Appraising a domain name has been one of the most complicated processes in the domain market since the beginning. Lack of data, the uncertainty of the market, changing trends, the economic state of the world, and especially, the difference between every single domain name increasing the difficulty level of an appraisal significantly.
If you’re a car producer, it’s quite easy to price the cars you’re producing. There are certain costs of production, there are a few audiences for your cars and there’re costs for researches and there’s a profitability level for your company. If you’re a real estate broker, again, the inputs are almost crystal clear for you to appraise the house you’re going to sell. It is not possible to sell two apartments in the same location within completely different prices.
However, when it comes to the domains, very small differences could be resulted with a significant price levels. What are those details?
1- Extension:
Voice.com sold for $30M in 2019 (DNJournal), while Voice.io sold for $25,000 in 2019 (NameBio). The same word in another extension usually sells for a small fraction of a .com price, because the .com is the address people assume and type first.
2- A Letter:
Wine.com sold for $3.3M in 2003 (NameBio), while Winy.com sold for $3,650 in 2008 (NameBio). One letter changes a lot. A dictionary word and a misspelled version of it are not in the same league: the misspelling fails the radio test, and people who hear the name end up on someone else’s website.
3- A Word:
Mortgage.com sold for $1.8M in 2000 (NameBio), while TheMortgage.com sold for $500,000 in 2000 (NameBio).
CreditCards.com sold for $2.75M in 2004 (DNJournal). Add one more word in front of it and you have a different, far less valuable name, because people don’t type or remember the longer version.
4- Niche
The size of the market behind the word matters. A generic word in a large consumer market is worth much more than an equally short word in a small niche, because many more companies need it.
5- Economy
Prices move with the market. The same name can sell for very different amounts in a boom and in a downturn, so an old sale price is a weak guide to what a name is worth today.
6- Trends
Words go in and out of fashion. Ringtone names changed hands for serious money years ago and are worth little today, while names tied to new technologies can rise quickly.
Sale data: NameBio and DNJournal.
There are many more variables: search volume, cost per click, market competition, the radio test and more.
Some of those variables could taken into account with automatic processes and automated appraisals but some can not. Therefore, using automated appraisals might hurt your pricing and in the end, your pocket.
On the other side, professional hand-made domain appraisals take every criteria into consideration and provide the best possible results. Moreover, those results come with the priceless value, experience. Our appraisal is a fixed $89 per domain, with the report delivered within 24 hours of payment.
