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Share Your Thoughts About GoDaddy Auctions Valuations

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GoDaddy LogoYesterday morning, I wrote an article discussing that an updated valuation tool was being released by GoDaddy in conjunction with expiring domain name inventory coming up for auction at GoDaddy Auctions. The refined domain appraisal tool takes the Afternic sales database into account and predicts the retail value based on its proprietary algorithm.

I think it will be helpful for domain owners to find “hidden” inventory by performing searches based on valuation, and I also believe this will become a revenue driver for GoDaddy.

One thing you will notice is that when you hover over a valuation, GoDaddy displays the following disclaimer to ensure that people understand what the valuation is and what its limitations are:

“These valuations are based on an algorithm that utilizes data GoDaddy has available to it to help identify predicted sale prices of domains. We make no guarantee or promise as to any results that may result from your purchase or sale of any domain. You are responsible to independently assess and determine the value of any domain you purchase or sell and we will not be liable for any losses you or anyone else suffers as a result of your reliance on these valuations”

Obviously it is a bad idea to bid on an auction solely because of the (automated) valuation listed by the auction house. GoDaddy isn’t the only domain auction house to share an appraisal within the auction page. NameJet added Estibot appraisals to its auction pages in October of 2015.

With the appraisal / valuation tool now rolled out to GoDaddy Auctions visitors (from what I can see), I am curious what you think about the valuations. I haven’t really had a chance to look closely yet, but I am curious what you think so far.


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 (23)

    Mark Thorpe

    GoDaddy should of added this feature to all domains listed for sale on GoDaddy auctions, like “Buy Now”, not just expiring domains.
    But we know why they didn’t.

    May 12th, 2017 at 9:57 am

      Elliot Silver

      Probably because people who list their names would be upset if GoDaddy valued them at “less than $1,000” and they think the names are worth more.

      In reply to Mark Thorpe | May 12th, 2017 at 10:22 am

      Paul Nicks

      Exactly right Elliot. I like the idea of allowing people to opt into the appraisal process, but that’s not on the short term roadmap right now.

      -Paul

      In reply to Elliot Silver | May 12th, 2017 at 3:23 pm

    Tom T

    Any extra tool provided by the registrar or auction house is helpful but I wouldn’t be putting much stock in these valuations. Should not deter you from doing your own research for domains that interest you.

    May 12th, 2017 at 10:10 am

    Nick

    My biggest problem with it is the placement, it’s a huge box right next to the current price and I get the 2 boxes mixed up. should be a smaller box all the way to the right

    May 12th, 2017 at 10:13 am

    Francois

    FYI, appraisals do not appear from France, maybe it’s the case outside USA.

    May 12th, 2017 at 10:26 am

    jz

    Looked at some 1k plus valuations for domains that make no sense and no value.

    May 12th, 2017 at 10:40 am

    Jeff

    It’s mid way through 2017 and they are just now getting this? Godaddy is so far behind the curve. They may be the largest but they are followers and not innovators. Most of their in-house products that they developed were horrible which is why Blake has went on a buying spree over the last few years. It would be nice if they came out with something truly new for the industry.

    May 12th, 2017 at 10:51 am

    Eric Lyon

    As with all automated appraisal tools, there is very little to no accuracy on the final output value. Automated tools generally are unable to compensate for trends, market shifts, deep niche research, etc.

    While it’s a nice gesture and yet another feature for a steadily growing arsenal, at best, it may help them generate a little more retention with investors/buyers that don’t do their own research.

    May 12th, 2017 at 12:41 pm

    F Carson

    My thoughts Elliot as per your article request, as shared prior:

    This is still laughable Elliot. So trust the same six billion dollar company that rolled out a prior version to arrogantly guide “valuations” for their patent attempts that had no relationship with intrinsic value or common sense in the first place? So they can stroke themselves with investors happy at their ability to cash out and gain liquidity from ongoing share sales at a ridiculous valuation for the benefit of only their oldest shareholders? Now as the leading domain provider on Earth, their big idea is to let Afternic performance metrics guide valuations that genuinely lead investors, domainer retirement goals, and consumer perceptions? Would be fine, except GoDaddy bumblers have made a mockery of Afternic through deprioritizing growth and even the most basic of attention to this platform. They have run it into the ground, compounded by mixed messages on the new extensions that undermine their own base future value proposition. No advertising, no staffing enhancements, no intelligent direction, no efforts to reach new buyers, no new market share. A company that would rather use a history ranging from elephant shooting, to telling congress they will shut down any name instantly on request, to using SuperBowl money to trivialize puppy farms – with not one mention of Afternic and it’s premium showcase capabilities (or even the new GTLDs for that matter!). An industry leader just showed me last week using Wayback that their management hasn’t had the sense, attention or care to even update their featured home page listings on Afternic for THREE YEARS. Most of their listings have been there since before the acquisition, and they have the singular most worst business category sorting ever seen from a domaining company online. So looking within their own performance and network as a tool to guide value perceptions for others is flatly insane. They don’t have the character, market understanding, ethical brand positioning, or experience ever producing one true dollar of profit to take this role. Feel free to share. The watered down recent Pros and Cons of GoDaddy was exactly that.

    May 12th, 2017 at 1:53 pm

      Paul Nicks

      Hi F Carson, thank you for your candid feedback.

      I would like to openly discuss a few items that you called out so that you can greater understand why we’ve made some of the decisions we have with regards to Afternic.

      First off, you are absolutely correct that our featured listings are laughably stale, and that our categorization algorithm could stand to be updated. Let me elaborate on why that is and why we have anything but deprioritized growth.

      When GoDaddy acquired Afternic a little over three years ago, our thesis was that small businesses would almost always start the search for a domain name at their favorite registrar. Afternic’s DLS platform is a perfect way to distribute our customers’ inventory right to the registrar channel. So, instead of a heavy marketing expense to try and prop up a marketplace as the best search option, we made a bet that it would be easier for us -and more profitable for our customers- if we focused all of our energy on selling domains via our reseller network. So instead of investing money and resources into trying to get small businesses to visit Afternic, we are investing in expanding our reach at registrars, where customers already are. Every dollar we would have spent, during Super Bowl or otherwise, to prop up Afternic.com as a destination for domain search would have been taking customers away from searching for domains at the more natural registrar channel.

      Our bet is paying off. In the three years since we acquired Afternic, we have added more than 20 new registrars to our already 100+ reseller channel, including new players like Google and international companies like eName, and RegRU. We have also more than tripled the size of our sales team to better serve customers who have Afternic “for sale” links on their parked pages. Last year we also added a new product for our registrar resellers that allows them to monetize their expiring inventory on GoDaddy Auctions, which is producing great results.

      The Afternic.com website is, for all intents and purposes, a portal for domain owners to list their names into the most active aftermarket in the world, not a destination for SMBs to search for inventory. We believe that not only do we sell more domains than any other marketplace, we are growing at a pace that surpasses the market as a whole. This is a direct result of all of the effort we have put into the Aftermarket that doesn’t always show up in advertisements or blog articles.

      Lastly, if an “industry leader” is really trying to win your business by showing you how our homepage content is stale, I would be cautious. Most likely, they’re trying to distract from the one thing that truly matters, the ability to sell your names. No one brings more visibility to your domains than Afternic, and no-one sells more domains.

      Thank you for the time

      -Paul

      In reply to F Carson | May 12th, 2017 at 5:32 pm

      F Carson

      Thank you for the courtesy of the response.

      I think you are missing the much grander and more important point here though.. and that is the responsibility to the customer base that helped make you in the first place to not publish arbitrary valuation numbers that are harmful to the industry, individual investors, and domain collectors around the world. Not even factoring the related financial advantage to your platform, or the counter role this data clearly plays in helping individuals bypass currency controls through false commoditization strategies under the guise of 4L, 5N, etc..

      Your valuation system is not smart enough to avoid consistent issues with associated word values and predicting accurately their potential real world applications, which means you are perpetually extending harm to domain investors whose loyalty to GoDaddy means renewals across millions of domains. For many that means you are helping to minimize value on domain properties they have long held, simply because advanced analysis of word parsing is too time intensive or complicated to recognize an accurate value proposition. The other critical factor here is the high number of private sales that are made outside of your network, many at confidential prices that would not normally be obtained through a GoDaddy platform or an Afternic-based registrar feed. They are not even able to be factored into this valuation tool.

      So it is one thing to embed this data into a third party tool for entertainment. Another completely though to embed it within the trading marketplace of the largest registrar on the planet. Given the migration patterns of registrars of late, and the model past employed by Web and others to split expiry revenue with the registrars themselves as a participation incentive for representation, I would submit that you have a dozen or more genuine conflicts of interest. Least not being a lesson in possible interpretation strategies on the subject of qualified investment advice and the legal precedent to give (and receive) it.

      And questioning the ethics and motivations of someone highlighting a clear ball drop that is in fact beyond laughable (some would say negligent) is a strange tactic. Personally I’d feel better knowing that the company working on a valuation tool wasn’t also the one dismissing in entirety its own front page real estate value for sales generation enhancement while pretending like it doesn’t exist. You can spin preferred channel visibility all you like, but has your team even ever attempted to spend the thirty minutes it would take to cycle or change the premium properties since buying this successful platform in the first place?

      Seems like a pretty strange philosophy to maintain half of a front page with such blatant disregard in its passive value stimulation. Or discovering its capabilities for income supplementation. Maybe you should replace the domains for sale with information reinforcing charities that feed starving kids?

      In reply to Paul Nicks | May 12th, 2017 at 9:10 pm

      F Carson

      As an add note, I like Go Daddy although I doubt you could tell. I believe they stand uniquely positioned to be a powerful future voice for domain owners and website users, leveraging the strength of their market penetration and consumer share to galvanize a massive lobbying base for protection of rights and common sense. Not to the mention the tiers and progressions of added value services and new product offerings you could bring to the market place over the coming years. Your growth is only limited really by your imagination. Every day you strive to be a better company than you were yesterday.

      I’d like to see a GoDaddy aggressively standing in front of ICANN with a loudspeaker, holding them accountable for silly decisions and making an intelligent voice heard that favors intelligent planning and logical risk assessment. You have the size and representation base for it. Or a GoDaddy that loudly argued for the consideration of some uniformed template for billing and rate guarantees to protect consumers from an unpredictable environment of new GTLD entries.

      And definitely a GoDaddy that realizes that unlocking the fullest value potential from a domain name is an interest shared by all of their customers universally. Should be helping the domain investors as your reliable base maximize their ability to achieve the best valuation possible, even if it means investing in the ability to directly stimulate placement introductions yourself.

      But you can’t let your valuation tool reduce the occurrence of Unicorns.

      In reply to F Carson | May 12th, 2017 at 11:17 pm

    John

    Well I would certainly commend GoDaddy for at least including the disclaimer, though people tend to gloss over or ignore such things. Also I haven’t seen any of this yet so I don’t know how visible it is.

    I suspect it’s more or less all but certain King Rick is angling for a buyout, otherwise I also think he would be saying something – something just as incisive or much more so than I would about all automated “appraisals” in his legendary style.

    This topic has obviously been discussed before. It’s sad and genuinely surprising to see how many people posting about it are like sheep to slaughter, however. But good to see still not all.

    I like the word “ABOMINATION.”

    Yeah, sure, for people like Elliot and others looking to score some good inventory they can flip for a profit, these “tools” may sometimes be of use. (I guess because the “valuation” was too low and enabled the pickers to find bargains, ay?)

    And yeah, sure, for a number of nothing but “plain, vanilla, blue chip, super safe, no-brainer” domains that even a robot would have a really hard time giving a “valuation” for that does not at least have some connection to reality, they may sometimes get it in the right ballpark.

    But that’s it.

    For sellers, these mindless automated nightmares of code are in my humble opinion nothing less than that: an ABOMINATION.

    And by the way, when I used to code in relation to highly sensitive and extremely important data for a major government agency I was considered quite whatever the right word is, if I can say so myself. But without details that’s neither here nor there I guess. And that’s not even my Uncle Sam time I’m alluding to here, which was not IT. 🙂

    Abomination.

    I could give specific examples that would illustrate that in spades, though that would be TMI for me now. I will mention, however, that on at least one recent occasion Mr. Estibot even offered up a valuation of $0 for a domain that is the EMD for one of the most popular things in the world, in one of the most lucrative industries in the world. Thanks, Mr. Estibot! Would love to have been in a sale negotiation when that got pulled out of the hat.

    And this whole automated “appraisal” phenomenon has interfered with negotiations for me before, which I’ve also mentioned before as well.

    In closing I will refer people to this thread I found before and liked:

    “Marchex’s Sales Prove It: Estibot Appraisals Are Worthless”

    https://www.thedomains.com/2012/11/02/marchexs-sales-prove-it-estibot-appraisals-are-worthless

    (And for those inclined to troll, btw, yes I know this thread is about the GD feature specifically, but the larger topic is automated “appraisals” in general, hence the appropriateness of mentioning “Mr. Estibot” as well and any other such “thing.”)

    I really like how Rick Schwartz begins the comments there:

    https://www.thedomains.com/2012/11/02/marchexs-sales-prove-it-estibot-appraisals-are-worthless/#comment-117212

    May 12th, 2017 at 3:16 pm

      John

      And in all fairness I will even clarify that it was *one* EMD for that, as in one among others, not *the* EMD as in the only one. And that certainly does not mitigate…

      In reply to John | May 12th, 2017 at 4:03 pm

    Alex

    Afternic is “scamming” us. They are being very shady!

    May 12th, 2017 at 10:13 pm

    John

    Literally just now this happened to appear as I was perusing Google News. How long before this happens for domains:

    Homeowner sues Zillow, says ‘Zestimate’ is nonsense

    http://www.miamiherald.com/news/business/real-estate-news/article149337129.html

    May 16th, 2017 at 12:04 am

    John

    Follow the money…

    “The Zestimate feature is the cornerstone of Zillow’s business model since it pulls in millions of home shoppers, allowing the company to sell advertising space to realty agents. Zillow makes big money with the help of its Zestimates”

    May 16th, 2017 at 12:15 am

    John

    My last comment is not appearing, which was to quote Rick Schwartz from 2012. When I tried to repost it, I got a duplicate comment error, so obviously it is held “in suspended animation” right now. But it is a duplicate of this: http://domainnamewire.com/2017/05/11/godaddy-will-display-new-valuations-godaddy-auctions/#comment-2245007

    May 16th, 2017 at 12:31 am

    John

    (P.S. That one actually is in moderation right now, too, but Andrew usually clears them eventually, so keep looking if it doesn’t show up here. Powerful words by Rick Schwartz on this topic.)

    May 16th, 2017 at 12:33 am

    John

    Okay, maybe it’s caught in a word filter, so this might work (this is what I posted, minus one word):

    The words of Rick Schwartz from November 2012 bear repeating now:

    “These services do DAMAGE to domineers. they don’t help them.”

    And here is the whole quote:

    “Mike,
    As I have stated for years….ALL domain appraisals are worthless. Period.
    They are based on [DELETED WORD] which in my opinion makes them for AMUSEMENT ONLY and should be labeled as such.
    I am trying really hard not to use the word SCAM. But it always seems to be the first word that comes to mind whenever I hear somebody say “Domain Appraisal”. The others include “Rookies”, and “Desperate”. I won’t even answer an email that MENTIONS an appraisal. The minute ANYONE touts an appraisal, in the garbage it goes. These services do DAMAGE to domineers. they don’t help them. These are based on NONSENSE with info fed into them by folks with limited knowledge of what makes domain names valuable to begin with.” (Rick Schwartz, TheDomains.com, November 2, 2012 at 10:57 am)

    May 16th, 2017 at 4:35 pm

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