    • GoDaddy Auctions
    • DomainLore
      • Good place for buying .uk domains.

If you have a domain topic/keyword in mind, search the keyword.

If you don’t have a niche in mind, browse through the listings.

  • Premium domains: short, memorable, aged, popular keywords
    • Sandwich.com: recently placed up for auction by Yahoo
      • Reserve Price Range: $50,000 to $99,999
      • Estibot Appraisal: $178,000
      • Sandwich.com final selling price: $137,500
    • Crackers.com: recently placed up for auction by Yahoo
      • Reserve Price Range: $25,000 to $49,999
      • Estibot Appraisal: $65,000
    • Santa.com
      • Reserve pricing information is not available.
      • Estibot Appraisal: $650,000
    • HardDrive.com
      • Reserve Price Range: $25,000 – $49,999
      • Estibot Appraisal: $241,000
    • Pleasure.com
      • Reserve pricing information is not available.
      • Estibot Appraisal: $152,000
  • Expired domains: aged domains the previous owner has let expire.
    • FreshDrop.com is a good way to find expired options.
      • Inventory constantly changes.
    • See if you can figure out why the domain was dropped.
      • Owner felt it wasn’t worth renewing
        • It’s not likely worth anything to you, if it wasn’t to them.
      • Registrant no longer with the company
        • Could offer value to you.
      • Email address is no longer valid and not receiving emails about the domain name expiry
        • Could offer value to you.
      • Forgot about owning the domain name.
        • Could offer value to you.
      • Legal reason
        • May not be worth investing in.
      • Banned by Google
        • No value to you, because Google won’t rank it.

Place your bid.

  • Use tools such as NameBio.com and DNSalePrice.com to compare the sale prices of previous domains.
    • .COM sell higher than other TLDs.

If you win the bid:

  • The seller should contact you to arrange the transfer.
    • Many marketplaces have guides to help you do this.

If you lose the bid:

  • You won’t pay for the domain, so you can keep bidding on others.

Negotiate directly with the owner.

  • Use WHOIS records to locate information about who owns the domain.

Browse the website, and see what you find.

  • A fully developed site.
    • These will be hard to purchase at a sensible price.
  • No website at all.
    • The website may be dead, but it may also mean the owner just never bothered to put a website up on the domain.
  • Site with little content but an indication of sale price.
    • If a site lists the sale price, you can negotiate with the owner.
      • Don’t bother asking about the price first thing–they will be turned off from the sale.
  • A parked website.
    • This means the owner is just making money off of advertising.
      • Check the Alexa rank to see how much traffic it already gets.
      • You may be able negotiate a reasonable price.
  • Site diverts to another site full of ads.
    • Check the Alexa rank.
    • Contact the owner to negotiate a sale.

Selling Domains at Auction

  • Choose a domain auction marketplace.
    • You can use the same ones you would use to buy a domain.
  • Price your domain with a valuation tool.
    • Premium domains will come at a higher price tag.
    • Older domains are generally worth more
      • Domains with traffic are generally worth more.
    • Domains that already earning money have more value.
  • Pitch your buyers.
    • In your sales listing include:
      • Traffic volume
      • Income earnings
      • Age and expiration date
  • Use Escrow.
    • This puts the buyer’s money into an account so you know the transaction is good and releases the money to you after the transfer is complete, to protect both you and the buyer.
      • Escrow.com offers a service to facilitate these transactions.
    • Transfer the domain to the buyer.
      • Every domain registrar has their own process for this.
        • If you need help, contact the registrar that holds your domain.

Sources

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Discussion

2 Comments to “A Beginner’s Guide to Domain Auctions”

  1. You should add IceNap.com to this list, seems to be one of the best options right now when compared pricing and features.

  2. You can also list your domain names for free at “grabflip”

    This article is really helpful ..thanks 🙂

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