Drop Mania

seeker · May 16, 2004

I was wondering about this for quite some time, so I thought I would share this.

How many of you have been in an auction for a domain name you wanted, and just because it was 'caught' and had bids, raised, and raised your bids?

I notice that some domain names that are for sale here and at other places dont do well.

Yet, were it that these same names to drop, many would use 'drop auctions' to catch the very names that somethimes are available for cheaper by a quick sale...
Which brings me to my point.

Are many people in this business thrilled by the process itself of catching domains instead of the logic of acquiring by any means (i.e. a quick sale)?
Is it the gambling factor?
What exactly drives people that are offered $30 for a domain that will later in time go to pool (as an example) for $XXXXX????

Food for thought I guess.

Ed30 · May 16, 2004

I was trying to get rid of foggy.org for a long time for as little as $5. I ended up giving it away to a charity auction - certainly no-one on here wanted it. It dropped last week and ended up being caught by pool - I didn't see the auction so I don't know what it went for.

seeker · May 17, 2004

that's exactly what I mean Ed!
I have seen domain sold here (and some that I have bought) for as liottle as $10 up to $30 that I am sure would go to pool or such a service were they to drop.
In fact, just the other day, I placed a pool order (I thought If I get it for $60 ok, otherwise I would not bother with an auction).
It was caught and went to low $XXXX.
I have bought 2 very similar both in category type and OVT results domain with better google PR for less than $30.
So I think it is some sort of gambling or bidding mentality that helps drive these prices higher.
People get 'thrilled' by 'winning' domain names, which is sad, as it shows that quite a few (perhaps thousands of people) see this not as a business but as some sort of domain casino...

P.S. out of pure cusiosity I checked, and believe it or not domaincasino is regged in .com and .us!!!

dotNetKing · May 17, 2004

I've also seen several of the few names which I decided were not worth paying the renwal fee and have let drop, be registered by domain professionals and also Pool.

There is definitely a thrill in the competition of winning a dropping name against the competition.

Also, it is often difficult to tell why a name has dropped. If EVERYONE knew it was being dropped because it was considered a worthless name, then I guess no one would register it.

Many names will drop through mistake, lack of interest, lack of money or whatever, and these are names that could be worth more.

Again, it is difficult to tell why a name has dropped, but there is always a chance it is a "valuable" name that has dropped, whereas for unregistered names, there is less likelihood that it is a valuable name.

I picked up a name which a friend of mine dropped (it had had very few visits during the year and no offers). I got an offer and sold it the day I acquired it for a nice 3,000% profit. This must have been on the purchaser's radar as a dropped name, I assume.

puravida · May 17, 2004

dotNetKing said:
If EVERYONE knew it was being dropped because it was considered a worthless name, then I guess no one would register it.

I bet BFD or Ult would still register it.

I think that their philosophy (which I do not think is reasonable) is to acquire everything that drops --regardless of worth. They do this just to steal hope from other domainers, to 1-up each other, and to try horde everything.

I think they figure that every domain name will be worth money some day. I think these guy have lost the vision and have poor business sense. They were in the right time at the right place before --and had existing money.

Now, they're just nutty.

They do not realize that most newcomers will just think up some off-the-wall domain rather than spend $100 on a crappy dropped name that Ult paid $360 for in a pool catch. These guys just don't get it.

That's not to mention that the domain market for "worthless" domains will come crashing down within the next year or two --after this realization takes place. Who knows? Maybe I'm wrong and BFD and Ult can sustain these prices longer... but... it will be only them that is buying!

Regards,

Wesley

mole · May 17, 2004

Auctions inflate the price by at least 10x, and decrease your chances of reselling your names to cover your base cost at least 100x, imho.

The bubble is starting to bloat again in these past 12 months, more often pumped up on empty hope than real buyer demand. The artificial scarcity of .COM era is gone forever, folks. Wake up and smell, reality.

seeker · May 17, 2004

I agree that te strategy the BFD and co are following seems useless.
I look around me and see so many new sites (and companies) register all kinds of domains , hyphenated, made up words...etc.... so that they dont have to pay what we now call 'end user' prices.
This is not good news to people that are spending money catching domains at outrageous prices.
The chance of someone actually paying what many of us hope some of our domains are worth is slim at best, unless it is a MUST have name for someone.
Even generic domain names. I had a few clients that we designed web sites for opt for made up names because they were unwilling to pay a very low $XXXX figure on a name that would suit them nicely.
And it is not because of lack of funds, they just think that since they are starting the site from scratch, they are not relying on type ins, so why waste $XXXX and not go for a made up name instead.
And you know what. For many, it makes sense.

BGray · May 17, 2004

I couldn't agree more with the subject of this thread. I stopped bidding on names long ago for the same reason. You see crappy names go for way more than they are worth and even if you do get a good name it probably wasn't that great of a deal. IMO unless it is a very high end name most name dropping bid services only provide actual value to an END user that actually use the name. I don't see the profit margins for resellers.