How to buy a domain name
Find out where to buy, which types of domains you can buy, which risks you should avoid and learn to define the purpose of your domain purchase.
Chances are the domain you would like to register is already owned by someone else. If it is an active site (especially if owned by a corporation) then forget about trying to buy it. But you might also be lucky in getting a domain for a bargain price. Some people might just not be aware of the value their domain has and others might be in financial difficulties and therefore willing to sell it cheaply.
Unfortunately most of the top domains are already either with a company or they are in the hands of people who have a good idea what to ask for the domain and that will usually be well above a bargain price.
Before starting a domain buying spree plan how much money you are ready to spend and make sure to have some reserves if new bargains appear. Maybe the most important point is to get familiar with prices paid in the past as you will have to judge what is a bargain and what isn’t. Once you did some intense price research a good exercise would be to look at recent sales and give your own statement of what was too expensive and what was not. Did you spot a bargain?
The domain market - Where to buy domains and how to do it
The easiest option is to look for domains that are on sale on one of the domaining aftermarket trading venues like Sedo. From time to time you will be able get real good bargains, also pay attention to the domain auctions, some domains sell ridiculously cheap.
Of course it is easier to get a bargain if you are not sticking to a particular category, the good thing is you can make as many offers as you like, with some luck you might get a few good ones priced low. In the bidding process don’t be afraid to state your highest bid explicitly, some domain owners might rethink their pricing and sell at your highest bid. Just give it a try before terminating a transaction, it doesn’t cost you anything and it might end up with a deal. If you intend to build a whole new portfolio by buying all domains from other domainers be prepared to pay a high price, a better approach would be to combine several methods.
Directly from domain owners
If you feel like hunting for treasures by contacting domain owners directly (by phone, fax, mail or email) then look for niches in which other domainers probably did not yet make offers to domain holders.
If you are looking for a certain top domain or top domains from a certain category and of course if you are ready to spend some serious money then contacting a domain broker can be another helpful option to buy your domain(s).
Bargains can often be found in domain forums, but prepared to write several emails or private messages before a transfer is really done. Most transactions go smoothly, but you do not have any assistance. There have been reports of scams in forums so be careful if you do not know the seller. That’s why it is recommended to use an escrow service especially when you are doing higher priced deals.
Another tip when handling private deals: An easy way to find out if the seller has control over the domain is to ask him to make a small change in the whois record, if he is not able to do this easy task then stay away from the deal.
Expired domains - Drop Catching
Daily thousands of domains are dropping as the previous domain owners either failed to pay the renewal fee or ordered to delete their domain. In former times people tried to snap up those names with scripts or look through lists that contained deleted domains and register the best ones available. Nowadays auction houses like Pool or Snapnames catch most of the interesting domain names and auction them off to those clients applying for them.
Sometimes you will be able to fetch really nice domains for a bargain price at an auction. Auctions are part of most domain conferences. As getting to know other people in the domain business should be one of your tasks to gain further knowledge, head to a conference some day. Many names that make it to domaining conference auctions are premium domains so be prepared to spend some cash. Internet platforms like Sedo are also auctioning off domains, so you should always try to monitor what’s going on there from time to time. Here you will also find really low priced domains. Sometimes you can also find bargains on ebay.
If you have a certain amount of money to spend then don’t spend it all in a day, start getting used to domain buying and slowly build up your portfolio with low priced domains and get used to the process, that will help you make better decisions in the future.
In any case if you are looking to buy domains then don’t just check out one venue, use as many options as possible to find the domain(s) you are looking for at the price you are willing to pay.
7 Domain types
We have set up 7 different types of domains that you can invest in. Some domainers tend to do business in just one area others cover all of them
Domains that are unregistered and can therefore be hand registered.
Domains sold bellow their fair value (eg. domains that sell cheaper than similar domains have sold for).
Meaning you will get a fully developed project (a domain plus a web site).
Domains that have been registered previously and that are now being snapped up through private scripts or drop catching services.
Domains covering future growth areas or topics (eg. hybrid cars) that should expect more traffic to come.
Domains currently receiving a large number of unique visitors.
Domains with steady earnings offered at low multiples (ratio between price and earnings).
Domain buying risks and how to avoid them
How to avoid buying a traffic domain with false traffic stats
Sometimes these domains seem to have an unbelievable amount of traffic. Besides demanding longer term traffic and revenue statistics it might be a good idea to ask the seller for a traffic check so you can test yourself if the number of visitors is real and where they come from. That is especially important if you are only buying the domain because of the traffic. This can be done easily, you can hand over eg. a Google Analytics code that the seller puts up on the page and you can then easily check the stats from then on.
How to avoid buying a domain with a trademark
Always make sure that the domain you are interested in does not infringe any trademarks, as this can lead to costs that can top the value of the domain. This can be done by checking the trademark databases on the internet. Also check if any complaints have been files in the past.
How to avoid buying a domain with a bad background
In any case check archive.org to see if the domain has any history, if yes then research it. Also look at existing back links, these should not be from bad neighborhoods like linkfarms etc. Of course it will be difficult to research every domain you intend to buy but if you plan to spend a lot of money you should definitely take some time for the research process.
It might also be a good idea to have an idea what purpose the domains you want to buy will have, this could play an important role when deciding how much to spend for a certain domain.
So here are the 5 main objectives
Domains for development
Domains you plan to develop sooner or later by yourself.
Domains for flipping
Domains that are resold immediately for a quick buck
Domains for investment
Domains that you plan to hold for a longer term.
Domains for parking
Domains that might not be so appealing to attract a good paying buyer but that still make decent parking revenues.
Domains for resale
Underpriced domains that are poised to sell higher sometime in the future.
Of course domainers usually park their domains until they find a buyer or develop them into projects, but some people do have a clear objective and focus on that.