How to Value Domains such as .com/net/org/co.uk/org.uk and others

December 13, 2011 - by admin · Filed Under Affiliate Marketing Articles Leave a Comment 
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    Over the last 6 months, I’ve been spending more time researching and investing in exact match domains and hanging around big UK domain forums such as AcornDomains.co.uk.

    I think a really interesting subject for many affiliates (especially new affiliates) is how to value a domain; specifically how to value the different extensions such as .com/net/org/co.uk/.org.uk/info and others.

    In this article, I’m going to provide a general “outline” of how much you should be paying for domains, tips for buying domains, and how to value the different extensions for the same keyword domain.

    How to Value .com/net/org/co.uk/org.uk and info domain extensions

    .Com Domain Extension Valuations

    The best domain for all intense and purposes is .com (e.g. UKPokerAffiliate.com).  These domains rank well across all search engines and they are extremely important for international businesses and branding.

    Normally when people see a domain in advertising/marketing, they’ll instinctively type the domain with .com extension at the end of it even if it was a .net domain.  I also think .com domains are a lot easier to rank, have more trust from users, with a higher CTR% in the search engines.

    The problem with buying a .com domain is that they have the highest prices – you’ll be competing with a lot of domain hoggers (people sitting on domains for years) mainstream businesses and end users for these domains, which inflates the price.

    As a very general rule, you can expect to pay $10,000 up to $50,000 for a .com domain with just 10,000 global exacts in Keywords; $50,000 – $100,000 with a .com domain with 30,00+ global exacts; and $100,000 – $500,000 for a domain with 100,000 + exacts.

    A lot of people will just compare the exact match traffic per month in Adwords multiplied by the CPC (cost per click) when valuing domains too.  For example, if Pencils.com has 50,000 exacts per month with a CPC of $1, then some people will value it at $50,000.

    .Net Domain Extension Valuations

    The second best domain extension for targeting global search engines is the .net.  These are usually worth 20%-40% of the price of .com, depending on the market.  The difference in price is because you get less “end-users” and businesses wanting to develop these domains, and more SEO/affiliates people want them instead. That’s why you’ll find .net domains registered years after the .com was.

    In terms of SEO, xxx.net has a sizeable disadvantage compared to xxx.com when it comes to ranking in the search engines.  From my own experiences, I’d argue that a .net needs around 30% more “backlinks” to rank above the .com.  If we removed the “brand” inflated figure of .com and just looked at the value in terms of SEO for affiliates, then I’d say a .net should be worth around 50%-70% of .com.

    The funny thing is that a lot of affiliates will be so used to developing websites on .net domains that they will be happier to pay high prices because they look better in their network.

    .Org Domain Extension Valuations

    Buying a .org domain is a funny business because there are so many “domain snobs” who avoid building sites on these domains, which devalues them massively compared to a .net. A .org domain will be worth roughly 10-20% of .com.

    You’ll also find a number of unregistered .org domains where the .com will be registered 5-10 years ago (e.g. iPhoneBetting.org, BettingMobile.org, SpreadBettingPlatforms.org).

    This is mainly because .org still has “charity” connotations and isn’t suitable for building a commercial website. A lot of affiliates and domainers will avoid is full stop. It’s also pretty ugly in my opinion, which is why I’m not going to develop any future sites on it. Even if I picked up a premium .org domain like Roulette.org, then I’d just try and flip it for a profit.

    .Co.uk Domain Extension Valuations

    To be honest, the valuation of a .co.uk domain (or any other country-code top level domain – ccTLD) depends entirely on the share of market compared to the global market for each industry.

    In a lot of markets (like online poker or gambling), the UK has roughly a 5-10% market share, in which case the .co.uk domain extension is worth around 10%-20% of the .com (a little bit less than a .net).  In other situations, where the UK has up to a 30%-50% market share, then the .co.uk domain can be worth 25%-75% of the .com.  Remember that unlike a .net domain, .co.uk extensions are also very good for branding, so you’re entering the inflated “end-user” market.

    .Org.uk Domain Extension Valuations

    Org.uk domains are very ugly, but they’re very under-priced nowadays: at around 10% of the .co.uk value.  I’ve enjoyed picking up a few .org.uk domains in the past because I think the value of these domains will increase over the next 6-12 months as users get used to seeing them in the SERPs (possibly up to 25%-50% of a .co.uk domain).  I’ve seen a lot of .org.uk domains ranking nicely for a number of terms, and recent sales (such as £50,0000 for Sledges.org.uk) shows there’s some growing interesting for them.

    For example, I registered WimbledonBetting.org.uk last week for $10 which I think is worth at least $50-$100 in an auction, and I picked up Spreads.org.uk for $10 which is probably worth $100-$250 now.

    .Info/Biz Domain Extension Valuations

    A lot of people use a general rule of thumb that xxxx.info is worth 1% of the .com.  However, I think this is quite a flexible figure based on the competitiveness of the market and the personality of the buyer.

    Tips for Buying a Domain

    I don’t claim to be an expert on negotiating domain sales or anything.  I’ve never bought a domain for £xx,xxx or anything like that.  However, from my past experiences buying domains from sellers on Sedo.com and other personal emails, you’ll usually want to get the domain for about 40%-75% of what the seller is offering it for.  For example, I think the guy who sold me MobileBetting.net originally wanted $5k, I said I couldn’t afford more than $1k and it was a “take it or leave it offer”, then he said his lowest possible price was for $2.5k, which what I bought it for (MobileBetting.co.uk was sold for £3k a few months earlier, i.e. $5k).

    In another example, the guy originally wanted £7.5k for StudentBanking.co.uk, which I said I wasn’t interested in, he then offered £3.5k (if he could talk his partner into selling it for that low first) which I refused, and eventually we did a deal for £1.5k.

     

     

     

     

     

     

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