We are coming upon a series of important domain auctions.
Snapnames.com will be holding their first live auction in January at Domain Fest and Moniker.com will be holding its next auction at TRAFFIC Vegas in February.
To prepare as a seller for these auctions I looked backed and analyzed the results for the last live TRAFFIC auction which was held in Miami in October and have come to the following conclusion:
The most important factor in determining whether a domain will sell at the live auction is the reserve price.
Look at the numbers:
106 names were priced 10K or below, of these, 87 sold or 82%.
The total sales of these 87 of the ones that did sell were $1.3 M.
The total reserve prices of these domains were 375K, so these domains sold as a group 350% more than reserve.
52 names were priced 10,001-25,000, of these 31 sold or 60%.
35 names were priced 26K-50K of these only 10 sold, or 35%.
The total sales of these 10 names were $760K.
The total reserve prices of these 31 domains were $425K, so these domains sold as a group 55% more than reserve.
17 names were priced from 51K-99K, of these 6 sold or 35%.
The total sales of these 6 domains were $785,000.
The total reserve prices of these 6 domains were $430K, so these domains sold as a group 55% more than reserve.
36 names were priced over 100K and less than 1 M, of these only 5 sold or 14%.
The total sales of these 5 names were $1,960,000.
The total reserve prices of these 5 domains were $1,650,000, so these domains sold as a group 12% more than reserve.
(For purposes of this study we included the cowboys.com sale in at $375K even though it sold at silent for that amount, as it sold for $275K in the live but the bid was retracted. Also computer.com was counted at 2.1 million)
Combining the above, domains priced under 25k
158 names were at auction, 118 sold or 75%
Combining the above domains priced over 25k and under 1M
88 domains were at auction only 21 sold or 23%
These are the only 6 names to sell for more than 100K:
Computer.com:
Category killer
One word
Operating site
Crosswordpuzzles.com:
Category killer
Cowboys.com
one word
operating site
Category Killer
SportingGoods.com
Category killer
Investment.com
one word-financial
Category Killer
Singlesonline.com
So here are our conclusions
Only extremely rare and special names, category killers are going to sell if the initial reserve is more than 100K.
Even to be priced at over 25K the domain has to be extremely good, once again names priced over 25k are three times more UNLIGHTLY to sell as one’s priced 25K or under.
Here’s the ultimate question, If you get the 500 smartest, most experienced and well financed domainers, in the same room are they going to let a name sell for 20K that is worth 50k or 100K, or more. Are they going to let a name sell for 5K that worth 25K?
I don’t think so
Here are some examples
Domain reserve sold
europeanvacations.com 20K 85K
promotion.com 50K 170K
caribbeanvacations.com 35K 130K
amusement.com 25K 60K
helicoptercharter.com 8k 21k
criminallawyers.com 20K 195K
christmasgiftbaskets.com 6K 25K
Poker.mobi 5K 150k
There is a psychology in auctions. It is very important. If a bidder see’s a name they think it priced reasonable or below what they think the domain is worth they are going to bid.
Once they starting bidding anything can happen.
If bidders perceive a name as having a reserve too high, they dismiss it in their minds, they don’t bid, nothing happens, dead name.
For example, bulldozers.com, a great name, did not sell with a reserve of 75K, Our opinion is that is the reserve was 25K , there would have been bidding and the domain would have sold probably in the 60-80K range, based on the bidding that took place in the room.
If criminal lawyers.com had a reserve of $175K would anyone have bid?? I don’t think so.
Let’s say you have a name you think is worth 50K but for bidding purposes you place a $20K reserve on it and it only sells for 30K, maybe that’s all it was worth. After all the market sets the price and if the market will only pay 30K maybe the 50K was unrealistic.
Finally you need to take into account the commission rate and structure when pricing your domains. Moniker.com, talks in terms of minimum take home. So if you place 75K as you minimum take home the reserve price will actually be $86,250 ($75,000 x 15%). If you want to have the reserve price (selling price) at $75k, then you minimum take home needs to be stated as $65,200. Snapnames.com will take off the 15% from the reserve price, so if you want the selling price to be $75K you would price it at $75K knowing you will receive only $63,750.
Timing of the auction does have a small affect also. Auctions in the summer traditionally perform somewhat weaker as the vacation crowd is away from some of the action.
Paul
The TRAFFIC auctions that have been held so far have not had much of a seasonal difference, although non have been held in the dead of summer.
The closest one to summer was the one this past June held in New York which did very well.
Just to be clear we are talking about pricing domains for the TRAFFIC show auctions and possibly the snapnames.com live auction. Other smaller industry type auction like the recent webmaster world auction or the Geo Auction, this would not work because there are not enough live bidders in the room. Snapnames we will have to see how it works this time.
Good post.
I think these domain auctions should be more advertised, this is one of the success key.
None of these actors is really serious marketing his auction. That’s a shame!
I have to disagree with you.
the TRAFFIC auctions are heavily advertised and well attended. Looks like domainfest will also be well attended and there is time to register for both of them.
NO
I still remember a lot of domainers in NamePros or DNForum asking when the live auction will start and where to go to follow the auction.
And we are talking here about domainers, not webmasters.
hi greeting ThANKing
please ask Moniker to remove the fee of ‘the absentee’s bidding ,
even up2now ,
there’s still
not enough competitions among houses of auctions ,
1 proof : :
for Moniker-held auctions ,
you must register in advance and pay a fee to bid.
there’s also fee for the absentee’s bidding
http://www.elliotsblog.com/index.php/2007/12/15/the-problem-with-domain-auctions/#comment-1182
>> Kelly Lieberman Says:
>> December 15th, 2007 at 8:18 pm
[[…..]]
>> In some cases,
>> you must register in advance and pay a fee to bid.
>> This possibly shuts out potential buyers
>> who hear about it late or change their mind
>> and decide last minute to participate.
please ,
please ask My Dear Sir Monte Cahn e.t.c. to remove ‘these kinds of fees
something a little bit off-topic but still in ‘the relevancy : :::::
http://www.elliotsblog.com/index.php/2007/12/15/the-problem-with-domain-auctions/#comment-1292
>> ***UPDATED BT ELLIOT***
>> Unless one of the major auctioneers gives people
>> a compelling reason to pay a large commission
>> (like bringing the buyers),
>> there is going to be a problem
>> as the market seems to be saturated.
we have been prepared well to pay well over 20.00 % e.t.c.
to any auction’s house
who could prove themselves out
that
they could really bring in more buyers e.t.c.
we have also been prepared well to pay well over 20.00 %
e.t.c.
to Moniker ,
should they remove the requirement to pay some fees to bid
cheers please ThANKye 2w
by ‘the way ,
the stocks markets ‘r not doing very 2[too] rosy ,
there4 ,
please let me talk like the Dutch uncle once again : :::::
please ask My Dear Sir Monte Cahn e.t.c.
2[to] remove
those in-deed in-deep ridicuous requirements
which demand the bidders 2[to] pay some fees 2[to] bid
cheers please peace ThANKye 2w
2w
I have had this conversation with Monte many times and asked him to waive the fee. I think that you will see a way in 2008 to bid silently but live for no or a very small fee that will be refunded in the event you buy.
I know the major objection to allowing unlimited, free, silent, remote bidding has been verifying the bidders ability to pay before bids are placed.
I believe snapnames will allow for live remote bidding for the domainfest auction.
Advertising Spaces
All you have to do is check out the TRAFFIC website to find out when the next shows and auctions are scheduled for:
http://targetedtraffic.com
and for snapnames.com auction you can check out:
http://domainfest.com
We also try to maintain a list of upcoming auctions and conferences at http://DNCalendar.com – let me know if there are any I missed.
/FM
With all the due respect:
Your response about advertising is not correct.
These places DON’T advertise their auctions as they SHOULD and there is NO exception.
Few days ago I got access to one of these auctions you defend.
There were thousands domains in auction and you know what? Just few bids!
It was pathetic.
And I can tell you the cause was not only due to the posible bad names and/or crazy reserves.
It was mainly due to the lack of participants.
I taken the example of domain forums.
Do you know that +85% of forums visitors are NOT members?
A very large part are NOT domainers, simply webmasters, company owners, marketing specialists… Potential domain buyers!
The question is NOT:
Where they should go to know the date of an auction.
Because they do NOT even know this auction exist!!!
If you do not ACTIVELY advertise your auction online then you are losing a huge number of domain buyers.
Serious/smart auction events should have a larger online presence.
I am wondering when they will understand that advertising is not a loss.
I know they are your close friends, for this reason you try to defend them blindly.
But they are NOT giving today to our domains the advertising they deserve.
And this is the biggest reason why domain owners put these stupid reserves:
They DON’T TRUST the auction!
first ThANKs to My Dear Sir MostWantedDomains
.1.
but ,
the Moniker’s access fees ‘r just too high ,
o k , at least , in my own eye ,
please let me take the access fee of USD299
for the for Geo Domain Expostions’s Auction november2007
forexample
.1.a.
USD299 could have been enough to buy up
a-not-that-too-bad-plus-flippable.com at a
a aftermarket
.1.b.
i can guarantee that ,
nearly-or-even-over 1 billion of Chinese people in China
do currently not have their monthly wages being
USD299 ,
over 500 millions Chinese people in China do currently
have just only USD xxx.00 as their montly wages ,
please ,
please let me repeat again ,
i ‘m talking about the
current Chinese people in
current China
the most exponentially explodingly growing
+
capittallistic[capitalistic];–^)
economy at this very moment
with some reservation ,
i stand by My Dear AdvertisingSpaces ,
for at least 1 point : :::::
the domain auctions houses may b better2do more ad at
the domain forums or blogs e.t.c.
cheers peace ThANKye 2w
hi greeting ThANKing My Dear Sir MostWantedDomains ,
this very post ‘s become more n more interresting ,
please make your each-n-every individual post
to become subscribable
or
please make any follow-up of your each-n-every individual post
to be able to be sent to the emailsboxes of ‘the participants
cheers ThANKye 2w
you can subscribe to the feed by clicking on the RSS button on the right hand side of the page after all the links listings
Thanks very much for your analysis.
I wonder how many people who’ve set the reserve too high did so in hopes of not loosing out on what they’ve invested into that name in order to flip it. For example, what if someone already bought it for a high amount on the aftermakret, say at 30K, so they are hoping to sell at 50k. But they’re afraid to loose their 30k so they set that or higher as their minimum – thereby screwing up the chances as you outline in the first place. Just wondering…
Ari
That is certainly a risk. However once again for the TRAFFIC shows only, there are 500 very smart, financially solvent (the show costs around 2K just to attend) people in the crowd so if the best you can get is 30K maybe that all its worth.
We sold several names at the Miami show for around 100K. Some sold at the reserve and some ran up. Overall we were happy with the results. We also had other higher priced domains in auction, that did not sell.
2w
If you wish to subscribe to the RSS feed you can do so here
http://feeds.feedburner.com/TheDomains
hi greeting ThANKing My Dear Sir MostWantedDomains ,
i have become your subscriber
cheers ThANKye 2w
thanks
Reserve prices in an auction, serve one purpose and one purpose only. They are beneficial to speculators , Flippers and conduits to corporate end buyers! Auctions are the weakest platform for getting the best prices for undeveloped names.