How To Determine A Domain Name's Fair Value And Price

How To Determine A Domain Name's Fair Value and Price

23 January 2016

Written By Alexandria Astoria Vale

Business Developer

DomainName.ForSale

 

Question(s):

How Do I Determine The Fair Value Of A Domain Name?

How Do I Know If The Asking Price For A Domain Name Is A Fair And/Or Good Price?

 

Step By Step Answer:

A. Comparative Shop

B. Add value, accordingly

C. Consider your ROI (Return On Investment)

 

 

A. Comparative Shop

= Compare The Prices Of "Comparable Domain Names"* To The Asking Price Of The Domain Name That You Want

 

*"Comparable domain names"

= Same word in front of the dot

EXAMPLE 

Business.World = "comparable" to Business.Center, Business.Network

 

--1. Historic Sales Data

= Price That Comparable Domain Name(s) Sold For In The Past

Namebio.com

Sold.Domains

 

--2. Current or Future (Projected) Sales Data

= Price That Comparable Domain Names Are Going For In The Current Marketplaces

Large Marketplace(s):

DNS (Domain Name Sales) https://domainnamesales.com 

Uniregistry Market  https://uniregistry.com/market

Sedo https://sedo.com

AfterNic  http://www.afternic.com

Godaddy Auction  https://auctions.godaddy.com

 

Small Marketplace(s):

DomainName.ForSale https://www.domainname.forsale

 

 

B. Add value, accordingly, if your Ultimate Domain Name possesses any one or more of the 8 attributes pointed out in "Domain Name Valuation Indicators" THE BIG 8 

 

1. Exact Match, Good Match

a. "Exact-Match

= SLD (Second Level Domain) + gTLD (generic Top Level Domain) = Exact Match

= Word before the dot + Word after the dot = Actual 2 Word Phrase Used In Everyday Language

= Word before the dot + Word after the dot = Familiar 2 Word Search Term

= Perfect 'before the dot' + 'after the dot' combination

b. "Good Match"

= SLD (Second Level Domain) + gTLD (generic Top Level Domain) = Good Match

= Word before the dot + Word after the dot = Good, logical match

= Good 'before the dot' + 'after the dot' combination

 

2. Keyword rich*

SLD (Second Level Domain)

= Word before the dot = Popular keyword i.e. Google search word?

gTLD (generic Top Level Domain)

= Word after the dot = Popular keyword i.e. Google search word?

SLD + gTLD

= Word before the dot + Word after the dot = Popular keyword phrase i.e. Google search term?

 

*SEE: Search Results, Search Volume - Exact Match, Good Match

 

3. Clear, Memorable*

= What your business, website, brand DOES = Clear

= The way the domain name “explains itself” = so obvious and/or clever = can't forget it = Memorable

 

*A Clear, Memorable domain name  

= directly affects "Commerce Potential" of the domain name

= Greatly Increases Commerce Potential

 

Commerce Potential

definition

= Level of ease with which the domain name can effectively sell a product or service

 

4. Advantages

a. Inherent brand

= Word before the dot + Word after the dot = Indicative of Brand = IS a brand

b. Perfect for a product

= Word before the dot + Word after the dot = Perfect name for your product

c. Good or Ideal for a service

= Word before the dot + Word after the dot = Good or Ideal name for your service

d. Innate business name

= Word before the dot + Word after the dot = Can be used as a business name

e. Innate organization, non-profit and/or charity name 

 = Word before the dot + Word after the dot = Perfect name for a non-profit or charity, etc. 

f. Cool app name

  = Word before the dot + Word after the dot = SO Cool = Should develop an app just to use the name

g. Brilliant game name

= Word before the dot + Word after the dot = Sounds like it should be a game name

h. Relevant to You and your existing or future business/organization/brand/app/game/service/product, etc.

 

5. Positioning*

a. Category Killer

= Word before the dot + Word after the dot = 2 Word Term That Defines An Industry or Sector 

= Positions you as Industry Leader or Sector Leader 

b. Category Competitor

= Word before the dot + Word after the dot = 2 Word Term That Makes Sense For The Industry or Sector 

= Positions you as Strong Competitor = Puts you on an even playing field (with current industry competitors) or better

c. Niche Dominator

= Word before the dot + Word after the dot = 2 Word Term That Defines A Niche (describes the niche perfectly)

= Positions you as a Niche Leader

 

*Positioning  = directly affects "Commerce Potential" of the domain name

Category Killer = Highest = Greatly Increases Commerce Potential 

Niche Dominator = High = Moderately Increases Commerce Potential

Category Competitor = Slightly Increases Commerce Potential

 

6. Projections

a. Growth market, sector, demographic

b. In demand industry or profession 

c. Notable trend

d. Emerging tech trend; Disruptive Innovation

 

7. Similar domain names sold = *Already Factored In Via Step A: Comparative Shop

a. gTLDs

b. country codes

c. .com’s (if you insist)

d. any others that you consider relevant 

 

8. Structural build out = viable?

= Can you add sub-domains and “build out” the revenue stream potential of the domain name?

EXAMPLE

domain name = Fashion.Boutique

Subdomain build out 

= Mens.Fashion.Boutique, Womens.Fashion.Boutique, Kids.Fashion.Boutique

 

With regard to the 4h: "Relevant to You and your business "; the best domain name with the right gTLD extension for YOU and your business i.e. the one that will attract the buyers that you are targeting = very valuable to YOU. In some instances; only one or two domain names = exactly right for you and your business. So, there is an very important added value here that is specific to you, the given buyer. 

 

 

C. Consider your ROI (Return On Investment). 

YOU COULD GAIN:

Instant conveyance of relevancy, trust and authority.

Receive type-in traffic immediately.

Gain organic search results i.e. high search result rankings.

Have no need for advertising, marketing or branding expenditures.

Be remembered.

 

Acquisition of the ultimate domain name will result in a maximum ROI.  

Cost of domain name acquisition will be recouped easily and quickly via any one or more of THE BIG 8 features.