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How to Value a Doman Name

Ironically, there are an abundance of websites making a buck from telling you the value of your domain name. However, with the largely subjective nature that accompanies domain names, how can one really gauge an accurate appraisal? Of course, it’s easy to separate premium names from those further down the pecking order, and it’s also obvious enough to pick out the ‘lemons’. But what about differentiating between domains which are traded more regularly?

As with many things, the value of an item is only representative of what someone is prepared to pay for it. Now, in the domain realm, this can create intricacies. You see, that unloved 11 letter domain might not mean anything to just about everyone in the industry. But if one person is attached to it, suddenly its value has become tangible. In general though, domains which have a wider appeal are likely to attract the highest value. This means names that are difficult to remember, contain spelling mistakes and hyphens, or are subject to potential trademark issues, will draw lower values.

With that said, .com.au domains still rule the roost when it comes to like-for-like value. That does not mean .net.au domains cannot have a high value. In fact, domains like carinsurance.net.au and creditcards.net.au have been amongst our highest sellers. However, when comparing .com.au against other Australian domains, their higher liquidity and recognition among customers affords them superior value.

There are also an assortment of other factors, more objective in nature, which contribute towards forming a valuation. In particular, the presence of acronyms, brand names, generic words and keywords can all help command value. Similarly, facets like search traffic, SEO appeal, backlinks, domain age, Google CPC, and the domain’s authority are all considerations. These are methods often utilised by valuation websites such as Estibot and Website Outlook, however, that does not guarantee they’ll produce accurate, or even similar, results.

Meanwhile, one of the more ‘reliable’ methods to value a domain, is to use a site like NameBio to gauge the results from similar sales. Similar sales can include the historical values of the particular domain in question, but should also extend to: the same type of domain (e.g. three-letter acronyms); domains in the same sector; or domains that are likely to attract the same type of buyer(s). It’s by no coincidence that some of the highest selling Australian domains are within the finance and insurance sector – participants in that sector realise the associated value to end users.

What you’ll notice from the above, is that there is no definitive way to consistently value domain names. Each domain is one of a kind, and accordingly, should be valued on its own merits. Each of the aforementioned considerations should be assessed when trying to put a value on a domain you are either looking to purchase, or to sell. You’ll also find it easier to categorise and group domains on a pricing scale (low to high) rather than attempting to establish a specific dollar figure.

That’s it for this occasion, stay tuned for our next educational article. If you have any questions, don’t hesitate to contact us.

Best wishes,
The Netfleet Team

http://www.netfleet.com.au

 

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