Sweetmantra: Domain Name Strategy

The Seven Deadly Mistakes to Avoid When Buying a Domain Name from Someone Else

For over two decades I’ve had the privilege of helping hundreds of business professionals acquire domain names that are of strategic importance to them. As part of the client onboarding process at my domain buyer brokerage company Name Ninja, we always ask the client if they’ve made any previous attempts to acquire the domain. Most clients are shrewd enough to not try to acquire the target domain on their own – they leave that up to us – but we’ve also seen several overly enthusiastic clients make some innocent domain buying mistakes that have hurt their (and our) chances of getting the desired domain for a reasonable price.

Because we keep seeing people make the same damaging mistakes over and over again, I’ve compiled the following list of the seven most important things people need to be aware of if they hope to buy a domain name that’s owned by someone else.

1. Never try to contact the domain owner directly. This is the single worst move you can make because it risks revealing your identity as the buyer to the domain owner. Think about it from the perspective of a domain speculator (a person who specializes in re-selling desirable domains): if someone from a Fortune 500 company is contacting you asking about buying a domain name, wouldn’t you demand a higher price? On a related note, please don’t try to outsmart a domain speculator. If you think using a free email service like Gmail or Hotmail and a fake name is going to hide your identity from a seasoned domain speculator, you’re dead wrong. These guys and gals specialize in uncovering who a potential buyer is, and you are probably giving them all sorts of clues about your identity without realizing it.
   
   
2. Don’t keep re-visiting the landing page or Website associated with your target domain name. Not only are you increasing the traffic to the domain, which most domain speculators use as a metric to help them determine which of their domains are more popular and therefore warrant a higher asking price, but you risk revealing your identity as the buyer. If a savvy domain speculator notices that one of her domain names is suddenly getting a lot of traffic via the IP address of a major bank, she’s going to assume that the next purchase inquiry coming in (even if it’s anonymous) is from someone representing that bank.
   
   
3. Don’t submit an inquiry or offer for the domain name via your domain registrar or the domain’s landing page. By doing so you not only risk revealing your identity as the buyer (yes, even if you use an alias) but you are also expressing unnecessary additional interest in the domain name. Worse, you may also inadvertently be contractually obligating yourself to pay a brokerage fee to the registrar regardless of whether or not you end up buying the domain through them.
   
   
4. This one seems obvious but you’d be amazed how many times I’ve seen people screw this up: Don’t publicly announce the name of your new venture until you’ve gotten your target domain name. I remember one client who prematurely issued a press release about the name of their new spin-off venture and within 24 hours the list price of the target domain they wanted tripled. The owner of the domain, a very savvy domain speculator, had seen their press release and immediately cranked up the price of his domain name, and who could blame him? I still refer to that incident as “the $10,000 press release” because that’s how much extra it caused the client to fork out for the domain.
   
   
5. Don’t register a bunch of alternative TLD versions of your target domain immediately prior to you attempting to acquire the target domain. If you do, you are telegraphing to a savvy domain speculator that you are really, really interested in their domain name because why else would you have registered the .net, .org, and .info versions at the same time. Already registered some other versions of the domain? Please make sure they are hidden behind a Whois privacy shield … and for heaven’s sake don’t forward these domains to your corporate Website, which blows your cover. Once again, a seasoned domain speculator is going to investigate what other versions of the domain may already be registered and will use that data to try to figure out who the buyer is.
   
   
6. Hold off on filing a trademark until you’ve gotten the matching domain name. You probably didn’t realize this, but trademark applications are posted online in several searchable databases. Some unscrupulous domain hustlers monitor the trademark databases for new trademark applications and then immediately go and register the matching .com domain name in the hopes of re-selling the domain for profit. Even legitimate domain speculators (as opposed to the ‘black hat’ hustlers) will check trademark databases to see if someone has recently filed a trademark that matches their domain name. This is all part of their standard procedure for trying to figure out who the potential buyer might be.
   
   
7. Don’t get ‘married’ to your target domain until you know for sure you can get it. Far too many times I see clients fall head-over-heels in love with a domain that they will never be able to get. Avoid painting yourself into a corner by assuming you’re going to get a specific domain name. Make sure you have multiple options (or at least a Plan B) and give yourself (and your domain buyer broker if you’re working with one) enough time to find you a suitable domain name that can be acquired.

If you’ve read this far you might have gotten the impression that buying a domain name from someone else can be a complicated and risky affair. You would be right. If you go about things in the wrong way you could end up delaying your important launch, overpaying for the domain name, or ruining your chances of getting the domain at all. I’m not saying you have to hire a domain buyer broker to help you (although that would make my day), but I’d strongly encourage you to avoid making any of the seven innocent mistakes I’ve described above.

Good luck and happy domain buying!

Why I Paid $1,500 to Rescue Oliver Stone's Domain Name

I make my living as a domain name buyer broker helping entrepreneurs acquire their dream domain names, but in my spare time I like to help people solve their domain name problems, even if they aren't aware of the problem in the first place.

One way I help is by rescuing expired domains from a treacherous fate. For instance, over the last decade I've rescued domain names for artists, musicians, actors and other people and causes I admire, including Freddie Mercury, Phil Collins, and 'Darth Vader'.

Most of my pro bono domain rescue projects I do in a low-key manner and don't discuss publicly. I have decided to share the details of my recent rescue of OliverStone.com, however, because there's a valuable lesson in this about the perils of letting others own your personal domain name.

Oliver Stone's “Natural Born Killers”

 
In January 2012, according to a report in Domain Name Journal, filmmaker Oliver Stone (or someone representing him) purchased OliverStone.com from a domain speculator for $6,000 USD. Later that same year, The Oliver Stone Experience, a Website devoted to the filmmaker's life and work, was launched on the domain.

Mr. Stone's domain name was registered to, and managed (badly, as it turns out) by media conglomerate Universal City Studios. Someone at Universal dropped the ball and let the OliverStone.com domain expire on October 16, 2016. This took Oliver Stone's Website offline for over a month. Had I not intervened, this valuable domain name, and its accompanying Website, could have ended up being lost in cyberspace.

Regardless of whether you’re an Oscar-winning film director or a member of the general public, having your important domain names registered in the name of a third party instead of your name is inherently risky. If that third party fails to renew your domain name, as was the case here, it can be difficult or impossible for you to retrieve the domain name since, legally and technically, you are not the owner and never were.

The expired domain OliverStone.com eventually ended up in auction at a domain marketplace where, thanks to a tip from domain name investor and blogger Elliot Silver, I purchased it for about $1,500 USD on November 24, 2016, which coincidentally happened to be Thanksgiving Day in the United States. A few hours later, the domain was safely in my possession and I reinstated the original domain name servers, thereby bringing Mr. Stone’s Website back online.

I then contacted Oliver Stone directly to make arrangements to transfer ownership of the domain name back to him. The domain is now in Mr. Stone’s possession, and he reimbursed me for my $1,508 hard cost.

By now you may be wondering why I spent $1,500 to buy this domain name and return it to Oliver Stone.

Here’s the thing. I'm a lifelong film fanatic, a former film critic, and I worked as a producer and director in the film industry for many years. I've long admired Oliver Stone's work, especially his fearlessness at tackling controversial subjects. I didn't want this 19 year-old domain to fall into the wrong hands because Universal City Studios had failed to properly safeguard Mr. Stone’s domain. At best, Oliver Stone (or Universal) would have been forced to buy the domain name – yet again – off another domain speculator. At worst, the domain could have been held hostage for years and never returned to its rightful owner.

I also wanted to make sure Oliver Stone's Website was reinstated as quickly as possible so that his bold voice could continue to be heard the world over.

Happy Thanksgiving, Oliver.

P.S. Some of my favourite Oliver Stone films are Wall Street, Platoon, Natural Born Killers, JFK, and Born on the Fourth of July. His most recent film is Snowden, which I was privileged to see recently here in Canada. Snowden is arguably Stone's most important film because it bravely explores the controversial and timely story of NSA whistleblower Edward Snowden. Sadly, this film was not picked up for US distribution by any of the major Hollywood studios, so I encourage you to seek it out. It deserves to reach a wider audience, especially in the United States.

New gTLDs – Aren’t We Forgetting Something? (My DOMAINfest Asia 2016 keynote)

Last month I gave a devil’s advocate keynote talk about the new TLDs at DOMAINfest Asia in Hong Kong. Since my talk didn’t get me thrown into Hong Kong harbour, as I feared it might, I thought it would be worth sharing my talk with a wider audience via my blog. The following is an abbreviated adaptation of that talk.

 

(photo courtesy of Jothan Frakes)

What constitutes "success" in the new TLD program? And how could this could be measured?

Many people have strong opinions on this topic. And so they should. I propose we look at the new TLDs through the eyes of end user registrants. That’s a perspective we don’t hear much about, and we don’t talk about, as much as I think we should. I will conclude this article with some suggested – and alternative – metrics to gauge the true success of new TLDs.

But first, a bit of background.

I make my living as a domain buyer broker helping entrepreneurs acquire their dream domain names. Prior to this I spent over 15 years working in marketing and advertising. I love domain names and naming, but I always have my marketer’s hat on. This means I am always thinking about the customer, the consumer, the end user.

When it comes to domain names, I’m TLD agnostic. I will help my clients acquire any TLD domain they want.

Here’s a fact that may surprise you: I often ask my clients if they’re aware of the new TLDs (they usually aren’t), and I’m usually the one who recommends they consider a new TLD domain.

So, as regards the new TLD program, I'm an enthusiast.

When the new TLD program was first announced, I was excited and optimistic.

This was the largest namespace change in the history of the Internet.

We could see some amazing technological innovation.

We could see some very creative naming options and uses.

Physical and virtual communities could use these new names to define themselves.

And brands could have greater control of their own namespace.

I believed the new TLDs could have enormous potential if we as an industry brought them to market in the right way.

Unfortunately, and despite some notable exceptions, I don’t think that’s what’s happened yet. As an industry, I think we lost our way a bit with the new TLDs. In the excitement to launch this bold new namespace, some participants forgot something very important: the consumer. And by consumer I am talking about the end-user buyers of these new TLDs, not domainers (domain speculators).

Don’t get me wrong: I love domainers. I buy domains from them all the time on behalf of my end-user clients. And domainers are an important part of the domain name ecosystem.

But the long-term viability of new TLDs depends on more than just domainers. It depends on consumers becoming aware of these new TLDs, and it depends on consumers registering these new TLDs, and it depends on consumers using these new TLDs.

Somehow, sadly, a number of industry players appear to have forgotten what it’s like to be one of those consumers.

And the reason I say that is that many aspects of the new TLD program don’t seem to consider how consumers think about and purchase and use domain names. The process of buying a new TLD domain is not always consumer-friendly.

How do I know this? Because consumers – end-user buyers – tell me this all the time.

So let’s spend a moment looking at the new TLDs from the point of view of a consumer. Let’s forget about the domainer point of view. Let’s forget about the registry point of view. And let’s forget about the registrar point of view.

Let’s put ourselves in the shoes of a consumer. In fact, let’s give this consumer a name. Let’s call him “Adam.”

Adam is a middle-class, white collar business guy. Adam has a day job at an accounting firm. He also has a bit of an entrepreneurial streak and would someday like to start his own music lesson business. Adam knows that he’ll need a business name and matching domain name for his new venture.

Adam is a lucky guy: He lives in 2016, a world where he has a choice of hundreds of new TLD domains to choose from.

We will assume that Adam has already heard about an exciting new TLD called .Banjo. This will be the perfect TLD for his music-related venture.

Let’s also assume that .Banjo is now in its General Availability phase.

Today is Adam’s big day. Today’s the day Adam has decided to name his new business “Flying Banjo”, and so off he goes to his favourite registrar to register Flying.banjo.

Adam is so excited because all he’s been hearing about for the past few months is how this expanding universe of domains beyond .com will give him the opportunity to get his dream domain name.

But when Adam goes to his registrar to try to register the domain, he discovers that Flying.banjo is not available to register and is, in fact, one of the so-called “premium” domains being held back by the registry. The domain Adam was expecting to be able to buy for $20 is actually priced at $5,000.

Adam is confused. Adam is upset. Adam is wondering what happened to all the choice and availability he had been promised – by our industry – with these new TLDs?

I call this the False Promise of Availability. And it’s the first major disappointment for consumers with the new TLD program.

I’m a businessman. I get it. Registries need to make a profit. So I understand why many new TLD registries decided to hold back a portion of their inventory as premium domains. But Adam doesn’t understand this. Adam feels like he has been stiffed.

Nevertheless, Adam’s a good sport. He’s really motivated to get a .banjo domain, so he’s somehow talked himself into investing way more than $20 to buy his .banjo domain. He’s decided to buy a premium .banjo domain for $1,000. So Adam whips out his credit card and starts to register the domain name.

Unfortunately, when Adam tries to complete his purchase at the registrar, he learns that in order for him to get his .banjo domain he needs to prove to the registry that he knows how to play the banjo. Yup, Adam has just found out that this new TLD has special registration requirements.

I call this the Roadblock of Ridiculousness, and it’s another major disappointment for consumers with the new TLD program. Registries should be bending over backwards to make it easy for new customers like Adam to purchase their domains, not throw up unnecessary obstacles to adoption.

(I understand why a handful of new TLDs like .bank need to enforce certain registration requirements. But for most new TLDs with restrictions this has only caused huge problems to adoption. It’s no wonder that so many of the new TLDs that had restrictive registration requirements are now backpedalling on those requirements.)

Thankfully, our good friend Adam is a persistent fellow and he manages to gather the necessary paperwork and provides it to his registrar and – lo and behold – Adam is now the proud new owner of LearnToPlay.banjo.

Adam is so excited. He hires a designer to start working on logo ideas. He starts planning his Learn to Play Banjo Website. He starts writing copy. Everything is going according to plan.

But several more horrible things could happen to Adam’s new domain name in the coming weeks, months, and years.

First, Adam’s new domain name might get clawed back by the registry.

We all know this has happened to consumers, and regardless of the “reasons” given, and regardless of whether the fault lay with the registry or the registrar, this is a terrible way to treat early-adopter customers like Adam.

Thankfully for Adam, his domain isn’t clawed back. But Adam still has a nasty surprise waiting in store for him.

Adam paid $1,000 for his premium .banjo domain name, so he’s expecting to be able to renew it for $20, which is what most .banjo registrations and renewals are priced at and is what consumers are used to. Why is that? Because we as an industry have conditioned consumers to this pattern over the last two decades.

Unfortunately for Adam, he doesn’t realize that his premium .banjo domain comes with a premium renewal price. 12 months later, Adam is shocked to discover he needs to fork over another $1,000 to merely renew his domain name.

So… How would you feel if you were Adam? Do you think he’s got a right to be angry? Frustrated? Disappointed?

I think he does. Because he’s been forgotten.

I think Adam is owed an apology. I think all of us in the domain industry need to remember Adam if we’re involved in making decisions about how we will market, price, and distribute new TLD domains.

Bottom line: Never forget the consumer. Never forget Adam.

I could mention a whole bunch of other irritants and obstacles that consumers have told me they face with the new TLD program, but I don’t want to dwell on the negative.

Instead, let’s turn our attention to defining success with the new TLDs. Because I am a marketer at heart, consumers like Adam figure prominently in how I think we should measure the success.

To me this is quite simple, especially if we keep the consumer in our mind the entire time.

Here are some metrics I think we should use – or aspire to use – to measure success of the new TLDs:

• what percentage of the new TLD domains are renewed every year
• how many new TLD domains are developed into actual websites (and not parked)
• how many domains are used as the primary domain by the owner and not forwarded to another legacy TLD domain
• how many new TLD domains are showing up in print ads or TV commercials or on billboards
• how many of the top 10,000 most trafficked Websites are using a new TLD domain

I think these metrics will give all of us a much clearer picture of whether or not the new TLDs are a success – with the stakeholders that matter the most.

In closing, and in case you doubted it, I love this industry. It’s made up of smart and hardworking people who have lots of great ideas and are doing some very cool things.

I’d like to single out Jeff Sass and Colin Campbell of .CLUB who have done a phenomenal job of bringing their new TLD to market in a consumer-friendly manner. I’d also like to congratulate the entire DONUTS team for doing a great job educating consumers about the benefits of all new TLDs, not just the many strings that DONUTS has brought to market. I also think Radix has done a better than average job bringing its new TLDs to market in a consumer-friendly fashion.

As I stated at the beginning, I love the new TLDs. But I think in all the excitement of the new TLD program, some of our other industry friends forgot the consumer, forgot the Adam’s of this world, and lost their way.

All of us in this industry can get back on the right track with the new TLDs – if we focus on the consumer and measure the right things.

A Domain Buyer Broker’s POV on which Domains are Most Wanted

As you may know, I spend the majority of my time working as a domain Buyer Broker helping clients acquire domain names that are owned by various third-parties.

My clients are typically “end-user” buyers of domains versus domain speculators. Most of my clients are startup founders, serial entrepreneurs, or marketing executives and when they approach me (via my company, Name Ninja) they usually have a specific domain name – or type of domain name – already in mind. That target domain will usually be put to use for a new or upcoming business, product, or service.

Because I was curious and had the data on hand in our CRM, I recently did an analysis of 500 of the most recent domains we have been asked to help clients acquire. I had a hunch as to what the results might be, but I figured I would let the data speak for itself. While I cannot reveal the individual domains due to confidentiality clauses, I am pleased to be able to share the high-level results of my analysis.



Before we get to the summary results, keep in mind that this data set consists of domains that are already owned by a third-party. Not only are these domains already ‘spoken for’, but our clients want these domains badly enough that they sought the help of a professional domain Buyer Broker. It's also safe to assume that the buyers of these domains are willing to pay a premium for these domains. In other words, these are domains that are seen as valuable assets by the buyers.

Now on to the results…

Type of Domain

What type of domains do my clients want to get? Generic domain names are by far and away the most sought-after domains by my clients. I suspect this is because my clients want a domain that positions them and their business as the category leader, which is one of the benefits of a generic domain name.

68% - generic (e.g., robots.com or robotparts.com)
15% - invented (e.g., botzilla.com or fluffyrobot.com)
6% - phrases (e.g., herecometherobots.com)
6% - abbreviations/acronyms (e.g., HCTR.com)
5% - surnames (e.g., asimov.com)

Number of Words

Apparently size does matter, and in the domain space what matters is brevity. Half of my clients want a one-word domain and most of the rest want a maximum of two-words. This is not surprising because the shorter the domain the easier it is to type and remember.

50% - 1 word
44% - 2 words
6% - 3 words
<1% - 4 words or more

Domain Extension (TLD)

Despite the introduction of hundreds of new domain extensions like .xyz, .club., and .site in the last few years, my clients clearly believe that .com is still king. Eighty-four percent of the domains I get asked to help acquire are .com domains (94% of the 89% that are gTLDs) with country code domains (ccTLDs) being the second most popular at nine-percent. I rarely get asked to help a client acquire a new TLD domain, although part of the reason for that may be that the new TLD domains are relatively easy and affordable to acquire (compared to a .com) and therefore don’t require the assistance of a Buyer Broker.

89% - gTLDs (global top level domains)
- 94% .com
- 2% .co*
- 2% .net
- 2% .io*
- <1% other gTLDs (.org/.tv/.me)
9% - ccTLD (country code top level domains)
2% - new TLDs (new top level domains)

* Although .co and .io originated as country code domains, they are now commonly used as global top level domains, especially via startups.

Bottom Line

In summary, based on the most recent inquiries I’ve seen, the most sought-after domains are generic, one-word .com’s (like robots.com) and generic, two-word .com’s (like robotparts.com). Invented, one- and two-word .com domains (like botzilla.com and fluffyrobot.com) are a distant second in popularity, followed by one-word ccTLD domains like robots.ca or robots.de.

Personally, I am very open-minded and can see the merits of all types of domains regardless of the domain extension or length. I’m therefore always happy to help a client acquire their dream domain name, no matter what that dream domain is. I do find it interesting that my data reveals a strong preference by our clients for a certain type of domain, which also explains why I’ve even been asked by different clients to help them acquire the same one-word .com domain. That always cracks me up when it happens, because many clients are surprised to learn that someone else wants or wanted the same domain.

My data set is only 500 domains so I would caution you about drawing any major conclusions from my numbers. The insights I’ve gleaned are from the perspective of my boutique domain buyer brokerage and may not accurately reflect what other people are seeing or experiencing. In other words, I hope you found the results of my analysis interesting, but please remember that your mileage may vary. ;+)

Why Choosing the Wrong Domain Name is Like Burning Money

I often get asked if it really matters to a company’s bottom line whether or not they have a better domain name. While there are quite a few intangible (and therefore debatable) reasons why a higher quality domain name is beneficial, such as the company being perceived as having ‘market leadership’ because of their intuitive domain name, here’s a very concrete example of why a better domain will actually save you a lot of money. And for the record, “better” doesn’t necessarily mean a .com domain; this advice applies equally to domains in other TLDS, new or old.

When I’m on a road trip in my car I like to listen to satellite radio. One of my favourite channels, CNN Headline News, features commercials for an eclectic variety of products and services. Almost all of the commercials end with a ‘call-to-action’ of some kind, and usually that call-to-action is to invite listeners to dial a toll-free number or visit a Website.

I’ve heard hundreds of commercials during my road trips, and I’d estimate that one-third of the Website addresses featured in these commercials use problematic domain names that are not intuitive at all and quite literally fail the Radio Test. What’s the Radio Test you ask? It’s a measure of the intuitive nature of a domain name and focuses on whether or not someone who only hears the domain name (versus seeing it) will know how to correctly spell it. So, for example, the domain WritePanda.com (while not a bad name and domain in general) would fail the radio test because people might not know whether to type “Write” or “Right”.

Now keep in mind these are 30-second commercials and the advertisers are paying thousands if not tens of thousands of dollars a week for their commercials to run. In the commercials featuring the problematic domain names, the announcer usually has to spend five or more seconds explaining how to spell the unintuitive domain name. So, using WritePanda.com as our example, the end of the commercial features the announcer saying something like, “To learn more, visit Write Panda dot com, that’s W-R-I-T-E panda dot com.”

Let’s do the math. Five seconds out of a 30-second commercial is 16.7% of the total commercial time wasted explaining an awkward domain name, time that could have been used for something more productive like describing the product or service. If an advertiser is spending $5,000 a month on radio ads, and that’s a modest budget by typical advertising standards, that advertiser is wasting $835 a month explaining their problematic domain name to listeners. That’s over $10,000 a year from their advertising budget that's going up in flames because of someone’s decision to choose and use an awkward domain name.

And you know the craziest part of all of this? Most of the domains these advertisers use are quirky, two and three-word .com domains where the better, radio-friendly version of the domain could probably have been purchased for under $5,000. I honestly get the impression that for many of these advertisers someone in their marketing department had the choice of spending $2,000-3,000 on a better domain name or registering an awkward domain name for $15 and they chose the awkward domain because the better domain name was considered ‘too expensive’.

Well guess what? They might have ‘saved’ three grand on the domain purchase, but their short-sighted decision is actually costing them thousands of dollars (or more) a year in wasted radio airtime.

If you intend to advertise your Website on the radio and you pick a domain name that fails the Radio Test, you’ve just depleted the potential effectiveness of your media budget by nearly 20%. When you think about it that way, that better quality domain name isn’t so ‘expensive’ after all.

Here’s a handy rule of thumb to remember: If you have to explain your domain name to someone when telling it to them in person or over the phone, that’s not a good domain name to use for radio advertising -- and probably not a good domain name in general.

I’m Heading to Collision to Discuss Startup Domain Name Challenges

I will be attending the Collision startup conference in Las Vegas May 4-7. According to conference organizers, over 10,000 people from around the world are expected to attend this downtown Las Vegas event devoted to the fusion of entrepreneurialism and technology.

To stimulate dialog about the many domain name challenges facing startups, my domain name consulting firm Name Ninja analyzed the domain names of 491 startups attending the upcoming conference.

Our analysis revealed that 79% of the startups at the Collision conference may be using a “risky” domain name that could play havoc with their marketing efforts. Choosing a hard-to-spell name that fails the “Radio Test” was the number one problem we uncovered, followed by not having the exact match .com domain.

Here’s a link to the official press release about the results of our analysis. We also published a handy infographic that summarizes the results and includes some startup domain name best practices, common mistakes to avoid, and other useful information.

Anyone who knows me is aware that I sympathize with the challenges that startup founders and other entrepreneurs face when it comes to acquiring the optimal domain name. For those on a tight budget, free tools like LeanDomainSearch.com and NameBot.com can help an entrepreneur come up with a name and matching .com domain name for their new venture.

Since I will be in Vegas attending the Collision conference, I am going to make myself available to any startup founder that wishes to discuss their domain name challenges. Startup founders that would like to book a complimentary in-person meeting with me can do so by emailing collision [at] nameninja.com.

See you in Vegas.

 

How to Lose $800,000 by Doing Nothing: Domain Acquisition Roadblocks

As a domain name buyer broker, I make my living tracking down the owners of domain names and convincing them to sell their domain names. I love the challenge and excitement of what my team at Name Ninja and I do, but I would be lying if I said we don’t face some major obstacles along the way.

The three biggest roadblocks to us acquiring a domain name are:

1. Figuring out who the actual domain name owner is (if the ownership info is private).
2. Contacting the domain owner.
3. Getting the domain owner to respond.

Figuring out who the actual domain name owner is a fun exercise and requires investigative legwork and creative thinking. It’s one of my favourite parts of the assignment, especially that ‘ah-ha’ moment when we uncover the identity of the domain owner. It might take a while, but sooner or later my team and I will be able to piece together enough clues to figure out who owns the domain. This is usually a temporary hurdle and rarely a permanent roadblock.

Contacting the domain owner is pretty straightforward and simply requires having current and valid contact information (phone, email, business address, etc.) for them, or at least current and valid contact information for someone (a colleague or friend) that knows the domain owner. Social media can certainly help in this regard, but – to my great surprise – I’ve found that old-school communication channels like faxes and registered letters can be the most effective way to make contact.

Getting the domain owner to respond can be the toughest challenge and biggest wildcard of the whole endeavour. If we don’t get any responses to our emails or phone calls, my first inclination is to re-confirm that we have the correct contact information. Assuming that we do indeed have the correct contact information, we then ask ourselves a series of questions:

• Is the domain owner on a business trip or vacation at the moment? Are they in the military serving their country? Or have they recently passed away? Any number of these scenarios can be verified by using classic investigative techniques.
• Is the domain owner unable to understand our messages for some reason such as a language barrier? Additional research and sending messages in different languages or through a local intermediary can help to overcome this problem.
• Is the domain owner not receiving our messages due to a technical issue? Here is where we start to consider and explore if their voicemail system is not working or if our emails are mistakenly ending up in their junk folder, etc. Sometimes, however, the roadblock is a human one: the recipient’s emails are being ‘managed’ by a secretary or executive assistant and they are not passing our messages along to their boss. You’d be amazed by what a gift of chocolate or wine will do in situations like these!
• Last but not least, is the radio silence due to the domain owner deliberately choosing to ignore us? This can certainly happen, despite our best efforts and intentions. Of course I do realize the domain owner is not obligated to respond to us and nobody’s saying they have to sell their domain name. It's a free world and the domain owner can do (or not do) whatever the heck they want. Since I am extremely patient and persistent, we keep trying to make contact for as long as our timeline allows. That can be days, weeks, or months, every project is different.

By now you may be wondering where the $800,000 fits into all of this. Here’s how, and this is as close to me going off on a rant as you’re ever likely to see…

There’s no doubt in my mind that on a handful of the domain acquisition projects I’ve worked on the domain owner has deliberately chosen not to reply to us. They probably think this is a genius negotiation ‘strategy’ on their part – playing ‘hard to get’ – but I find this behaviour borderline passive-aggressive. I genuinely believe that the professional and courteous thing for them to do is reply (even if it’s just to say “I will never sell this domain.”) but I am aware that not everyone out there is professional or courteous and I certainly don’t take their behaviour personally.

Interestingly, I’ve never seen a domainer (domain speculator) pull this stunt; it’s always been a member of the general public. Nine times out of ten, I'd rather be trying to buy a domain off a domainer than a member of the general public because at least with a domainer they are inclined to sell and usually have some realistic sense of what the domain name is worth.

So for anyone reading this that thinks that ignoring repeated purchase inquiries for a domain name is a brilliant negotiation tactic, I’m going to let you in on a little secret: it’s probably not. One thing it is for sure is costly to some domain owners who’ve tried this behaviour with me. By my rough count, just based on the acquisition projects my team and I have been involved in to date, domain owners who’ve deliberately ignored repeated purchase inquiries from us have lost out on over $800,000 of domain sale deals.

To be clear, I’m not talking about domain owners with valuable one-word .com’s that they hope (and should hope) to sell one day for enough money to be able to retire on, I’m talking about domain owners with B and C-grade domains (typically two-word .com’s that can be easily substituted by another two-word .com) that have a relatively low fair market value and would normally sell in the four- and five-figure range tops.

Domain owners can go ahead and ignore purchase inquiries all they want. They should know that the cost and risk of maintaining radio silence is that eventually those prospective buyers (or their brokers) will find and buy a different domain name owned by someone that does have the courtesy to respond to serious purchase inquiries.

Buyer beware? I think not. This is a case of seller beware!

Want to Be a Successful Domain Speculator? Start with these Seven Key Steps.

Almost every day I get approached by would-be domain speculators (a.k.a. domainers) wanting me to sell their domains or give them feedback on their domain portfolios. Sadly, 99% of the domains that come across my desk are mediocre and have zero chance of being re-sold. In fact, most of the domains I get sent shouldn’t have been registered in the first place. Yes, they’re that bad! It pains me to have to tell people that they’ve wasted their valuable time and hard-earned money on buying this crap, but they deserve a reality check.

While there are many people and companies that have made a very good living from the speculative buying and selling of domain names, that doesn’t mean this is an easy field to break into and that hard work isn’t required. Frank Schilling didn’t make his millions by accident or dumb luck; he’s worked seven days a week for two decades to build his successful domain empire. The same can be said for many of his peers.

The common thread I have noticed with the newest generation of people who have been successful in this field, the folks that have emerged in the last five years, is that they didn’t just dive in and register a whack of domain names – anyone with a credit card can do that. These people did their homework first.

Your goal shouldn’t be to amass the largest portfolio of domain names. Your goal should be to really understand what types of domain names can be re-sold for a profit. Then, and only then, should you start building your domain portfolio.

One of the cool things I admire about the domain speculating industry is that a lot of the professionals in this field are willing to share their expertise with newcomers. This means that you can avoid making the same mistakes that they did. There are numerous excellent blogs where professional domain speculators share their wisdom on a daily basis, plus a wealth of other resources and tools to bring a newcomer quickly up to speed.

Because I don’t have the time to individually help every aspiring domain speculator that approaches me, I usually recommend that they take the following essential steps to learn more about what works, and doesn’t work, in this field.

1. Do not register a single domain name for potential re-sale until you have completed the remaining steps. (From what I have seen, this is the hardest step for people to take!)
2. Purchase and read Sean Stafford’s excellent eBook, “Domain Graduate”, which can be obtained at http://www.domaingraduate.com. For the price of registering two domain names, you will learn a ton about what kind of domains to register, what kind of domains to avoid, and where to sell your domains. I insist that everyone who works for me read this eBook because I consider it the definitive guide to this field. Lots of eBooks have been written on this topic, but Sean’s eBook is the best one I have ever read.
3. Purchase and read David Kesmodel's excellent book “The Domain Game” (available at http://thedomaingame.org/), which is an entertaining and informative read about the birth of the domain speculating business. The Domain Game features excellent profiles of some of the pioneers in the space including Scott Day, Garry Chernoff, Frank Schilling, and Mike Mann.
4. Spend at least a week reading current and older posts on as many blogs by professional domainers as you can, starting with DomainInvesting.com (Elliot Silver), The Domains (Michael Berkens), Rick’s Blog (Rich Schwartz), plus check out DomainShane, Domain Name Wire, and the weekly Domain Sherpa Review show on DomainSherpa.com (Michael Cyger). For even more domain speculating blogs, be sure to visit Domaining.com.
5. Join a domain speculator discussion forum such as DNForum or NamePros and read as much as you can. Tip: spend your first week reading and getting to know the lay of the land before you start posting questions.
6. Analyze the weekly domain sales reports published by industry tracker Ron Jackson on DN Journal and for each domain ask yourself, "why did someone buy this domain?"
7. If possible, attend a domain name conference such as NamesCon or TRAFFIC or a local domain investor meetup.

Once you’ve completed the seven steps above, you will be ready to register (or buy or trade) your first domain name for re-sale. Best wishes to you and your domains as you embark on this exciting new venture!

 

Happy Birthday to Name Ninja!

It's been exactly one year since I launched Name Ninja. To celebrate this major milestone, we created the following infographic that reveals some of the data behind the company's first year of lethal domain name consulting. Check it out! (You can click on the graphic for a larger version.)

Thank you to our many clients, partners, and friends for an amazing 12 months.

Hate Domain Speculators? Here's a Few Reasons You Shouldn't.

The next time you find yourself bemoaning the fact a domain speculator owns a domain name that you want, think again. It’s far better that a professional domain speculator owns the parked domain than it is sitting dormant with a mid-to-large sized company. Here’s my take on why…

First of all, the reason most domain speculators or "domainers" own domains in the first place is because they are hoping to sell them one day. If you contact them and are willing to pay fair market value for their domain name, then chances are you will get a quick response (often within hours) and can sew up a deal within days if not a week.

In fact, millions of domains owned by domainers are available for instant purchase at a fixed price, meaning you don't even have to go to the trouble of contacting the owner or negotiating with them. If you are comfortable with the purchase price you can simply whip out your credit card and buy the domain name on the spot. You will probably have it within days if not hours.

Now contrast this with a domain owned (but not used) by a mid-to-large sized company. First you have to figure out who the right person at the company is to speak to about the domain. It could be their head of marketing, the IT person, the in-house lawyer, or even the CEO. Once you've figured out who you need to speak to the next hurdle is getting through to them. That can take weeks.

Many times these large companies aren't used to being asked about purchasing a domain name they own. It confuses and puzzles them, and this will lead to them needing to have lots of internal discussions and meetings. Finally, and typically weeks or months later, you may get to the point where you are able to negotiate on price, and this is where things can go really wonky.

Unlike domainers, who buy and sell domains all the time and know what a comparable domain might realistically sell for in today’s market, the folks at these companies often have unrealistic expectations of the value of their domain, simply don't know any better, or just cannot be bothered to engage in a discussion about selling the domain for less than a six-figure price, even if a domainer would happily sell the same domain for four figures. It's just not worth their time.

Don’t get me wrong. I empathize with the folks at these large companies, I enjoy interacting with them, and I understand why they often take the approach that they do. In fact, I would probably do the same thing if I were in their shoes, especially if I didn’t know much about the secondary market for domain names. But when you step back and look at these two scenarios objectively -- a domain owned by a domainer and a comparable domain owned by a large corporation -- I’d bet that in almost every case the domain owned by the domainer can be acquired for at least half the price and a quarter the time.

When I am looking for domains to buy on behalf of my clients in my role as a Buyer Broker at Name Ninja, I love it when I discover that the domain is owned by a domainer, and I shudder when it is a large corporation. I know what the implications of the latter usually mean to my client's budget and timeline, and it is not pretty.

Remember this the next time you are griping about domain speculators; they are probably the least of your worries. If a Fortune 500 company owns the domain you want, now that’s when you should be afraid, be very afraid...