EggZap

This post inspired by the following article!

Domaining.com

I have two anecdotes that have relevance to it.

Around last Halloween I decided to sell one of my developed Halloween costume sites/domains on Ebay. Why ebay? You ask! I know it’s not the best place for a domain, where the average price for a domain sale is probably 3$. Here is my thinking, there are about 100 different stores and individuals selling costumes on eBay at that time, and since I listed the domain in the Halloween costume category I knew a lot of end users (costume sellers checking competition) would become aware of this opportunity. I also contacted any website I could find selling costumes and everyone who was bidding on those keywords. I put up the domain/website for a 1$ with no reserve, and much to my chagrin bidding was very heavy by about 7 different bidders all of which had a history of selling costumes. The price rapidly rose to about 20% estibot value, then stopped. In the last hour/minutes of the auction, bidding picked up again, but this time it was domainers. It sold for about 50% Estibot value to a Domainer in asia.

I was surprised that people who sell Costumes on Ebay and online costume selling websites would let this opportunity go by, but to the outside world, they do not understand how a keyword domain would sell for so much when they can simply hand register a domain and start selling their wares.

I have a client starting an online business based on the European spelling of word that 80% of the world spells differently. In his mind he paid a hefty price for this domain (mine too), and he asked me what the common American spelling of this domain would go for. He thought I was crazy / incompetent when I replied its a 6 figure domain. He would not pay more then 5K for it.

Ok, So most of the world thinks domainers are crazy, when I see discussion groups where people buy and sell four letter domains like
zxth.com zqqg.com, ppqz.com for 20$/50$, when I see every and any 4 letter domain that drops is picked up by someones algorithm and bought immediately, I am inclined to think most of the world may be right.

As the above article underlines, domainers are Nerds, who talk in terms of key words searchs/month PPC, type-ins, parking. I think every big company will have one of these nerds of staff eventually in their growing web marketing department. The little companies and the average joe will continue to undervalue domains and their relevance to their business model.

Their are garages out there, where one smart guy sells a heck of lot of unavailable.com because he was smart and was at the right place at the right time to buy the domain. Eventually, there will be a knock on the door by a bricks and mortar who sell the same product, hopefully the bricks and mortar will have a domainer nerd on staff to advice the exec on what to offer!

IMHO, I think the domain market value is 95% domainer set and 5 % end user set, maybe 99%/1%, and due to that fact, values will fluctuate wildly based on hobby domainers disposable income.

Price / Earnings Ratios for dnjournal‘s top domains reminds me of the stockmarket in 1999/2000.

But with that being said, you can still go to GoDrops.com buy a domain for 7$ that brings in 5$/month parking, shows there are still great opportunities*.

*(getting a domain that brings in 5$/month requires they eyes of a hawk and rubanesque physique)

I am just an Egg.