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Another End User Sale Detailed

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I am not going to share the names of the two domain sales I made this week to protect the privacy of the buyers, but they were both hand registered within the past 7 days, and they sold for $360 and $400. I have a third domain name, which is related to one of the two that sold, and I think that one is going to sell for a little bit less today.

I want to detail the domain sales process for one of the sales, as the second sale was was similar to the first (although it was made after just 2 emails).  For the first sale detailed below, as I was emailing companies based on a Google search of the product, I realized there was an alternate spelling to the product, so I registered that domain phrase too.  As of 11am this morning, I only sold one of these two names, but you’ll see more information below.

My initial email to around 30 companies and people in the business:

———————
I see that you sell custom xxxxxxxx, and my company is selling the domain name CustomXxxxxxx.com. The domain name is the exact match of the search term, and developing it could provide a SEO boost for your company in this market.

If you are interested in acquiring CustomXxxxxxx.com, please let me know. I am offering it to several xxxxxxxx companies in the next few days. Also, my company owns XXXXXXX.com and will be looking for partner opportunities in the near future, so if you have any ideas on how we could work together, please let me know.
———————

Half way through the 30 emails I sent, I added a line about the second domain name I bought, mentioning the fact that I own it as well and would sell it. I mentioned one of my domain names that I am looking to partner on, as it’s a very well known name in this particular business and I thought it would give me added credibility.

Out of the 30 or so emails, I received nine replies. Six asked for the price of the first name, one said she wasn’t interested but wanted to know the price, one said she didn’t sell this type of product any longer, and one asked for the price on the second name. I replied to the eight interested people with an email saying the names are $900 for both and it would go to the first person who replies. I didn’t get a positive response to this BIN offer (I got 3 “no thanks” types of replies).

Two days later, I sent out a second email with everyone Blind Carbon Copied:

———————
I am blind carbon copying the 9 people/companies who have shown an interest in CustomXxxxxxx.com and/or CustomYyyyyyyyy.com. I have opted to drop the price of the domain names to facilitate a quicker sale. Each domain name is just $360 to purchase. The domain names are registered at Moniker, a Florida-based domain registrar. If you would like both domain names, the price for the pair is $600, although I can’t sell the pair if someone agrees to buy one of the domain names first.

The first person to write back and say, “I will take it” will get the domain name. Payment may be made via Paypal.
———————

One lady replied within an hour and said that she would take the first name for $360, and the name was transferred within a day and payment was made nearly immediately. She opened a Moniker account and didn’t have any issues using them. In less than a week, the profit from the sale was $330 after Paypal fees and the cost of the domain name, and it literally took under 2 hours for all correspondence and research.

This morning, I received an email from the person who wanted to buy the second name, and he offered $500 for both (he also asked how much Moniker charges per year). I replied that I only had one of the names remaining, and I would sell it to him for $250 – and I gave him Moniker’s price. I also let him know I was going away tomorrow so I could hopefully close the deal before I leave. I will provide an update later.

So what did I learn from this and from other recent sales to end users?

  • Looks like sales under $500 are easier to make
  • Domain name should be the exact match .com of a high profit margin product (custom things are generally higher margin)
  • Almost all replies were from individuals or very small businesses
  • I previously mentioned that registering names at Godaddy made a sale easier because everyone knows Godaddy, but it worked fine with the names being at Moniker
  • Focus on one or two names at a time, sell those and repeat the process
  • You might not always get what you want for the names so be flexible in pricing
  • Don’t go for a “home run” with your price
  • Treat everything like a learning experience – test everything from emails to pricing
  • I still love finding new domain names and selling them. Yes, it’s thrilling to buy a $5k name and flip it for $10k, but when I bought the name I knew it was worth more than I was paying. Finding unregistered names that has value is more fun for me although I probably couldn’t run my business simply by doing this.
  • Not all valuable domain names are registered!

About The Author: Elliot Silver is an Internet entrepreneur and publisher of DomainInvesting.com. Elliot is also the founder and President of Top Notch Domains, LLC, a company that has sold seven figures worth of domain names in the last five years. Please read the DomainInvesting.com Terms of Use page for additional information about the publisher, website comment policy, disclosures, and conflicts of interest.


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Comments (25)

    Adi

    Congrats on the sales!

    I was wondering if you are using the email from “whois” or if you are using the Contact email that’s on the site to contact potential buyers.

    Thanks,
    Adi

    May 27th, 2010 at 12:13 pm

    Leonard Britt

    Thanks for sharing your experience with another successful sale – just curious if the email contacts are primarily Whois/website derived or if you use another service or method to obtain the email contact. Often I will hunt in Google for marketing + @company.com or email @company.com to see if I can find another contact than the standard info@company.com.

    I believe there is a valid point that going after small businesses is likely to be more effective as large companies are harder to penetrate. Yes, pricing in this economy, particularly when the buyer wasn’t initially seeking the name, needs to be realistic. I’ve changed my approach of late to not mentioning the price in the initial email.

    May 27th, 2010 at 12:20 pm

    Elliot

    I contacted people using either the email address on the website or via contact form on their sites.

    Just based on my experience, I don’t name the price because if I say $900 and the person is only willing to pay $350, they may not even reply to my email By not naming a price, I can gauge who is interested and then price accordingly. If my price is too high, I can always go back to those people who contacted me. If I don’t hear from them, I won’t know who is interested.

    May 27th, 2010 at 12:26 pm

    eTraveler

    That sounds like a lot of work :)

    Come join me pool side and do that with a iPad.

    PS I got burned yesterday, so today I have to rest.

    May 27th, 2010 at 12:33 pm

    The Fromainer

    Good work Elliot!

    “Looks like sales under $500 are easier to make”

    Often when pursuing end users in this way it is too easy to price yourself away from the negotiation table by asking for ridiculous prices out of pure greed, I’ve done it myself!
    Reasonable everyman prices are the way to go, especially when targeting small business owners.

    I’ll be awaiting the outcome of the last sale.

    The Fromainer

    May 27th, 2010 at 12:38 pm

    Elliot

    @ eTraveler

    May be work, but it’s much more fun for me than closing bigger deals like GolfPros.com and HorseSupply.com, which had much greater profits (closed them this week).

    I am not much of a sit by the pool guy usually, but I am off to Paris tomorrow for a little vacation. No iPad though :)

    May 27th, 2010 at 12:38 pm

    3DKing.me

    Very good, simple, and honest approach.

    May 27th, 2010 at 1:13 pm

    Rob Sequin

    Good business model and nice execution.

    Ever hear the term “You eat what you kill” in sales?

    In other words, no sales no food.

    You certainly “killed” this one!

    Nice job.

    May 27th, 2010 at 1:15 pm

    eTraveler

    So jack is not a dull boy, that is good to hear.

    Note: for the people who do not understand that comment, that being most uneducated people under 30. :)

    http://en.wikipedia.org/wiki/All_work_and_no_play_makes_Jack_a_dull_boy

    If you are offended by my uneducated comment, go get one :) heheheheheheheheh

    Did you use a website like Homeaway.com which has luxury places to stay cheap? $1500 for the week for the listing below? Where are you staying in Paris?

    http://www.homeaway.com/vacation-rental/p150224
    4th Arrondissement Pompidou Le Marais Vacation Rental apartment

    May 27th, 2010 at 1:16 pm

    Elliot

    @ etraveler

    We’re staying on Jardin du Luxembourg. We’re staying at a place recommended by a family friend.

    May 27th, 2010 at 1:18 pm

    Michael

    Great to hear this story Elliot – Inspiring and shows there is still opportunities for people late to the domain game!

    So do you mention the ‘exact’ number of searches when looking to sell these type of domain names or do you leave this bit of information out if the numbers aren’t that high?

    Were the ones you sold below the 500 / 1000 mark?

    When you say “developing it could provide a SEO boost for your company in this market.” Do you mean this as a standalone site or as a 301 redirect?

    Also do you then find yourself needing to explain / educate the potential buyer how this can give them an SEO boost by buying a keyword rich domain name?

    Michael

    May 27th, 2010 at 1:20 pm

    equipment hire

    excellent post Elliot
    small sales, but couple of those every day and you’re in clover
    nice approach
    cheers
    Guy

    May 27th, 2010 at 1:20 pm

      Elliot

      There are lots of opportunities. If I was a new investor or someone without a whole lot of luck selling names, this would be my takeaway:

      1) Buy one or two names in a niche I know – preferably product type names but not brands!

      2) Cntact the companies who sell or manufacture product and attempt to sell the domain name.

      Don’t buy a ton of names hoping to strike it rich. Learn what companies want in a domain name and find the names that will work. In my case AwesomXxxxxx.com wouldn’t have made sense. They sell custom xxxxxxx online, so owning the exact match name can benefit their business. With a profit margin of between $200 – $1,500 for every one of these products they sell, the companies know one good lead from the domain name that has a one time acquisition cost can pay for the name for life.

      May 27th, 2010 at 1:24 pm

    Elliot

    @ Michael

    I didn’t mention anything about searches – just what was in those emails I posted.

    A 301 redirect probably wouldn’t do much. If It was me, I would do a small website on the domain name detailing that particular product with the hopes of ranking in Google. The broad Xxxxxxx term is competitive but “custom Xxxxxxx” isn’t as competitive and would be easier to rank.

    May 27th, 2010 at 1:32 pm

    Michael

    I guess what I was trying to ask was is the reason you didn’t mention the exacts is that because they weren’t that high and if you did have a domain with a decent amount of searches would you then highlight this detail in the email?

    Would you ever consider getting a quick WordPress site out and get it ranked (if the competition wasn’t that great) and then look to sell it, and maybe get at least a $1000 for the site + domain, or would you see that as too much work upfront with no guarantee of a sale?

    Michael

    May 27th, 2010 at 1:46 pm

    Elliot

    @ Michael

    I’ve set up mini sites on domain names I bought that haven’t sold as quickly as I hoped – AthensVacations.com and JerusalemVacations.com for example.

    May 27th, 2010 at 5:24 pm

    Marcus

    Great post. Thanks for the insight.

    Can you give us an idea of the search volume for the keyword?

    Also, can you give us the estibot appraisal?

    Not that it matters as far as your price, but it would be helpful it comparing to other domains.

    I’ve been putting the price in my emails, but I am going to send me next round of emails without it to give that a shot.

    May 27th, 2010 at 6:05 pm

      Elliot

      @ Marcus

      I haven’t mentioned estibot before and I personally wouldn’t use it as an example. Estibot valued one name for $1,100 and the second at $510. There were 319 searches monthly for one and 298 for the other.

      Also, I just got off the phone with the person who agreed to buy the $400 name because he hasn’t paid yet. He mentioned that had my number been much higher he would have said “forget it” since he already ranks #1 for the term. He then said something to the effect of, “for $400, why not?”

      Price does matter, and a price under $500 seems to be an easier decision.

      For my next round of testing when I get home, I will probably have a price in it and do a combination of email #1 and #2 where I mention the price (keeping it around $400) and say first come first served. If these sales prove to be easier, and I close on 1 sale a day, that could be around $300 profit, assuming I buy 10 names ($80) and only sell one of them. Sorry if this is confusing… perhaps I will write out my plan in another post.

      May 27th, 2010 at 6:08 pm

    Adi

    I was wondering how much time do you spend searching for an available domain until you find it?

    thanks

    May 27th, 2010 at 7:35 pm

    Domain Report

    Do you know if either of the names you sold were registered before (and dropped?).

    I’ve picked up a few names in the last year or two that used to be taken but became available. I’m always checking real estate, realty and homes domains for cities, and they sometimes get dropped.

    Have fun on your trip!

    May 27th, 2010 at 9:18 pm

    Elliot

    @ Domain Report

    I know at least one was but don’t remember on the other two. I could do a Whois history which might be helpful but I have to pack :)

    If I was to venture a guess, I would say that all 3 were previously registered and dropped.

    May 27th, 2010 at 9:38 pm

    Elliot

    @ Adi

    I literally stumbled upon the first two after just a few minutes of searching, and a day after getting the 8 positive replies, I bought the third one.

    One tip I will give is to look at a popular site and see what types of products are being sold in a specific category. Don’t buy the trademarked terms… look for generics. Even small niches have several sellers who might want to “own the category.”

    May 27th, 2010 at 9:44 pm

    Arseny

    A goldmine of information! Thanks a lot, Elliot!

    Btw, what kind of software do you use to manage your clients relations?

    Wishing you a nice weekend,
    Arseny

    May 28th, 2010 at 9:38 am

    TV

    Good stuff in the follow-up comments. Thanks for elaborating.

    June 25th, 2010 at 3:05 pm

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