Afternic "Stalking Horse" Auctions on My Blog | DomainInvesting.com
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Afternic “Stalking Horse” Auctions on My Blog

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Over the years, I’ve inquired about many domain names that are owned by Buy Domains and listed for sale on Afternic. There are many names I’ve tried to purchase but I couldn’t reach an agreement on price with the company.

I am planning to test out a unique type of domain auction on my blog in conjunction with Afternic, and I would like your feedback before I start them.

I am going to choose several domain names that I’ve wanted to purchase from Buy Domains, and I will put them up individually for auction. I will place an agreed upon “stalking horse” bid on the domain name, which is essentially the reserve price. Readers of my blog can outbid me, but I cannot bid any higher than my opening bid. If nobody outbids me, I will get to purchase the domain name at my offer. If I lose, the person with the high bid will get to purchase the domain name. Bid increments and payment terms will be specified at the time of the auction.

Here’s an example to illustrate how this will work:

I saw XXXXXXXXX.com at Buy Domains last week, but the $4,088 asking price was higher than I wanted to spend for this name. I will place a $1,000 stalking horse bid on this domain name, and it will be on auction on my blog for three days (perhaps a week). If I am outbid, the winner will get to buy the name. If I am the high bidder, I will be able to buy the domain name for $1,000.

Essentially, I am putting my money where my mouth is, and Afternic is taking a gamble that there will be interest in the domain name beyond my offer.

I would like to know what you think of this idea. Please comment below.


About The Author: Elliot Silver is an Internet entrepreneur and his company earns revenue from domain names. Elliot is President of Top Notch Domains, LLC, a company that has sold seven figures worth of domain names in the last five years. Elliot is the publisher of DomainInvesting.com. Read this blog's disclaimer for information about the publisher, comment policy, disclosures, and conflicts.

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Comments (32)

    Talk like this

    Nice idea :) Why not give it a go and see how it goes.. So, far i havent seen auction like this in domain auction so, far.
    I hope you will be granted 10% if you are out bided… That will make total sense.

    October 4th, 2012 at 3:55 pm

      Elliot Silver

      I won’t get anything if I am outbid. The win for me is that I get a domain name at a great price (from my perspective) if I win.

      October 4th, 2012 at 3:56 pm

    RobbiesBlog.com

    Sounds really interesting Elliot,

    I too have been in the same position on a few names where we cant get the price right with Afternic / buy domains.

    I hope it works and you get the domain at fair market value.

    Like everything the value of anything is only what the highest bidder is willing to pay.

    October 4th, 2012 at 3:58 pm

    Anticareer

    Not sure I understand how Afternic is taking the gamble if it is a BuyDomains owned domain, unless Afternic is going to make up the difference (assuming no one outbids you).

    Interesting concept… will definitely move some domains that may have just sat there for years collecting dust.

    October 4th, 2012 at 3:59 pm

      Elliot Silver

      Buy Domains and Afternic are owned by the same company.

      October 4th, 2012 at 4:00 pm

      Anticareer

      Ahh, that would make sense. Make sure to load up on nice premium domains.

      October 4th, 2012 at 4:06 pm

    Steve

    Will your “stalking horse” bid remain hidden until the auction ends? I think that would make it more interesting – only revealing your bid at the termination of the auction.

    I guess the other options would be to reveal your bid right from the start of the auction; or reveal your bid only once it has been surpassed.

    Steve

    October 4th, 2012 at 4:00 pm

      Elliot Silver

      I was thinking that it would be prior to the auction so people can see what they need to bid to win.

      The complications come in when people try to place snipe bids, especially in the case of a tie or if I am out when bids are placed and I need to approve them manually.

      October 4th, 2012 at 4:02 pm

      Steve

      Maybe you could run the actual auction on Afternic’s platform, BUT, somehow display a live ‘feed/update/screenshot’ on your site!

      This way you eliminate all the ‘complications’ associated with running an auction. Plus, as per my original comment, you could hold off revealing your ‘stalking horse’ bid (at least until you are outbid – as it would equate to a hidden ‘reserve price’ which I beleive is allowed in Afternic auctions?).

      Plus, Afternic would likely see more activity on thier site proper – something I’m sure they’d be interested in!

      Steve

      October 4th, 2012 at 4:27 pm

      Elliot Silver

      Great suggestion!

      October 4th, 2012 at 4:28 pm

      Mike

      I like the idea of Elliot keeping his bid/reserve hidden until it is surpassed. Otherwise the problem I see is that Elliot has such a good reputation for buying domains at a price that he can turn for a profit, if anyone knows that Elliot would pay $1000 for the domain, then surely the domain is worth $1050 in the eyes of probably 90% of your readers just based on the fact that your reserve is like you giving it your own personal appraisal, if that makes sense. In other words, if I know Elliot was going to pay $1k, I’d assume he feels comfortable flipping it for at least 1500 to 2000 or more, so why would I not just always bid the next highest increment over Elliot’s reserve. Not saying me personally, but I could anticipate a lot of readers seeing it that way. And I don’t think they’d be wrong. So I doubt you’d ever win one of the domains this way Elliot. Much better to keep your bid hidden until it is breached, imo.

      October 4th, 2012 at 5:52 pm

      Elliot Silver

      Just because I think something is worth more doesn’t mean it is actually worth more. If I buy a name for $10,000 and can’t flip it, I am comfortable holding on to it until I find a buyer or a buyer finds me. There are many people who wouldn’t be comfortable buying a name simply because I think it’s worth more.

      Additionally, others could take the tact that if I am only comfortable offering $1,000, why should they want to pay $1,100 for it, or whatever the next minimum bid is.

      It will be interesting to see how this plays out, and perhaps we will try out a few things to see what works best.

      October 4th, 2012 at 5:56 pm

      Mike

      yea, 90% was probably hyperbole on my part, I am sure not everyone and maybe not even most, but I’m fairly sure that some would see it that way. It will be interesting to see it play out like you said. Either way, the general idea is a cool one.

      October 4th, 2012 at 6:05 pm

    Domainsville

    You have a wonderful idea there, but you’ll have to find a way to verify bidders beforehand to prevent shill bidding. We were going to run auctions through Domainsville in a blog post format, but couldn’t find a way to verify bidders. I would propose sending the domain to auction at Afternic, then advertise the listings on your site. Good Luck, Elliot!

    October 4th, 2012 at 4:01 pm

      Elliot Silver

      That is certainly an issue.

      I would say that the person needs to follow up with an email to me to confirm the bid.

      I’ve sold a couple dozen names via blog posts which I am sure you’ve seen, and there was only one “false” bid/purchase. I emailed the person who posted “sold” and when the email bounced, I deleted the comment.

      There’s always a risk of shill bidding no matter what platform is used.

      October 4th, 2012 at 4:04 pm

    BullS

    If you see “BullS” bidding, you all just don’t bid because someone will visit you at 3am….plain and simple.

    October 4th, 2012 at 4:13 pm

    SiteSwoop

    I think it sounds like a pretty good gamble. Of course, like others mentioned, you might need to find a way around the approval of offers, but otherwise sounds like you could snap up some decent domains.

    October 4th, 2012 at 4:28 pm

    Steve M

    On the surface Elliot, a nice idea.

    I suspect, however, that the logistics and difficulties; some of which are intractable; will render the whole thing not worthwhile.

    For any of the parties; including the bidders.

    That said, better to have tried and failed than to not have tried at all.

    You may want to have one or more disclaimers covering everyone against anything and everything that might go wrong.

    Utilizing Afternic’s existing bidding / infrastructure; as others have suggested; may be the best way to go.

    Disclaimer: I’m not an attorney; none of this is legal advice to anyone for an purpose.

    October 4th, 2012 at 4:51 pm

      Elliot Silver

      I am leaning towards using their platform for the auctions to avoid any troubles, and I can use my blog to promote the auction, explain why I like the domain name, and give rationale for my offer.

      October 4th, 2012 at 4:53 pm

    RaTHeaD

    ya shoulda bid $1088… buydomains loves the 88′s. it’s like they’re chinese or sumpin”.

    October 4th, 2012 at 6:55 pm

    Uzoma

    If you let it happen at Afternic platform, and simply point everyone to a domain for auction at Afternic, what do we have? We have Afternic auction, right? Which means status quo. So, where’s the genius? We can do that now.

    October 4th, 2012 at 9:11 pm

      Elliot Silver

      We have a domain name that is for sale at most likely a lower reserve price than Afternic/Buy Domains would like. The domain name would also be hand picked by me and be a good value (in my opinion).

      Using their platform would help issues such as sniping and bid increment issues and moderation issues.

      October 4th, 2012 at 9:28 pm

      Uzoma

      To make it interesting, I suggest you bring it here like was originally planned. Find a way to tackle the logistics by employing a software, work at it, you should not expect to capitalize just on the popularity of your blog. I’m not trying to tell you what to do, just my opinion. It will be simplistic just to point folks to Afternic because you think a domain name is good. It will get boring in 3 weeks.

      October 4th, 2012 at 10:33 pm

      Elliot Silver

      I am not buying or building special software for something like this, especially when Afternic already has that software built. Many companies have tried and failed at this and I am not venturing into the auction platform business.

      October 4th, 2012 at 10:36 pm

      Uzoma

      Then, don’t do it at all. What you initially described entails building a software. You can’t titillate everyone with an interesting idea, and end up cutting it down to status quo. Right now, we have Afternic auctions, by the time you implement what you are leaning towards, we will end up with Afternic auctions. At best you will be duplicating one of those daily lists permeating and clustering Domaining.com. The world doesn’t need another daily domain list.

      October 4th, 2012 at 10:41 pm

      Elliot Silver

      You’re wasting your energy… have you spent more than $1k on a domain name yet?

      October 4th, 2012 at 10:42 pm

      Uzoma

      Oh, why a personal attack? I thought you were debating the virtues and vices of an idea? Easy.

      October 4th, 2012 at 10:43 pm

      Elliot Silver

      It’s not personal… but you are telling me what I should do (in a not so friendly way) when you are unlikely to participate in these auctions anyway hence my question about buying a name for over $1k. There’s a difference between making a friendly suggestion as others have done and badgering, and you are pretty much badgering me.

      I have no intention of bidding on the TRAFFIC auction, and you don’t see me trying to tell Rick Schwartz that I think his approach is wrong and continuing to express my opinion when it doesn’t have any bearing on me.

      When you make a suggestion, it’s appreciated. However, the way you present things is like it’s your way or the highway. How many times have we disagreed about things and you’ve said you’ll never return? I think it’s about 5. It’s not a nice thing and you wonder why you seem to get a whole bunch of dislike votes when you comment.

      October 4th, 2012 at 10:46 pm

      Uzoma

      Okay, the 6th time may be the charm, I will not comment on your blogs again. I have purchased and sold domain names in virtually every reasonable price range. But, that is not the point at hand; I just wanted you to know that.However, I’m done commenting on your blog. Go deal with your “yes” men. I’m not the type to agree when I should disagree. Goodbye

      October 4th, 2012 at 10:56 pm

    jimmy

    can i email you a list of domains i have offered 1,000 for to buydomains and they haven’t been willing to sell?

    October 4th, 2012 at 11:04 pm

    Poor Uncle

    Elliot I think that guy has a crush on you. Maybe he is your biggest fan.

    October 5th, 2012 at 12:13 am

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