Some DNS Tidbits You Need To Know
As most of you are aware, the Domain Name Sales (DNS) platform is the brain child of Frank Schilling and has been adopted by numerous domainers across the globe as the place to park and sell your domains.
While parking revenues are dropping and no longer the lucrative income source it once was, the robust platform with integrated CRM is an excellent place to sell your domain names.
However, it appears that the great majority of domainers may not be taking the right approach in maximizing sales through the platform.
I had the great pleasure of meeting Jeffrey Gabriel, who is Vice President of Sales with DNS.
Jeff is an industry veteran with over 70 million dollars in domain name sales under his belt and as he says, is a numbers and stats guy, because stats don’t lie.
I’m a numbers and stats guy too and when Jeff shared his insight regarding the statistics pertaining to actual closed sales at DNS during an excellent presentation at Namescon, I knew I needed to change the way I do things on the platform going forward.
While Namescon broke the industry record for conference attendance, with around 900 attendees, not everyone was able to attend and with multiple sessions going on at any one time, there were many attendees who were unable to hear Jeff’s presentation.
As such, I thought I’d put this article together and share some of what I learned.
One of the more interesting statistics shared by Jeff was the fact that 78% of the sellers who respond to buyer inquiries on the platform do not provide a phone number.
In fact, 40% of these sellers also don’t provide their full name when responding to inquiries. Most will provide a first name only, perhaps a last name or just initials.
Sales is about trust and the more successful sellers on the platform always provide their full name, phone number, skype information, etc., making the buyer feel a little more comfortable that they can reach out to you if they want to. If you’re hiding or being cryptic, as most are, you are really just driving sales away from you!
As Jeff reminded us, to be successful in real estate, the main rule is location, location, and location. In domain sales, it’s comparable sales.
Do your homework when listing names on the platform and be armed with comparable sales that have occurred.
While this probably isn’t anything new to you, don’t make the mistake of only looking for comparables using just the keywords in your domain name.
Look at other sales in similar categories, whether it be a specific sector (i.e. healthcare, education, travel, etc.), type of domain name (i.e. call to action, brandable, etc.) or specific consumer product domains.
One of the consumer product examples Jeff used was menswatches.com.
Don’t just present comparable sales with the keyword watches like goldwatches.com, digitalwatches.com etc., also find and present previous sales with similar but different consumer products like earrings.com or rings.com.
Taking this approach often makes the light go on for many potential buyers who are not familiar with domain pricing and such similar sales will often legitimize the asking price you have presented.
Another great take away is to know your industry inside and out.
While you may think you know all that you need to know, many domainers on the platform don’t do their homework and blow many deals as a result.
Jeff’s example discussed the fact that many domainers will explain to potential buyers that the sale can be consummated using Escrow.com or similar escrow services.
However, when they come to an agreement to sell a name for say $10,000 and send them to Escrow.com to consummate the deal.
The buyer may be surprised to learn that Escrow.com’s credit card limit to purchase a name is only $5,000.
Suddenly, the easy deal you thought you had might quickly disintegrate, as you sent them there and did not educate the buyer that this would be the case, because you didn’t even know it yourself.
Did you know SEDO’s credit card limit for purchase is only $500?
Take the time to know all the ins and outs of your business, otherwise you’ll end up with egg on your face and will lose many deals that you could have had. There are many things you control as a sales person and doing them right can make all the difference in the world when trying to consummate a sale with a potential buyer.
Some of these are obvious like your image (i.e. how do you present yourself on Facebook, Twitter, etc.?), your professionalism (how do you respond to inquires? do you follow-up when you said you would ? Are you accessible ?) and knowing your industry (payment methods, transfers, contracts, etc.).
All these things are within your control and the quicker you take control of these things, the quicker you will be successful in selling domains.
There were many other great points that Jeff shared, but I thought the most important pertains to price. You need to give the potential buyer a good experience in order to make a sale.
The most common response given to an inquiry from a potential buyer who indicates that they want to purchase a specific name, is to say “we are looking for offers in the $XXXX to $XXXXX range”, or “we are looking for 4 to 5 figures for this name”.
Again, it’s about trust and the buyer’s experience during the transaction. Most buyers will walk away at this point. What other industry prices its products or services as “4 to 5 figures”.
Put yourself in their shoes for a minute…if you brought your car to a mechanic to get fixed and ask what the cost is going to be, what would you do if the response was “the cost will be in the mid $XXXX range”? The answer is obvious, yet the majority of unsuccessful sellers on the platform still use this approach.
Back to some stats, 99% of the time, Frank, Jeff and the brokers at DNS selling Frank’s names, provide a price out of the gate when an inquiry comes in. That’s how they qualify them. That’s how they get responses and reactions out of them, including offers.
I learned a long time ago to do what successful people do and if you want to sell more names, you should consider it too. For an even more eye-opening statistic, 55% of people who consistently provide a price on the platform (again this would include 99% of inquiries into Frank’s names), sell 85% of all the names sold on the platform. If that’s not a wake-up call, I don’t know what is!
If you want to sell more names when an inquiry comes in – set the price! At some point you’re going to have to anyways. If you do it at the beginning, the stats prove you’ll simply be more successful!
A big hats off to Jeff for sharing his insights! I know I’ll be selling a lot more names this year taking these approaches and I hope you do too!
“99% of the time, Frank, Jeff and the brokers at DNS selling Frank’s names, provide a price out of the gate when an inquiry comes in.”
I agree 100% but I have read many times that most people will go back and forth in emails with potential buyers just trying to get the buyer to make the initial offer. Some big name domainers have said this too but in my opinion it makes no sense.
If you want to sell a name then throw a price out there and if you left anything on the table then you learn and move on.
You are correct Todd, not all big domainers subscribe to putting the sale price out there right away.
The psychological effect of anchoring comes into play, and others just won’t give a price first, especially if they cannot garner any info on the buyer. Maybe you legitimately want $5,000 and the name is worth that, but the buyer is a major pharma company that would not blink at $50,000. Without any knowledge you price at $5,000, get a sale and then see the ads on tv and say. “Bleep,@&$(@$ Bleep”
An article on Anchoring
The anchoring effect is a well-known psychological phenomenon that is used by salespeople everywhere. Most people know that the prices of cars are a higher than they’re supposed to be, and that negotiating a better price is the first step to buying a car. Try as they might, though, they will keep that original price in mind. Just suggesting the higher number will provide an anchor from which the person can’t stray too far. This goes for everything, from shoes to designer jeans. Unless people do a comprehensive survey of the market, and study the realistic retail costs for most products they buy, they’ll decide based on the initial price.
But anchoring doesn’t only work with prices and direct negotiation. Any suggested numbers will have an effect on how you see things. A psychology researcher conducted a study in which participants were asked to estimate the height of the Brandenburg Gate. This was not a fact that they would likely have come across in their studies. Some participants got a preliminary question, asking whether the Gate was taller or shorter than 150 meters. Some did not. The ones that did receive the preliminary estimated the Brandenburg Gate as having a height close to 150 meters.
http://io9.com/5962687/why-sales-people-love-the-slippery-psychology-of-the-anchoring-effect
If a person has a portfolio of ultra premium domains then I think the strategy of not giving a price is fine. On the other hand if you have a portfolio of lets say brandable names then I think its best to price them or you won’t sell very many.
Let’s face it DNS has some great names in their inventory, many times I have tried to purchase some, and the brokers in house, always say please make an offer over $1,000, and are clear to say it may cost more than that, but that is a starting point, so your advice sort of contradicts that of what they are doing in house?
Vincent, it was great seeing you at the show, and I am beyond flattered that you took the time to write about what you learned. Hopefully, this will help you make a lot more sales in 2015.
@Travis: We represent thousands of sellers on our platform. Some of our customers want us to qualify every deal before asking for a price. Do we agree with that strategy? No, we are firm believers in providing the price. If a customer does not want to do that it is fine with us we are happy for the opportunity.
Jeffrey M. Gabriel
VP of Sales – DomainNameSales.com
1-800-818-1828 x6261
Sedo states their limit is also $5000 for cc.
Credit/Debit Card: Sedo accepts Visa and MasterCard payments for transactions up to 5000 USD. If you’ve purchased a domain, you may make a payment through your Sedo account (via My Sedo > Billing). If you’ve ordered an appraisal or featured listing, you are asked for your credit card details at the time of purchase.
Teri,
Vincent did not word that correctly. The slide was about 3rd party Escrow Services, not about platforms.
What I was saying was If you have an agreement and call Escrow.com do you know their limit which is 5k on a CC. If you decided to use Sedo for escrow services do you know theirs? Their limit is 500 on a credit card. Not if you are buying a domain on the marketplace ordering an appraisal etc.
Jeffrey M. Gabriel
VP of Sales – DomainNameSales.com
1-800-818-1828 x6261
We have worked with Jeff and the DNS team numerous times on credit card transactions for over $5000, but that is our published limit.
Couldn’t make it to Namescon and this was THE session I wanted to attend.. Thanks for writing this article.
Great article.Thank you for sharing the insights.
My experience with DNS is same as stated above, price range, not price. They preach what they don’t practice.
Could it be these are the 1%, Jeff did say 99% maybe on the top names or trending names they did not give exact price. I don’t know and I agree no one should be preaching one thing at a conference and then doing the opposite daily. Maybe its the 1%.
Raymond,
Some of us are developers who have end user clients, and everytime I have asked about a name it is like pulling teeth, and word games to get a price.
I don’t think to date, I have ever been able to get one. Now we just bypass DNS all together, and such actions really only hurt the users on the service with private accounts.
Just do a direct whois, or hit up sedo, godaddy, afternic.
Not saying anything about the organization, just getting a price, I know it can be hard to leave money on the table, but many people are working with real money budgets, and have a yes, or no approach.
I agree, you need to work within the budget, and it is not cool to say one thing and then not put into everyday business. It would be nice for Jeff to reply if he gets the chance.
Ladies and Gentlemen,
We have the pleasure of having an in house portfolio which we price every single day, and this is the strategy we use. We also represent many other customers who range in strategies.
Some of our customers have their names with Uniregistry. Park with us, sell with us and even let us price their domains, and handle the transfers. All they do is collect a check.
The other extreme would be customers who require an offer, and a summary as to who the buyer is on every single inquiry.
Then there is everyone else in between.
I assure you, we practice what we preach when we are permitted to practice what we preach.
Jeffrey M. Gabriel
VP of Sales – DomainNameSales.com
1-800-818-1828 x6261
It’s not the brokers, it’s the sellers not setting the price. The brokers do what you tell them to do. I now broker my own, but at first I didn’t and for every inquiry, the broker asked me for a price and I’d suggest I wanted an offer first, which is how they proceeded.
This was a superb article, thank you! Going to be interesting to see Jeff come in here, comment, and answer some of the questions that have been submitted.
If you have a domain name someone really wants, then you don’t have to name the price, as illustrated by Rick’s great sales over the years.
KC,
Rick is a far better salesperson than he is a Domainer, and might I say he has a fantastic domain portfolio.
When dealing with million dollar + domains your options are limited and his strategy might work, but in the grand scheme of things making things difficult for a buyer when they want a 3, 5, 7, 10, 20k domain will not work in your favor. There is a lot more competition out there.
Jeffrey M. Gabriel
VP of Sales – DomainNameSales.com
1-800-818-1828 x6261
Great article Vincent. Thanks for this!
Thanks for sharing great article Vincent.
Very good info. I have had a few offers on DNS and 1 sale but also you will get many people who dont even know the form is for a domain name as for me I get offers for discount coupons due to one of my domain names.
Great article, thanks Vincent, Jeff for the comments and Raymond for the great blog
Hi Jeff and friends,
I just wanted to confirm that Sedo’s credit card limit is $5,000 for all services including our escrow services.
Here’s some additional information about our payment process:
https://sedo-us1.custhelp.com/app/answers/detail/a_id/651/kw/credit%20card/search/1
Thank you,
Carolyn Rodon (Sedo)
Carolyn,
I have no problem admitting a mistake, and if that is the case that is the case, but I was told by a very high ranking Broker when I asked about a deal that 500 USD is the max for a credit card on an Escrow transaction.
Either way! Know your limits!
Jeffrey Gabriel
Just added some domain names to DNS and look forward to working with them. These tips were definitely helpful!