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Clara Edberg — 13/01/22

The domain name aftermarket – the place where domain names can be sold for millions of dollars.

More and more companies are seeing the value in owning their part of the internet. It creates clarity in communication to consumers while protecting the business from third parties registering the name for malicious purposes. Do you know if you have secured your name digitally? Do you know if the name you want is available or if someone already registered it?

If the domain is taken, there may be a solution to the problem. The domain name aftermarket - the place where already registered domain names can change owners.

In today’s digital world domain names are among the most important assets a company has. They are unique and, unlike trademarks, domain names can only be registered in one copy. This has resulted in an emerging aftermarket, where already registered domain names can change owners. Often when such transactions are reported in the media the price is of significant amounts – sometimes even astronomical. But the fact is that there are also daily transactions where the price is much more manageable for most medium-sized companies.

Several of our domain experts have extensive experience in the aftermarket and domain acquisitions, we sat down for a chat with Marcus Glaad and have gathered some of his insights and knowledge into this blog post.

In the industry, we say that about 35 % of all registered .com-addresses are actively in use. Meaning that there are around 65% .com-addresses that are not active, some of which have been registered for speculative purposes in order to make money from a possible future sale.

One thing affecting the price is the top-level domain. The extension you have to pay the highest price for is .com. Especially with short, 3-, 4-letter combinations. They are usually communicative, short names that are easy to pronounce and easy to remember.

During the pandemic, the demand for good domain names has increased further. Many companies have focused on digitizing their operations. More and more people want to get hold of communicative names that they may not have seen the same value in before. Companies are now spending more time and money on accessing names that help create clear communication with their consumers. With increased demand and reduced availability of vacant domains, a consequence has been an increased number of sales on the aftermarket, as well as an increase in prices.

Recently, we helped the entrepreneur behind Meme Limited, Mattias Tyrberg, buy the domain meme.com for $ 1,250,000. Which makes it one of the largest domain deals globally in 2021. Dotkeeper has run the process, negotiated the price, and secured the transaction so that money and domain name changed owners securely.

Now you’re probably wondering what it is that can make a domain name go for a price like meme.com. There are several parameters, but it is mainly the prevailing market, i.e. supply and demand and what someone is willing to pay for the name.

We also look at what similar domain names are going for right now, and in the past. Here it is extra important to compare with the right domain name and to understand which domain names are similar to the name you are interested in. What does the composition look like: how many letters do the similar name contain, are there numbers etc. In this situation, it is good to take the help of a domain specialist who can assist with knowledge and understanding of how to value a domain name and who later in the process also can help to acquire the domain at a reasonable price in negotiation with the seller.

When we talk about the price of already registered domain names, it is important to remember that the meme.com price tag isn’t typical. Most domain names go for a much lower price.

 

What are the benefits of using a broker like Dotkeeper for acquisitions?

The advantage of working with a partner such as Dotkeeper is that we have a large network of registrars and brokers as well as access to platforms where domains are sold. Something that can complicate an acquisition process if you do it yourself is GDPR, which has made ownership information in WHOIS hidden and much more difficult to access. Here we have elaborate processes to obtain information about who is the current holder and then seek contact.

So, are you eager to finally get hold of that special domain name that would make a big difference to your business? We at Dotkeeper have many years of experience in brokering domain names and are happy to take an initial conversation with you to tell you more about how we can help you make a good deal.