I get weekly offers on my domains over at Sedo. Most of the offers are for my 5 letter names and usually start with a bid of $200. My counter usually lies in the range of $2000 to $10,000 depending on my feelings of the quality of the name and of course my original investment. Nine times out of ten I’ll get a “canceled negotiation” email or “no response” email back from Sedo but every once in a while like today, I’ll get a nice counter with “Please justify your price”
As a domainer owner your first response is “it’s mine that’s why” but as a salesman you immediately turn to why you think it’s worth the price. You can take several routes. You can go the past sales route. You can take the poor route of “I have more than that in it”. An answer that tells the owner nothing of the value. You can take the overused “I’ve received bids higher than this in the past” which looks silly when the name has never had a bid before. You can tell them the value of that type of name to a company and other companies that have been successful with that type of name. I always choose to use this response if I really like the name.
This is a fantastic 5 letter dot com that is both easy to pronounce and easy to spell. I make a living helping start-ups find names and this meets all the requirement I look for in a solid name . It makes a great visual and audible presentation and will stick in the minds of your first time and eventual frequent visitors. The most important part of my price justification is it’s mine and I think it’s worth more
While I will admit “make a living” may be a stretch but I did make an extra $12,000 dollars selling 5 letter domains in the last few years that certainly added towards my living so it’s only a little stretch. This response is not one I give on every name because some of them aren’t exactly “fantastic” and I think I have a pretty good handle on poor vs good vs great.
The hardest part in this negotiation is not to get caught up in your investment. I have names that I bought for $50 that are as strong of names as my recent $800 purchases. It all comes down to luck and timing. A bad name is a bad name regardless of what price you paid and vice versa. This particular name is one I purchased at a very reasonable price but I knew when I bought it I had a steal. I knew it was a $3-4 k name. You may ask how a 5 letter meaningless dot com can be worth that much but then again you would be saying “please justify your price” and to that I would answer.
It’s mine and I can ask whatever the hell I want……..that’s why
I love getting those. Most recently it was for a language instruction .COM. I would have been willing to sell it for around $1000, but the initial offer was $100. I countered, and got the “please justify your price” response.
I wish they had an option for “please justify your lowball offer.” 🙂
I’ve gotten a couple of these and they always make me laugh. Most recently was someone offering $100 for FriendTags.com. Next time I think I’ll use “Because Sedo would make more from the transaction than I would”
I like your justification response when asked to defend your price, but I think the last sentence is a little cocky, to say “it’s mine and I think it’s worth more”. You could say something like “Domains of a similar quality are becoming more in demand and getting harder to find. Similar types of domains regularly sell for higher prices than what I’m asking”.
I like your points about easy to spell, easy to pronounce, memorable. You could also add it would look good on a business card or print ad.
DR,
I agree it comes across as a little cocky but a little is OK with me. I am an unmotivated seller when I have a good name. I fully believe it will only grow in value so if I don’t sell it now I will sell it later. As long as I have enough money to make it to later I’ll be just fine. So far so good.
I would take a different approach since the buyer might sincerely be looking to understand why it is worth that much. So, if I was interested in pursuing negotiations, I would simply ask what type of information the buyer was looking? If I was not, I would simply respond with a polite thank you. You never know who might be behind that other end of that email … Google? 🙂
Rich,
I agree but I’ve always thought a nice mix of polite and cocky accomplished my goals. It lets the buyer know that you are more than willing to negotiate but you are in control. I don’t need the money and although it doesn’t mean I wouldn’t like to sell, it does mean I don’t have to sell. And I do agree being in a position of power doesn’t give you the right to be an ass.
The craziest one I ever had was “I want to start a business on this domain, how much do you want for it?”
It didn’t result in a sale!
I think I will use Nadia’s quote. “please justify your lowball offer.” Thats perfect 🙂
I also respond in a similar way on sedo or via emails.
Btw, I have sold 2 5 letter pronounceable dot-com names: one for $3500 and the other for $10,000.
They are very good investment and most of those get traffic anyway.
When I get the “please justify your asking price” comment at Sedo the first thing I do is see how long the person has been a member at Sedo. Anything over 3 or 4 months I usually consider another domainer and/or broker. I have no need to justify my price to them and just counter offer.
If the person is new to Sedo and potentially an end user I’ll respond with the best information I can to hopefully conclude the sale. Unfortunately this scenario is rare in comparison to the broker/domainer one.
While at first glance the “justify your price” to a lowball offer seems silly, in actuality unless you have a true premium .COM domain with no comparable alternatives, it makes sense to be able to justify your price. If you want to make a sale, the buyer needs to see the value in what you are selling.
I think a simple link to DnJournal’s sales reports is all you need.
@Kevin – Ha, thank you. Sometimes I wish I knew what these buyers were thinking.
@Leonard – It’s a joke. I’m not suggesting anyone actually write that, but you know we’ve all thought it from time to time.
Why expend the time and effort to educate a low-baller who is [presumably] ignorant of domain values or after-market pricing, is beyond me.
The “justify your price” route is a clear indication that he eventually won’t pay your price, but is willing to be entertained at your expense [time loss].
At the very least, if you’re willing to take the time, charge him/her consultation fees.
One simple way to avoid the “justify your price” comeback is, to not respond to a low-ball offer to begin with…
Yanni,
This is on sedo. People often start with a lowball and move from there. I’ve had people start with $200 and pay $5000. On many 5L domains $200 is the value so that’s where most people start. I’m never offended by a lowball unless it’s a $100,000 name and they bid $500. Just because they don’t know doesn’t mean they aren’t willing to spend.
RE “of course my original investment”:
That has nothing to do with what anything is worth today.
An additional justification you can add centers on scarcity and urgency:
Tell the prospective buyer that the asking price is justified because the quality of the domain name is so high that you know that if he doesn’t pay your asking price today, one of his competitors will come along at some point in the future and pay it. As the current registrant of the domain name you’ve got nothing but time and $10 reg fees to worry about. That may get him to move off his, er, dime.