Here Are The 4 Mistakes Almost Every Rookie Domain Buyer Makes

From emotion-driven, domain name buyers, to buyers getting caught up in the hype, these are the 4 things rookie domain name buyers tend to miss.  Name Experts founder Joe Uddeme outlines the things to avoid when buying a domain name.

A few years back, a friend of mine regaled me with the story that he’d bought abedtonight.com for 10 bucks. He was convinced he’d quickly flip it for a couple of grand.

He was adamant that he’d found a unicorn – a rare domain name that is both super-valuable but hasn’t been snapped up yet.

I wished him every success, but I knew the reality. He’d bought a $10 name that was worth about ten dollars.

While abedtonight.com could certainly work as a brand name, it fell at the first hurdle:

No one had a business of that name, and no one was looking for that precise URL.

I can imagine his pitch when trying to sell it:

• “Hey, Mr Investor, how would you like to build a new online hotel booking service for a few hundred grand, and I’ll sell you a fantastic domain name to go with it?”

Not only would an investor likely laugh off such a pitch as insanely generic/borderline insulting, but they’d also point out an obvious flaw in your plan:

• “What about bookabed.com or getabednow.com?”
• “In fact, isn’t there already a laterooms.com out there doing great business?”

So here’s the first rookie lesson, which luckily wasn’t an expensive one for my friend to learn: don’t believe the name you’ve bought or are considering buying is as valuable as you think.

It usually isn’t.

Domain name mistake #2: buying into hype

Every year or two, a TLD (that’s the bit at the end of your domain name, such as .com or .org) gets hyped to death because it suddenly reflects the cultural or economic landscape.

There’s a long list of guilty parties. They include:

• .book
• .love
• .cm

But when great .com names are so scarce, it’s no wonder that people clutch at straws.

Here’s just one concrete example: Nu Dot Co LLC won an ICANN auction (for $135 million) in 2016 to launch .web as a rival to.com – but it never took off for a whole bunch of reasons.

The result? Potentially billions in projected revenues quickly vaporized.

There have been a couple of notable exceptions to the hype rule, such as .io and .ai, but nine times out of 10, the best name will be .com.

Quite simply, if you want a .com and it’s a good one, you’re going to have to dig deep for it.

Domain name mistake #3: no clear vision of the end user

There are hundreds of thousands of two-word domain names, such as fastcars.com or dreamhomes.com.

And because the combinations are near limitless, it is still possible to come up with a decent two-worder that you cannot believe no one owns.

I just tapped fastwool.com into a domain reg tool, and this short domain name is all mine for 10 bucks.

This is a reasonably snappy, memorable name, and it would be easy to convince myself of its value to a new business selling high-quality fleeces or shawls.

The reality, though, is that I’m imagining an end user and vast market size without verifying this in any way. By doing some research, however, I may quickly realize:

• The market is smaller than I thought
• It is dominated by two or three major players
• Sales of such products are dropping
• Entering the marketplace requires at least 100k startup capital

…or a thousand other things that would make me back off.

It’s true you can still land on a great two-word name, but you’ve got to do your homework, looking at Google Trends, checking out possible competitors and so on.

When searching for a powerful band name, “this just feels right” rarely plays into it.

Domain name mistake #4: paying way over the odds for a domain name

Sometimes a name will punch you in the gut. You’ll just know this is the name for your new brand, and you’ll want it at all costs.

Thing is, it’s listed at $50,000.

But you’re flush with VC cash, and you decide to buy it – without spending any time/money researching comparable names or learning some domain name negotiation skills.

Or – worse – forgetting to check the domain name history.

Once you’ve bought it and find out it was once an adult site, you can’t just ask for your money back or press rewind so you can begin your brand name research properly this time.

You’re stuck with a $50k white elephant you can’t get rid of – and you still don’t have a name for your business. Brand name mistakes like this are surprisingly common.

How I turn these domain name tips into sensible buying strategies

A domain broker with years of experience will help ensure you buy the right name at the right price.

This is what I do for each client:

1. Take a demand-first approach – I’ll reverse-engineer the value of your name according to the industry you’re in or are targeting.
2. Perform a comps deep-dive – based on real sales data, not hype.
3. Do a traffic/backlink/history audit – it’s the best way to get the inside scoop on what you are interested in buying and provide an accurate brand name valuation.
4. Create an exit map – if you’re buying to sell at a later date, I’ll help you work out your buyer (and the depth of their pockets) before you make an offer.
5. Agree on a budget and portfolio cap – no getting carried away or emotional bidding; no sprawling portfolios you quickly lose track of.

I’ve seen these fixes work repeatedly.

And when coupled with more than 16 years of negotiation skills, I put these tactics to use to protect domain name buyers from the many pitfalls that so many others have encountered before them.

So don’t let hyped domains drain your wallet – book your free domain name strategy call with me today and turn guesswork into profit.

About the author

Joe Uddeme is Director and Principal of Name Experts, one of the world’s leading domain name brokerage services. He has overseen domain name sales and acquisitions totaling more than $150 million and is renowned worldwide as a go-to expert in buying and selling premium domains. Contact us at: [email protected]