State of play

[julian]

..it's completly dead. There must be a lot of people in serious shit out there and there's no way back. This is desperation on a level i've not seen before - maybe i'm seeing this all wrong.

Judging by the sales, and general prices at the moment you can't tell me domainers aren't feeling the squeeze.

It seems to me the sub £100 domain market has died on its arse for one thing. I think a lot of affiliates are stuggling like fuck. Minisite club has been smacked down by google.

Go back 4/5 years ago people were sat on their portfolio now of good domains now the same people are spashing 'big' ish names out for bins in the premium section but surely the best time for this was 4 years ago when we were basking in the realms of domainfocus prices etc.. I must be missing some bigger plan..

 

[Bailey]

I did think your post would attract some response Julian - certainly had plenty of views. I've made my thoughts clear in other threads so i'm not about to repeat myself. However, There does seem a reluctance to get this into open debate (maybe it's a shoot the messenger thing)

I'm fairly fresh to the Uk market (although most of my registrations are between 6- 11 years old) Personally I wouldn't be overly concerned purely because it does seem to defy logic when you look at the internet growth in general and the buoyancy in most other cclds. - And the Gtld market is certainly holding-up.

Quite distresing to read DBs post the other day and hopefully it was just a bad day/week. but i do wonder how much is to do with a certain kind of focus in registration strategies that can bring about an inability to off-set the market variances

 

[Edwin]

I would have to say "it depends". A few weeks ago, coming into the Easter/royal wedding period, was probably the deadest time I can remember in recent years - not even an ENQUIRY in 4 weeks.

But since then I've closed 4 separate £x,xxx sales, got another on its way and several more reasonably good "possibles" that may yet turn into cold, hard cash, so things may be picking up again. Watch this space...

 

[Bailey]

Without a doubt Edwin some of us are in better positions to weather-out any fluctuations in our own personal fortunes - I listen/read some of this development income talk and think "why the hell didn't i get involved in that ?" but then maybe i wouldn't have the level of general domain sales knowledge That i feel i have"

The trouble with domaining is that it is expensive as a 'hobby' but only financially rewarding as a 'compulsion' ( spent 10 mins trying to think of the right word and thats not it)

 

[Rob_F]

Only really noticed a dip in reseller sales. End user sales have been reasonably consistent for me over the past six months or so.

- Rob

 

[doodlebug]

I've been watching auctions on Sedo and DL and there doesn't seem to be much interest from buyers :|

I can't believe attics.co.uk sold for £62 on Sedo :shock: I tried bidding in the last 30 secs at £67 but was too late

 

[Bailey]

Only really noticed a dip in reseller sales. End user sales have been reasonably constant for me over the past six months or so.

- Rob

I do wonder whether the domainer-to-domainer market has been a bit of a bubble for many. I don't count myself a boni-fide.co.uk player. So my only real measures are

1. Analysing the market as an outsider.
2. Number of "written enquiries" received.

 

[Edwin]

I think quite a few people may have pretty much left the sub-£100 market, especially some of the larger portfolio holders who used to buy pretty regularly there. I know I have.

This is something I've discussed before, and it comes down to "incremental value". If you have 1,000 domains and you add one more of a similar "average quality" to the names you're already holding, then you've increased the theoretical overall value of your portfolio by just 0.1%. If you're starting from 3,000 domains, that's just 0.033% and at 5,000 domains the value delta is just 0.02%. Now how much effort (and money) is it really worth expending to produce 0.02% more "theoretical value" in a portfolio where you already have 5,000 names on the shelf, ready to be sold?

What looks to be happening is that many buyers are hunting further up the quality scale, going for much smaller quantities of much higher value names in the £x,xxx-xx,xxx range.

It's also worth looking at the cost side of the equation. 5,000 names may sound like a lot (let's face it, it is a lot) but that's "only" £15,000 in renewal fees every year. It doesn't take a huge leap of the imagination to see how a portfolio of 5,000 generics could cover its costs with a couple of dozen sales a year, for example.

However, if you bought 20 names a month at £50 each and did nothing else except renew what you were already holding, then at the end of the year you'd have spent £27,000 rather than £15,000 and would be sitting on 5,240 vs 5,000 names.

And if you bought 50 names a month at £50 each then you'd end up spending £45,000 in a year to end up with 5,600 names vs spending just £15,000 to maintain 5,000 names.

At some point, the ongoing "nibbling" effect that low-value aftermarket purchases have on annual expenditure starts to have a real and very significant impact on the cost side of the equation - it may be "easy" to cover £15,000 in renewals through ongoing sales, depending on the breadth of the portfolio, but trying to cover a sum 3x as high in order to keep playing in quantity in the £xxx market may be much, much more difficult. And that's before you attempt to put a value on the "time saving" of not having to trawl through sales threads many many times a day so as to unearth the rare bargains.

 

[grantw]

I do wonder whether the domainer-to-domainer market has been a bit of a bubble for many.

At the end of the day, if you're a domainer and your main customer base are domainers then somethings gone wrong! More and more people seem to be dumping stuff on here rather than waiting for/approaching end users. It's creating a buyers market for the domainers that target end users and giving the impression that the market is dead/dying. Why buy that niceish domain for 50 quid when you know there'll be 5 more similar/better quality listed tomorrow!

End user sales for me are also pretty steady.

Grant

 

[Bailey]

I think I understand your mindset Edwin . So in reality the 'drivers' behind the UK market (in the proposition that was) have gone or certainly diminished. - which will create a decreasing circle

it would of course be interesting to look at Nominets transfer stats over a 5+ year period (as a ratio measure)

I am going to throw a contentious issue into this mix and that is - to an outsider the UK market always appears to be at a tangent to the overall Gtld market - I'm not about to say more at on this than I think I understand - Purely because each CCtld market does have unique differences/qualities. But, I'm often lost to understand the metrics of the overall gtld/co.uk market differences - lets face it's not language usage - that may go some way to explain away other Country level variances. (thats as a connection of .com etc to the USA and subsequently English speaking markets)

But if anything you would expect the UK market to almost mirror the Gtld market (which I have to add, is where my money is)

 

[Bailey]

Is it possible - that the UK domain market has been over-picked?

Lets face it most of us tagged onto the Gtld explosion - Could it be that at a Country level we (domainers) over capititalised on the UK purely because of the "language -recognition"

If you own all the bricks in the world nobodies buying bricks scenario - the market wants what it can't get - at the price 'it thinks' it can afford

 

[retired_member32]

i had a poll of 20 regular domainers on msn over the last week concerning the state of the domaining market and the general census is it is very very slow ,moving stock is hard and there is certainly something in the wind ,house prices are dipping and growth is slow so it should be expected...

concerned domainer

 

[willbon]

I think the domain market is currently suppressed because of 2 reasons - 1, some are 'battening down the hatches' and preparing for tougher times 2, some are experiencing tough times.

but.... the future is bright.... as people lose their jobs, there's going to be a lot of individuals starting their own businesses and realising that they need to be on the internet will go hunting for their domain name... (cha-ching)

also... as the general populous starts to 'get' why they need keyword / brand / short generic domains, the demand will rise. (cha-ching)

Although we're in a 'technological age' I do think the domain market is still very much an emerging market.

So a blip I reckon.

 

[cc976a]

Seems like the end user sales are steady but it's certainly noticeable on here the drop in lower end market names (the type that would make good affiliate sites and adsense profits - rather than end user businesses).

The mighty G and it's focus on driving PPC is seeing off any attempts at most starting fresh affiliate sales / MFA sites. These were probably the basis for many of the lower end sub £xxx names.

There are only so many hours in a day. To develop, implement and update a multitude of sites without the additional cost of extra help, mounts up - so i'm sure many don't bother, or just stick to what they have. I for one am one of them.

This is a 'hobby' as such for me. Certainly made a few G's out of it over the past few years so won't grumble. In this business you need a lot of time to research and understand the end user market. Without doing this full time it is difficult. I've approached many end users and although I've certainly been involved in selling - personally and commercially - unless I have a site driving traffic and giving the end user potential immediate business no one I spoke to had the faintest idea on how this name was going to benefit them, had any interest and thought I was mad, or general comment was 'I already have a name???'.

Perhaps I am targetting the 'wrong' end users.

Finding a person to buy the name, who hasn't yet started a business, is a little like fortune telling I guess, unless you chuck it up on Sedo and wait for some bids.

I'm probably going to get shot down but personal experiences which may have prevented many from reaching end users.......and better pickings for all of you that have built an onging potential client base

 

[Bailey]

The whole scenario at the moment is counter-intuitive. So the 15% growth figures quoted for year-on-year in online spending is focusing in the core sites that everyone is familiar with and it's not new business thats picking-up at all. Could you imagine a consistant 15% pa growth in any market that wouldn't be creating massive investment in "new supply" channels - be it holidays, housing or whatever.

I'm an arse**le for looking for connections/relationships that may or may not be there. So the whole marketing mix may be in at a point of seismic-shift. Why would you (google etc via it's advertisers) continue to support a PPC - model that has already matured. Sure you are going to see plenty of inhouse type advertising but, that is already going to be driven to the major sites. The web begining to emulate the 5 or 6 stores you already use for most of your high-street shopping.

 

[foz]

Wouldn't the current downturn in wholesale/reseller sales (on here) be because of the reserved release domains? Every domainer holding back on spending knowing they will need it come auction day?

 

[wb]

Wouldn't the current downturn in wholesale/reseller sales (on here) be because of the reserved release domains? Every domainer holding back on spending knowing they will need it come auction day?

Possibly. I was hoping to see some underpriced premium domains come up for sale by those looking to raise funds for the auctions, but haven't seen anything like it yet. Guess everyone has enough cash already.

 

[Edwin]

There's also the estimated £500,000,000 in applied-for-but-as-yet-unbilled Olympic tickets that may be weighing on a lot of peoples' minds. That definitely qualifies as a "distraction" (as did the incredibly long run of unseasonally hot, dry weather for most of the UK)

 

[cav]

Domaining is only an "after work" thing for me but my little business is showing an upward trend but this is due to:

• working hard on approaching end users
• educating end users on the benefits of the domain name
• undertaking careful research
• not asking for stupid money (i.e. my domains are affordable to a cashflow conscious end user)

 

[Paullas]

Wouldn't the current downturn in wholesale/reseller sales (on here) be because of the reserved release domains? Every domainer holding back on spending knowing they will need it come auction day?

Thats another balls up nominet have made i think. They should have capped it to about 5 domains per application/tag holder. But now every 2 letter will goto auction and the people with £££ will get them, and im sure nominet didnt want this from the start as they said they wanted it to be fair. Also if every domain goes to auction on 27th July how can someone who has applied for every 2 letter bid for them all? I know ill get slatted for putting this but i and alot of people will waste the £10 non refundable knowing that a they know a person with £££ has also applied for the same domain they have gone for and every one for that matter.