Prices, Gouging and Haggling for Internet Domains?

GregStevensLA asks: "I'm considering paying for a 'premium' domain name for a small web start-up I want to form. The company that currently holds the domain name is offering it for $1500, but they made it clear to me that they expect a counter-offer and are 'willing to make a deal.' I've never done this before, and I have no idea what a reasonable counter-offer is. If I say 'I can't go above $1000' am I being too easy? Should I try to push for lower than that? My understanding is that these prices are hugely inflated anyway (i.e. pure profit going to companies that probably scooped up the domains for free). In some sense, paying anything beyond a registration fee is gouging, in my opinion. I don't want to be conned... on the other hand, this is the reality of business, and I don't want to come across as amateurish. Does anyone have any advice for this new-comer to domain name purchasing?"

From A Seller

[paulthomas]

I know there are people with a lot of disdain for cybersquaters here on slashdot.

I recently put two domain names that I own up for sale. They point to an austere page that says essentially: "Welcome. I do not need this domain anymore and if you would like it, I am willing to sell it for $50. Contact me ..."

There is certainly a difference in amount, but my domain names are fairly obscure and (likely) won't be of much interest to anyone. I'm not going to renew them, and my thought is that if anyone would like to have them sooner than the expiration then they can pay me a small amount for that. Hell, a couple of the big registrars still charge around that much for one year.

Maybe this person isn't a cybersquater per se, perhaps he once used this domain and thinks it is worth something. So far as I know, there isn't even a way to relinquish a domain name that is registered some time out into the future back into the commons. Determine what you will pay for the privilege to use the name now rather than later (or instead of another name), and make an offer. Be upfront -- "This is what it is worth to me, this is what I will pay, final offer, let me know." Depending on your project, maybe it is even worth what he is asking.

If you have a firm value in your mind and do not pay more than that value, you'll win -- regardless of whether you get the domain.

A domain name is off limited value

[SmallFurryCreature]

It may have some value if it is an obvious name that some people might enter directly into their browser. Just ask yourselve how often you do this?

A lesser value might exist if the name is easy to associate. weather.com for instance is easier to remember as a weather site then sfgsjkdhgfksdfk.com It don't matter to find the site via google but in ads or just remembering the site from previous visits weather.com is just a bit easier.

The last case is if you already got a real world brand name and now want to have that same name on the web. Just recently I wanted to visit the vanguard page. It wasn't the first result on google (a game not coming as the first result for its name is pretty rare) and I actually had to scroll down to see vangaurdsoh.com

Does it matter? Well not much as you can see BUT I have in the past just typed in vanguard and gotten the wrong site.

So the question to you is, does the above apply to you? Is that name really worth 1000 dollars? It sounds like it is a lot of money for you. So most likely not. Try finding another name or one from a different domain like say .net .us or whatever.

Most people will either use a search engine to find your site OR find it by being given the URL in some other form. Focus on something that is simple to remember and doesn't cost a 1000 dollars and do some advertising.

Re:.com is overrated

[Alfred, Lord Tennyso]

I'm afraid I gotta disagree with you there, at least to a point. If your .foo domain name duplicates a .com domain name, then you're just buying trouble. If there's somebody actually there, you'll risk looking like you're surfing off their trademark, and maybe you are. Even if there isn't, people will go to the wrong web site all the time. Get popular enough that people are going to domain.foo, and the scuzzball domain squatter is going to make a ton of money off you selling to a scuzzball who puts up nothing but Google ads to people who type domain.com out of habit.

Or worse, they'll put up an exact duplicate of your page and use it to steal passwords and credit cards.

In general, non-traditional TLDs just look unprofessional to me. I'd never buy anything from a .biz domain; I just wouldn't trust the guys who own it.

For the most part I consider general-purpose TLDs a waste of time. But they do have this going in their favor: if it keeps the question asker from paying anything to the squatter, and the squatter has to continue paying his $3.25 (or whatever it is) a year to sit on the domain, along with a few thousand others... well, that makes me smile just a little. If people abandoned .com in droves, leaving the squatters holding the bag, it sure wouldn't make me unhappy.

This is easy

[hotspotbloc]

We're talking about small change here (less than $1k USD), not "business.com" money. If you're serious about wanting the domain then just buy it. This isn't a "red vs. blue pill" issue, there is no rabbit hole, it's a business decision. Make it and move on to building great software.

Re:Don't Buy It

[fermion]

I think it is a bit more complicated than this. Gas stations aare wierd because people will often stop at whatever gas station is on thier way because it is not a long term stop. For example the station that is accesible directly to the off and on ramp of a freeway has an advantage to one in which the driver has to take a convoluted route. This is the same for fast food stores. OTOH, banks, stores, and the like, is often more a time commitment.

But even banks will pay extra to build where the customers are. For instance, there are two new banks near me. Both are built on pretty recently expensive real estate, real estate that could have been had much cheaper a few miles down the road. But they built where the money was.

So there is some element of "location" here, like being a .com, and bussiness routinely make decisions to pay exhorbanant fees for location. But there is a second issue here, and that is branding. If one is burger king, then building a consistant brand means that you must use something like BK.com, and, if the brand is established, then the law pretty much gives access to those domain.

However, a new service still has to worry about presenting a consistant brand and a veneer of credibility. It may be shallow but I think twice about dealing with a so-called pro that has an address at aol.com, or ms.com, or even mac.com. I mean I would sooner conduct bussiness out of the trunk on a olds. When banks merge they spend massive amount of cash rebuilding the brand. So why is it not rational, when one is trying to build a new brand to not invest money in it?

I am not trying to defend these creeps. I do not even like the fact that allegedly reputable registrars like godaddy have the service of stealing domains from those who forget to register, and then try to scare their clients into long term registrations based on the fact that godaddy has a service that can steal them if the client is one second late. But a cool name seems be helpful for bussiness, and a domain matching the cool name does seem to provide some added value.

So, what is the advice to the original question that no one want to answer, but rather demean the poster and criticize the behavior that all of the money making world seems to believe, at least to some degree, is rational. Just like any other deal, figure out what it is worth. Not how much you can pay, but what it is worth to you. Just like any other product. Try to negotiate to that price. If you can live without the domain, lowball. If not try to find the current going rate and start there. It might be the 1K, it might less, or more. If you can't justify the cost, move on. Perhaps there is another name use can use. Perhaps there is another way to represent the name.

At the end of the day it is a bussiness decision, and all this emotional crap that all these allegedly rational posters are pulling is just not useful. To get anything done we all have to deal with scum. If you can't take the scum, then stay out of the bedroom.

Squatting sucks but legit buying exists.

[MikeFM]

Mostly I agree, but I also have some sites that I started and never went anywhere. I never turned them into spam ad sites and I mostly still own the domains because I keep forgetting to cancel the auto-charge on the domains. I don't want $1500 for these domains but enough to cover what I've spent on them would be nice. Say maybe $150 each? I don't think that's unreasonable given that I'm making no effort to sell them and still wouldn't mind making them work if I found time to make the sites I originally planned.

I also recently considered buying a domain that was in active development by someone else but for which they hadn't had commited strongly to branding. I probably could have bought it for $500 but eventually decided it wasn't really worth it for me. I thought $500 was fair though.

Safer Domain Name Checking

[resistant]

And when you pick a name, buy it immediately, as the registrars are known to watch the queries for domain names, and if they see a good one, they'll grab the domain themselves and then offer to sell for a lot more. So today you find reallygooddomainname.com and it's available, but tomorrow it might not be -- tomorrow they want $1000 for it.

Certain registrars and resellers are notorious for selling "recent inquiry lists" to domain kings. I actually lost a domain name this way a few years back, after checking availability. It was very unlikely that specific domain name, which was meant for a personal site for a family member, could have been picked by accident by someone else with the same two-day period (while I was mulling it over).

After that experience, I became very cautious about where to check domain name availability. OpenSRS used to be good for a simultaneous WHOIS search and check of availability, but now they have this annoying captcha. At NameCheap [namecheap.com], an Enom reseller which I've used for years for most of my small collection of domain names, I've never lost a prospective domain name after an inquiry and subsequent mulling, although apparently they did recently decide to keep as a "pay for click" empty parked domain name one that I decided to drop as superceded (for a business idea) by a more relevant term. I've not had problems either with GANDI [gandi.net], but haven't used them for new domain names for years.

There are undoubtedly many decent registrars and resellers, and a few bad ones run by slimebags, just as with any type of business.

By the way, a great place to check information on ownership of a domain name is here [domaintools.com]. Basic membership is free with a simple registration (use fake information and a throwaway email address if you are more comfortable with that), and they have lots of neat tools even for free memberships. Just make certain you only use it for domain names which you know are already taken, because the people who run it are in the business of reselling domain names, and giving them ideas isn't good.