Domain Value Algorithm

[EstateNIC]

It's possible to mine data off the web and get a pretty reasonable ballpark value for a domain. Identifying and enumerating the various components that make a domain valuable is a requirement for domaining success -- while most domainers do this by "gut" from similar sales, you don't have to. My valuation models usually start with a domain name and a spreadsheet of various parameters -- keep adding useful info about the domain and tweak numbers as values change. When I find that I am no longer adding new classes of parameters, but only changing the data within the cells, it's time to see if the various information pieces can be distilled into a set of equations. When doing this, I suggest using a operations research / constraint programming perspective. Whether your model will have any generic applicability will depend on your modeling talent. There's nothing wrong with trying to quantify a domain's value. Overall, though, if you get good at valuation modeling, you will probably find that your skills are better suited for more interesting and lucrative markets elsewhere.

Like what ? I mean the other markets?

 

[Gerry]

Doubtful that anything you could create, concoct, device, scrape, or piece together would have placed a value anywhere close to $16 million for Insure.com.

Bottom line, a value is what someone is willing to pay. It must have intrinsic value to the buyer.

That is why auctions exist. Any item with multiple bids means it was worth only an X value to every one bidding except the winner. In that case, it was worth X+ and nothing I know of is ever going to be capable of estimating that formula - the intrinsic value.

Quad post???

 

[ordersomething]

Art is not a part of science. Art is it's own category like science is it's own category.

.

 

[EstateNIC]

but each of them supports each other.

 

[ordersomething]

but each of them supports each other.

Please provide your academic credentials.
As I understand it, teaching without a license may be punishable in a court of law.

 

[EstateNIC]

So, Just give me an example that science says that and art doesnt ?

 

[katherine]

Art is a part of science. I mean art supports science and science proves art. Ex: look at mona-lisa paint. The science proved that why people liked it so much. (For more info you can look at "golden ratio" in google)

Speaking of Mona Lisa, assuming it was on sale, how much do you think it is 'worth' ? Being such a unique piece of artwork, there is no standard valuation model, the only limit being the motivation and financial means of an end user.
It's the same with domain names.

 

[EstateNIC]

So lets change my question :

How you value a domain ? Please dont tell me that you feel it. Even you have feelings, your feelings are based on something right ? Or it is gods gift?

 

[Gerry]

This has been addressed.

You can spend some time reading the responses or spend that time building your value tool.

Hope you get something from either.

 

[noelius]

Some time ago I setup a excel spreasheet for doing it, based on a website which tried to evaluate, and the appraisals were too priced in my opinion. So, it's useless. But you can make an algortihm to check your personal appraisal. For example, if you don't need it listed at dmoz, don't consider it on the appraisal and so on... Just my personal idea.

 

[jmcc]

The problem with trying to develop a valuation algorithm with a limited set of variables and too little historical data is that you end up with a very simple algorithm that doesn't really do anything. And it cannot explain why an enduser sees any value in a domain name.

Regards...jmcc

 

[katherine]

Please dont tell me that you feel it.

Why not ? Gut feeling, experience, past sales data, but also how good the combo sounds. It's usually not hard to tell a good name from a crap name.
Valuation is another matter. I never said it's a scientific thing. Why is that so hard to understand ?

 

[EstateNIC]

I mean you might tell me why you feel like that, instead of you feel the value.

if you get in love with someone, you would really have good reasons for you to value that person right ? ex : beatiful/handsome, trustworthy..

why is that so hard to tell

 

[katherine]

Because there are so many parameters, and not all are equally important. Every person has different criteria. Sometimes an end user 'must' have the domain, so they might be inclined to pay more than reasonable price.
Example: is ireport.com worth 750K ? No tool could predict that it would sell at that amount, actually even experienced domainers would have quoted much much less. Here we are talking about brandable domains, that are even more unpredictable.
There are tools available already but they are worthless because they are as accurate as the daily horoscope.

 

[Theo]

if you get in love with someone, you would really have good reasons for you to value that person right ? ex : beatiful/handsome, trustworthy..

why is that so hard to tell

Do you really decide a person's value based on a ratings system? Human emotions don't apply to business evaluation of a material or a service.

 

[EstateNIC]

Do you really decide a person's value based on a ratings system? Human emotions don't apply to business evaluation of a material or a service.

That is out of the question. I just meant to give an example about emotions. And to be honest people dont put their emotions to value a domain. They only value domain because of what they have in their mind.


I wanted to mean that we can have an average value. A general idea of a domain's value. Not the exact value like a rational example like ireport.com

 

[Theo]

One could develop an algorithm about domain value that takes into consideration aggregate data from many people. But even then, there will be times whereupon a domain's intrinsic value is determined by one person: its eventual buyer. I played that "game" several times in the past, asking for an appraisal on a pending sale; the responses were disheartening.

 

[EstateNIC]

So please tell me how you value a domain other than considering past data values ?