Wanted: Domain Appraisal Recent DN Journal Sale Typo Held

[wwwdomain.name]

I've a recent DN Journal Sale Typo...

The real name sold for $75k on ebay...

Any ideas as to what price to pitch the www NO dot version at?

Feedback appreciated.

 

[bb99]

Is it a generic word/phrase (without the www that is) and does it get any traffic?

 

[wwwdomain.name]

Thanks BB...

Yes to both...

I secured the name wilst the original was being offered for sale first time round so I know it's OK to approach the new owner as he bought second time round...

At the price it went for, I'm sure they will be developing as the market it's in is very strong though it must get a lot of traffic if they just bought it for ctr....

 

[bb99]

I'd say you're looking at a sale based on PPC revenue / traffic, with perhaps a bit more on top because it's generic-ish.

If you can prove the revenue by way of stats etc then we're then down to the "how many months of revenue is it worth" question which has kind of been addressed many times - but without any definitive answers!

No doubt someone else who's actually bought/sold similar (I haven't) will comment soon...

 

[wwwdomain.name]

Thanks again for the speedy reply BB...

Much appreciated.

 

[aqls]

Valuing a revenue domain.

If you were to buy an income share, i.e. an investment that paid dividends, you would be looking at two major factors of value: The resale price of that stock in future (i.e. will the stock price go up or down) and the annual return on that stock (i.e. dividend may be e.g. 5%).

Your purchase of that share is determined by your judgement of the risk/likelihood that you will benefit overall from the alignment of both of those factors.

With a domain, if you buy it for sake of argument 5 years revenue then effectively you have paid an investment price for the domain which equates to that figure and expect a 20% annual return on that investment.

So 20 times annual revenue would equate to an equivalent investment in the stockmarket or bonds or property (or whatever) bringing you 5% (dividend) return.

The differing risks and rewards of domains need to be taken into account, some of them here:
Risks:
a) The long term future of .co.uk as a dominant domain brand may not be reliable e.g. other extensions eg international domains may be given preference by dominant browser manufacturers or search engines when determining default site destinations.

b) The traffic may be pumped and the revenues and traffic may not be reliable over a long period of time.

c) The prices of domains in general may fall and therefore undercut your original investment price

d) tm issues of course + many others

Potential:
a) Better management of domains may bring hugely increased returns e.g. trialling different parking solutions (e.g. overture vs google vs Miva etc) may bring better returns, development may bring hugely increased returns

b) the traffic may only just be getting started as global takeup of the internet continues to rise, as people get more used to typeing in domains directly, as parking in general becomes better SEOed etc

c) prices of domains may continue their trend rapidly upwards, or your particular domain may become the focus of someones beedy eye for e.g. brand development or brand consolidation.

d) many others

I would put a typo and generic value under the category of "beedy eye, possible brand consolidation" potential!

The current "market average" of about 4 to 5 times annual revenues may be a figure reached by the buyers' assessment of the % return they would be prepared to live with given the high risks listed above e.g. most likely pumped.

The risks can be increasingly accommodated with contractual vigour and prior checking of traffic sources, and only dealing with reliable people.

The potentials have not really been the main focus of the average domain seller to date.

So I think it is a buyers market, and that 4 to 5 times annual revenue on an honest deal is quite a bargain!

Unfortunately I've just run out of budget . . .

-aqls-

 

[wwwdomain.name]

Wow - Fantastic post AQ...

Nice to have a comparison with other markets... Takes it out of the box...
Put's another perspective on things....

Bit off topic but, think I've found a fantastic investment ... NNNNOT!!!

http://cgi.ebay.com/www-1-2-3-4-5-6-7-8-9-0-00-com-Domain-Name-Website_W0QQitemZ5812689137

10/10 for the feedback....

Thanks.