I’m not suggesting that domainers should have to educate anyone, but I think it’s fair to say that if a) you do sell domains and b) you are a pro domainer, you are likely to have a very different idea of what a domain is worth to Joe Public.

You’re far more likely to sell something if expectations are set out.

@Richard some good points and I did get a laugh or 2.
I also found the argument that a buyer shouldn’t be expected to be educated on domain values to be off base. Anyone who is buying a domain or anything else should buy based on the idea of “what is this worth to me” . An appraiser can never understand your business and what a domain could mean to your bottom line. Only you can.

The inquirers who feign ignorance and say “I don’t know what domains are worth” always figure out the value to their usea as soon as you tell them the domain price. Suddenly they can figure out that the price I quote is too high or just right. The buyer should always be aware of the value to them or don’t go buying . . .that applies to anything you buy I’d think.

@Richard if Lisa doesn’t want to I’ll take you up sometime on that guest post from the other side.

My business isn’t selling domain names. If it was, I’d list them for sale somewhere. My business is OWNING domain names that generate revenue through a variety of streams and/or have speculative value that makes it worth paying the renewal fees.

Continuing with the car analogy, I have a couple of classic cars and frequently get asked if I’d consider selling them. Some people stop me in parking lots, others knock on my door. Under those circumstances, I expect that person to tell me what the car is worth to THEM – and then I’ll decide if it’s interesting enough to keep talking. Otherwise, I’m generally just pissed that I interrupted what I was doing and answered the door to talk to some yo-yo who thinks I should sell my Corvette for less than I paid the last time I had it serviced.

If I haven’t listed a name for sale anywhere, I expect a prospective buyer to say something that will get my attention

I find that a peculiar attitude to take if your business is selling domains (vs developing them), regardless of whether they are advertised for sale.

I can’t imagine going to a car showroom to find a salesman with his arms crossed saying “Come on then – impress me, or I’m not interested in selling to you.”.

It simply would not happen in any other industry – especially not when trying to sell:

a) an expensive asset
b) that’s often poorly understood
c) to buyers who may be unfamiliar with the market.

and that includes an initial offer.

Again – there is no other sales-based industry where someone with money in their pocket to spend would be ignored unless he guessed what price the owner *might* want to sell at…

domain names are worth what someone is willing to pay for them

Expecting non-domainer buyers to be able to price accurately is hopelessly optimistic. Paid appraisals by experts vary wildly. Expecting your non-expert buyers to do the same? Never going to happen.

I paid for an appraisal of a great dictionary domain last September at DomainAppraisal.org. The appraisal came back “XXXXXXX.NET is worth $36,400 – £65,000″.

Now, my first thought is – if an expert is quoting me a price where the margin of error is 100%, I do not trust this. Period.

you prove you’re a serious buyer, then it’s worth spending more of my time on.

I fully appreciate that filtering time-wasters can be a full-time job in itself. Here’s an idea: setup an autoresponder for the unprompted offers, explaining exactly what information you require to respond to an enquiry.

Send them to a simple contact form that validates they’ve entered all the required fields – easy to do with WordPress and cForms plugin. 10 minutes work generates more qualified leads & fewer time wasters.

especially if they told me they’re a poor student working on a project (while using their company e-mail address and real name

I know there’s a whole post waiting to be written about the bad things that buyers do, too. If you fancy writing it as a guest post, drop me a line.

I would, for once, like to receive a purchase inquiry from someone who appears to have done his/her homework; i.e. “I’m Richard Kershaw, with Quality Nonsense, Ltd. and I’m interested in your domain name keywordkeyword.com. In researching this potential purchase, I’ve found that similar names have sold in the range of $XXX. I would like to discuss with you an offer in that range.”

…which is broadly the approach I take – price-naming aside – so delighted to hear it seconded. Like your suggestion of naming a price range as a qualifying statement.

If I haven’t listed a name for sale anywhere, I expect a prospective buyer to say something that will get my attention – and that includes an initial offer. Ultimately, domain names are worth what someone is willing to pay for them – so I expect YOU to tell ME what you’re willing to pay for it. If it’s interesting and you prove you’re a serious buyer, then it’s worth spending more of my time on.

I have a standard response to inquiries because I got tired of wasting my time on people who thought they could get a premium dot-com name for $50, especially if they told me they’re a poor student working on a project (while using their company e-mail address and real name – like you, I know how to search LinkedIn and find that the “poor student” is actually CEO of a large company with a business related to the generic name they want to buy). More than 95% of the time, I don’t hear back from people after I send the standard response, which is intended to prove the actual identity of the person and how serious they are. I’ve had people tell me they “aren’t comfortable” providing this information to someone they don’t know – yet they’re expecting me to discuss sale of a property with johndoe@gmail.com!

Add e-mails from people requesting link exchanges with my PR2 to PR5 sites. You have to have some criteria for sorting through the chaff.

I would, for once, like to receive a purchase inquiry from someone who appears to have done his/her homework; i.e. “I’m Richard Kershaw, with Quality Nonsense, Ltd. and I’m interested in your domain name keywordkeyword.com. In researching this potential purchase, I’ve found that similar names have sold in the range of $XXX. I would like to discuss with you an offer in that range.”

I can only think of two which I see regularly:

• Rick Latona (eg, Database.com)
• Memorable Domains (eg, MerchantAccounts.co.uk)

Bought a domain recently after a protracted negotiation. It turns our their WHOIS wasn’t up-to-date – within a day or two of acquiring the domain, I get offers from people who weren’t able to contact the previous seller.

If you’re not using a domain, make it as easy as possible for people to buy it.

cheers

Minimum offer: £500. I make an offer of £500. Seller’s asking price: £500,000.

Again, Sedo leting sellers list with ‘Make Offer’ doesn’t help. It’s tough to make a credible opening offer when you’ve no idea what the sellers expectations are to the nearest zero.

If you then ask why the price hike, the standard reply is “it’s cheap at that price” but totally unable to justify why….although it is amazing how many of them will tell you that they are earning £30 000 per month so do not need to sell it as a justification.

It has got so frustrating that I have given up using them and have got much better results just approaching people directly. Sedo seems to need a “buy it now” style model, whereby if you bid the asking price they have to sell it, or just do auctions.

To take the first example I can think of, Sedo’s offer/count-eroffer process is bad for buyers and sellers alike. It encourages a lot of this behaviour.

Exhibit A: Making an offer with a qualifying statement, but the seller doesn’t see the statement because it’s yet to be moderated. Offer gets rejected w/o the seller ever seeing the offer in context.

Lowballing is annoying if you are a seller but then why not up your minimum offer amount to what you are looking for?

Good article.