The art of negotiation can be pretty tough when it comes to selling your domain names. Many of us always wonder what is the right price of a name and how do we even determine how much to sell the name for. At first, it may seem to be difficult but once you get more experience it becomes a bit simpler.
I have talked about pricing your domains in the past but this post will focus on how to deal with an inbound offer on your domain and if you should agree right away to the first offer. The most common approach is to either take the first offer in order to simply sell the name or counter with a larger number.
Of course I’ve done both of these but it’s always good to have a strategic approach for better results.
You must first ask yourself:
- What is your pricing strategy?
The pricing strategy that we implement is quite simple, we take note of our total investment for that domain. This includes the initial purchase price and the yearly fee for the domain. The longer we hold a name the more it continues to build as an “expense”. When it comes to selling the name our goal is to initially price the name at 50 times our initial investment when countering an offer and we know we are willing negotiate down to 10 times our investment.
Of course, these numbers are not always set in stone but a good road map for us. If you have no idea what price you want for a domain, how will the buyer know?
- Who is inquiring about the domain?
This one is critical. Knowing if the potential buyer who gave an offer is a large company and how much they make can help you get a sense of what you could reasonably counter with. Many times it is not possible to know who the offer is from but you can always try to google the email, phone number or if they gave their name you can google that as well.
This is a very important step. Do not look over it. The more information you have about the potential buyer, the better.
- How many inquiries have you received?
This usually determines if you should keep your domain for another year, longer or let it drop. But I usually tend to give most domains we get the benefit of the doubt for at least one year. If we get a couple of inquiries then we will keep the domain longer to wait for the right buyer. Even one strong inquiry could lead us to hold a domain for several years.
One thing you should always keep in mind is this is simply a strategic approach but it’s easy to over analyze and make a dumb move like holding a domain that you should have sold.
If an offer comes and it’s a “solid” offer, just go ahead and close the deal. When that happens to us we simply do not hesitate. We’ve blown mid $x,xxx deals by asking for more.
Let me hear your thoughts in the comments below and any stories you may have with accepting or rejecting initial offers!
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