Using Comps to Buy Domain Names
A while ago I discussed buying domain names to capitalize on industry trends and recent sales. For example, VideoShop.com sold for $30,900 last week, so very similar names like VideoStore.com or VideoShops.com would be great buys in a similar price range, as the sale of VideoShop.com could be used as a comparison point to make a profit (if you are buying for flipping purposes). Using relevant sales for comparison and valuation purposes is a great idea, and it’s a good way to pinpoint the value of a very similar domain name.
However, people should be cautious to not go out and make stupid registrations to try and capitalize on these trends and sales. Recently, Pizza.com sold for $2.6 million at auction. Since then, I can’t tell you how many pizza names have been listed for sale on various forums and sales venues at ridiculous prices. Just because Pizza.com sold for $2.6 million doesn’t mean GetYourHotPizza.com or NeighborhoodPizzaPlace.com are automatically worth anything, and in many cases, they aren’t worth any more than the registration fee.
Understanding why a domain name sold and buying similar names for the same reasons is good. For example, names like PizzaShop.com and PizzaDelivery.com are great because they make sense. Simply appending a word to the front or back of “Pizza” don’t automatically make it a good name. When you are trying to capitalize on a trend, do some keyword research to see why the name sold, and try to find similar names. Just because a name sounds like another name or looks close to another name, it doesn’t mean it has similar value.
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