Why Push to Auction on Sedo Might Be a Bad Idea | DomainInvesting.com

Why Push to Auction on Sedo Might Be a Bad Idea

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SedoFrom my perspective (as an infrequent buyer on Sedo), a seller pushing a domain name to Sedo auction after receiving a private offer is a bad idea, and it may cause the seller to leave money on the table, as I will explain below.

A couple of weeks ago, I made an offer on a domain name that I wanted to buy for somewhere in the $1,000 range.  I don’t have a record of my opening offer, but it was in the ballpark of $500 and the owner’s counter offer was $1,000. Once I received the counter offer, I knew in my head that I was going to buy the domain name, but it was just a matter of how much I would spend, since the owner’s expectation and my expectation were in the same range.

I didn’t want to buy it now for $1,000, figuring that we’d meet somewhere in the middle between our two offers. I counter offered at $688, hoping the owner would either accept the offer or come down somewhere in the $800 range, where I probably would have bought it or countered at $750, with the idea being that I would get it for $200+/- less than what I wanted to pay.

Instead of doing what I expected, the seller sent the domain name to public auction, which is his right to do, although it was annoying to me. If I won the auction, I would either have to pay Sedo to keep the sale private (even more annoying), or my purchase price would be disclosed, thus taking away an advantage when I want to quickly re-sell the domain name.

As the auction came to an end, another bidder jumped in and bid $738. I opted to not outbid this price, and the domain name was sold for $738.  I didn’t want to get carried away in a bidding war, and I didn’t want to allow the owner to make more money by using my private offer as leverage. As the saying goes, I cut my nose to spite my face, but there are plenty of other good deals out there.

Had the domain seller opted to initially reply that $1,000 was his final price, I would have bought it. Instead, he tried to squeeze as much money as possible out of the name by going to auction, and he lost out on $250+. Not a big deal when all is said and done, but it’s 25% left on the table. Had we been talking thousands and not hundreds, that would have been a nice chunk of change.

Pushing a domain name to auction may seem like a good idea to make as much money as possible from a domain name, but this is a real example of where it cost the seller some money.


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 (52)

    Troy

    “As the saying goes, I cut my nose to spite my face”

    So your main point is that sending to auction at SEDO can be a bad thing because there are buyers out there that we make irrational decisions?

    If you were willing to pay up to $1000, but did not, then it was simply an irrational choice on your part that was possibly initiated out of spite.

    I don’t think you are making that much of a logical point with this post. Absent spite I still don’t see why you chose not to participate in the auction even though it was in your best interests.

    Maybe I am reading the post incorrectly…

    August 30th, 2010 at 2:20 pm

      There certainly are dangers to P2A

      I know Sedo allows “Push to Auction”, but frankly it’s a horrible business practice. Imagine buying something using Buy-it-Now and then being told, “Sorry, it’s going to auction”.

      What Sedo has done is essentially turn their “Buy it Now” price into an “Opening Bid Price” which is absolutely not what “Buy it Now” is supposed to be.

      I once needed a domain in a hurry for a project and reluctantly paid the Buy-it-Now price, only to find out that the domain had been pushed to auction.

      What did I do? I told Sedo to f**k off, and they could sue me. (Yeah, sue me for $250. LOL) And I canceled my Sedo account. I will never buy from them again.

      You can tell me I broke the rules. But that’s business. There are contracts and there are penalties in business, and there are times when it pays to tell someone to F off despite everything else.

      Yes, there are dangers to Push-To-Auction. And the primary one IMHO is that the buyer takes off and leaves the seller whining into his beer about “deadbeat buyers”.

      Tough shite. My advice is set a selling price and stick to it — or auction it off. But don’t force your buyer to wait around for competing bids. That’s just plain annoying.

      August 13th, 2012 at 7:06 am

    Shane Cultra

    As I tell my buyers. If you want it, then buck up. If not, I am going to do what’s in my best interest and that’s often push it to auction. An auction on Sedo is about as good of a valuation as a domain can get. It’s out there for the world to see and the final price is what that domain is worth at that point in time. He lost nothing and was probably happy to get the $738. No, that wasn’t me but I do get a little tired of people low balling me and then getting upset because I put it out there to auction. Nice to see the other side’s opinion though

    August 30th, 2010 at 2:27 pm

    Elliot

    @ Troy

    It may not seem rational, but the fact is that I would have paid $1k had he simply said, I won’t lower my price below what I initially offered. Instead, he used a different tactic (the auction), which was annoying to me and I said f-it I won’t bid. I saved $1k for another name, he’s probably happy with his $738-15% for Sedo, and the buyer got a name at his price.

    @ Shane

    He might be happy as a pig in shit, but at the end of the day, he still lost out on an extra $260 (-15% of that amount) in this deal, whether he realized it or not. In your case, it might seem like it would be in your best interest to push it to auction, but if this was your name, it wouldn’t have been in your best interest, although you might just have been happy to make an extra $50 and not thought about the fact that the person who made the initial offer dropped out simply because of the push to auction. This is why I posted my feelings.

    It’s totally his prerogative to do so, and he may have paid just $7 for the name, but this might give Sedo sellers something to think about because there are probably others who think like me and would be annoyed enough to not bid in a similar situation.

    People want to optimize and reinforce their position in a negotiation, but they might not take spite/feelings into consideration.

    Perhaps I lost out on a good name, but ultimately I am cool with it and the seller didn’t make more money.

    Also, this might only happen 1% of the time, but I am an active private buyer, and it’s just something a seller should consider next time he/she receives an offer on Sedo and thinks about sending it to auction rather than simply maintaining their asking price.

    August 30th, 2010 at 2:34 pm

    tricolorro

    “Had the domain seller opted to initially reply that $1,000 was his final price, I would have bought it. Instead, he tried to squeeze as much money as possible out of the name by going to auction, and he lost out on $250+. ”

    I’m sorry Elliot but I have to disagree with your stance.

    You knew that you were willing to pay the $1,000 if it came to that but the Seller did not.

    Had the Seller “opted to initially reply that $1,000 was his final price”, you as the Buyer could have just canceled the negotiations as is frequently done.

    How was the Seller supposed to know that you would not have done that?

    How was the Seller supposed to know he was dealing with Elliot Silver (serious domain buyer NOT low ball domain shopper)?

    By sending the domain to auction, the Seller avoided possibly losing the sale and ,if lucky, could get a higher amount than your $688 counter-offer which he did.

    The extra $50 goes a long way towards Sedo’s commission.

    You say the Seller “…lost out on $250+” by not countering with a firm $1,000 sales price.

    But had you bid just once more, maybe, just maybe, you could have won the domain for a lot less than your $1,000 limit and saved yourself almost $250.

    These negotiations can be very delicate since Buyer and Seller are not dealing directly. Either party can end the negotiations if an offer or counter-offer is not acceptable.

    Since you were willing to pay up to $1,000, why not just bid up to that amount?

    August 30th, 2010 at 3:10 pm

    Joe

    Hi Elliot,
    I usually agree with your posts, but this time I don’t really get your point. Why should he have made an error sending the name to auction? When you replied to his $1000, I think he didn’t counteroffer again with $1000 because was afraid of losing the deal (I know it because I lost a sale in a very similar situation), so he sent it to auction so that he could have a certain sale and could hope to earn something more.

    August 30th, 2010 at 3:18 pm

    Elliot

    Had I wanted the name badly enough I should have bought it at his counter offer but I didn’t. If you want a grand, stick to your guns because you might actually get it.

    Personal feelings aside, I gave some insight into my private negotiation, which you can either use to help or you can blow it off, call me crazy, and hope there aren’t others out there who would be agitated by a send to auction :)

    I didn’t bid out of spite, because I didn’t want a public sale report or to pay Sedo to keep it private, and I didn’t want to get caught up in auction fever and bid more than I want.

    August 30th, 2010 at 3:25 pm

    Shane Cultra

    Elliot,

    You’re looking at this a little one sided. You obviously weren’t willing to pay $1000 or you would have paid $1000. You MAY have been willing to pay that much but you didn’t. Again, I love this post because it shows the human side of negotiation. It’s not all cut and dry. You know what you were thinking he didn’t. He seized the opportunity for guaranteed money. Nobody ever lost money selling at a profit but many often have chasing more.

    August 30th, 2010 at 3:29 pm

    Leonard Britt

    I will agree that taking a name to auction is a 50/50 proposition. Sometimes another buyer or two will jump in and push the bid considerably higher but more often than not you relinquish your negotiating leverage and just settle for the bid price which you had when you sent the domain to auction. The most interested party is normally the one who initiated the negotiation. However, any counter offer can be rejected and so there is also a risk to a counter offer. I got tired of lowball offers so now have fixed pricing on more than 95% of my domains.

    August 30th, 2010 at 3:43 pm

    melodramatic

    If you were willing to pay 1,000 dollars for the domain name then you should have paid it. You are upset that he pushed the name to auction to try to make more money, but at the same time you are trying to low ball him. His motivation is to make as much as he can, and yours is to get the domain for as little as you can. The domain only sold for 738.00 and you were willing to pay a 1,000 then u should have bidded up to that point. Sounds to me you are just mad. It is his right to try to make more for the domain, just as it was your right to try to get it for as little as possible. Pushing the domain to auction is not bad at all. Pretty sure there are alot of folks who pushed a name to auction and got more than they thought they could get. Either sell the name for what the offer price was, or make more by pushing it to auction, is a win win situation.You make it seem like he’s a dummy for pushing it to auction and missing out on and extra few dollars. I’m pretty sure he’s not a mind reader. If you are so concerned about him missing out on the extra money, then maybe you should’nt have tried to low ball him, and just paid the 1,000. Maybe the title should be: See the domain name you want at a price you are willing to pay, pay it.

    August 30th, 2010 at 4:00 pm

      Elliot

      @ melodramatic

      You must not get too many offers on your domain names if you think a $500 offer for a $1,000 domain name is lowballing. I deal with $100-500 offers on 5-6 figure domain names that either I own or my client owns, and that is what I consider lowballing. Making an offer at 50% of the seller’s desired price, with no price indicators, is certainly not low balling, especially when he ended up selling it for a mere 30% more than my opening offer.

      I am not mad in this case, but I was annoyed when he pushed a private negotiation to a public auction. I’ve only intentionally bought one name at public auction before that I can remember (Secaucus.com). I am a domain flipper, and my purchase price is knowledge that a buyer could use when negotiating to buy one of my domain names, so I always prefer than my acquisitions remain private.

      August 30th, 2010 at 5:04 pm

    Kevin M.

    “”Personal feelings aside, I gave some insight into my private negotiation…”"

    Yeah, Elliot you may have. It can/may be summarized that you probably don’t sell names on SEDO, and if so, you’d probably accept lower than targeted offers, as you’re not one inclined (read-feel it’s wrong) to send a name offer, to auction! (Now, which names again did you have listed there..?? ;) )

    August 30th, 2010 at 4:18 pm

    Elliot

    @ Kevin

    I don’t have any names listed for sale on Sedo right now.

    August 30th, 2010 at 4:22 pm

    Uzoma

    I’m ready to render a verdict on this debate. Let me be the arbiter on this one.

    Elliot, I do understand where you are coming from. However, you must remember that when the Seller sent the Name to Auction, you were on hook for your offer, he’d already sold it to you at your LOW BALL offer, and was simply trying to maximize utility at Sedo by getting someone to out-bid you, in which he was successful! The Seller made all the right moves, and in this one rare instant, you (Elliot) made all the bad moves. I usually agree wit you. I find your post very troubling, as it calls into question your allegiance to the “domainers”,. I hope you are on “our” side.

    In light of the foregoing, I hereby give this one to the Seller, Shane, and tricolorro. You lose this one, Elliot. Thank you.

    August 30th, 2010 at 4:47 pm

    Elliot

    @ Uzoma

    Your “verdict” makes little sense here since neither Shane nor tricolorro have any skin in this game.

    If nothing else, I wrote a blog post about a topic that encouraged discussion and brought traffic to my blog… and I saved $1,000. So… who really “won?” :D

    BTW, yes, the seller is presumably happy that his bet paid off with him making $50 more than he would have had he agreed to my offer.

    Bottom line is that everyone here is happy with the outcome, and people who read this article can see the flip side to sending a domain name to auction at Sedo.

    We’re all winners.

    August 30th, 2010 at 4:59 pm

    Sam Nunez

    Interesting that Elliot was unwilling to pay as much in auction as in negotiation because of the implied “privacy cost” of having the auction public.

    Is this a common perception among sellers?

    August 30th, 2010 at 5:22 pm

    Elliot

    @ Sam

    Had this been an important acquisition for me, I would probably have sucked it up and bid as much as I could to get it and then paid the privacy fee Sedo charges. However, it was a name I didn’t *need* to have so I opted to sit it out.

    August 30th, 2010 at 5:25 pm

    Sam Nunez

    Understood.

    I was just wondering if this is an issue in general (in other words, if we should wave the fee for pre-auction bidders… just a thought)

    Would you support the idea of allowing people to push domains into auction for a fee, like bido used to do?

    (currently you need at least one offer on sedo to push a domain to auction)

    August 30th, 2010 at 5:30 pm

    Kevin M.

    @Sam I can say that I know that many a domainer has had complaints and reservations of listing names, due to the ‘privacy cost’ that is ‘tacked on’ there. People feel a charge for such, is just ‘free money’ for the collectee!! It should be abolished imo (in manys’ opinions).

    August 30th, 2010 at 5:30 pm

    Elliot

    @ Sam

    To me it’s bothersome that I can either dig through Sedo to find a name I like or come across one during private Whois searches, and all of a sudden we go from a private sale where only the seller, buyer, and Sedo know a transaction may be consummated to the public auction where everyone that watches Sedo not only learns of the auction but also knows the price, unless I pay a fee to keep it quiet. However, between the start of the auction and the close of it, it’s already been publicized for others to see – it’s just not reported.

    This type of situation makes me much more inclined to negotiate with someone in private via email rather than going through Sedo.

    August 30th, 2010 at 5:35 pm

    Sam Nunez

    yeah, I can see why,

    But on the flip side, there may be overall benefits in keeping the market transparent, with financial incentives for traders to disclose prices?

    (keeping the market efficient, as economists would say)

    My 2c

    August 30th, 2010 at 5:41 pm

    Elliot

    @ Sam

    I see that side of things and agree that it could be beneficial to the market. Since my objective is generally to quickly flip names, it is usually detrimental to my business.

    August 30th, 2010 at 5:47 pm

    tricolorro

    “I’m ready to render a verdict on this debate. Let me be the arbiter on this one.”

    Uzoma,

    It’s not a contest or jury case.

    It’s a discussion on sending a domain to auction at Sedo, nothing more.

    A $500 offer , followed by a $1,000 counter-offer, followed by a $688 counter is NOT low balling.

    Elliot was doing smart negotiating.

    The problem is the two parties are not dealing directly with each other.

    If negotiating by tel or email, Seller can say, “Thanks for your $688 offer but I really don’t want to let the domain go for less than $1000. Can you sweeten your offer?”.

    Or Seller can say, “I’ll accept your $688 offer if it’s net. You pick up the escrow fee.”

    But using a third party like Sedo, negotiations are more delicate.

    I can’t tell you how many times I receive a real low ball offer like this:

    Sedo email:

    “Congratulations. Your domain, keywordkeyword.info has received an offer. Please log in to your account…etc etc”

    Then I find the offer is for: $60.

    I counter with $100.

    Then the next email from Sedo:

    “Unfortunately the Buyer for your domain has canceled the negotiations. Better luck next time*.”

    And that is the point I wanted to make with Elliot.

    I believe the Seller wanted to make the sale otherwise he would have stuck to his guns and asked for $1,000.

    Had the Seller done that, then Elliot could have just canceled the negotiations.

    Therefore, it was actually smart of the Seller to send the domain to auction.

    Worst case: no other bidders and domain sells for $688 (providing the Buyer pays up which is another story).

    Summary: It’s obvious the Seller’s $1,000 price point wasn’t firm and Elliot didn’t absolutely, positively have to have the domain.

    Otherwise it would have sold for $1,000.

    So there are no winners or losers here regarding this blog topic.

    But if you gained anything from this exchange of viewpoints, then you are a Winner!

    *Sedo doesn’t really say “Better luck next time”. :)

    August 30th, 2010 at 6:12 pm

    Uzoma

    To: tricolorro,

    Every situation in this business is a courtroom, my friend.

    I like Elliot for two reasons: he is brutally honest, and he shares his knowledge with all of us little ones.

    Having said that, we must enter any discussion or debate with vigor, without respect to title or friendship. When we debate honestly, as we are doing here, we come out winners.

    Therefore, this post has been vented thoroughly, we have all given our 2cents. I used a courtroom analogy in mine; you weren’t supposed to take it literally, as it was used for emphasis and to express strong feeling.

    The last couple of paragraphs in your post are profound, tric. I’m sure everyone reading this blog assumed those facts as a given or standard.

    August 30th, 2010 at 6:38 pm

    Josh

    I see where Elliot is coming from but also where the seller was. Its a risk you take to make more, sometimes it works, sometimes it doesn’t.

    August 30th, 2010 at 8:04 pm

    Kevin Davis

    Should’ve Could’ve Would’ve

    August 30th, 2010 at 8:27 pm

    Uzoma

    My last comment on this goes to Elliot, who said:

    “BTW, yes, the seller is presumably happy that his bet paid off with him making $50 more than he would have had he agreed to my offer”.

    That’s just it, Elliot. The seller hedged his bet very well. The worst possible scenario for him will be that nobody else bid on the auction, in that case, you win the auction; he gets to sell it to you at your offer price within 6days 23hours and 59seconds. And the best possible position he could find himself at is that a bidding war ensues either with you and some other buyers, or without you, between other buyers, and he sells his domain for $1000, $2000, or who knows…the sky could be the limit; among the perks he derives are hope and adrenalin pump.

    QED

    August 30th, 2010 at 8:30 pm

    Jason

    This past Friday, I received an offer for a domain at Sedo. I had an opportunity to push the domain into the auction, but I decided to counteroffer. I didn’t hear back from buyer the entire weekend.

    I thought I made a mistake, since I always wanted to get into a Sedo auction. However, I fired out another offer, and then another. I enticed the buyer to respond. I closed the deal when they responded with an offer.

    To make a long story short, Im glad I didn’t push the domain into the auction. I had a guaranteed sale. I couldve lost lost the sale if I got greedy.

    @Elliot

    I think you’re a domain psychic. I was going to mention thr Sedo auction. Cool article.

    August 30th, 2010 at 8:33 pm

    Jason

    As a seller in that position, I wanted to close the sale. The buyer had the upper hand in the negotiation. If I had accepted the first offer or entered the domain into the marketplace, I would have taken a risk.

    In the end, I received $100 more than the original offer. I pushed over the domain. Everyone leaves happy. The seller pushed the domain into the auction because they wanted more money. Worpress.org was pushed into the marketplace and received 50+ bids. You never know.

    The next offer I receive at Sedo will be pushed into the auction. That has been one of my goal – to enter a Sedo auction. I’m glad I decided to avoid the auction in favor of closing the deal within 3 days of the first offer.

    August 30th, 2010 at 8:49 pm

    Don

    I think that you run the risk of that domain name going to auction and then having it noticed on the bid forum.

    What happens if it runs to 5k. You spend all that work just to find that it is a highlighted domain name in the system. And then the bidding gets noticed.

    It’s not worth to mess around with a domain name for a few hundred dollars.

    If it’s worth it, buy it and be done with it. Why worry about a few hundred dollars. If the name does not have the potential to be a 20 bagger why buy it.

    August 31st, 2010 at 1:44 am

    June Char

    Since it’s closed would u disclose the name?

    August 31st, 2010 at 8:01 am

      Elliot

      @ June

      No. The name has no bearing on the post, and there’s no need for the former owner to know.

      August 31st, 2010 at 8:30 am

    prospecting

    sedo is great, as with all auctions, the lower the sale price of an asset, the higher the probability that asset will again go to auction in the future. reselling is key !

    August 31st, 2010 at 10:01 am

    Domain Report

    Interesting post, I think it’s just a case of your emotions getting in the way of business, and the fact you were only partly interested in owning the name.

    I don’t think the seller did anything wrong, he didn’t know what you were thinking, and he just used the Sedo platform options available to him.

    From the buyers perspective, the most he’d get from you was $1000, he already had the $688 offer, so perhaps the chance of pushing it to auction and getting more than $1,000 was worth more to him than the extra few hundred he’d possibly get from you.

    It’s funny that it’s not just price that affects these negotiations, but also emotions.

    August 31st, 2010 at 10:56 am

    Pat

    I haven’t sold a lot of names at Sedo. But, I have pushed a couple names into auction at Sedo and then actively reached out to as many end-users as I could possibly find for the name, alerting them to the auction.

    Why wouldn’t I try to get my full asking price rather than settling at a price I’m not particularly happy with?

    Unfortunately, my efforts have only generated another offer once, but it doubled the push price that time. I would feel like I was cheating myself if I didn’t make every effort to get as much as possible for a name. Particularly, if I had countered with what I felt was a fair price for the name.

    If a bidder makes an offer, and the owner counters, you have to realize that Sedo offers this push-to-auction option. There’s nothing underhanded or unfair about it. I’ve seen a fair number of complaints like this in the forums where the bidder acts like the domain owner has done something egregious by sending the name to auction. That’s nonsense, IMHO.

    I think you took it way too personally. If you didn’t want to pay the asking price immediately, you could’ve put in a proxy bid for your limit after it went to auction, and then you’d either have the domain, or you’d have the satisfaction that someone had paid more than you were willing to.

    You said it yourself… you cut off your nose to spite your face.

    The owner has a huge disadvantage at Sedo because there is no way to assess the buyer. That leads me, and probably a lot of other people, to assume that the bidder is an end-user and try to get top dollar for any name that gets bid on.

    I think anyone who gets a bid at Sedo should use every possible tool available to them to get top dollar. If that offends the initial bidder… cést la vie.

    August 31st, 2010 at 11:18 am

    Webmaster Crunch

    Agree with you, as a buyer i would definitely move away from the auction. As a seller, you should take the risk since no one can guarantee you can receive a higher bid or get no sale finally like your case.

    September 1st, 2010 at 12:11 am

    Poor Uncle

    Sorry…can a newbie chime in and try to learn something really quick. I’ll stay out of the debate.

    But recently I got my very first offer for one of my domain names. I counter his offer and asked for 4 times as much simply to see how he would react. Needless to say, I never heard from him again! Bad move on my part or is it?

    I have the following questions:

    1. If someone is serious enough to make an offer, won’t he usually at least respond even if the counter is outrageous?

    2. Was Elliot required to buy the name when it got sent to Auction with his counter offer price if there weren’t anyone else interested in the name?

    The name I got an offer was thru Whypark.com. Do they have auction where I can send the name to auction instead of playing the counter offer game?

    Any help is greatly appreciated.

    September 1st, 2010 at 12:43 am

      Elliot

      @ Poor Uncle

      1) When I make an offer for a domain name, it’s generally an educated offer in my opinion. If someone replies to my offer with a price of 4x+ my offer, I may cancel negotiations knowing we aren’t that close, although it really depends on the amount of money involved. Usually I will counter offer as long as the person doesn’t reply 10x or more.

      2) Yes – had nobody else bid on it, I would have paid $688 and probably would have paid for privacy too.

      I am not sure if WhyPark has that type of system, but you can email craig@whypark.com to ask.

      September 1st, 2010 at 9:03 am

    Jason

    @Poor Uncle

    Your mistake was not sending another counteroffer. If the buyer never responded, they elected to wear you down. When the seller has to wait, they may contemplate whether the counteroffer is too high or if the buyer is no longer interested in the domain.

    Which domain were you trying to sell? You usually know exactly what you want for a specific domain. I received an offer, and sent a counteroffer. I did receive an offer againuntil after I fired out 2 more counteroffers – 3 in total. When the buyer sent a second offer, I accepted the offer.

    Answer to the outrageous counteroffer – NO. They won’t respond until you send a counteroffer that is within their price range. Four times an offer is extreme. Silence is the method to negotiate.

    September 1st, 2010 at 1:01 am

    jeffcool

    IMO the offer/counter offer system of SEDO is from another age and is confusing, especially when mixed with auctioning. We always say that domain buying from end-users initiative is not spread enough, but we should admit that SEDO doesn’t make it clear and simple to the one-time one-domain buyer.

    And just to make a point, has anybody some example of a big art auction house (Christies, Sotheby’s, etc…) working with the offer/counter offer mechanism ?

    Auctions with start, reserve and BIN prices would be much clearer and better for both buyers and sellers. The only good thing to keep in SEDO is the principle of the permanent listing with the first bid starting a time limited auction (“auction in progress” listing offers the right visibility to “hot” domains).

    Another interesting new feature could be a decreasing auction (price periodically reduced until sold). This would help some domainers to clear out their portfolio, while giving others some bargain opportunities.

    Just some thoughts.

    September 1st, 2010 at 1:46 am

    tricolorro

    “But recently I got my very first offer for one of my domain names. I counter his offer and asked for 4 times as much simply to see how he would react. Needless to say, I never heard from him again! Bad move on my part or is it?”

    Poor Uncle,

    Every Sedo transaction is an island unto itself. There’s no way of knowing before hand if any action you take is a bad move.

    You received an offer.

    You countered.

    The Seller could have countered with a higher offer but never did.

    How can you know what would happen before hand?

    The Buyer could have countered and the sale stays alive or the Buyer could have canceled the negotiations and the sale would be dead.

    When you didn’t hear from the Buyer again, you as the Seller could have counter-offered as Jason suggested but realize every counter-offer you make has to be for a lesser amount than your previously Selling offer.

    Therefore you are really putting the Buyer in the driver’s seat.

    I’m not saying this is what you should have done but had you sent the domain to auction your Selling price would either have gone up or would have stayed at the initial offer (as long as the Buyer pays).


    “The name I got an offer was thru Whypark.com. Do they have auction where I can send the name to auction instead of playing the counter offer game?”

    You have nothing to lose by contacting WhyPark as Elliot suggested but realize that WhyPark is not a Domain Marketplace.

    If you received an offer for your domain, where exactly would it be pushed to auction?

    September 1st, 2010 at 10:43 am

    Jason

    @Poor Uncle,

    The strategy is to make an immediate counteroffer. Give it a few days. If you don’t hear from the buyer, then reduce your offer. 15% of the asking price. Wait a day. If you don’t back from the buyer, or they never contacted you beyond the first offer, send one more counter at 10% less than the second amount.

    Most likely, the buyer knows that you’re interested in selling the domain, and not asking some outrageous price. As you’re looking to make you first sell, I wouldn’t get stuck in a offer/counteroffer war.

    You can’t expect to make a fortune on your first sale. On my first domain sale, the process involved a Go Daddy offer/counteroffer. I received an offer through e-mail. I replied back with a counteroffer. The buyer upped their offer. I replied back with the same price. The buyer sent one last offer. I sent another counteroffer with the reason why I was staying firm on the price. They accepted the offer. I sold the domain.

    It really depends on the domain and the price difference. There are some domains where I may not rush a sale because of their commercial value, but the rest have flexibility.

    You can usually determine the value of the product or service through looking in the search engine. When you countered with 4 times the amount, the buyer is not going to respond, especially when the two amounts are so far apart.

    It’s up to you to make it worthwhile. I’m sure that you know the value of the domain. If I want to sell a domain for $800, I know that I’ll take $500 as the lowest offer. If a buyer sends me an offer of $400, and I counter with $1600, that deal will be dead unless I take the initiative to send another offer closer to the amount I’m looking to make, and without reason of the buyer.

    If you need the money, then I would try to work out the deal quickly. If you have time to wait, then work on finding a common ground in the price. Unless you paid a fortune for the domain, you have plenty of profit room.

    As a seller, I don’t mind whether I or the buyer has an upper hand. It really depends on the domain. If I’m trying to sell a nice domain I originally wanted to keep, I will probably invest more time into trying to get the best price – taking the leadership role in selling the domain.

    I believe that when you receive an offer at Why Park, the buyer will e-mail you. They give you an opportunity to link your sales page to Sedo or Go Daddy. I think it’s more of a private negotiation. Don’t quote me on that. All my domains are hosted at Why Park.

    Recap: Receive offer, counteroffer, don’t hear back in a few days, counteroffer at 15% less than the original, wait a day, no response, send one last offer for 10% less than your last offer. Most likely you’ll receive a response.

    Sometime you have to part with your domains. I see many people pricing them at 20 times or more than their value. These domains sit around with no action. I find these domains on the drop, and then sell them. It takes work to make a sale. It’s rare that I receive a random offer. I value the offers I do receive.

    I won’t pay $2000 for a domain that is only worth $50. If I really want a domain that is only worth $200, but I know will be valuable in the future, then I may pay 4 times the value. It really depends on the domain. Domain age plays a role, as well.

    This is all from experience. While I’m no pro, my strategy is working for me. Good luck.

    September 1st, 2010 at 11:23 am

    Jason

    As for the article theme, I would have sent out another counteroffer at $1000. If the buyer kept trying to toy around with the same amount, and I had the time to wait, I would send the domain into the auction. I’ve seen bad domains sell for 27 times their value.

    Another sold for 50 times its value. Both times the seller wrote a lazy one liner regarding future value. I want something that already has value, instead of waiting 10 years to see any real growth.

    Because of closing the deal early, I managed to receive the funds the next day. If I had the time to wait, I would have pushed the domain into the auction. Out of respect for the buyer, I avoided pushing the domain into the auction. I could have pushed the domain, but then the company may have risk losing the domain. I
    was fair, and it all worked out.

    It really depends on the seller’s situation. Not every domain investor makes a good living. What if they needed the extra money to pay their rent or car payment. When you’re playing around with small amounts, there is a need for extra money.

    If you were bidding on a $20,000 domain, then both parties most likely have money to throw around. If you really wanted the domain, you would have made the sacrifice to go after it. Some people don’t have the time to play around with back and forth negotiations that may not result in a sale.

    September 1st, 2010 at 11:33 am

    Hui SC

    U are right Jason and I shared the same opinion. I used to owned a few thousand domains since 1998 and had sold more than 3 thousand domains mainly 4 letters and generic. Currently, I have parked all at sedo.com and looking for a bulk domain purchaser. Pls email me at domainsales@consultant.com for a list of my domains for consideration

    September 1st, 2010 at 9:25 pm

    popo

    Wow. I completely disagree with anyone who thinks pushing to auction is ok.

    “Buy Now” means “Buy Now”. Period.

    If I’m on a website and something has a price and a button next to it that says “Buy Now”, I’m interested because I believe this is available to me at this price, now.

    If suddenly the seller changes the terms under my feet and pushes to auction, I don’t care if it’s binding or not — I don’t pay. And I register a new account under an employees name. (I’m on my third now).

    Fuck anyone who tries this shit with me. It’s dishonest. Period.

    Sedo should be ashamed of themselves for allowing this sketchy shit.

    August 6th, 2011 at 4:35 am

    Sam Nunez

    Buy Now listing are indeed immediate, non reputable sales.

    push-to-auction is only for domains listed with the negotiable format.

    August 6th, 2011 at 12:55 pm

    Poor Uncle

    Elliot, I just realized u wrote this a while back. Haha
    But what was the rule of the negociate? If he said his final price is $1k, I assume your previous offer would be voided?

    Seems like the rules of sedo, doesn’t allow him to send you a courteousy notice to say you either pay him $1 k or he will send it to auction with your offer as the starting price.

    By the way, when he send it to auction, your offer is no longer biding right? The only leverage he has was people know your offer for the name right? Once he send it to auction, do you have the option to walk away?

    If those were the rules, I think the man did the right thing.
    The only other question I have is, if he said $1 k and you said no, does sedo still let him send to auction with your previous offer as the starting bidding price?

    March 3rd, 2012 at 12:11 pm

    Jay

    It may be annoying for a buyer if the seller sends the domain to auction, but that’s the seller’s prerogative. When I’m trying to get rid of some of my domains, I’d always send it to auction when I get an offer that’s reasonable (of course, always more than what I paid for). For domains that I feel can fetch a higher price, I’d hold back and wait for better offers.

    May 18th, 2012 at 10:07 pm

    John

    The seller has every right to auction it, and even put as reserve the buyers final offer. But transferring the buyers final offer to the auction as first and starting bid is a practice that creates artificial impressions about the value of the domain and it is an appalling practice, I dare to name it a scam.

    August 22nd, 2012 at 5:36 am

    Claudio

    Sorry for you, but he made the best thing, being to a mind reader as everyone are.

    $ 688 is an offer coming clearly from a “mad” person, someone who lives only for his personal self-esteem”, making wars that are not a work but only something that only some lucky persons can do.

    You lost in this case (I repeat, you lost because he made the best things: he, like you, is not a mind reader).
    688 can be only an offer coming from a player, certainly not from an end user.
    670 if you want, but not 688.

    688 means: ATTENTION: A “MAD” IS WAITING YOU TO AN AMBUSH

    If you receive an offer from a “mad” person, a player and nothing more – certainly not an end user – you will try “to securize” the situation…

    January 8th, 2013 at 1:03 am

    Claudio

    “670 if you want, but not 688.”

    I wanted write $ 690 not 670.
    690, 700, also 685 but not 688 ….

    I hope you will remember this for the future… :)

    January 8th, 2013 at 1:14 am

    Joseph

    These days we, the sellers, do not get too many offers. I would also push it to auction. You could cancel the negotiation at any time and than he made nothing. This way he earned some cash! Good for him!

    Of course, if you are not in need of cash you can just wait a bit more, maybe, JUST MAYBE, there will be someone else with a better offer.

    I have rejected an offer of 1000 euros a few years ago. No other offer came in since. Maybe I had the impression that my site worth more than 1000 but.. the marketplace said “NO”..

    February 9th, 2013 at 6:27 am

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