Domain Manage

Buying 'methodology'?

Discussion in 'Sold Domains' started by retired_member11, Jan 27, 2006.

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  1. retired_member11

    retired_member11 Retired Member

    Mar 2005
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    I'm wondering what methodology (not too grand a word I hope) people use to assess the potential of a domain name before deciding to go ahead and make an offer.

    Do people have a check list?
  2. Domain Forum

    Acorn Domains Elite Member

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  3. aqls

    aqls Well-Known Member

    Nov 2005
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    I have been compiling an 'ideal' check list for myself, though can't say I've ever used it. It's more like a 'choose what's relevant' sort of list. But with domains now going for a million and upward this sort of extensive list will start to make much more sense.

    A) Choice

    Keep it focused on my target areas - so if it's a dud then all is not lost, and I may be able to make something out of it.

    B) Buying practice

    Keep a maximum price in mind - it's all too easy to get carried away and pay way over the odds.

    C) Valuation

    Determine why you are buying it - traffic versus brand vs generic
    If its for traffic then you are looking at what people might type in, so for instance plurals are more likely than singulars.

    If its for brand then singular statements "interior designer . xxx" sounds better than "interior designers . xxx" (depending on your sexual preference!)

    Also for brand vs generic, you have more rights to it as a brand if you own or can purchase company name and if you trade with it for a while and that it is not generic. It would be harder to defend a brand like cheapflights than say argotravels.

    Research brand separately to the domain name. e.g. its easy to determine that xxxooks is a great brand name just because its available. Brand choice is a whole separate field (memorability, uniqueness, identifiable to marketplaceness etc)

    All of this of course is dependent on the actual domain in question.

    Check list of valuation points:
    links inward - e.g. google links
    Alexa rank
    Age of domain - longer is better
    Length of domain in characters
    Length of domain in words
    Are the words definitive for the niche [thanks Edwin]
    Hyphens - can be good but only at the right price - probably 10% or less of value - it's all to easy to overpay with hyphens
    Numbers - same as Hyphens
    both us and uk OVs
    OV with
    OV without but words joined together
    ov whenwords are split
    Legal entitlement
    a) are you stepping on anyones brand or infringeing any trademarks (Europe wide)
    b) can you make a brand out of it
    c) is company name registered
    d) are patents and trademarks already taken out on it

    Note even ran into potential conflicts albeit successfully resolved and there are worse examples than that of generic names being "owned" e.g "easy".

    D) Total ownership
    Can you buy up other similar domains to consolidate your brand e.g. .com as well. e.g. get hyphens too, (does someone else already have close domain)

    Conversely, if many other domain extensions are all taken with that term (e.g try to get mortgage.anything) then that is a good indicator of an 'in demand' term and can justify a higher price from its rarity and popularity.

    What is being done with the other .extensions of the domains - are they parked or used by major or minor outfits.

    E) Retention of value
    Is there possibility in the future that someone else may want this name off you, so even if you don't build it up it will still retain its value.

    Is there a possibility of "big picture" changes like Nominet taking away .co prefix etc.

    i.e. SWOT analysis (Strengths weaknesses opportunities threats)

    i.e. will it increase, decrease in useage over time
    version names and numbers eg NT, 2000 etc are time sensitive

    Is concept now or future
    will concept be outdated soon eg wifi and G4 and perhaps blueray coming up but only perhaps for a shortish period of value

    f) Commercialness
    Nearness to a purchase - i.e. if you are selling fitness equipment then there is a vast difference between or even to

    Value of likely purchase - if you are not yet certain of the field of endeavour but are purchasing for future ppc then e.g. look at e.g. hotels rather than flights (thanks atlanta1)

    But make sure there is enough demand for the product in question.

    Something like total demand divided by total competitors x profit margin = is it big enough?

    Popularity of market - e.g. loans is a very, very competitive market, so you may get good ppc rates but if you are trying to sell loans then you will equally have to pay high ppc rates, so determine which side of the fence you're on.

    If you are selling then find your niche.

    If you are getting revenue then find the high paying keywords

    G) High paying keywords
    Look at google, wordtracker, ov and all the others to determine top paying keywords in your field.

    H) Alternatives available - is the one domain *really* that good - given with your time you could make others work well. Why pay $60k when you could pay reg fee on another one and spend $60k doing it up. General public probably couldn't do that, you probably could.

    I) Check values
    Check ov results are genuine eg with wordtracker
    e.g. my last purchase was with an s at the end.
    OV showed over 3000 with extension
    So far in 5 days absolutely no traffic

    If I had checked with WordTracker I would have found that the results were different from Overture and would have given me the clue that it was a false reading. Perhaps from some big site publishing a false link last month, or something like that.

    J) Compare with .com value
    Compare what people have done with the .coms and what price that was sold for, or what price they would sell for.

    K) Affiliate valuation
    If you are buying for ppc, check there are decent merchants already in existence unless you fancy the direct approach.
    We can all wait for merchants to start affiliating but it may take years for the particular product you are interested in to make it onto the networks books.

    L) Market sector
    Touched on previously, e.g. for sake of example debt consolidation pays more than music generally, unless you find the appropriate niche in music - i.e. know your market sector and the niches within it.

    M) Competition
    Difficulty of getting serps

    N) Locality and specificness
    Bigger trends are towards local search results and very specific searches
    Make sure you haven't gone too general when you actually would do better with specific and local descriptions.

    O) Repeat visitness and memorability
    (lots of made up terms here!)
    How easy will it be to create your site to get repeat visits.
    E.g. domain forum is more likely to attract visitors who like to visit forums.
    domain purchase is more likely to attract one off domain purchasers
    You may find the former actually sells more domains
    You know your market for the actual product and domain.

    How easy is it for people to remember the name to come back to, i.e. how similar or confusing is it to other similar terms.

    P) Differentiation and consumer benefits
    Does the term have enough consumer benefit built in.
    i.e. you want loans to quick, you want hairdressers to be qualified, you want eggs to be fresh.
    So things like cheapeggs or cheaphairdressing work less well than cheapflights.

    Other opportunities
    Sometimes you might get a one off. e.g. if your name happens to be the same as a major brand then you can leverage that. (thanks Goose)

    Sometimes a country name or capital city name changes
    e.g. Bombay to Mumbai

    compare in google number of instances of plural -plurals and vice versa
    to get indication of the difference in usage of the term for your term

    look in google to see ad prices for each version
    [plural] vs [plurals]

    Number of near neighbour ways of describing the term
    ez, eze, easy, eeze,
    ez-, simple,

    number of advertisers advertising for the term

    check searches for purchase related phrases on the term
    eg buy guillotines rather than french guillotine

    wordtracker (dogpile metacrawler) can help with plurals

    academic terms rate higher than colloquial perhaps

    perhaps number of links in froogle vs google will give you some idea of its commercialness.

    and various other buying/sales variants e.g. is the seller pricing for end user or broker quick sale.

    etc etc

    Feel free to add or dispute anything here, it is just a work in progress.

    I have some other ideas too if you want them.



    copyright -aqls- 2006
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  4. retired_member11

    retired_member11 Retired Member

    Mar 2005
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    An awesome reply. Many thanks for taking the time.
  5. aqls

    aqls Well-Known Member

    Nov 2005
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  6. Lucky Luke United Kingdom

    Lucky Luke Active Member

    Dec 2005
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    That's superb, aqls.

    You mention that you have other ideas. Can you let us know what they are?

    Many thanks, Luke (more a newbie than ever, so it would appear :???: )
  7. retired_member11

    retired_member11 Retired Member

    Mar 2005
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    I'm also wondering how much of a problem there really is with unscrupulous individuals artificially inflating domain statistics and ppc earnings prior to putting them up for sale. The thought of this possibility inhibits my willingness to buy. Recently I've been averaging only 2 buys a month due to suspicions about the stats and ppc being quoted by sellers. What 'due diligence' checks can be made to verify stats and ppc? Quite a difficult issue.
  8. aqls

    aqls Well-Known Member

    Nov 2005
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    It definitely happens. I've witnessed it on several purchases.

    Therefore safest way is to ony buy domains that you 'understand'.

    I can usually guage the bs from the honey from comparing what I have to what they are saying, but I still get caught out from time to time.

    It is a difficult issue.

    Other ideas meanwhile:
    google ppc allows you to display only 35 characters on your ad and that includes the www. and the so you are left with 25 characters and then you can't add directories.

  9. charlie

    charlie Well-Known Member

    Jul 2004
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    admin - this must be a sticky :D
    nice one aqls
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