(image source)
This week is going to be one of the busiest weeks for auction houses. Besides the daily auction houses out there (Bido, Sedo, Afternic, NameJet, Snapnames) this week will be all about live domain auctions.
First in line is Aftermarket.com’s GeoDomains auction. Later the week Rick Latona is coming strong with an auction at the Targeted Traffic conference, with great inventory and a domain one all have eyes on, Shows.com, no reserve.
Last is the usual suspect and still top dog in the live auction business, Moniker.com. With years of experience and tens of millions in transactions under their belt, this auction is the “signal”, the “beat” of the industry.
Great inventory is out there, some are priced to sell, many are not. Things are getting better for buyers but is it enough? The global economic climate is still a mess and no company can truly predict tomorrow with confidence. Without understanding tomorrow, companies tend to preserve capital for a possible rainy day, they tend not to take on any additional debt. They tend to focus on operations, cutting costs. This of course effects commerce all around us, and as demand weakens, prices are as well.
The second problem here is live auction buyers are historically domain professionals or domain companies. Essentially, it is trading hands between one Domainer group to another. This was all good when domain companies and domain professionals were doing well but that isn’t the case anymore. Like the rest of the economy, everyone took a beating, most still do. Without these groups in full force it will be interesting to see the activity.
Third problem is related to the second one. Many have moved from buying into building. They built their inventory over years, happy with what they have, and now looking into executing on that inventory. Execution to those who do not know, is extremely expensive. Hiring people, offices, technologies, advertising, etc. When someone is focused, most cash flows to one direction. If their focus is development/execution it cannot flow into auctions as well. Even if some money flows back into auctions I believe the lion’s share will still go to operations.
And what should you do? Should you put your money in domains, or elsewhere? Since cash is extremely valuable today (likely more than you realize) I suggest to pick your buys extremely carefully. If you do not see how to get your money back from a domain, if it is not the PERFECT FIT for your plans, think hard before raising that paddle.
While we plan to attend all these auctions, we don’t have anything in mind as of now to buy. That may change as we see activity. My philosophy on good domains - “there’s always a price”. What the price though is the real issue.
Heading to TRAFFIC tomorrow, may post a little less this upcoming week.
Have a great day!
Sahar
Thanks for telling it like it is rather than hyping things.
I agree execution may be expensive, but yet it can be done by just 1 person who is willing to work hard enough.
Take for example, Markus Frind, plentyoffish. just 1 guy, and 8 servers is enough to do the job.
—-answer—-
1. I don’t know the true story there. It may be how he sells it to the media rather than reality.
2. There are always exceptions to the rule, again, exceptions.
Cheers
Sahar
The right thing to do, I’m not here to win a popularity contest
Cheers
Sahar
Your right. Most companies are not betting on tomorrow today. They can not see beyond current doom and gloom to seize opportunity. This is especially true when it comes to big ticket domains. The corporate consensus seems to be that this is not the environment to be purchasing pricey nice-to-have assets vs. need-to-have. This is the reality of their business decision.
That’s why aggressive promotion and targeted advertising by powerhouse vets like Rick Latona and Rick Schwartz are vital to elevating domain valuations outside the circle of the domaining industry. In marketing, perception is everything. Frank