How To Calculate The Value Of Your Domain Name

A domain name's value can range between a few dollars and several millions of dollars, CarInsurance.com was sold in 2010 for $49.7 million. Your success in this business lies in your ability to get a valuable name at a cheap price and then sell at a higher price. Proper domain appraisal is very important if you want to make a fortune in this business. Here are the techniques you can use to get an estimate value of a domain name so that you will be able to make money online.

Research Recent Domain Sales

It is very important for you to be familiar with recent domain sales so that you will have an idea of what sells. You will have the opportunity of seeing what people are buying and the amount they are buying them. DNJournal and Namebio are top sites to get this type of information. However, you should take note that the reported sales are just some of the total sales but this information can help you in appraising a name.

Use Appraisal Tools

There are many appraisal tools that can be used to evaluate your domain name. Majority of these appraisal tools make use of algorithms that consider keywords, monthly searches, cost per click, Alexa rank and so on. Some popular appraisal tools include Estibot, Valuate, Godaddy Appraisal Tool, just to mention a few. The use of these tools is just the first step in the appraisal process because some factors may not be considered by the appraisal robots.

Signs You Have A Marketable Domain Name

If you have taken the necessary steps to evaluate your domain, there are other factors you need to consider. By considering these factors, you will be able to position yourself for a more profitable business.

Good Top-Level Domain

There are many top-level domains (TLDs) like .com, .net, .info, .biz, .org, .tech, and so on, but in all sincerity, .com takes the market by storm. The .com is the first TLD and it is the most popular. In fact, the internet is generally associated with .com, consequently, names ending with .com perform better in the market than others. You can easily sell other TLDs but not as high as you would sell a .com. For example, a buyer will prefer to buy car.com instead of car.net or car.info.

Short

The shorter a domain name is, the higher its price would be. If you can lay your hands on a short one, you have definitely hit a goldmine. Even though they are very hard to find, you may be lucky to get one if you are ready to pay the price.

Passes the Radio Test

It must sound good and easily understandable. People hearing it should be able to remember it quickly and write it down easily. Its spelling should not be complicated and must be the right spelling. If it causes confusion in any of the aforementioned ways, it may not be marketable.

Hot Keywords

Some keywords are hot online and if you have names relevant to them, you may be having a hot cake. You can use keyword planning tools like Google Keyword Planner or Wordtracker to see the popularity of keywords. However, it is not advisable to use long keywords just because they have a high keyword value. Domaining is mostly concerned with selling short names. Hence, you should keep your keywords as short as possible.

Brandable

If you can lay your hands on brandable names and you are ready to keep them, you may be in for a big deal. Even though there are risks associated with brandables, e.g. trademark issues, if you carry out your research properly, you should be able to get those that are free of any hassle.



Age Also Matters

You know that they say old wine tastes better than new one, the same goes for domain trading. The older, the better and this is because of some SEO properties attached to old domain names. They have been indexed, ranked by Google and Alexa, have backlinks and so on. If you add up these properties, you are going to get a valuable digital asset.

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Already Generates Traffic

When a domain is already generating traffic, it will add more to its value. It may be an expired domain that was generating traffic and if you are able catch such an asset, you will be more profitable in the business. Take note that we are not talking about a fully developed site here but just a TLD. There are lots of domains generating traffic and your ability to get them will go a long way in adding value to your business.

Using The Right Formula

There is no fixed formula that can be used to calculate the exact worth of a domain name. What is most important is the willingness of the buyer and your negotiation skills. A name may be valuable to you but no one is willing to pay for it. As a result of this, you should know how to play the waiting game. The more you hold on to a valuable name, the more its value increases and that's why the business is referred to as the real estate of the digital world. The end-user value of a domain is the most important factor that determines its price. What will an end user use it for?

Getting The Most Out Of The Business

In order to make money online trading domain names, you need to do everything possible to get the most out of the business. Coming up with the right value is very vital and it will determine how far you can go. If you are able to put various factors together and follow the best industry's practises, you will definitely make a fortune for yourself. Like every other business, it takes time before you can build up a portfolio that will make you rich. As a result of this, you should do everything possible to build a portfolio that can stand the test of time.

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