Author: Francois
July 19, 2012

Most of you probably noticed that lately the domainer aftermarket seems almost dead.

Recently, someone sent me a joke that in fact could be food for thought to try to improve this situation:

A rich tourist visiting the area drives through town, stops at the motel, and lays a $100 bill on the desk saying he wants to inspect the rooms upstairs to pick one for the night.

As soon as he walks upstairs, the motel owner grabs the bill and runs next door to pay his debt to the butcher.

The butcher takes the $100 and runs down the street to retire his debt to the pig farmer.

The pig farmer takes the $100 and heads off to pay his bill to his supplier, the Farmer's Co-op.

The guy at the Farmer's Co-op takes the $100 and runs to pay his debt to the local prostitute, who has also been facing hard times and has had to offer her "services" on credit.

The hooker rushes to the hotel and pays off her room bill with the hotel owner.

The hotel proprietor then places the $100 back on the counter so the rich traveler will not suspect anything.

At that moment the traveler comes down the stairs, states that the rooms are not satisfactory, picks up the $100 bill and leaves town.

The summary is: When money circulates, there is no debt and everybody can make a living.

It’s the same with domains. If everyone holds his domains like they were lottery tickets and only sells when an end-user is ready to pay a fortune, then nothing ever happens.

Hold your few best names, but try to move the others for a reasonable profit, and everybody will benefit!

Thanks for reading.

PS: MotionLess.com is for sale at CAX.com for a reasonable price where another domainer can still make some profit.

 


26 Responses to “Motionless nothing happens”

  1. J S says:

    Good Joke,

    But ultimately the Hotel owner is out $100, he wrote off the hooker’s debt.

  2. Stian Eng Holtet says:

    You are spot on. When everybody buys, everybody’s happy and we will all benefit.

    There are still a lot of sales I think though, especially premium LLL.coms are selling for the same, if not more, than they did back in 08.

    But the forums are pretty dead unfortunately. I’m pretty sure they will wake up again eventually. Just give the market some time.

  3. domainer says:

    The aftermarket domainer2domainer prices are reaching the moon soon, end-user pricing there, so not dead definitely

  4. Jiji says:

    @J S “But ultimately the Hotel owner is out $100, he wrote off the hooker’s debt.” – no, because he’s out of his dept also.

    But this is the perfect example of tax fraud… the example speaks for itself: if everybody would compensate it’s debt with it’s claim everybody will be on 0 – and if you don’t have a real 100$ you would want to make it on paper as a get out of jail free that passes between all agents. But that’s why it’s illegal to print any kind of money or substitute: the taxes would be avoided. I know that in US people don’t think in tax terms at every transaction, but in Europe the story would be like this: if the tax is , let’s say 10%, the buther will get 90$, the farmer 81$, the Co-Op – 72.9$, the hooker (if it is legal :) ) – 65.61$ and the hotel owner will get 59$ FROM THE ORIGINAL MONEY.. in fact each will get 90$ and have to get 10$ from their pockets. And 50$ will go to the public budget.

    Think about this ;)

  5. CB says:

    @J S “But ultimately the Hotel owner is out $100, he wrote off the hooker’s debt.” – no, because he’s out of his dept also.
    Jiji is exactly right.

    What’s concerning in the real world is that the government, through the reserve bank, prints the $100, lends it to a bank, who lends it to you. You then go out to work to pay back the money plus the interest, and the government makes you pay tax on your income. They claim this is to provide you with services like hospitals, police etc, but they printed the money in the first place. Why not just print some money and use it to provide those services directly? Because in reality we all work for the reserve bank.

  6. wonay charles says:

    GREAT LIL POST!

    Thanks for being honest about the state of the domain market today.

    I find it quite amusing that so-called domain experts like Morgan L and Domain S and more still pretend by telling us that the domain market is strong right now.

    Infact Morgan L states that he makes as much as $30,000 per month. I find it really funny that he thinks that other domainers buy his lies.

    I hope domainers can use their common sense and sell their domains based on that very common sense that helped them invest in those domains.

    Don’t trust these domain experts who claim that they are selling domains still and making big money. And, if you are still foolish enough to buy into their nonsense then read this post once again.

    Ask yourself if they were actually selling that many domains right now then why on earth would they be hiding those sales.

    Till next time….

  7. Nick Di Gennaro says:

    Would you know how I can get in touch with that hooker ;-)

  8. Francois says:

    @Wonay
    I am in dev mood today so I was not planning to respond to any coment until tomorrow but I cannot let anyone treat of liar a domainer like Morgan who give of his time to help the domain community by sharing his experience in his blog. If he said he made this amount is because he did it. The fact the reseller market looks to be calm for most does not mean some domainers are not doing well and even very well. It’s the difference between the generality and exception. So please Wonay if like me you are also having bad domaining times currently it’s not a reason to critic persons who looks to be luckier or harder at work than us, or both. Thanks!!!

  9. Michael says:

    @Jiji, you’ve actually introduced a new character to the story, the highwayman

  10. Adam says:

    Its interesting what you said Francois on Eliots blog.

    `Look these 1.3 million .CO domain names registered.
    These are 1.3 million times someone did not selected a .COM so hundred thousands of possible aftermarket sales lost!

    Imagine a minute the effect on the aftermarket when thousands of new extensions will arrive?

    It should be terrible!`

    Thought which comes to my mind is that people always have preferences and always there is choice number 1 or choice number 2 or 3 etc.

    For example, there are many brands out there but some are chosen more often.
    So I think the question is which choice number .co will be when new extensions come
    if high it will be successful extension if not ..

  11. Francois says:

    @jiji
    The joke is American.
    Not all countries have taxes, but if it was the case in this joke then it will happen what you outline.
    Here in France taxes are really high, it’s a true nightmare… you need to make a lot of business to can get a decent salary.
    But like my daddy use to say: I would like to pay millions of taxes, this will mean I am making millions!!!

    @Adam
    Get prepared for huge terrific changes.
    My tip is keep only your premiums and try to resell asap the others.
    When gTLDs will come the demand on secondary quality names should strongly decrease as their price.

  12. Adam says:

    Exactly, I do this for last few moths.
    When do you expect these changes will be significantly visible?
    I have sth in my head but would be interesting to here some successful people`s opinion too.
    Of course, it does not mean they will be right but it may help to strengthen or weaken my own opinion or build new one.

  13. Francois says:

    @Adam
    First batch of gTLDs will be there at the end of 2013 so it’s not next week.
    But as deadline will approach we should see more domainers trying to liquidate low/mid value domains.
    To get advantage it’s better to put for sale when the market is not saturated.

  14. Adam says:

    thank you.

  15. robert mclean says:

    The domaining “business” belongs to the ones that registered .coms prior to 1999. Those that got rich now own the business. The registrars, the forums, the auction sites the whole thing.

    The new gTLDs are the products of the ones that got wealthy with .coms prior to 1999. The new gTLDs will almost all fail, going the way of the .tel, and .pro extensions.
    There will be some winners, but very very … very few. It is a cash grab, a hype machine, a toy, if you will for the wealthy.

    Domaining is now a grand fraud. Domaining is an insular, exclusive club, made up of a handful of the rich from 1996 to 1999 .com grabbers.

    The laughable thing is that to perpetuate the “industry” the ones that have gotten wealthy, or made money to some extent, stand on there heads , trying to convince the rest of the “domainers” most of which are money losers, that the industry is bouyant.

    It is a lie to say that the domaining business is viable any more.

    you know it and I know it whomever you are writing or reading this.

    Robert McLean

  16. Francois says:

    @Robert

    I have to admit there is a significant part of truth in what you say!

    I will say the suprimes crisis of 2006 definitively changed this industry, names lost +10 times in value and demand for domains over $10K is now dismal if we compare.
    I remember that before this event nobody could ask me for a name under $100K (yes one hundred thousand dollars). It was simply my bottom selling price and I assure you that even at this price I was not happy to sell as I sold so many crap names over this minimum… Today these names will not sell for few thousands dollars at best.

    I am now facing the worst financial period of my life, I cannot event make a leaving, in fact I never really made a living domaining since 2006, I mainly lived from the money earned previously. I started domaining in 2004/2005 but today even some domainers you think they are top domainers are in a very bad shape in fact… When you see a top domain company who recently launched a new marketplace targetted to domainers cannot even spend few hundred dollars to promote it then you understand the catastrophic situation everybody is facing in the domaining world. On my hand all the summer I have been developping services with no domains relationship to try to find a solution and at the same time trying to sell my few premium domains at loss to pay bills.

    Now sure, there is old domainers with huge portfolio or few geniuses doing well, but it’s a minority.

    The worst that may happen to any new domainer is make a significant sale quickly as he will think it’s the norm. It’s like game addiction, from there he will start investing and investing more and will finish losing what he won and sometimes what he not even still own. So my recommendation is keep your job and consider domaining sales as a gift that may happen sometimes if you are a hard worker and a smart person. Don’t be motionless!

  17. Rich says:

    Francois@
    Thank you for sharing your thoughts :-)

  18. Maksim says:

    Thanks for the story makes the day brighter.

  19. Bill says:

    Frank S is addressing the main issue we face. In my opinion it’s liquidity. You should not have to learn about domaining if all you simply want to do is buy a domain name. This is what really hurts our market.

    Another big issue is what I call “best price ever sickness”. Domainers that have turned down offers made 2+ years ago or ask current offers to beat those previous best offers.

    Just because someone offered 1 million for VHS.com in 1999 does not mean it’s worth 500k or even 100k now.

    The SEO changes that are going on regarding exact match domains is going to hurt domain values far far more than the new gTLDs.

    All of this said, I’ve had three 20x+ revenue offers rejected this month on 500k+ domains.

    The guys holding the premium stuff are still doing just fine.

  20. Francois says:

    @Bill
    - Frank has done many good things (THANKS) for domainers and should continue but I am curious how is addressing liquidity.
    - One of the many ways to improve liquidity is sellers start accepting seller financing, nothing happens in real estate for example without credit.
    - Unfortunately you are right about sales price depend on economical situation and we stupidely tend to think our domains can only worth more on time.
    - The guys owning premium stuff are a minority.

  21. Bill says:

    On the domain names sales platform a buyer can get in touch or put in an offer much easier then ever. I think this platform helps connect buyers and sellers much better than any other platform out there. Sedo is also good though.

    I think many buyers in the 100-5000 range are unfamiliar, uncomfortable and unaware of the steps to buying a domain.

    I also agree credit would help, if domains were growing in value as much as some people claim or like to think there would be people lining up to lend money for them.

    However without liquidity and no reliable metrics to validate true market value not many people will put their money at risk.

  22. Francois says:

    @Bill
    I never used it so I don’t know all the options but my feeling is Frank’s service does not promote your domains, it’s an interface to facilitate communication (once you get an offer) and help get organized. For the average domainer (like me) who rarely receive serious purchase offers (no big sale this year) I am afraid the interest be low. Using it should not generate more buying demands.
    This service will improve liquidity when it will start advertising domains for sale, giving them more exposure, helping search potential prospects, or providing credit to buyers.

  23. Nick C says:

    I really don’t think the magnitude of the Peguin3 EMD update has really hit the domaining community yet by even the slightest means.

    By end of December, in my opinion we are going see unloading of prime generics and portfolio’s like NEVER in our worst imagination. Carrying costs for REG FEE are going to be the biggest monkey on the backs for those with 500+ keyword domain portfolio’s. I’ve been in the eCommerce sector since 1995 and intimitely know the value of EMDs, and can tell you that the best of what we can hope for is G to remove the EMD PENALTY (Yes slight PENALTY at this point, not just loss of previous boost) and at least return to a neutral base. For those domainers who beleive “dont worry, Google is constantly changing their algorythm..this too shall pass…”, this will mean an unprecedented opportunity to buy from those who are jumping ship. For 90% of those who consider themselves “domainers” (in my book, made at least $5K domain resale profit per year) this is the Extinction Level Event for the occupation/profession of “domaining” as it was known. In the end, this is going to eliminate 9 out of 10 from the domain business.

    I am probably going to end up culling my portfolio of 425 of my 450 generic .coms (avg estibot value of about 2 to 4K each),for not much more than reg fee — if I’m lucky : (

    Going forward, I am going to focus on mainly well aged brandable (not keyword) .com’s with archived PR’s 4 or higher in the $500 to $1000 range.

    I’m expecting to be railed with pointed vitreol by you guys here for my opinions, but I’m in the same shithouse as everyone else.

  24. Francois says:

    @Good comment Nic!
    For those that don’t know what EMD is, that’s Exact Match Domain, basicallly if your domain is a descriptive name like keyword.com then you should have less chances to get a good ranking for keyword in Google now (it was exactly the inverse in the past).
    Strangely it’s something that has not been largely covered by domaining bloggers (since tweeted by Matt Cutts On September 28th) when it’s a major threat for domaining.
    Few SEO friends who are using descriptive domains as gateways to get more traffic on specific keywords already commented me few weeks ago how they have been hit by this change and their domains falled down into the troublion in serps.
    So yes this should cause significant damages in traffic and revenue our domains generate in a near future and it’s another reason to not stay motionless.

  25. Without a Reseller Market, We Don’t Have a *Real* Industry | SALEDOM.COM sale domains says:

    [...] in July, he highlighted it again on Domaining.com and it’s an article I encourage you to read. Here it is. Since I started my 3% commission brokerage offer, I’ve mostly received submissions which [...]

  26. Bipin says:

    Thanks for sharing such good thought…I appreciate and have many for sale with a reasonable profit.


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