IDNX/Sedo: Number Crunching Shows, Domains Sell Faster With “Charm Prices”

This is a Guest Post by Thies Lindenthal, Sedo.com’s product manager for domain pricing, and a visiting scholar at the Massachusetts Institute of Technology (MIT) Center for Real Estate. Mr. Lindenthal holds a PhD in Real Estate Finance from Maastricht University, and frequently publishes on both housing markets and on Internet domain names as a form of ‘virtual land’.

Dr. Lindenthal developed IDNX, the first scientific grade price index for Internet domain names.

Here is the Dr. Lindenthal post:

Pricing domain names is as much an art as it is science.

Though opinions differ on the merits of automatic appraisal services (at Sedo, we believe in the benefits of fast, automatic price suggestions), statistics show that one very simple strategy speeds up sales.

The retail world has known for a long time that using charm prices—for example, $499 instead of $500—increases sales and helps a consumer make a faster purchasing decision. Extensive research in retail and housing markets also shows that charm prices are not an urban legend, but a legitimate sales tactic: consumers really do react positively to the “odd” 99 prices.

We wondered whether domain owners might also benefit from this nugget of retail psychology, so we took a closer look at Buy Now domain listings with different price points and the amount of time those listings spent on the market, using Sedo’s sales data as our basis.

A one-off comparison of average time-on-market for domains that ultimately sold for $500 rather than $499 shows that domains priced with a round number took, on average, 22% longer to find a buyer on Sedo’s marketplace.

However, this figure is too high for a handful of reasons.

Firstly, this increase in sales velocity could be caused in part by aggressive sales strategies used by domain investors. Those sellers who often list their domains with low prices and do a lot of additional marketing might also use charm pricing already – which makes it difficult to disentangle the different factors.

As a means of controlling for differences in sales strategies, we compare time-on-market for domains listed by sellers who use both round and charm prices. This ensures a fair comparison. In the case of these domains, we can assume that those with round prices and charm prices are promoted in the same way and that the seller has applied a similar pricing rationale.

Taking it one step further, we look into difference in the quality of the domains in each seller’s account. By using Sedo’s automatic appraisals, we can tell whether a seller is over- or underpricing specific names in their portfolio. This factor takes into account different strategies used by individual sellers.

After fairly accounting for these factors, the empiric exercise shows that charm prices clearly increase the sales velocity for Buy Now domain listings. On average, a Buy Now domain with a charm price will spend 16% less time on the market in comparison to a domain with a round price.

This compelling result has also been put to use in Sedo’s new Big Data Pricer. After calculating the price suggestion for a domain based on real sales data, the Big Data Pricer optimizes that suggestion by selecting the closest relevant charm price. This ensures that our sellers have the best chance of selling fast within the desired price range for that name. Sometimes it just takes one dollar to help sell faster.

A final recommendation is that our sellers should tailor the currency that they’re listing their domain in to the most likely buyers: if the name is country- or language-specific, then take the price suggestion, convert it into the most relevant currency, and then use the charm pricing principle to make the best of that domain!

Get more information on pricing and domain value at Sedo.com/IDNX

I agree with Dr. Lindenthal comments.  We price our domains in odd numbers as well even though we don’t do Buy it Now pricing when we respond to offers.  I think this is something that Mike Mann has also preached for years and

Guest Post: The Future of Exact Match Domains In Search

This is a guest post by Mark Collier who describes himself as  an SEO expert turned domainer.

I recently completed a significant correlation study of Google’s algorithm and noticed the continued decline since 2010 of the power of Exact Match Domains (EMDs).

After Matt Cutts’ announcement that Google latest algorithm  update would target “low-quality” exact match domains, domainers were left feeling that the last 3 years have been nothing less than a pummeling by the search giant.

In 2010 SEOMoz’s correlation study showed a 0.38 correlation between a .com EMD and ranking #1 in Google, just a year later it was 0.22 and my own 2012 study showed a 0.18 correlation.

This sustained set of blows to the raw SEO power of EMDs has left many in the domaining industry, including myself, pondering the future of EMDs.

Now we all know EMDs hold branding and memorability value, but what’s the likely value of EMDs in 2014, 2015, etc.

It may help to look at what the future of search engines will be in 2014 onwards to make this determination.

We know due to the continued decline of webmaster controlled factors (particularly on page factors) that Google are moving away from using factors that can be influenced easily or significantly by the owner of the website it benefits.

Essentially Google want to be harder to manipulate, not because they don’t like webmasters but because they believe and probably rightly so that being open to manipulation leads to poorer search results for users.

So in recognizing this, we could say that as EMDs are controlled solely by the webmaster that they are destined to continued decline and ultimate failure, but that of course would be nonsense, I’m not a doomsdayer and EMDs are most certainly not dead.

If Google’s goal is to provide the best search results for users then they must take into account the fact that users often search for the domains they could type directly into the search bar and the fact that often the EMD for a search result actually provides the most relevant content for a query.

What’s evident here is that Google will strive to recognize when users are searching for a particular domain or brand and when the EMD actually provides the most relevant content and only then will webmasters see the value of their EMD translated into search engine traffic.

The recent update targeted “low-quality” EMDs, translation:

irrelevant or poor quality content e.g. parked domains.

And the recent addition of a EMD patent to detect commercial queries (brands) is further evidence of this seismic shift.

This is the future of EMDs, webmasters will have to either create brands out of their EMDs or develop a site of substantial quality to benefit from the SEO power of EMDs.

Exact match domains are no longer powerful for the same reasons they were five years ago, but they are still extremely valuable for SEO purposes, but only when used in the right ways. Domainers must recognise this and adjust both their purchasing and developing decisions accordingly.

Mark Collier is a 17 year old, maths, stats and computer nerd who has “developed a revolutionary Dropday/Freshdrop alternative, which gathers the data domainers need to analyze dropping domains (including exact match search volume!).”

You can sign-up for free, early beta tester access.

This post was submitted by Mark Collier.

Guest Post By Paul Keating On UDRP’s: “Why Panel Certification is Important” The Case Of HardwareResources.Org

This Guest Post was written by Paul Raynor Keating, Esq.[1] one of the preeminent attorney’s practicing in the domain industry.  Paul has handled many UDRP’s and had some thoughts about a recent UDRP involving the domain name HardwareResources.org.

We are publishing the post unedited:

“”Although the UDRP has functioned for over a decade, the evidence continues to mount in favor of a certification process so all can be assured that panelists have the proper legal knowledge and address claims seriously.   Examples abound of panel errors but I have seen few that competes with the likes of Hardware Resources, Inc. v. Yaseen Rehman, Claim Number: FA1201001423229 (HardwareResources.org), a recent decision by NAF-favored panelist Atkinson (http://www.dnattorney.com/study.shtml).

In Hardware Resources, the panelist was so absorbed with the Complainant’s assertions that he failed to examine even the most basic aspects of the claim.  Granted the case was a default.  But that provides little excuse given the obviousness of the problems.  Given Mr. Atkinson’s litigation experience (he authored an article entitled “How to Respond to Trial Objections in 1995), I am somewhat perplexed.

Complainant asserted 4 registered trademarks for “HR Hardware Resources”.  A 10-second trip to the USPTO site satisfied my surprise that the PTO would allow registration of such a descriptive trademark.  Complainant’s “trademarks” consisted of 2 text marks and 2 design marks.  Each of the marks contained the following disclaimer:

“NO CLAIM IS MADE TO THE EXCLUSIVE RIGHT TO USE “HARDWARE RESOURCES” APART FROM THE MARK AS SHOWN.”

The significance of the disclaimer is of course that the Complainant had expressly disclaimed the words “Hardware Resources” if they did not appear with “HR”.   Perhaps Mr. Atkinson (or more likely the intern at NAF who may have written the decision?) missed that bit.

Notwithstanding the clear disclaimers, the Mr. Atkinson boldly stated:

“The differences between the mark and the disputed domain name include the deletion of the initial letters “H” and “R” of Complainant’s mark, the removal of the space between the terms, and the addition of the generic top-level domain (“gTLD”) “.org.” The Panel holds that removing letters from a mark does not differentiate a disputed domain name from the mark.”

Had Mr. Atkinson (or his associate) taken 20 seconds of time he could easily have discovered that the elimination the “HR” was in fact material for the simple reason that Complainant held no trademark rights in their absence.  Actually, come to think if it, the disclaimer would have been printed in the trademark registration certificate that Complainant surely produced.

From this highpoint, the analysis gets only worse.  Legitimate interest is found lacking because “using a confusingly similar disputed domain name to host pay-per-click links and pop-up advertisements, whether competing or not, does not constitute a bona fide offering of goods or services or a legitimate noncommercial or fair use according to Policy ¶¶ 4(c)(i) and 4(c)(iii).”  Of course no mention is made of the descriptive nature of the asserted trademark or of the domain.

The authority for the panelist’s position?  Two NAF decisions, Hewlett-Packard Co. v. Collazo, FA 144628 (Nat. Arb. Forum Mar. 5, 2003) and ALPITOUR S.p.A. v. Albloushi, FA 888651 (Nat. Arb. Forum Feb. 26, 2007).  The panelist was obviously not familiar with either of the decisions.  Hewlett-Packard addressed the domain HPCanada.com.  HP is obviously a famous, non-descriptive mark and there could be no legitimate interest in using the domain to display links for computer equipment.  Alpitour dealt with the domain BravoClub.com.  The asserted mark was used for a hotel chain and obviously not descriptive; respondent used the domain for PPC for (surprise….) hotels.  Exactly how HardwareResources.org presents a factual or legal scenario that is even close to Hewlet-Packard  or Aplitour is a mystery.

Going from bad to worse, Mr. Atkinson next finds bad faith because Respondent offered to sell the domain to the Complainant for a whopping $40.00.  Surely this is a joke.  The opinion is apparently based on an empty allegation by complainant. God forbid there be any reference to evidence.  I am always amazed how far panelists will go to “justify” an expansion beyond the actual text of the UDRP when doing so in favor of complainants.  I rarely see this when the issue might favor the respondent.  This $40-issue is yet another example.  While it is possible that $40.00 was more than the out-of-pocket costs, the rule in this regard is tied to the concept of targeting and registering domain names for the purpose of holding them ransom to a known trademark holder.  This case fails the mark by any stretch and by even mentioning the issue Mr. Atkinson opens both himself and the UDRP process to ridicule.

Yet again showing his preference for complainants, Mr. Atkinson finds bad faith registration based upon PPC use with websites that “have featured pay-per-click links, some relating to Complainant’s competitors and some being simply generic” and some that ‘displayed information about Complainant”.  Mr. Atkinson thus finds that the respondent must have registered the domain “to attract consumers and create confusion for its own profit”. This is lumped together with the $40-issue to support a finding of bad faith.

It is telling that the only reference to “generic” was in the Complainant’s allegations.  The panelist certainly does not mention the word or deal at all with the descriptive nature of the phrase at issue.  The use of a descriptive domain for descriptive purposes has repeatedly been found both legitimate and in good faith.  It has long been held that the foundational issue is whether the respondent “targeted” the complainant.  Here, the Complainant had no trademark in “Hardware Resources”.  The domain was used for – guess what – PPC links related to items long considered to be hardware-related.  That Complainant may have appeared in any of the PPC links is the fault of the Complainant who voluntarily selected a less-than-stellar trademark.

The most important lesson to be learned here, however, is not that Mr. Atkinson should abstain from being involved in the UDRP process.  The important lesson is that decisions such as these destroy the carefully structured balance of the UDRP process as a whole.  Respondents are repeatedly told that they can legitimately register and use domain names for descriptive purposes.  It instills little confidence in the “system” when panelists such as Mr. Atkinson issue ill-thought out opinions such as this one.

While panelists aren’t earning the salaries of bankers in New York, this case shows that 20 seconds of thought would have produced the correct result.  Trademark disclaimers are there for a reason; without the disclaimer the USPTO would not have issued the registration.  It defies logic to permit a registration with a disclaimer and then support a trademark in only what has been disclaimed.  Complainants must be held responsible for selecting descriptive trademarks.  After all, they do it for a reason – a descriptive mark gives them a leg-up on the competition.  If a consumer is looking for “hardware”, coming across a sign for “hardware resources” leads to the assumption that one will indeed find hardware items there.  However, having selected such descriptive marks they should not be permitted to use them as a sword to prevent others from doing so.

And, $40 for a domain name?  I am not sure who was being sillier; the panelist in using this as bad faith or the respondent who thought it was a good idea to make the offer.””



[1] Paul is an attorney specializing in the domain space.  He has offices in Barcelona and London.

Guest Post: From 0 To 10,000 Uniques In Less Than 60 Days: A Case Study

This post was written by Sean Sullivan who Director or Tier 1 Development with  DomainHoldings:

Not long ago I wrote an article asking if a .US domain could become just as successful as a .Com.

The story was about CelebrityGossip.us, a domain that I acquired for my girlfriend Erika  as a side project that I thought would be fun for her.

After she showed that she had significant interest in it I thought that I’d help take it to the next level and do some professional development on the project.

So the first step was designing a great looking site that was different than the traditional gossip sites. Erika and her close friend and business partner in this endeavor, Samantha decided to give it a different look and feel and incorporate some original ideas into it.

One of which was including stories from “Old Hollywood”, gossip and scandals from 50+ years ago. Again quality content that’s original will always help a site gain ranking on a more accelerated rate. The site officially launched on June 5th.

One of the less commonly known ways that you can help establish a brand and accelerate rankings is by using highly targeted re-directs. It’s something that if done correctly accomplishes two goals. One, it helps establish your brand with consumers. Secondly if you have a massive amount of visitors being directed to your site that can help grab the attention of other websites who will then link to you. Plus there can be some SEO benefits as well, but it’s technical and detailed so I’ll spare you.

So now you might be wondering exactly what I’m talking about when I say re-directing traffic. Do I mean just purchasing traffic with PPC or one of the traffic market places? Well you could do that, but I think a better strategy is to find domains and or websites that are highly related to your target audience with traffic and then re-directing that domain with a permanent 301 re-direct. I’m going to bypass the SEO specific details and instead provide you with some metrics instead.

From June 9th to July 17th the traffic re-direct sent approximately 450,000 unique visitors. I know, that sounds like a giant expense and you’re thinking how do you possibly send that much traffic to one site affordably. If you can get creative and cut deals with domain owners who have sites that do a huge amount of traffic (even in aggregate) but convert poorly you can accomplish this.

Celebrity Gossip - DevelopmentAs You Can See – At Launch Zero Traffic – Click To Enlarge
celebritygossip.us traffic closer lookA Closer Look At The Traffic

One of the key things that I did with this re-direct was find targeted traffic that was inexpensive yet still relevant. I won’t disclose the traffic source or all my secrets but my goal at the end of this program was to retain anywhere from 1% to 3% of those 450,000 re-direct visitors as regular readers of CelebrityGossip.us.

On July 18th we turned off the traffic re-direct and have since relied solely on the sites type-in traffic from returning readers and the traffic obtained via organic search. (Mostly Google) As you can see from the images below (click to see larger picture) the long tail is where things really start to develop.

I’m pleased to say that while it is still early, it seems to have worked as planned. CelebrityGossip.us was doing on average 250 to 450 unique visitors a day in organic and direct navigation traffic. This traffic is most likely attributed to visitors who were returning to read more since being introduced to the site.

celebrity gossipTraffic Once The Re-Direct Was Turned Off

I won’t know the exact numbers for about 45 days (based on returning visitors vs 30 day period) but I am estimating that CelebrityGossip.us will have retained roughly 3,000 to 4,000 unique visitors (regular readers) that were introduced to the site via the traffic re-direct. Things will be slightly more difficult to determine now since we have re-branded the site as CelebGossip.com but as you can see in the images below (click to enlarge) all traffic sources were growing quickly. Just before we re-branded the site on August 2nd total traffic was nearly 900 uniques a day.

Organic Traffic Ramping Up
Great Increases In Organic Traffic

While I think that the re-direct was a good technique that’s outside the box of traditional SEO and web development, the real force driving the sites success has been Erika and Samantha’s commitment to writing great quality content daily. As anyone who blogs or does web development knows, writing content on a daily basis can be a grind. So kudos ladies, you’ve done well.

In closing there are no immediate short cuts to success. There are some opportunities that you can take advantage of that increase your odds for success. That said, I don’t want people to think that by just doing a re-direct it’s going to equal success over night. If done incorrectly or not methodically re-directs can do more damage than good. So kids don’t try this at home without the supervision of an SEO professional.

Regarding the matter of being able to obtain success with a .US domain, I think this case study is indicative that it in fact can be done. You simply need to have the right plan of action in place. I think that a .Com is always going to be a preferable domain (hence the acquisition of CelebGossip.com)

But if you’ve got a great site, good content and are bringing something of quality to the internet you too can go from zero to 10,000 uniques a month pretty quickly.

Microsoft Knocks Google Off The Map

(This post was submitted by a frequent commentator to thedomains.com who goes by “Cartoonz” who described himself as follows: “an International Man of Mystery whose many projects include KHN.com,  providing some of the finest Nutritionals on the planet”.  I do know him well and he has been involved in the domain business for a long time)

Bing has a map feature, maybe you’ve seen it, maybe not.

Maybe you figured it was just a clone of Google maps, MapQuest, whatever.

But Bing has features that they don’t have.

Seems somebody took the cool idea of Satellite Images to a new resolution for Bing.

Check it out.

Try the “Birds Eye View” (different from Aerial) of your house and tell me that isn’t far better than Google maps or even Google Earth for most places.

I’ve been checking out foreclosure auctions of properties all over the place and I’ve found this new tool incredibly useful.

That is the end of the guest post.

Now I usually, almost never play with Google maps and haven’t checked out bing.com maps until I read this post.

I think that Cartoonz is on to something.

If you type in “Loews Hotel Miami Beach” for example you will see a big difference between Google and Bing.

On Google you will see PPC ads off the left of the map but no information about the hotel.

On Bing you see a listing for the hotel, its offical website, its address and phone number and a “book it” icon.

On Bing you can clearly see where the hotel is on the map and with just 1 more click you can get directions to the hotel.

The satellite photos on bing are easier to get to and looks better than Google’s.  Bing.com also has 3-D Map options for viewing.

You can read more on Bing Maps by clicking here.

This post was submitted by Cartoonz.