whoapiad space available here, contact us todayad space available here, contact us today

Should You Compete On Price When Selling Domains?

September 18, 2012

Early on I learned from my marketing mentor that  it’s never a good idea to compete on price.  While this is a general axiom in product marketing, should it also apply to domain sales?

The difference with domain names, unlike most products that can easily be replicated by competitors, is that every domain is a precious snowflake: no two are exactly alike.

That said, many domain names are very similar. Take for example, someone interested in starting a new dating website.  A broker presents them with the following three choices,

  • BeautifulSingles.com
  • AttractiveSingles.com
  • GorgeousSingles.com

Are any of these “have to haves”?  Although different to a degree, I would say that in the final equation none of these domains are differentiated enough from each other to really matter.

Every Domain a Snow Flake

Every domain a snowflake

When a domain name is one-of-a-kind, and there is no genuine substitute, then there’s no need to consider competing on price.

Although I’m always in the process of improving my portfolio, most of the domains I would not class most of the domains I own in that special category of “have to haves”.  Thus I’m forever toying with my pricing strategies, trying to find that sweet spot where I can sell the most domains for maximal value with a minimal amount of effort.

There have been two specific times I can name where I chose to adjust domain pricing downward to compete with the similar domains of others.

The first example (a domain I no longer own) was a .org domain that I had initially priced around the $2k range.  One day I noticed the .com had been actively listed for sale in the same venue for $1,088.

The keyword category was in education, wherein end-users sometimes prefer to use the .org over the .com, (the smart play is to own both for brand protection).  However because .org does not typically command the same pricing, I decided to adjust my domain down to equal the price of the .com.

Even at $1,088 the sale would still be a great return on investment. What I did not want was for the price to be a barrier if and when a buyer finally comes along searching for those particular keywords.

The second case involved a .com domain that I felt contained a weaker adjective than a very similar but lower-priced domain.

The domain I own is Gain[Keyword].com which I had originally priced at $3,500.  Sometime later I found that the domain Find[Keyword].com was being listed for $1,895.

For this particular keyword, I felt that ‘gain’ was not as strong a descriptor as the word ‘find’ and given a choice, there’s a good chance that most end-users would opt for the significantly lesser-priced and somewhat better-sounding of the two.

Therefore I decided to adjust my pricing $500 down from the other domain, lowering it to $1,395.

The danger in this type of strategy would become evident if the other domain owner were then to try to compete with me by pushing his price down below mine.  Obviously if we continued along these lines we’d both risk undervaluing our domains.

I’d love to hear your thoughts on this topic.  Aside from prior sales comps, do you ever factor domains for sale of the same or similar keywords or quality when deciding how to price your inventory?

Previous post:

Next post: