Buying things is easy, selling them……..well it takes some skill. I get several emails a day asking questions about how and where I sell my domains and it gets tough to answer each and every one, but I think I do a good job answering most of them. I have to admit I pick and choose based on the people that seem most sincere rather than just being too lazy to do their own homework. Lately, there’s been a bunch of new quality posts regarding getting top dollar for your domains such as the recent articles by Rick Schwartz. Back in January I wrote a post detailing my strategy to negotiating prices. It applies to any product not just domains. Last week a college professor (obviously not an English professor) asked if he could use the post in a class. I couldn’t even remember exactly what I had written. My articles are completely written in this manner, sit down, write, super quick proofrea. All off the cuff. After going back to reread the post I realized that this was one of my better posts and was worth reposting. I didn’t have many readers when I wrote it so perhaps somebody who just recently became a reader will enjoy it. Here it is .
We’ve all gotten the email. Someone is interested in buying your domain name and they’d like to make an offer. Usually they offer you $50 on a name you paid 5K or more but occasionally you’ll get someone that actually wants to negotiate and may be serious. While I may not have been involved in the million dollar domain negotiations of Rich Schwartz or Rick Latona, business is business and the art of negotiation translates from one object to another, including domains. I wouldn’t advise many of these if you truly are a motivated seller. They could drive a buyer away, but if you wanted top dollar, that’s OK. Here are 10 tactics to getting the most for your domain
1. Be Prepared to Walk Away: This is true for both selling and buying. If you want to get the best deal for anything you have to be able to say, “no thanks”. If you are motivated to sell it will come across in the final price. There is nothing more frustrating for a domain buyer than a guy that doesn’t need the money and is unmotivated to sell. It forces you to get to a price that stirs them financially. The more money they have the harder it gets. If that’s not you, pretend it is.
2. Don’t Bring What You Paid Into the Negotiation: At this point, nobody cares. If you got it for $60, that doesn’t mean you should sell it for less. As a buyer I don’t care what you paid either. The “I can’t sell it for that because I paid more than that” is terrible negotiation. What you paid doesn’t set the value, the negotiation and you do.
3. Be realistic: You have to be careful here, what’s realistic for you may be completely different for the buyer. He/she may be willing to go much higher. At the same time, you don’t want to scare the buyer off by asking for a million dollars on a name that would do well to sell for 5K
4. If you have good financial data put it out there: If you site is making $200 a month let them know that. It’s human nature to think they can do better. In their mind their saying, if they can make that much doing it that way, I can surely do better. Data gives it real value. A great starting point. Like stocks, though, domain names are often sold on potential, not present return.
5. Take your time between negotiation communication: Like a girlfriend that’s mad at you and won’t take your call, the waiting kills the buyer. If it doesn’t, they didn’t want the name bad enough to give you a great price anyway. I love the old email response “Let me get back to you I’m headed to …..put something here that is as unimportant a task as you can think of” It gives the appearance of #1 above.
6. Try and figure out your buyer: In a negotiation you want to ask the right questions to try and gather data about the other party. As a seller, sometimes this takes creativity. The obvious start is the email. Gmail? Not much help. A smart buyer will hide as much as possible. Big boys like Apple use 3rd parties. Gathering info gets more difficult the more seasoned the buyer. End user or the guy that owns all the other domains in your category obviously helps your case.
7. Do your homework: You can’t negotiate if you don’t know what you’re talking about. What did other similar names sell for? How big is the end market for the name? Are there any other names available that the user could use that would be as good or better? You have to know where you stand. Having information make you more confident. Confidence can make you more money.
8. Don’t be insulted: Often buyers have no idea who you are or what you do. They may think you are some guy that registered 50 junk domains and happened to be sitting on one they want. They most likely did a who is search and at least know how many domains you own but they still may lowball you. Don’t end a negotiation just because they offered you a ridiculous price. I’ve sold domains for 5K that started off with a $200 offer.
9. Don’t blow smoke: Don’t bother talking up your domain. They contacted YOU. If you have some financials they might might not know about then share them. Otherwise let them guess. Share anything that might make it more valuable than they realize but saying “this name is awesome and candy.com sold for $3 million” and you’re selling LACandy.com (made up name) doesn’t show them anything but a seller that’s reaching for the stars.
10. Appraisals are guides, not worth: As much as I like Valuate or estibot, I usually use those to figure out CPCs and searches and a whole lot to make me feel better about a purchase. You want prices higher than that. Estimators can’t take into account want. You have to milk that want into dollars. If they need and want that name, CPC and traffic are thrown out the window.
Remember, not all domain sales are going to be top dollar. We all move names to clear up the portfolio or cash flow for other projects. But in the end, if you know how to negotiate a deal you will make more money.
To Be Prepared to Walk Away is a basic principle on any negotiation, actually is one of the first chapters on negotiation for dummies.
None of what I say is revolutionary but it’s nice to know they wrote a book using my strategies 🙂
The estibot although widely used, is an industry joke since the quotes it give are ALWAYS inflated. It is more of a sales pitch than a real quote. I had several $1000+ estibots that sold around $10, no matter what.
‘You have to milk that want into dollars’ – couldn’t agree more and a very nice way of putting it.