Today we sit down with Michael J Krell, managing director at BrandBucket.
Michael took the time to answer the tough questions not just things like what makes a good brandable ? He took the time to address controversies and why they charge what they charge for commission.
1) How long have you been buying and selling brandable names ?
I got into the domain industry about 4 years ago, and started buying brandables right off-the-bat.
2) Why did you decide to join BrandBucket and not sell on your own website ?
The simple answer is that I made more sales and money with BB. I started selling names by just putting up simple Wufoo contact forms for all my domains and sold maybe a dozen or so in the low $xxx. I had read an article about BrandBucket and couldn’t believe that the prices they were getting for some of the names listed on the site. About 1-2 months later I decided to submit around 50 names. About 10 were accepted and I sold one the first week it went live. I started my own site for inventory that wasn’t good enough to be on BB and for a few non-brandable names in my inventory.
3) What is your routine like for finding domains ? Do you seek out brandables each day ?
I search for names about 4-5 days a week. I have a few different lists that I go through. I look at all GD names that are expiring of a certain age under 14 characters. I also look through GD expiring names and deleting names filtered by a list of keywords and other variables. I usually try to take a look at NameJet and Name.com, but I don’t always get to those.
4) What are your thoughts on hand registering brandable names ?
The only time I hand-reg a brandable is if I let it drop without backordering it. I might periodically check a name generator and get a few that I feel are good enough to register. I don’t often try to think up names. We do have successful BB sellers that solely hand register names, so it is a viable option.
5) Some think that you get special perks for your own names on BrandBucket, can you put those rumors to bed ?
I would love to! When I first joined BrandBucket as a seller, I was fortunate enough to have a very high sales rate which was a major reason Margot reached out to me to become a Brand Ambassador and which ultimately led to my current position as Managing Director. As my personal portfolio has increased my sales rate has stayed fairly constant.
None of my names receive any special treatment in any search results or category listings.
My names are also not disproportionately suggested to potential buyers if they contact us directly about helping them choose a name. I am completely separated from the sales team and the sales process. My names are treated exactly the same as every other name on the marketplace.
6) In your opinion what are the best kind of brandables to focus on for a newcomer ?
I’m probably biased, but I would definitely say keyword brandables which make up 90%-95% of my brandable portfolio. If a new domainer isn’t currently following the tech industry, I would recommend reading TechCrunch and looking at CrunchBase to see what the successful and newly-funded companies are calling themselves. After a month or two, you should see patterns emerge that can help you make wise investments.
7) Some say BrandBucket charges too much in way of commission, 30%. Can you say what BrandBucket does to earn that 30% ?
Sure. The overhead to run our marketplace is much greater than a normal brokerage house. We have a substantial marketing budget, a dedicated team of developers, and a full-time sales and seller support team that all require substantial financial resources. This is in addition to our team of 6 name reviewers that look over each submission.
8) With new gtlds becoming more prevalent and a way for brands to be creative with their domain name, do you see brandable .com names being negatively affected ?
I don’t see the new gtlds negatively affecting .com brandables anytime soon. Here are a few of my reasons why…
Most of the better new gtlds have either been registered by domainers, held back the registry or contain prohibitive yearly renewals.
The majority of the public have no idea what these new gtlds are in the first place, so any company is taking a risk going with something that isn’t a .com.
I took a look at my sales over the last 90 days, I only see one of my keyword sales that contains a word that is currently a gtld. In other words, I think the prevalence of domain hacks in the new gtlds is very limited for the majority of the new gtlds, especially when it comes to startups primarily in the tech industry.
As some of the better ones come out like .shop, .cloud, etc this will open things up a little. There are obviously going to be new gtlds that succeed, but I believe those will be the extensions that are the most generic such as .ly, .me, etc. I would say that the majority of names I sell have the .net available for them to purchase, so if a company isn’t going to go with a .net why would they go with something that is only a year or two old ?
9) Why the need for exclusivity ?
The domain world is confusing enough to most end-users and we don’t want to confuse them even more by them seeing a name they might be interested in buying on several different platforms and several different prices. Our regular buyers know that names listed on our marketplace can only be purchased through BB which adds a great amount of credibility and strength to our marketplace which benefits all of our sellers.
In addition, logo design, editorial work, and our overhead is spread across each name. It wouldn’t be possible for us to flourish if we put in the time and capital to accept, list, and market a name, only to have it sell somewhere else. It isn’t a sustainable model in our opinion.
10) If a member does not like the pricing BrandBucket suggests can they persuade you to raise it ?
Yes, if an owner feels a name should be priced higher or if they want us to take another look at a rejected name, please email email@example.com and we will be happy to do so.
11) Any thoughts about releasing sales numbers on a quarterly basis ?
We have been experimenting with releasing data monthly such as the average sales price, ratio of keyword vs. invented, percentage of sales in each price range, and top search terms. Our goal with this is to help new sellers understand the market, and help more experienced sellers make educated decisions when choosing names to add to their portfolio and when pricing those names.
We have released a year-end overview of sales in the past and will be doing this for 2015 soon. There is a chance we may release specific sales numbers quarterly; however, being the largest and most successful marketplace, anytime we release numbers it makes us a target of speculation and gossip — usually negative and spurred on from competing marketplaces. We prefer to keep our focus on overall growth and to use our time to spread positive, useful information instead of fighting fires, this approach is better for the domaining industry and sellers.
12) What do you say to the member or prospective member that believes there are too many names listed to get noticed ? Will you stop accepting submissions at a certain number ?
Well, first and foremost domaining is all about quality. We have sellers that have less than 100 names published with double digit sales figures because they found names that attracted a broad user base and were fairly priced. Every week we see new sellers make their first sale, all of which have very small portfolios. It is great to see those sellers put that money into more great names and see their portfolio increase.
We don’t have a particular number in mind for our marketplace. As traffic continues to increase at an accelerating rate, it is vital that we add as many quality names as we can to meet their demand. The more quality options that buyers have, the better for all of our sellers.
13) There has become a secondary market on Namepros where people buy and sell BrandBucket approved names at wholesale pricing. How do you feel about this?
I think it goes to show the strength of the brandable marketplace. Brandables are much harder to quantify than something like Chinese domains, but almost everyone agrees that brandables of a certain quality have real value. The fact that our accepting a name has become the de-facto stamp of approval is very flattering and shows not only the strength of brandables, but of the authority of our marketplace.
Thank you for your time Michael