There’s tremendous value in the internet. That’s something people have been saying since the 90s. Mostly, they’re talking about a company’s website. It’s your online presence and the world’s window into your organization.
But that’s far from the only way to monetize the online experience. Domain flipping has become a lucrative business in which individuals purchase high-value domain names and sell them to those looking to buy a domain for a profit.
This industry has become so lucrative that many entrepreneurs have taken to it as a side gig or full-time career. Successful full-time domain flippers have been known to earn up to $100,000 per year.
A high-value domain name is in demand, with business owners lining up to grab the ideal URL and pop it up in front of their website, ready to take the world by storm. But, much like flipping real estate, you need a certain amount of know-how to turn a profit selling domain names.
What should you consider before putting your domains up for sale? And what are the steps needed to turn a profit in the lucrative world of domain sales? In this article, we’ll walk you through eight steps to help you learn how to sell a domain name for the highest possible price.
What To Consider Before Selling Your Domain
Where Will You Sell?
When it’s time to sell your domain, you need to consider where you’ll be selling it. There are several options for this. In fact, there are so many options available that it might be difficult to decide on one. That’s why it’s a good idea to become familiar with some of the heavy hitters.
Here they are, in no particular order.
Flippa
Flippa is a service you can use to sell domain names and entire pre-built websites and businesses. This premium service charges a lot of money to list (up to $499) based on the size of your sale. On top of that, it takes a 5% commission on successful sales.
BrandBucket
BrandBucket is a curated marketplace, meaning you must submit a domain and receive approval to list it there. After approval, your listing will include a description and a custom-designed logo. There’s a $10 fee to list a domain, and if you’re listing on BrandBucket, you’re not allowed to list anywhere else. It also takes a 30% commission.
Sedo
Sedo has been around since 2001 and features more than 18 million domain listings in its marketplace. With Sedo, you can use its incredible customer service, in-house escrow services, and intuitive interface and dashboard. Sedo promotes its listings across a huge network of partner sites. The listing is free, but commission prices range between 10% and 20%.
Afternic
Afternic is another option. It has over five million listings and has been around since 1999. The service sees more than 75 million searches for domains monthly, so it’s a high-traffic marketplace. Afternic’s parent company is GoDaddy, so listings sold through its marketplace also pop up as premium domains on GoDaddy. Listings are free, but a 20% commission is paid to the service for sales.
Do You Own Valuable Domains?
When learning how to sell a domain name, you must be able to recognize whether the domain you own has value. This is something to consider before registering a domain name.
There are a few set criteria you can use to value your domains. This can also be applied to choosing a domain to purchase before reselling.
First, how long is it?
Everyone wants a short domain, as they’re far easier to remember. So, if you have a short and easily remembered domain, you’ll be able to charge more for it.
Next, what keywords are included in your domain?
Any domain that features strong high-volume keywords will be more valuable. Since keywords are an essential part of the SEO process, using a high-value keyword in your domain will make it more appealing to potential buyers who are trying to rank specifically for that term.
Finally, how brandable is your domain?
By brandable, we mean a domain name that’s unique, descriptive, short, memorable, and user-friendly. It should be something a company can build itself around and that its customers can easily associate with the brand.
Set Realistic Goals
Once you’ve selected a marketplace and determined your domain’s value, it’s important to set realistic sales goals. Don’t shoot too high or too low. If you think that you’re going to make a million dollars off your domain and it only sells for a few thousand, you’ve sabotaged yourself.
When deciding how much you’re going to ask for, take the above steps into account to better determine what you need and what’s realistic for you.
How To Sell a Domain Name (8 Steps)
1. Research Recent Comparable Domain Sales
Before you can accurately price your domain, you must look at the current market. Even if you think your domain is worth a lot of money, if the market is oversaturated and comparable sales are far lower than your projection, you might need to re-evaluate your goals or wait for a better time to sell.
You can use a resource like NameBio to check on recent domain name sales. This includes historical data combing through domain sales with a combined worth of $1.5 billion. The database is updated daily and is a great way to check the industry temperature to see what some of your rivals are making on their domain sales.
Filters can be applied to your search, including the extension of your domain, any keywords that are included, and even domains of similar length.
Let’s say you have your heart set on making upwards of $50,000 for your domain. When you use a tool like this, you can check to see how similar domains performed. If they’re selling mostly for around $30,000, you’ll quickly realize that your goals might be a little lofty.
When that happens, expand your search parameters. NameBio lets you look back as far as five years in the past. If you see that the market for terms like these shifts over time, it might be best to wait it out. However, if you see that the current $30,000 average is on the higher end historically, then it might be time to strike while the iron is hot.
2. Determine and Set Your Domain’s Value
After you’ve done your research on the market, it’s time to attach a price tag to your domain by setting its value. But just because the market says one thing and you believe that your domain is worth a certain amount, it’s still possible that you’re over or under-valuing yourself.
That’s why there are domain appraisal tools that can help you figure things out. Something like Estibot can calculate your domain’s value using an algorithm that considers a number of factors, like:
- Domain extension (.com, .net, .org, etc.)
- Length
- Keywords
- Pronunciation
- Search volume
- Cost per click
Unfortunately, these machine-based appraisals aren’t ironclad. That’s why some owners get their domains appraised by an expert. This is especially wise if the automated service and pricing history are providing you with high amounts. It’s best to make sure these results aren’t too good to be true.
Domain name brokers can provide you with a bias-free assessment of what you’re working with. They know the market well and can usually predict future trends. If they believe that waiting a bit will only increase your domain’s value, it might be wise to hold off.
Remember that hiring a professional appraiser will cut into your profits, as it’s an added expense.
Additionally, you can share your domain through free online domain buying and selling forums. But this is a public forum that anyone can post in, so keep that in mind when you’re seeking advice.
Once you know what your domain is worth, it’s time to set your price. This can be difficult considering there are a wide variety of domain costs. Most domain names sell somewhere in the three to the four-figure range, with premium domains garnering between six and seven figures. If you’re working with a premium domain, try to price under market value to generate interest or even a bidding war.
3. Craft Your Listing
Now it’s time to prepare the domain listing that you’re going to be using. This is when you have to eloquently craft a sales pitch that advertises the best features of the domain you’re trying to sell.
If you want to really stand out from the crowd, include a lot of information. That means listing more than just the domain name you’re offering and your asking price.
But what should you include in your listing if you want it to garner attention? How do you create an attractive sales pitch for a domain?
For starters, talk about the traffic it generates if it’s a domain you’re currently using. If you’ve been using it for a long time, it should have an established record of success. Any existing authority that your domain commands should also be included to paint a picture of the potential for profit your customers can reap if they purchase from you.
Even if the domain you own is empty, check out the analytics for it anyway. It could be that people are visiting your domain because they’re interested in the keywords associated with it, only to find that there’s no website. This can be an attractive number to dangle in front of a potential buyer because it shows a market need.
Analytics are your best friends here. The more numbers you can use to back your domain’s effectiveness and profitable potential, the more alluring it will be to prospective customers.
Hype how memorable it is and how that can lead to real dollars and cents. If it’s a “.com” URL, talk about that and hype some reasons why that’s the best extension.
For example, Google has been known to favor .com sites because it’s the oldest and most recognized Top Level Domain out there. It’s far easier for users to remember a .com URL because they’re so used to them. That makes it more attractive from the perspective of actual users set to push your URL through a DNS server and better for SEO at the same time.
4. List Your Contact Information on the WHOIS Directory
While some are wary of putting their contact information out for the masses, there is a benefit to overlooking domain privacy when trying to sell. Many sellers opt to list their information on the WHOIS directory or ICANN.
These online tools allow users to look up the registration data of domain names using the WHOIS protocol and the Registration Data Access Protocol (RDAP), respectively. When using the RDAP, you have advanced security, a standardized format, internationalization support, and you’ll even be able to offer differentiated registration data access.
This helps interested parties find you when they’re in the market for precisely what you’re selling. By listing on these directories, potential buyers who are highly invested can find you, even if they’re not checking the marketplace that you’ve chosen.
By listing your information on one of these directories, you’re essentially fishing. You’re placing information out there and waiting for someone to bite on it.
5. List Your Domain
It’s now time to actually list your domain for sale. Similar to how you’d place a “For Sale” sign in front of a house that you were trying to flip, you can create a “For Sale” landing page and pop it up on your domain for interested buyers.
Sometimes, before checking a directory, someone might look to see if a domain is available by typing it into their web browser. If a clear and attractive landing page pops up advertising the sale with a direct link to the listing, you’ve created a great sales opportunity. This is an example of a parked domain.
However, you can’t just toss up a for-sale landing page with your contact information and expect that to be enough. As we discussed earlier, you need to list your domain on a marketplace that meets your needs. Of course, many factors will go into your decision on which marketplace to use.
Some of these include:
- The commission percentage that the marketplace takes for successful sales
- Whether there’s a cost to list your domain
- Whether the marketplace demands exclusive rights to the listing
- The regular traffic of the marketplace
- The success rate of the marketplace
- If the marketplace has an affiliate network that will also list your sale
- If the marketplace has a built-in escrow service
If you are looking for a faster turnaround, you can sell your domain on an auction site. When using one of these services, simply create your listing, set a minimum bid amount, and watch as interested buyers work against one another and drive the price up.
Much like eBay, you could include a “Buy it Now” price that someone could click on to end the auction for a predetermined amount. Just remember that when you’re dealing with an auction site, the buyers are mostly domain industry investors, so they’re likely trying to buy at a lower rate to turn around and flip the domain for a profit.
6. Find a Buyer
It’s possible to set your listing up and forget about it, waiting for the offers to come rolling in. But you’ll have more success if you actively try to find a buyer using outbound sales and advertising techniques.
It doesn’t hurt to reach out if you think you know of specific entities that might be interested in the domain you’re selling, whether for a business website or a blog name. Try sending a well-designed email or calling decision-makers for these companies. You’ll have to put some research into these prospects and build up your lead list.
You could also hire a domain name broker to reach out directly to interested parties and oversee the sale. This would mean paying them a commission, but it might help you find the best possible buyer. Of course, since these brokers work on a commission, they typically only take on high-end domains in the upper five-figure territory.
7. Use an Escrow Service
Once you’ve found a buyer, it’s a good idea to hire an escrow service to facilitate the money transfer, especially if you’re moving a particularly large sum.
The good news is that many marketplaces come with their own escrow service built-in. If you choose to sell on platforms that include this, then you’ve saved yourself a step. However, if your marketplace doesn’t have escrow included, you’re going to have to hire a service on your own.
The escrow service secures the transaction by ensuring the funds have been received in full before the transfer of ownership begins. Once that’s taken care of, the domain moves to its new owner.
This protects you from dishonest people and should be a regular part of any large sale you facilitate. Essentially, when the buyer pays for your domain, they’re actually transferring the money into an escrow account. The escrow service then takes that money and transfers it to you. Once you’ve received it, you can transfer the domain to the buyer through the domain registrar. The buyer then lets the escrow service know that they’ve received the domain and the transaction is complete.
If the buyer doesn’t pay in full or you, as the seller, failed to turn over the domain, the escrow service has all the signed and agreed-upon details and can present them as evidence if things escalate to litigation.
8. Transfer the Domain
When it’s time for the final transfer of the domain to its new owner, you should personally facilitate and monitor how it goes. Even if you’re using an escrow service, you should still pay careful attention to how the process unfolds.
This is a time when you need to be available to answer any buyer questions that might arise. By knowing how the process is going, you can answer these questions quickly and ease any concerns that might cause the sale to fall through.
Once the transfer is complete, you can focus on your profits, and the new owner can start setting up their migrations, hosting, and SEO efforts.
Summary
Selling a domain can be profitable, but if you walk in unprepared, you could end up with a lot less money. That’s why you should educate yourself about how to sell a domain name and maximize your chances for success.
Before you start your journey, consider:
- Where you want to sell
- The value of your domain
- The realistic goals you have
Then, once it’s time to sell, make sure that you:
- Research similar sales
- Set your value and price
- Create a compelling listing
- List your contact information
- Put the domain up for sale
- Find a buyer
- Use an escrow service
- Transfer the domain name to its new owner
By following the advice in this ultimate guide, you can ensure that your domain name profits shoot through the roof.
For help with the application, database, and managed WordPress hosting for your existing domains, reach out to Kinsta today. Our Agency Directory also lists vendors that can help with web design, PPC, SEO, and more.
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