Domain Negotiation Tip: Justifying Your Offer
When you are in the midst of negotiating to purchase a domain name on Sedo, one of the prefabricated replies you can select is something like “justify your price.” It’s always made me laugh a bit to see that reply, but when you think about it, justifying your offer or price is a great way to get the price you need.
Oftentimes when I am negotiating with a buyer or seller, the price we both have in mind is different. For times when the price gap is significant, there’s usually little reason to engage in a discussion. Why waste time on a name I want for $2-4,000 and the seller wants $100,000. Either he’s crazy and/or doesn’t need the money, or I am not as enamored with the name as he. Whatever the case, it would likely be a fruitless discussion.
However, there are times when we are just a few thousand dollars away from a mutually agreeable price, and the actual negotiation is critical in getting the price I want/need for the domain name. Discussing why you value a domain name the way you do can lead to you getting your pricing, or at least seeing the flip side to why the name is worth more or less to the other party.
One thing I like to include in my negotiation strategy are favorable comps (using DNSalePrice.com, DN Journal, or NameBio.com). By favorable, I mean that the names have similar results in Google, similar search volume, and are in the same vertical (ie: two real estate domain names). It helps if you have more than one comparable and they are recent comps.
Another thing I include is information about developing the website. When I am the buyer or the seller, I let the other party know my plans with the domain name and why I think it’s worth what it’s worth. I give them a bit of insight into my development plans and justify why I can’t offer more money or offer to sell it for less money.
I know that some sellers get annoyed when a buyer asks them to justify the price, but I think it’s a good way to discuss a domain name’s value and possibly come to terms.
What types of things do you discuss when you’re trying to buy or sell a domain name to bridge the gap?
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