There’s a domain you want to use but someone else has it? It may be cheaper than you think!



You have an idea for a website or business and know what domain you want so you try to register it but you notice someone else has it.  Typically, the first thought is “what a cyber-squatter” or “great, now they’re going to want millions of dollars for it”.  Sadly, though, in most cases neither is true.  Unless you have a trademark, had it longer than the domain, and the domain infringes on your trademark then you might be dealing with a squatter (but also possible they do not know about your trademark).  For example, if I owned and used to as an informational site about building houses with mud, Adobe (software) could not go after me for the name (as long as I had no computer related ads etc, too).  As for being greedy, domain prices are like a pyramid.  The higher you go in price, the fewer domains sell at that price.

You’d be surprised at how many domains do not sell for large amounts of money.  If you look at this year’s domain sales chart by DNJournal, you’ll see only 49 reported sales this year were over $100,000 and only 4 went over a million dollars (in 2012, 53 were over $100,000 and only 2 were over a million).  Even though that may seem like a large number, when you consider that hundreds to thousands (or more) domains change hands every day these sales are far and few.  While the lowest prices for domains are not the most common, it is believed that most sales are between $100 and $500 (you will spend more than that on an advertising campaign – and considering after that it’s only $10-$20 a year in registration fees, it’s a great investment).  The next largest group is $500 – $1000.

But – there are some snags.  Some people who own domains do have plans for the site (even if the page is “parked” with ads) and others are being used.  If someone already has a business built up on the domain then your chances of getting the domain are slim unless you buy the entire business.  If the domain is owned by someone willing to sell then then you have a chance.  You can use a WhoIs service (like this one) to find out who owns it, even WhoIs privacy supplies an encrypted email address that you can send an email to.  This should be your first order of business, contacting the owner.

You’ll also need to consider the name itself.  Just like real estate, some are far more valuable than others and since there is no set value it is up to the buyer and seller to come to an agreement.  Look at recent similar sales, look at the popularity of the word (or words) in the domain, and look at their potential.  Keywords (the actual words in the domain) will play a huge role.  High demand keywords like insurance, mortgages, and computers will be far more valuable than ones like crates, cans, and bottles.  Also look at recent sales (if you can).  Did the same domain sell recently in a different TLD (.com vs. .net vs. .org etc.)?  What about similar keywords?  Many sales are reported so you might be able to see similar recent domain sales.

askNow for what usually seems to be the hardest part – contacting the owner about the domain.  Oddly many people give up before this part and if you don’t ask, you are guaranteed to never get the domain.  While I’ll admit you shouldn’t volunteer too much information I would recommend to be honest to the buyer.  Let them know who you are, your contact information (email and/or phone number) and your offer.  Since domain sales are negotiated, I would not make your final offer right off, offer low (but not too low to scare them).  Then you wait.  Typically there are 4 responses you can get.  First, no response.    While I personally think this is not the best business practice, there are many reasons for them to not respond.  Your offer was way too low (even too low to negotiate), they have plans on it, your email could go in their spam filter, etc.  The second response would be, in a nutshell, “the domain is not for sale” which means one of two things.  Either they are not selling the domain (most likely) or your initial offer was so low that they don’t even want to consider negotiating.  Imaging walking into a Mercedes dealership and offering them $10 for a new car – they’ll most likely escort you out.  The third response would be a counter offer.    The feel your initial offer isn’t too low but would like more and think they can negotiate a better selling price.  You’ll need raise your bid and hopefully reach an agreement between the buyer and seller, somewhere in the middle.  The fourth, and best, response would be them accepting your offer.  This rarely happens (knowing people rarely offers their max when making an initial offer) but there could be many reasons for this – the owner might want to get rid of the domain or they would be happy with your initial offer.

So if you’re interested in a domain and someone owns it, don’t be afraid to start a dialogue with them to negotiate a sale, it could be for less than you expect (I’ve gotten quite a few for hundreds of dollars less than I thought they would sell for – and are very happy with them).

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