People often say to me that ideas are worthless because everyone has them.
I disagree because sometimes the silliest idea can make you a fortune.
Domain names like Beer.com or Voice.com were once just simple ideas, but their ingenuousness lies in their simplicity.
Today, both domain names are worth millions of dollars, proving my point that plain ideas are usually the best ones. They’re proof that domain investing is a lucrative business with a potentially high return on investment.
Starting a domain portfolio is mostly about patience and anticipation, so you’re likely to be disappointed if you’re looking to turn a quick profit.
In this domain investor’s guide, I’ll show you how and where to sell domains from your portfolio at favorable prices.
Domain Investing Tactics
Within the business world, the term ‘strategic thinking refers to the creation of opportunities that will help an organization reach a specific goal.
It is also one of the underlining concepts of domain portfolio development since making good investments or choosing the right moment to sell a domain name requires vision.
In other words, you must have a strategy that guides your buying or selling a domain name.
Most investors rely on well-established strategies that fit their business models and turnaround expectations. Let’s explore different strategies you can use to approach the domain name market.
In theory, domain flipping is a straightforward strategy that follows the ‘buy low, sell high’ principle. The investor’s primary goal is to purchase a domain name at a low price and then flip it shortly after at a considerably higher price.
The only issue is that you may end up selling a domain price too early and fail to maximize your investment. The strategy relies on current market trends, so you must dedicate much time to monitoring domain marketplaces if you want to use it successfully.
The buy low, sell high strategy isn’t ideal for novice domain investors who are still learning to differentiate between a domain name’s price and long-term value.
Registering a potentially profitable domain name is just one step you can take to increase its value. Investors often decide to set up hosting and upload content to a domain in an effort to improve its worth.
Employing this strategy also enables them to earn a passive income through participation in affiliate programs and posting high-quality content. Utilizing standard SEO practices improves the domain’s authority and, by extension, its value.
However, this is a long-term strategy that requires a considerable time commitment, and you should only use it if you don’t plan to sell a domain name for several years.
The assets in your portfolio don’t necessarily have to be unprofitable while you wait for the right market conditions to flip them.
Parking a domain name after registering enables you to profit from advertisements even though the domain isn’t connected to a website.
The effectiveness of this strategy mostly depends on the domain’s search volume, so using it doesn’t guarantee you’ll generate a sizable income.
How much is a Domain Name Worth?
No one can tell you how much a domain name might be worth because its value fluctuates over time. Ultimately, a domain name is as valuable as the best offer you can get for it.
This is what makes domain investing so difficult since there’s no way of knowing if the name you registered will be worth anything in five or ten years.
Predicting market trends is almost impossible, so a domain name’s value can suddenly skyrocket and plummet unexpectedly.
Hence, a domain name can be worth hundreds, thousands, or millions of dollars, depending on the market conditions.
A quick search on the NameBio site reveals that most domain names are worth between $2,000 and $100,000 on the resale market. Still, their prices rarely enter the six-figure range, while it’s relatively common to see a domain name go for much less than $2,000.
Registering a new domain name costs between $10 and $20 per year, while the renewal price ranges from $10 to $60. So, their resale value is usually much higher than the initial cost.
Domains with the .com extension are more valuable than domains with .org, .net, or .io extensions.
The Most Valuable Types of Domain Names
One hundred sixty-one million domain names were registered in 2022, while the total number of domains is considerably higher.
It’s easy to see why novice domain investors assume that the most valuable domain names are already registered. While this is partially true, there is still plenty of opportunity to discover a potentially lucrative domain name.
Even a simple blog name generator can help you come up with a unique domain name you can flip on the resale market at an excellent price. Let’s look at some of the most profitable types of domain names.
Including a geographic location in a domain name will make it appealing to buyers on a local market and enable you to target specific cities, regions, or countries.
Most investors create domain names by combining geographic locations with specific industries like logistics or fashion.
So, registering domain names like PhiladelphiaLogistics.com or ColoradoCardigans.com can be profitable in the long run.
Investors who rely on the domain development strategy can profit from buying a domain with good search engine rankings.
Purchasing a domain with a history of algorithm penalties might hurt your chances of considerably increasing its value. So, finding a buyer willing to make an offer for such a site could be difficult.
Domains with Sought-After Extensions
You’ll often hear the term TLD or top-level domain when you start investing in domain names. There are several types of TLDs, including gTLD, sTLD, and ccTLD.
gTLDs refer to common domain extensions such as .com, .net, or .info, while the most common sTLDs are .gov or .edu. Domain names with .com extensions are by far the most popular, and they’re easiest to sell than other TLDs
Still, adding domains with less popular extensions to your portfolio might pay off as .com extensions are becoming scarcer.
Any domain name that targets a particular industry is considered a generic name. In most cases, they’re short and memorable, making them attractive to small and medium-sized businesses that want to establish an online presence.
Parking a generic domain name can be a source of revenue while you wait for its value to increase.
Whois and ICANN Databases
New domain names with one of the extensions from the gTLD category are automatically registered in the ICANN database if you purchase the domain from an accredited domain registrar or reseller.
ICANN’s registration data lookup tool can be helpful if you’re researching domain names you’re considering buying. Registration of the domain name in the Whois database is the registrar’s responsibility.
So, after you purchase a domain name at GoDaddy or a similar platform, your name, contact information, server name, registration, and expiry date will automatically be added to the Whois database.
On most platforms, the Whois data will be redacted by default, preventing potential domain buyers from contacting you.
However, most domain registrars allow you to change the privacy settings from Private to Public and make your information available to anyone using the Whois database.
Adjusting this setting will enable you to receive offers for a domain name you registered without having to list it on a domain marketplace.
Domain Name Valuation Options
Estimating how much a domain name is worth at any given moment isn’t an exact science, but specific parameters can give you an idea of its value.
The extension type, the name’s length, universality, applicability to different industries, and sales record are among the parameters that can affect the domain name’s market price.
I’d like to mention that brand-ability is a crucial factor in determining the value of newly registered domain names because companies are looking for unique domain names that will set them apart from their competitors and allow them to promote their brands.
If all this sounds overly complicated, that’s because domain name valuation is complex. Luckily, there are a few quick ways to have your domain name appraised.
Creating an account on Estibot will give you access to an instant appraisal tool that estimates the domain name’s value based on word count, keyword, or the number of related searches, among other parameters.
The algorithm’s valuations aren’t always accurate, and you might get results that will mislead you into thinking that your domain is more valuable than it actually is.
Using more than one appraisal tool is advisable, especially if you don’t want to use other domain name valuation methods. It’s worth noting that most domain name marketplaces have built-in appraisal tools.
Determining a quote for expiring aged domains is relatively simple because you can always look at their sales records. However, you won’t have this luxury while appraising a newly registered domain name.
A platform like NameBio lets you monitor the latest sales on domain marketplaces and use them to set a price for a name you want to sell.
You can also search for recently purchased domain names similar to the one you’d like to flip based on category, keywords, extension, or length and check their prices.
Even though this isn’t a bulletproof method of determining the asset’s value, it can help you estimate how much a domain name could be worth.
Hiring a broker is the most reliable way of assessing the domain name’s worth. It’s also the most expensive domain name appraisal method since fees range from 10% to 20% of the sale price.
Nonetheless, their expertise and experience are invaluable as they can advise you when to put a domain name on the market to maximize its value.
Collaborating with a domain name broker will also give you access to their networks of buyers and improve your chances of getting a good offer for the domain you’re selling.
Setting a Domain Name Price
Regardless of the valuation method you use, the final decision regarding the domain name’s price is yours.
Depending on your assessment of the market conditions, you can choose between Buy-it-Now and Make an Offer pricing models.
The Buy-it-Now model involves putting a fixed price on the domain name you’re selling, which will cap your maximum profit but can help you close the deal faster.
Although their cost can occasionally be in the five-digit range, most domain names with fixed prices go from $2,000 to $5,000.
The ‘Make an Offer’ model allows investors to discuss a price with multiple buyers. It also lets you research the individuals or companies interested in your domain and figure out if you can negotiate a better deal than the one you initially received.
Still, I only recommend using the Make an Offer model if you have an in-demand domain that attracts a lot of attention from high-profile buyers.
Using For-Sale Landing Pages
Excluding the type-in traffic from your domain selling strategy will prevent you from reaching an entire category of buyers who are interested enough in a specific domain to run a Google search.
A landing page builder can become a valuable tool in the hands of a domain investor who knows how to harness the power of type-in traffic.
Creating a dedicated For-Sale landing page will inform interested parties that a domain name they’re researching is for sale and provide them with your contact information.
You don’t need a website to set up a landing page, as you can easily create a standalone page that contains a CTA button and all other elements that incentivize the visitor to reach out to you.
If you already have a website, you can easily redirect traffic to the landing page with an inquiry form for the domain name you’re selling.
Domain name marketplaces provide their users with an option to set up domain name landing pages directly from their platform.
However, landing pages you create in this way will contain ads, but more importantly, you’ll have to pay a commission fee if you sell a domain name through a landing page.
Explore Doman Name Marketplaces
Chasing potential buyers for a domain name on your own won’t deliver the results you’re hoping for quickly, especially if you don’t have a vast contact network.
That’s why most investors list domain names on secondary market platforms that give them access to thousands of potential leads.
The downside of this approach is that the platform takes a percentage of the domain name’s sales price. However, listing the domain name for sale is usually free, so you only have to pay a 10% to 30% fee if you get an acceptable offer.
Here are some of the most popular domain name aftermarkets among investors.
Each domain name on the BrandBucket is evaluated by the platform before being included in its collection. Investors are required to create seller accounts and pay a $1 appraisal and $9 listing fee.
The platform’s commission fees depend on the sale price, and they vary from 30% for names worth less than $10,000 to 15% for domains that sell for more than $100,000.
Still, you can adjust the listing’s price to cover the BrandBucket’s fees and use its buyer network to get attractive offers for a domain name you’d like to flip.
As one of the largest domain name marketplaces, Afternic attracts millions of buyers and generates millions of dollars for domain owners.
Most listings have Make an Offer and Buy-it-Now prices, which enables sellers to communicate their expectations to interested parties. The platform promotes all listings through over a hundred resellers and domain registrar platforms.
Sales commissions are high because Afternic takes a fixed fee on top of the sale price percentage for all domain names that sell for more than $5,000.
Setting up an account at NameCheap will give you access to one of the largest domain name marketplaces on the Internet. Moreover, you can use the platform to transfer domains to their new owners or set up hosting before listing them.
The Marketplace section features millions of Buy-it-Now listings that can cost just $5 or over $100,000.
You don’t have to go through the valuation process before posting a listing on NameCheap’s aftermarket. You can choose how long the listing will be available or which information you want to include in the description.
Registering for a domain auction can help you flip a domain quickly, but you should bear in mind that most participants in domain auctions are investors like yourself who are looking to buy a domain name they can resell at a much higher price.
So, entering an auction might be risky since you might end up selling a domain for a fraction of its actual value.
Most platforms allow you to set the minimum bidding price, which protects your investment to a degree, but it doesn’t guarantee you’ll get the best possible offer for the domain name you’re selling. Here are some of the places where you can put up a domain name for an auction.
Entering Sedo‘s marketplace will give you several sales options, so you can choose if you want to create a Buy Now listing, allow buyers to place an offer for a domain name, or join an auction.
Moreover, you can use the Make an Offer pricing model to get a proposal you can then use as the minimum bid at a marketplace auction.
Registered users can launch an auction for a domain name at any moment or participate in live auction events.
Sedo has a brokerage service that takes care of all aspects of domain name sales, which can be useful if you don’t want to spend time negotiating deals or transferring domains to new owners.
Besides being one of the most reliable domain registrars, GoDaddy is also a domain aftermarket. GoDaddy Auctions lets you list a domain quickly and join different types of auctions.
You must be a GoDaddy Auctions member to create a listing, but the annual membership that allows you to create unlimited listings for free costs just $5. The platform’s fees don’t exceed 20% of the domain name’s sales price.
You can feature a listing on the GoDaddy Auctions’ home page for an additional fee.
You can buy or sell a wide range of digital assets on Flippa, including websites, e-stores, apps, and domain names. Currently, the platform hosts over 6,000 domain names, and each listing contains a description, sales history, and expiration date.
Hence, auctioning a domain name on Flippa might help you establish trust with interested parties by providing information that will verify your listing’s legitimacy.
Find Domain Buyers with Outbound Marketing Techniques
Taking a proactive approach toward selling a domain name can prove beneficial, even if you don’t have a lot of contacts.
Launching an email marketing campaign that targets a certain niche can help you reach buyers who don’t frequent domain name aftermarkets or actively search for a domain name.
Putting together a list of potential businesses interested in a domain name requires more research than simply Googling companies that fit a certain keyword.
Sending a promotional message to the company’s email is unlikely to spark interest in your offer, so ideally, you’ll find a contact within the organization you can reach out to.
I want to underscore that this approach works best for location-based and generic domains that attract small businesses from a specific industry or city.
Moreover, sending personalized emails will improve your chances of getting a response because most CMOs and business owners are too busy to read emails that appear generic.
Setting Up an Escrow Service
You won’t have to worry about being scammed if you decide to list a domain name at a marketplace or an auction because a buyer must place funds in escrow to initiate a transaction.
Selling domain names outside marketplaces is much riskier since you have no way of knowing if the buyer intends to pay you the agreed amount.
Setting up an escrow service will protect you against fraud and help establish trust with the seller.
After the buyer places the funds in escrow, you can safely transfer the domain ownership, and the service will release the funds to you once the transaction is completed.
Transferring the Domain Ownership to the Buyer
The deal you agreed to won’t be finalized until your transfer the domain ownership to the buyer.
This process isn’t always quick because sometimes both parties agree to postpone the transfer until the domain name subscription expires so the new owner can renew it.
The first step you’ll need to take as a seller once the transfer can finally commence is to change the Whois privacy setting to the public if you already haven’t.
Afterward, you must unlock the domain on the registrar platform where the name is registered. You should obtain the authorization code to confirm the buyer’s ownership of the domain name you’re transferring.
The new owner has to log in to their account on the domain registrar platform and submit a domain name transfer request.
You’ll receive an email from the domain registrar once the buyer submits a request asking you to approve it in order to finalize the transfer.
I believe that registering a new domain name whenever you have an idea for a business you don’t have time to develop can pay off if you’re patient enough to wait for the right moment to put some of your assets on the market.
Don’t walk into domain name trading unprepared. Use every opportunity to improve your understanding of what makes a domain name valuable and strategies you can use to find buyers.
These and similar platforms can help you evaluate the domain name’s worth and ensure the transaction between you and the buyer goes smoothly.
On the other hand, if you’re a seasoned domain investor, you should consider selling domain names directly to buyers to avoid paying high commission fees.
Frequently Asked Questions
Is Selling a Domain Name Through a Broker a Good Idea?
Hiring a domain name broker will spare you the trouble of evaluating a domain name, creating listings, finding buyers, and negotiating deals. Even so, using a broker is only a good idea if you have a valuable domain name.
Can I Decline An Offer I Receive at a Domain Name Auction?
Sellers aren’t required to sell a domain name during an auction; they can decline a bid or place a counteroffer.