Value of a domain

[AugustaREGroup]

I think most members on this forum would say their best use of $$ is in the hands of REW, but for other purchases.. like a domain name. What is the value?

Do you think the lost art of people randomly typing "city state initial . com" into their url still happens or does everyone head straight for google (for the most part).

If you do believe the above statement is setting aside money for several domains (Either as a main domain or 301 redirect) worth paying a premium price?

Interesting to see "Premium Domains" for sale, sometimes at crazy prices. Anyone justify buying a premium domain (not factoring in any age/links/etc)... if so has anyone on here pay big bucks for a domain name?

(side note my citystateinitial.com is now on sale for $3975 - worth it?)

[bhartzer]

Good questions...I actually touched a little bit on some of these factors in my latest blog post.

One of the main factors s the potential revenue of that domain name over it’s entire lifetime. Potentially that could be 50 years of revenue.

As far as direct type-ins go, people are still typing in domains rather than going to Google. There are still a lot of people out there who have never heard of Google. And as we see more people getting online, there will be more type-ins of domain names. I know a domain name that makes over $300 a DAY in revenue just because of type-ins, and they have never developed the site.

As for your "city state initial . com" goes, I actually own several of those...and they don't receive type-in traffic. But, developing it and getting it top search engine rankings will definitely prove worthwhile, as people do search for "city state initial", I just don't find them typing it in directly that often.

Interesting to see "Premium Domains" for sale, sometimes at crazy prices. Anyone justify buying a premium domain (not factoring in any age/links/etc)... if so has anyone on here pay big bucks for a domain name?

Again, domain prices really aren't the "crazy". Consider the value of that domain name over its lifetime, and you'll quickly see that domain prices aren't that "crazy".

Webcam.com is going to sell this weekend for over $1 million dollars...I remember seeing it for sale about a year or two ago for only $120k, a definite bargain.

[webmaster]

You would never consider the value of a domain based on 50 years of potential earnings, that is insane - when valuing a domain it should be "times earnings" or of course there is always a "how much is someone willing to pay" that determines true value.

3-5 years times current earnings has always been my valuation methodology.

Do type ins happen? Not enough to buy a domain for just the traffic in most cases - but there is a case that could be made for buying "the right" domain from a branding perspective - but that lends itself again to "what you think it's worth"

[bhartzer]

You would never consider the value of a domain based on 50 years of potential earnings

When valuing a domain it should be times earnings for a certain period of time. You're suggesting 3 to 5 years. I totally disagree.

You might want to read this old blog post, it might actually change your mind about the value of domain names.

Do type ins happen? Not enough to buy a domain for just the traffic in most cases

If that the case, then you're probably looking at the wrong domain names. Sure, there are lots of domain names that don't get type-in traffic. But there are a lot of them that do get the type in traffic, and those are the domains that you should be concentrating on purchasing.

Let's look at "Dallas Real Estate" If you're an agent doing business in Dallas, that's the domain name you should have. You need to own the search phrase that perfectly describes your business: it could have such an impact on your business, your search engine rankings, your online brand, that it certainly would be worth 50 years potential revenue, okay even 10 or 25 years' revenue. After all, you would be "THE" Dallas Real Estate company. There's only one.

[AnnAnderson1015]

I wanted to add my two cents. I think the value of good names will go up over time as the internet age. This is why I am buying good domain names.

[AugustaREGroup]

Seems understandable. I guess you can always sell back a valuable domain that you bought... especially if you put some seo efforts into it.

One you transfer domain ownership does it take away all your SEO work, or just some?

[rvolk75]

I'm not sure what is the right way to value a domain. For example, if my site/domain generated $1,000,000 is sales from 10 transactions, how much is my domain worth? What if I got one lead who bought a $10M house (which is very rare), how much is my domain worth now? Can one good lead/sale really sky rocket the price of the domain?

In my opinion, real estate websites and domains should be valued at their potential, not by how much they brought in.

[NealRM]

A general rule of thumb for business is annual profit time 4 to 10 years with 5 to 8 being more standard. That changes based on the type of business and how quickly that business changes. Given how quickly the web changes, 3 to 5 years would be a good number.

Given the advancment in technology, the web will as different in 50 years as communication systems in general have changed over the last 150 years. (i.e. communication system 150 years ago = horseback rider with a paper note)

[Albert L.]

Normally domain is very important to know about website content and purpose. For example this forum name show its content and purpose.

[AlfredRE]

Domain name will effect Google organic results. The site I'm working on now had it's domain registered before I was on the job and it has absolutely no keywords in the title. It makes it a lot harder to place highly in organic results, especially for competitive terms.

But in terms of people just randomly typing in domain names... that's really a 90's, early-internet thing. I don't see people trying things like that anymore.