Rob Monster of Epik recently started an interesting discussion over at NamePros about “shooting the moon” when selling your domains. Basically the premise was that you don’t know how much the buyer would be willing to pay, so you might as well ask for an astronomical number and see what happens.
After all, you can’t get a high price if you don’t ask… right? Plus you can always offer a lease as a cheaper alternative, or you can walk your price back down.
For 99.99% of you this is terrible advice. Why?
Because getting a crazy sale is a numbers game, and you don’t have the numbers.
By the Numbers
Mike Mann is notorious for selling seemingly mediocre domains for shocking prices. I hear this all the time from new investors, and also surprisingly from some seasoned players:
If Mike Mann can sell something bad like AnimalsUnited.com for $39k why can’t I do the same? Maybe I should raise my prices… my domains are better than that one.
Well maybe, but you don’t own 352,316 of them.
Let’s look at how Mike Mann actually prices his names:
| Range | Number | Percentage |
|---|---|---|
| $250 or Less | 1,368 | 0.4% |
| $500 or Less | 9,026 | 2.6% |
| $1k or Less | 20,257 | 5.7% |
| $1.5k or Less | 32,744 | 9.3% |
| $2.5k or Less | 81,661 | 23.2% |
| $5k or Less | 134,837 | 38.3% |
| Higher than $5k | 217,479 | 61.7% |
| Higher than $10k | 175,426 | 49.8% |
| Higher than $25k | 68,358 | 19.4% |
| Higher than $50k | 20,090 | 5.7% |
| Higher than $100k | 3,863 | 1.1% |
50% of his names are priced at four figures or less, 38% are priced in the sweet spot at $5k or below, and 6% of his names are even priced in the three-figure range. Even the poster boy for ridiculously awesome sales is not just blindly shooting for the moon on every domain.
In the past year Mike Mann has reported 25 sales in the five-figure range. While he probably doesn’t report every sale, that is only a 0.014% sell-through rate for names in that range.
Let’s pretend for a minute that your entire portfolio was of similar quality to the cross-section of names he has priced at $10k+, and that you priced them all $10k+.
At that rate, if you own 500 domains it would take you around 14 years to get a single sale. If you only own 100 domains you would only make one sale your entire life.
For most of you, if you shoot for the moon you’re going to end up missing and floating around in space until you suffocate. Dark, I know… but it’s true. You won’t make any sales, you’ll bleed money from renewals and new acquisitions, and you’ll eventually say the domain industry is rigged and rage quit.
Survivorship Bias and Retail Comps
Retail comps have no predictive value whatsoever. If Mike Mann sells a mediocre domain for mid five-figures that says absolutely nothing about what your domain would sell for. Not even if your domain is very, very similar to his or is different but better. Let that sink in for a minute; read it again if you have to.
Your buyer is not Mike Mann’s buyer when he gets a crazy sale, your buyer is almost always Mike Mann’s buyer when he sells for 3-4 figures. You don’t have enough inquiries to stumble across the person with big plans and an even bigger wallet with any consistency. It might happen once a decade. It might never happen.
You are not Mike Mann either. He is making multiple sales a day, so if one deal falls through he’s not going to starve. That puts him in a very strong negotiating position. He probably does more end user sales in a day than you do in a year. You can’t afford to not care if a buyer walks, even if you do your best to adopt that attitude to project strength.
With retail sales all you hear about are the lightning strikes; the big sales; the often lucky sales. You don’t hear about the hundreds of thousands of domains that are overpriced and never get an inquiry. You don’t hear about the people struggling to make renewals because they’re shooting for the moon and missing. And perhaps most importantly, you don’t hear about all the solid sales the seller missed out on trying for that one lottery ticket.
You only hear the success stories, and that makes you believe you can do it too.
Why You’ll Probably Never Make a Crazy Sale
Let’s go back to the $39k sale of AnimalsUnited.com that I mentioned earlier. Crazy right? If only you owned the name that could have been your conquest. But what most people don’t fully appreciate is that to get a sale like that you have to first turn down $500, $1k, $2.5k, $5k, $10k, $15k, $30k, and $35k before you finally get to $39k.
Could you really turn down a $5k offer on a name you probably got for $50? I know I probably couldn’t. And even if you could… should you?
It’s much more likely that the buyer ghosts you at that point than increases his offer. At the end of the day you’ll score more by hitting a lot of singles and doubles, than swinging for the fences and striking out 7,000 times in a row (the odds of Mike Mann hitting a home run).
If you’re not in a position to turn down phenomenal returns you’ll never make those legendary returns. Even if you had the right name, in the right place at the right time, with the right buyer; you weren’t the right seller. Everything has to come together. So stop trying, you’re just scaring away solid sales playing extremely long odds.
What should I do?
That depends on where you are now and where you’re trying to get to. Maybe you’re just doing this for fun, you only own 50 good names, and you couldn’t care less if you make a sale as long as you live. If that’s you, by all means, shoot for the moon every time. You’ll probably never make a sale, but who cares.
I suspect most of you have small to medium sized portfolios, domaining is currently your side hustle, but you’re trying to grow it into a serious revenue stream. If that’s you, don’t get distracted by this sideshow of “shooting the moon”. Price your names reasonably, re-invest into better names after each sale, and be patient and consistent. It will happen eventually.
Only if you already have a large, high-quality portfolio can you play the lottery game of going for crazy sales and actually win. But like Mike Mann, you should only do it with a small percentage of your portfolio. The rest should be reasonably priced for steady cash flow.
Regardless of your status, list all of your domains for sale on Afternic and Sedo, price most of them and make it a reasonable number, and opt them into the MLS/DLS so they get into the registration path. If you do that you’ll be ahead of most domain investors, and well on your way to growing your portfolio.
Michael Sumner is the CEO of NameBio.com. Previously he was the lead developer at State Ventures which owns and operates geo domains such as OceanCity.com and Maryland.com. Michael was also the co-founder of DN Media, a company that was involved in seven figures worth of domain name transactions.
This is a spot on domaining article.Thanks Michael.
Seems like sound advice. Thanks.
I assume that many of Mike Mann’s – or any successful domain seller’s – bigger sales are closed on the phone. Skilled negotiation on the phone may get a buyer up there higher faster than via the snail pace of email that gives the buyer more time to reflect, and back out. The psychology of convincing a domain buyer that you have what he needs, is usually better conveyed in real time.
A smart and chastening dose of reality. Good man!
One of the best posts I’ve read in a while!
100% correct summary and take-away. Great data and analysis, as only you can collect. Very well written, Mike. 👏
You realise qalandar.com is very good quality name? It isn’t a $50 name that was hand regged yesterday.
Disagree with most of the article, the industry is about selling small volumes at high prices. No other industry on earth where the stock turnover is so low (That I know of anyway). If people want 20k, 40k sales they need to prices the better names at that level. There is no magic in what Mike Mann does to get high prices other than picking up good names and pricing them there.
I did not realize, I thought it was supposed to be a phonetic spelling of Calendar. Your comment prompted me to Google it, and while it still seems like a moonshot price for something with little commercial appeal or brandability (would be Seva.com all over again), I changed the example in the post to avoid offending anyone. The point wasn’t the domain itself, just that Mike is able to sell names for surprising prices.
I agree with you, there’s nothing wrong with pricing the top 5-10% of your portfolio at a moonshot level. But you can’t just will yourself into a $20-40k sale by pricing your names there. The key to a sale at that level is owning names that have the potential to be worth that much to an end user. Most people don’t own a single name that could sell for that much, so pricing all of them at $40k is just going to ensure that they never make a sale and wash out.
The odds of selling any given name in a year are directly correlated with the price level. The higher you price it the less chance you have of selling it. If you price a good name a $1 it will have a near 100% chance of selling. If you price it at $100 million it will have a 0% chance of selling. A moonshot price is by nature an extremely low probability price. If you quote extremely low probability prices for all your names you probably won’t ever make a sale.
The point of the article was to contradict Rob’s advice that people shouldn’t price any of their names, and only use his SSL “Make Offer” landers and respond to every inquiry with crazy prices. Especially since he was basing that advice on 3 sales from Epik’s marketplace of 380k names. He was looking at it from a macro level and not really considering how that would play out for Joe Domainer with a small portfolio of average names.
It sounds like you’re saying that every single one of Mike Mann’s sales makes perfect sense, and everyone could replicate it if only they had the right names. That’s nonsense. The “magic” in what he does is having a massive inventory that are all priced. He tends to only report the crazy sales to further his legend, and that makes people think he prices all his names as moonshots. Then they hear Rob’s advice and it all gets solidified. “Yes, I too should price all my names like a maniac if I want to be successful.” I wanted to show people that isn’t what he’s doing, and neither should they or they won’t make any sales.
Nice advice.
Enjoyed your realistic overview of the domaining enterprise. A great hobby this has been. Am not shooting for the moon at my moonshots domain website. Basically enjoying the ride covering reg fees. Ted
This article explained the realty in domain sales.
Don’t wait for a bigger sale, if you plan for long run…
btw, your calculation is wrong in the above data…
Sound reasoning by Mr. Sumner.
Well put.
Count me as one of the stupids, asking more for his names, than other domainers assess is prudent.
Danger.
Domainers kicking other domainers’ names.
Case:
I had an offer from someone for my name mining.camp for $8000 USD
Right before the buyer was to pay, someone from Godaddy alerted him to Namebio.com and cited that Space.camp sold for only $2000 USD, so he pulled out.
He then became abusive towards me and reneged even when I lowered the price to $2000.
The domain name business is owned, lock, stock and barrel, but roughly 3 dozen or so individuals that were first to the circa 1995-1999 .com registration trough. I would list the gentlemen here, but I know that trying to cite their names will result in having the post stopped.
Suffice is to say that the domain kings, when asked of the value of name not owned by them, will disparage the name so much so that real, criminal intent is evident.
From my experience, as a domainer that started in ernest to make money in the domain name business in 2008, the kings take gleeful occasion, time and time again to demean and disparage attempts of anyone other than the chosen 36, or so, to make a sale.
The kings of the industry and those willing to do their bidding, devalue names of the domainers on the outside, only, to serve their own purposes.
Sound reasoning by Mr. Sumner.
However, making sense of an uneven playing field and justifying maligning the value of other domainers names and their efforts is, perhaps more to the point of why those that are not counted among the kings can’t sell a name.
Robert McLean
Pretty odd that a GoDaddy broker would try to scuttle what sounds like a done deal. If he was repping the buyer he should have brought that up before making the $8k offer.
There’s no conspiracy to keep you down here, I’m just trying to help with sound advice to counter what I thought was reckless advice from Rob.
I see you’re asking the following prices:
The3DPrinter.com – $5 million
M3DP.com – $1.5 million
Metal3DPrinter.com – $1.5 million
3DMedicalDesign.com – $250k
3DScanPrint.com – $250k
SinterBot.com – $250k
I would certainly qualify those as extremely low-probability prices, but if you don’t care to ever make a sale it’s certainly your prerogative to ask those prices. You’re definitely scaring away interested buyers that might have still given you a really good price.
Or maybe I’m just trying to keep you from making millions for my own selfish reasons.
*evil grin*
Are you suggesting, Mr. Sumner, that nothing ever, ODD, happens in the domain name business?
It is “business as usual” and an otherwize “cost-benefit calculus” that the kings of the domain name business employ when disparaging the domains of those not in the “club” of 36 or so “first to the .com registration trough, circa 1995-1999.”
I don’t care what anyone asks for their names. It is none of my business. Why would the kings care what I ask, but to kick sand?
I hadn’t heard of ODD before, but after reading the Mayo Clinic description it made me think of your first comment a bit. Authority figures telling you that you’re probably shooting too high for your names, and you arguing and lashing out with defiant conspiracy theories. The article wasn’t even about you specifically, but you took it personally, which tells me that deep down you know that you fit the profile of a serial moonshotter.
Yes, there is a secret club and the mandate is to insult the domains of everyone who isn’t in the club. I think you just made the top of their hit list.
It’s not kicking sand to tell you something you don’t want to hear. Kicking sand would be saying those names are trash, nobody would ever want them, and your prices are comical. All I said was at those prices it’s very unlikely you would ever make a sale, and you’re scaring people away from even inquiring. Clearly you’ve tried to corner some market(s) that you’re familiar with, and you’ve become too attached to the names. Not a big deal, happens a lot.
I’d like to see you succeed in selling domains, because a rising tide lifts all boats, but I don’t really care what you ask for your domains. As I said it’s your prerogative to ask whatever you want.
Why would you care what anyone asks for a domain name, short of assuming the role of a buyer?
In expressing an opinion as to the merits of anyone asking any amount for a domain name, you risk, and perhaps this is closer to real motives, devaluing the names for which your your opinions are offered.
In fact, denigrating, demeaning, disparaging, attacking the efforts of any fellow domainer, is the issue here.
However, if you are not part of the club of “36 or so”, kings of the domain name business, first to the .com registration trough, circa 1995-1999, and need to vent, I do understand!
Unless you are a buyer, what I ask for my names, is not of your business!
“It sounds like you’re saying that every single one of Mike Mann’s sales makes perfect sense,”
I’m saying the example given was clearly a valuable name and I don’t think it was a “moonshot” price. People often see big sales and think it is some random sale of a worthless name because they haven’t researched the name. I don’t think Mike is deciding to price certain names high for no reason.
That was the entire point of the article… not even Mike Mann is shooting for the moon on every name, which is what Rob’s advice was before he walked it back. But you clearly haven’t spent much time looking at Mike’s portfolio if you think all of his prices make sense. $1.99M for HabitMonster.com, $995k for ActivityRiver.com, I could go on like this for hours. Download his portfolio, sort by price descending, and then defend your position again 🙂
https://www.domainmarket.com/s3/priced_domains.csv?t=1574162895813
The point was that while Mike does have some moonshots, he also prices a lot of names very reasonably. And it’s purely by virtue of the size of his portfolio, and the sheer number of moonshots (despite being a low percentage), that any moonshots actually come to fruition. Not because it’s actually a smart or repeatable thing to do.
Granted the example I chose wasn’t the best, but hopefully you can not get hung up on that and see the point I was trying to make.
Robert, those prices are pure nonsense, worthless names.
Spot on article. Thanks for sharing, Michael. Also kudos to Andrew over at DNW to point to it, I may have missed it otherwise.
Joern
Good one there Michael…
Exactly – smallish portfolio of hand-regged, expired, and low-cost auction side-hustle wishing there were better cash flow but selling enough each year to warrant the considerable investment of time. I’m finally getting around to listing most of my names at buy now prices. Had a decent sale within weeks of doing so. Not necessarily a corollary but fingers crossed. I keep some of my favorites, especially those I’d like to build out myself, pointed to my blog and respond to the usual ‘how much’ comments with high asks. But where you say, “Price your names reasonably, re-invest into better names after each sale, and be patient and consistent. It will happen eventually.” I wonder if this is based on your own experience or if you have any data that also supports that. And if it’s based on your personal experience, if you could talk about your ‘journey’ in a post or podcast interview some time. Would also love to hear your no-doubt data-driven methodology for pricing your domains. Thanks!
Michael, This is a very good post. It is easy to get carried away in this business and, although a bit painful, a reality-check is something we can all benefit from. Thanks.
Great article Michael. I often wonder why people portray only one side of the story – feels wrong. A little deceptive, especially when there is SO much more to it.
Also at some point surely MM has to downsize. Maybe even to zero. Maybe this is decades away (unless the portfolio can be passed on) but still, how do you keep “shoot for the moon” prices while reducing a portfolio to zero? You need the huge portfolio to have a chance of it working.
It is refreshing to see so many comments here where people get it.
Please do “go on for hours” because from what I can see he only has maybe 10-20 names out of 300,000 that are low quality and priced at that million+ level. I don’t think these are “moonshots”, they won’t sell until he prices them properly.
In 99.9% of cases he has priced them roughly in the right range. The stuff about him pricing “too high” has been going on since the buydomains days, usually by people who don’t understand the names or would sale the same names for peanuts.
Mike does sell a decent proportion of names at high prices. He sells about half a dozen domains a day and posts a 5 figure sale every few days so do the math.
The comment “Not because it’s actually a smart or repeatable thing to do.” isn’t an accurate statement. If people have a reasonable quality portfolio and price the better names at those $10k-50k levels they will get those sales as well. Of course most don’t have a reasonable quality portfolio and are holding largely unsellable domains.
Please post which of the 42 names that are priced $995k and up that you think are reasonably priced at that level. I could find six or seven, but you think there may be as many as 32. And that wasn’t the only range I was talking about, which is how I could go on for hours. There are maybe two or three out of 17 that are reasonable at the $795k level. But I’m not even talking about just the high priced names, I’m talking about names at almost every level, that was just the easiest way to quickly show you that not every name is priced sensibly as you implied.
And let me reiterate again that my argument is not that Mike Mann does too many moonshots or does a bad job of pricing, it’s the opposite of that… that he actually prices much more reasonably than people think. And if you want to emulate him that doesn’t mean grossly overpricing your entire inventory or always shooting for the moon.
Anyway it doesn’t matter because the truth is that he has a reputation for achieving crazy prices, whether you think that reputation is justified or not, or the prices are actually crazy or not. And my point was that despite that reputation, he actually prices pretty reasonably and so should everyone else.
He has posted four five-figure sales so far in November, six total in October, and five in September going through his Twitter feed. Let’s say 60 per year. With 175,426 names priced in that range, the sell-through rate is 0.03%. That means you’d need 3k names to make one sale a year, way more than the average domainer owns and theirs are worse quality. And even if they had the same quality they would still be upside down because 3k names has a carrying cost of $24,510 and his average five-figure sale is well below that amount.
Now you seem to be getting it… most don’t have a reasonable quality portfolio. So Rob telling them to shoot for the moon will have an even worse sell-through rate than Mike. Which means they would need to have *more* than 3000 names just to make one sale a year if they quote every inquiry at five figures and above. The average domainer probably owns about 100 names, which at that rate would take 30 years to make a five-figure sale. Got it now?
The average domainer would fail spectacularly by following Rob’s initial advice. The point of this article was to warn them not to try that.
And to be even more clear, I’m not saying all of Mike’s five-figure sales are crazy or moonshots. I’m just saying that the ones that are crazy only happen because he has a massive amount of names priced at that level, and it is not something the average domainer can repeat.
Thank you for a well reasoned article. Your responses to the comments also shine. This post should be in every new domainer’s reading list. Required.
Nate Cohen , Telepathy.com
Kevin Ham , Venture.com
Mike Mann , DomainMarket.com
Gary Chernoff , NetIncome.com
Monte Cahn , RightOfTheDot.com
Dr. Gregg McNair , Igloo.com
Larry Fischer , GetYourDomain.com
Rick Schwartz
Frank Schilling
who owns the domain name business?
So, let me get this straight.
To succeed in the domain name business,
#1. start with a massive inventory
#2. bow to authority
#3. price names so as to not offend domainers selling to domainers
#4. acquiesce to attacks by those that assess you names as worthless
#5. don’t, ever, expect to sell a name for more than the bloggers cite as “reasonable”
#6. don’t try to “corner the market” in an domain name niche
I’m sure, because I am stupid and you are the smart ones and the authorities, that you will not hesitate in putting me in my place and will expedite vicious attacks on why I should not hope to make money, ever in the domain name business.
Tell us Mr. Mann. Bring us along on how new domainers should conduct themselves. Please!
To succeed you need to know the difference between a good domain and bad. You need to start again instead of rambling here.
The OP seems to suggest the problem you face is pricing but I think it is quality.
“He has posted four five-figure sales so far in November, six total in October, and five in September going through his Twitter feed. Let’s say 60 per year.”
I counted nine in the 30 days (that he has posted). I think 50% of his revenue would be these so called “crazy” sales.
Count again. He sometimes lists the same one two or three times. And again I’m not saying every five-figure sale he makes is crazy.
I have two domain for whom i will shoot the moon for 10 years.
Menaairlines.com
Defi.es
mena=middle east north africa & defi=decentralized finance.
Hey Snoop,
M3DP.com is the exact-match for Medical 3D Printing
Either you are ignorant of the fact or just trolling, but Medical 3D Printing will over the next decade, change medicine!
So, that makes M3DP.com quality!
Now, I don’t know what your problem is, by I can see that you are afforded the luxury here of making person attacks. I wonder why?
The rat infested domain name business makes me sick, but you can rest assured, that I will not quit, until it is people like you, that eat their words.
Thoughtful, well conceived article based on data and solid logic. An illuminating counterpoint to the Monster approach. Well done.
If “Medical 3D Printing” took off as a term it is still very hard to see why M3DP.com would be worth anything. You are very far off course with this. I saw you also said you haven’t sold a domain in over 2 years. You may like to think about why that is.
you win Snoop
too smart for me
Little Ricky Schwartz is “Snoop” here.
Hey Schwartz, why don’t you start again, and stop rambling here.
Further, taking joy in other domainers struggling shows your real character.
I don’t need, nor want your help.
anything else, little ricky?
It’s actually not Rick, but I’ll leave it up to him to say who he is.
Have a good laugh Mr. Sumner
Whomever you little Snoop troll is, you have fun with him.
Have a good laugh.
Internet Trademark Infringement and Product Disparagement Law says you may not be in the clear here, sancting slander and libel of me and my property.
Have a good laugh.
laugh it trolls
Your little snoop buddy, is either one of the first to the .com trough, circa 1995-1999 , or some shade of domain broker puke.
Suffice is to say a coward, if not willing to identify himself.
True colors Mr. Sumner.
Your true colors are showing here.
Do you honestly think that I am so stupid as not to know full well want the commonly held appraisal of my names and any other domain names are?
I can ask any sum for property I own.
You and your domain troll buddies, however, do not have the right to slander and libel me and my property.
Laugh it up.
Do your worst.
keep up the attacks
Hi Michael,
That was perfect analysis and backed with data.
Thanks for your insights.
Ravi.
Wonderful article. Thanks for injecting some sanity, Michael.
Too bad Rob hasn’t comment here to clarify because I don;t think you are accurately describing what he means by shooting the moon. Certainly that is not what I think he means by shooting the moon.
The way I understand it is different:
Lets make an example of a mediocre domain that’s probably only actually worth $2,000. My understanding of the concept it you are going to accept offers only (no BIN) and your first price you quote back won;t be $2,000 but something a bit higher, say you start out offering it at $7,500, by doing so you increase your chances of it losing above its actual $2,000 value, maybe $4,000 or $3,000 or even just $2,500.
He walked back his advice in the NamePros thread to essentially going for moon shots only on your best names, and pricing the rest. What Rob was initially talking about would be akin to saying “We’re considering six-figure offers” on everything, including your $2k example. When I wrote this article he hadn’t refined his position yet.
What you described isn’t a moon shot it is just negotiating; starting higher so you can meet somewhere in the middle but still get close to your desired price. Nothing wrong with that, but that isn’t what Rob was talking about even with his revised position. You would be better served by pricing your mediocre names though, even if you set the BIN at 2-3x your expected price to leave room for negotiation.
A moon shot would be asking $25k to $50k on that $2k name. You would scare away every inquiry and probably never get a response much less a sale. If by some miracle you did get a response and you came back down to reality, you’d be negotiating from an incredibly weak position coming down that far.
But then you’d have some lucky person on NP that it did work out for because he basically won the lottery, and it will seem like confirmation that this approach works. And when you don’t hear from the 99.9% of people that it failed miserably for, because most people don’t like talking about their failures, there’s nothing to balance out that anecdotal “proof”.
Michael, this is one of the best pieces I’ve read. I hope you continue to provide your insights, the industry needs them!