How do you arrive at a value?

[djbw]

I've got a couple of domains I think would be worthwhile trying to sell to various endusers but have no idea about what they would be worth or how to go about valuing them. I realise there is a domain valuation section here, but for something niche specific that domainers in general aren't likely to be clued up on I'm wondering how accurate these will be (no offence!)

I realise it's a balancing act between what I would sell for and what the buyer will pay, but I don't want to go in with ridiculous expectations or massively undersell.

How do YOU decide how much to try and sell for?

 

[Bailey]

thats a well worded way to ask. And there is whole book to be written - not by me.

So lets just focus on your domains in this instance - and hopefully the logic will carry through for some others. You need to ask yourself a couple of questions to try and establish where your (domains) starting from.

1. When you say the subject is 'niche' - We need to establish just how niche ?
1A) if you were to look-up your domains in say a fairly comprehensive market seller like 123-reg How many of examples of the exact match / hyphenated / plural / singular are taken at Gtld and CCld level

2. What presence does the term have in a search engine - i'm not asking about page views or any kind of performance measure - pure presence again you probably need to input the terms in "quotations" exact match / hyphenated / plural / singular

there are many other questions that move this forward but, if the term is not out there in the first-place - and that can be by registration or what i would best describe as a "natural language referencing" (you'll be suprised how often terms evolve quite logically) -

Without positives feedbacks - even if in very low numbers. Your domains may be a tad too niche

 

[Edwin]

There are other ways to look at the value of a domain name, by working backwards from the product/service/industry it relates to.

For example, how expensive is 1 unit of _____ (whatever the domain represents)?

When you search for _______ how many Adwords advertisers show up?

Is this THE term for that particular product/service?

Do companies have that product/service as their PRIMARY or ONLY line of business?

Are there any tradeshows or exhibitions for manufacturers/dealers/suppliers of this product/service?

The more "YES" answers (and the higher the value of the _____ in question) the better.

Even if the ______ gets almost no "search interest" (because it's very specialist/niche, e.g. most B2B products/services) if it's high-value, has plenty of advertisers fighting over it, is undisputably THE term, is a core offering for several companies, and has its own tradeshow (or at least a tradeshow where many of the companies present are pushing that product/service from their stands) then I'd argue it's probably going to be £x,xxx minimum in the .co.uk for all the other non-search benefits (credibility, sense of industry leadership, ease of advertising, ease of recall, etc.) even if it brings literally ZERO extra visitors from search engines.

 

[djbw]

Thank you both for your helpful replies. They have caused me to devalue one and confirm my thoughts on the other. I'm still new to this so your help is much appreciated!

 

[websaway]

These are the questions you need to ask-

How much is the name worth to the seller ? ( can it be easily monetised if he/she keeps it, you probably won't be able to sell oil tankers but you will be able to sell conservatories )

How much added value does the name hold for a potential purchaser ? ( it needs of course to add value, otherwise not much point in purchasing it )


Has the name got resale value ? ( this one is extremely important. If you buy a name and it has value in the use of and also has a commercial asset value in the future then it's a no brainer. This is why accurate specific product or place names are a great investment )

 

[deanmain]

Think of a number and double it.

Or if trying to sell on this forum half it!!!

 

[DomainDetective]

I have the same problem at times in deciding how much I would be prepared to sell for. In the end the market decides the value. In other words how quickly do you want to sell and how much demand is there for your domain.

For instance when Facebook decided they wanted to buy fb.com from the current owner that had a huge impact on the end price.

 

[FagEnd]

Think of a number you would be happy to sell it for, then double it. Then sell it for half price

There is no formula for valuating names, all these online evaluation tools are worthless. A domain is worth what a buyer will pay, and no amount of appraisals etc will change that.

 

[newguy]

Think of a number and double it.

Or if trying to sell on this forum half it!!!

Made me chuckle .

 

[aZooZa]

Pseud's corner. Double it.

 

[Bailey]

As a small addition To this thread. And it simply is, identify your buyer, be realistic about their capacity and willingness to spend. A couple of hours work can put you in 'their shoes' so to speak. I know a lot of domainers don't agree with this strategy. But, the wonderful tool that is the net is just how much historical and current information there is around to help

The hardest part is normally getting your 'prospect' (if they have contacted you) to identify themselves. But I know through a multitude of means that are available I'm usually able to identify the buyer and therfore consider their mindset in pricing

 

[djbw]

...identify your buyer, be realistic about their capacity and willingness to spend...

I was actually considering this yesterday. One of the firms using this name is an accountant, who I (perhaps wrongly) would consider to have a higher turnover/profit margin than other potential buyers, and thus able to spend more. They are also a recently formed company and shockingly appear to have no website yet. Make sense to try them first?