Dealing with lowballers?

[heirJORDAN]

Hey all, I have a domain in my portfolio that I've given up plans of developing. There were plans to brand it personally, but then I noticed an upstart clothing brand using the same name. This led me to listing the domain for sale and starting with another name.

A few years back, I almost promptly received interest from a childrens learning center who also happened to use the same name. They asked me for a price --- and no matter how hard I probed them to make an offer, I had to cave in and asked for low $xxx.

I thought the sale would go through for sure yet I never heard from them again.

I list the website on GoDaddy auctions a few months back requesting offers. I get one for the min. of $50. I counter with a similar asking price and again... no response.

3-5 years later, both businesses are still going strong. If anything, you'd think I'd be able to get more yet it seems as if I'd be lucky to even get $100 for it. How do I deal with this? :upset:

 

[vinsdomains.com]

Keep looking, and remember, patience is a virtue!

 

[Biggie]

Hey all, I have a domain in my portfolio that I've given up plans of developing. There were plans to brand it personally, but then I noticed an upstart clothing brand using the same name. This led me to listing the domain for sale and starting with another name.

A few years back, I almost promptly received interest from a childrens learning center who also happened to use the same name. They asked me for a price --- and no matter how hard I probed them to make an offer, I had to cave in and asked for low $xxx.

I thought the sale would go through for sure yet I never heard from them again.

I list the website on GoDaddy auctions a few months back requesting offers. I get one for the min. of $50. I counter with a similar asking price and again... no response.

3-5 years later, both businesses are still going strong. If anything, you'd think I'd be able to get more yet it seems as if I'd be lucky to even get $100 for it. How do I deal with this? :upset:

if the clothing co is using similar name, then yours should be getting some traffic.


and if you're getting some traffic, perhaps it will convert to $.

use those earnings to renew the domain for a few more years.... and let it sit in the vault.


imo...

 

[ksinclair]

If your main strategy is forcing users to make the first offer, you will always encounter low ballers.

You need to set a price or range. And dont sell cheap.

 

[heirJORDAN]

Thanks guys. interesting advice, I'll set a price and see where it goes from there.

Just realize I'm dealing with businesses that do not understand the potential value of domains. That's what frustrates me. Along with the prices of domains gradually rising... *sigh*

Don, they use the exact name and I just put it on sedo last week. So far, no ad clicks. A few on the "domain for sale" link however.

 

[katherine]

The vast majority of businesses do not understand the value of domain names. If they did we would be millionaires.

 

[draggar]

The vast majority of businesses do not understand the value of domain names. If they did we would be millionaires.

QFT. I registered a nice geo+keyword.com domain that I was going to develop but later found out is the same name of an organization (no TM and they can't cover the entire geo area). They contacted me and I was nice and said I'll only take $250 for the domain. They refused to pay over $20 for the domain - so I said no thank you and continued on with my plan.

The site is going up and doing well. Now, considering the work I've put into it and the increase in traffic the MINIMUM is $500 now.

 

[Deleted member 111831]

The vast majority of businesses do not understand the value of domain names. If they did we would be millionaires.

The 'vast majority of businesses' are right - even though they weren't a few years ago.

New startups are all naming themselves premium one word names and then registering getWord.com or tryWord.com. This + apps + facebook.com/name and twitter.com/name and they no longer need us.

Time to quit praying we'll sell 2 and 3 word junk for x,xxx and start selling at reasonable prices. Or keep losing money paying reg fee's and looking at the people who won the idiot lottery on dnjournal and cursing our 'bad luck'

 

[Raider]

I had to cave in and asked for low $xxx.

Did they hold a gun to your head?... When a domain offer comes your way you should reply with a price, usually higher than what you want for it and leave it at that. I think one of the biggest mistakes sellers make is they try to push the sale after the first inquiry, this shows desperation and as a result low ball offers often ensue.

One of the things I have NEVER done is reduce my asking price by over 25%, and rarely do I reply back to potential buyers after quoting a price, Notice I didn't use the word "Asking Price" this suggests the price is negotiable, which can often lead to low ball offers... If they really want the domain, they will contact you, if they want a better price which they always do, you have a 25% window to work with.

It's all about having patience and knowing how to play the game, Hopefully this will help you with future sales. Good luck.

The vast majority of businesses do not understand the value of domain names. If they did we would be millionaires.

So true

 

[Deleted member 111831]

One of the things I have NEVER done is reduce my asking price by over 25%, and rarely do I reply back to potential buyers after quoting a price

And what % of inquiries result in a sale? 1%? 2%? With 98-99% (correctly) thinking you're trying to take advantage of them? It's 2012. End users are not naive to these tactics anymore. You'd make more money if you sold more domains for a lower markup. That's why you are in this business, right? To make money? Or do you just want the thrill of duping one guy a year into paying you 20,000% more than you paid for something and 5,000% more than it's worth?

The only way we are ever going to make sales and stop the tide of people fleeing to facebook and twitter and coming up with clever hacks to cut us out of the process is to stop focusing on how to trick people into paying us way more than our domains are worth - and start trying to figure out what the price is they will actually pay. Hint: typical end user prices are going to need to come down at least 80%.

 

[Raider]

And what % of inquiries result in a sale? 1%? 2%?

If I could separate buyers who seriously want the domain and are willing to pay VS those who don't or wont, I could easily answer this question.

With 98-99% (correctly) thinking you're trying to take advantage of them? It's 2012. End users are not naive to these tactics anymore. You'd make more money if you sold more domains for a lower markup. That's why you are in this business, right? To make money? Or do you just want the thrill of duping one guy a year into paying you 20,000% more than you paid for something and 5,000% more than it's worth?

I know my total sales are more than 1 because I had 5 sales in the last 6 weeks, Not a lot but I'm quite happy considering the amounts. And I don't know what you mean by duping buyers or getting a thrill, what are you talking about??? I don't dupe anyone, If they don't like my price then DON'T buy it!, that's my attitude. And you seem to overlook what domainers are having to invest for quality domains these days, I pay out a lot of money at auction for these names and I expect a substantial return from my investment. Maybe if I was dealing in hand reg's like most others here, I could do what your saying and sell more for lower markups, this is not the case.

If you submit a realistic price for your domain and reduce it by more than 25%, you deserve to be played for more. I simply refuse to do it and it often DOES result in a sale.. My most recent sale which is currently in escrow, I reduced the price by less than 1% and it SOLD, The sale before that I didn't reduce the price at all and it SOLD, The one before that I reduced by roughly 15% and it SOLD. You must be assuming I'm asking these outrageously high prices for my domains, I'm NOT, And the reason I'm not is because I don't like haggling, I have very little patience for it, so I make it a point give prices that are realistic.

As I wrote in other threads, this is a side business for me and not my primary occupation, so I don't rely on it, Maybe that's what separates your way of thinking from mine.

 

[Deleted member 111831]

You didn't answer my question. What % of inquiries result in a sale?

We can all give an example of some idiot that payed us way too much and didn't bargain. That is the exception, not the rule. The rule is we quote an absurd price, refuse to bargain down to a reasonable level and the domain doesn't get sold.

I expect a substantial return from my investment

That's the problem. Everybody in this industry does, and nobody gets it with any consistency. If our expectations were more realistic we would all make more money.

 

[Raider]

You didn't answer my question. What % of inquiries result in a sale?

I didn't answer for the reason already given. Of course your going to have a higher % of sales when you price your domains low, it's a no brainer... I'm not in the Fire Sale business, and I don't believe you are either, You suggested we price our domains LOW so we can sell more right? More volume, more $$$ right?.. But here you are selling a bank typo for 50K; http://www.dnforum.com/f525/bank-typo-600-1k-per-month-thread-475527.html

And on a domain forum of all places.. lol.

Sure it's a revenue earner, but how do you know the domains I'm selling or have sold are not revenue earners also? you don't, all you can do is speculate..... I cant remember when I asked 50K or more for any one of my domains, and I have some pretty good names, and their actually spelled correctly

The rule is we quote an absurd price, refuse to bargain down to a reasonable level and the domain doesn't get sold.

Where the heck did that rule come from? It's definitely not the rule I live by, quite the opposite really, I do quote realistic prices and do bargain down to a reasonable level, reasonable being NO less than 25%, and the name usually DOES sell. :yes:

Now if you want to know what percentage of sales I've had where a potential buyer and I negotiate back and forth when the price is NOT so far apart, I'd say roughly 90% of time we agree on a price, the times we haven't is when the buyer is on a limited budget or is simply not willing to pay that amount for a domain name, which is fine with me. I'm simply not willing to lower my price anymore than I already have, and if I lose the sale as a result, SO WHAT? another buyer will come along, they always do.

 

[Deleted member 111831]

4 years of earnings is not an unreasonable price at all. It just so happens that domain earns a lot.

I didn't mean to make this personal and get you all defensive. I was speaking in general terms about how most domainers approach domaining.

 

[Raider]

I didn't mean to make this personal and get you all defensive. I was speaking in general terms about how most domainers approach domaining.

I'm not getting defensive, I'm just trying to express where I'm coming from because I think you have me confused with other domainers.. I realize that many of them over value their domains by a large degree, and when a respectable offer comes along they pass on it, thinking it's worth far more and then playing the wait game, this is simply NOT me. I play the wait game, but I play it with reasonable expectations.

 

[Deleted member 111831]

if I lose the sale as a result, SO WHAT? another buyer will come along, they always do.

If this is true for you, congratulations. You must have a portfolio that would make Frank Schilling jealous, not only for it's World-class quality but for it's total lack of domains that don't have a never-ending stream of regular offers.

For most domainers, this isn't the case. We get a lot of offers on a few of our domains, occasional offers on some others, rare offers on others - and no offers at all on the majority. For the domains not in the first two groups, it's a mistake to demand 10-50x reseller prices for them and refuse to negotiate down - when that's probably one of the only offers we will ever get.

 

[Raider]

We get a lot of offers on a few of our domains, occasional offers on some others, rare offers on others - and no offers at all on the majority. For the domains not in the first two groups, it's a mistake to demand 10-50x reseller prices for them and refuse to negotiate down - when that's probably one of the only offers we will ever get.

This we can agree on, names that I've been sitting on a very long time with no offers whatsoever, I price them less than I would other domains. But even with these domains, since the quote I'm giving is priced accordingly, the 25% rule still applies.. You may disagree with this approach and my stubbornness of not being willing to negotiate less, but I learned that most buyers eventually do pay, maybe not that day, it might be 6 months or a year for them to ultimately buy it, but many do come back.

Sold a 3 word .com to an Optometrist who owned the net and .org, he was the only one who made offers on it, but he wanted it for a ridiculously low price, over half of what I quoted, I blew him off, 6 months later he contacted me with another offer, I blew he off again, 2 weeks later he bought it.

I'd be lying if I said I didn't lose any sales, I've lost plenty and yes I've had some regrets, but for me it's worth that risk, because like I said earlier, domaining is not my primary occupation, I can afford to lose the sale where others who rely on domaining most likely cant.

 

[Biggie]

If this is true for you, congratulations. You must have a portfolio that would make Frank Schilling jealous, not only for it's World-class quality but for it's total lack of domains that don't have a never-ending stream of regular offers.

For most domainers, this isn't the case. We get a lot of offers on a few of our domains, occasional offers on some others, rare offers on others - and no offers at all on the majority. For the domains not in the first two groups, it's a mistake to demand 10-50x reseller prices for them and refuse to negotiate down - when that's probably one of the only offers we will ever get.

Hi

i think in some of your replies, it seems you associate/assume that other domainers are trying to do like FS does, ...thinking they are trying to adopt same philosophy in their selling strategies.

i think many are or do try to imitate that strategy.


but not all of us are followers and you have to consider that the philosophy of capitalism, has been around longer than domain names


so when it comes to asking for 10> 50x acquisition cost, if you don't ask...you'll never get it. even on a domain that had never received an offer before.

if you do ask and the buyer walks, then you still own the domain and can reconsider pricing later.


as Raider pointed out, many times a buyer may pass this time, but come back later to renegotiate.

you never know if/when the buyer is testing you...as in trying to get the lowest price.


there are quite a few domainers who sell names, but they may be in a position to pass on offers because the portfolio sustains itself.


you don't have to be on same level as a high profiler, you can be low profile and accomplish same goal.



it's all about the profit margin


spend $10, sell for $100, you made same profit margin as someone who spent $10k and sold for 100k

the only difference is the amount invested.


but i could agree with the approximate breakdown of offers received on a portfolio, but i think it applies mostly to a class of domainers with mixed levels of quality names.

the beginner or novice wouldn't fit that scenerio and maybe a guy/gal with all premo's wouldn't either.

get a lot of offers on a few of our domains, occasional offers on some others, rare offers on others

i think it basically applies to me, because that's about how it's been over time. except i do get some offers on the "majority" of my names, it's just that the majority of offers aren't high enough.

then that too could be because i have reduced inventory.


and i still get offers on domains i no longer own (thru sedo, cuz i didn't delete them after i dropped them), so "time" can be a factor that effects the lack of offers on particular names in a portfolio.


so the longer you hold them (assuming they have value/potential), could increase the chances that an offer/inquiry will be submitted.

 

[WhoDatDog]

Useable names are hard to give away right now. There is no such thing as a true lowball offer. Assets prices change, and 99 percent of domainers think that the highest price they ever were offered means that the price can never be lower than that. It is that type of flawed thinking that has turned forums into ghost towns.

A small percentage of people really understand asset values and markets. I can show you stocks that went down 99 percent in less than a year, and I can show you stocks that have gone up 20 times in that same time period. Domain values are misunderstood by most, and until people understand that values can change, and fast, there will continue to be less sales.

 

[heirJORDAN]

Did they hold a gun to your head?... When a domain offer comes your way you should reply with a price, usually higher than what you want for it and leave it at that. I think one of the biggest mistakes sellers make is they try to push the sale after the first inquiry, this shows desperation and as a result low ball offers often ensue.

I guess I should elaborate.

An end user contacted me and after a few e-mails, it became clear they were not going to make an offer. They were not going to negotiate until I gave them an asking price. I did not want to price the domain with the simple fear of underselling. This person could have had a budget that far exceeded my asking price. Selling for $xxx, only to find out a year later you probably could have asked for say... $x,xxx, is not the position I wanted to be in.



(And to the person saying that's "duping", no... that's only logical. I'm not a registrar, nor am I a charity. If I know I'm dealing with a guy willing to pay $1,000 for my rarakjfejkafiejriqejfienfnkmadkfnsadk.com, you'd bet your *** I'm going to shoot for every penny. Who wouldn't?)



[cont.]
Regardless, I evaluated it's worth at the time and gave what I thought to be an accurate price. I overcharged of course because I expected a counter offer. I was wrong, they just walked.

My beef is simple --- I'm dealing with people that think anything above reg. fee for a registered domain is ridiculous.
The point of this thread is simple --- I'm venting to a community that understands this and looking for advice on how to deal with them.

The end user(s) will be back one day. They always come back. The goal is to simply find out what it takes to get this person to stop walking from the table when I dare to say something other than "$15" and negotiate --- to educate this person that some domains are worth more than reg/auction fee's --- to get them to see that I'm not on drugs with my asking price.

If I can't change their minds, that's fine! It doesn't bother me one bit to renew. Their businesses are only giving the name more value. But until the day comes where I at least get the opportunity to slap a little sense into this guy/gal... well, it will continue to bug me. It's gone on for 5 years now. I'd like to break the cycle.