Website Sellers and Domain Sellers Should Always State their Asking Price
As an intermediary, that is, as a website broker and premium domain name broker, I interact with a lot of buyers and sellers every day. One of the things that I notice with sellers specifically is that a lot of sellers are afraid and unwilling to state their asking price.
The primary reason for this is that sellers are afraid that if they state their price first, the buyer may have been willing to pay more, and therefore they leave money on the table. However, as a seller, you have to ask for your price first. You are the one selling the asset. It doesn’t matter if you could have received more money if you do receive what you asked for in your asking price.
Yes, a website buyer or domain buyer may have been able to pay more money than you asked for. As such, you may have received more money than you did receive. So be it. As long as you receive a good return on investment (ROI) or profit on your original investment, it does not matter.
Lack of Domain Name Sale Comparables
This inability to state an asking price by sellers is prevalent among domain name sellers. Because domain names are not a liquid asset class, and they don’t have realistic publicly-available comparables, domain name sellers often do not have a logical reference point for valuing and pricing their domain names. This makes the process of selling a domain name more difficult than, say, selling real estate, which does have reasonable comparables.
This is why domain names often receive no offers and stay listed on the market unsold for years. And even when some of these domain names do receive offers from buyers, the buyer offers are generally ridiculous low-ball offers. These come from buyers who are not actually serious about purchasing these domain names. Or buyers who think they can steal the domain names for nothing. But all of this is because the seller never stated an asking price which could give buyers a benchmark for their starting offers.
Professional Brokers are also afraid to state an Asking Price
Unfortunately, this problem does not just apply to domain name owners. This also applies to professional domain name brokers who should be advising their clients. Many brokers, either out of fear of understating or overstating a domain name’s value, or following the instruction of the domain name owner, do not state a specific asking price for domain names that they are authorized to sell.
The real underlying fear that most brokers have is the fear of losing the client by stating a price that the domain name owner may not agree with.
By being indecisive, many domain brokers are unsuccessful at selling their domain names. Again, this is why so many domain names stay listed on the market for years and never sell. If the seller does not know what his domain name is worth to him, how will the buyer know? Why should the buyer know?
It actually is a disservice by the domain name broker to the domain name owner not to advise this domain owner to set an asking price. Instead the seller and his broker sit back and hope that domain name buyers will tell the seller what his domain name is worth.
State Your Price
In a nutshell, whether you are selling a domain name or a website, it is extremely vital to state an asking price. As they say, “Ask and you shall receive.” If you do not ask for what you want, you will not receive it. This theory applies to buying and selling assets of any kind. It applies to selling intangible assets like domain names and websites as well as tangible assets like real estate.
So, right now, if you have a domain name for sale listed at any online marketplace as “Make Offer,” you should go there right now and set a specific asking price.
Author: Kris Tabetando
Kris Tabetando provides mergers & acquisitions (M&A) advisory and brokerage services to Internet companies. He also partners with investors to acquire & manage Internet businesses.
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