When doing business in an industry like domaining you may run into conflicts of interest, or perceived conflicts of interest more often than other industries. For the most part the companies you do business with all started out small and may still be in direct competition with their customers. I am not in competition with Comcast or in with AT & T. I am in competition with certain divisions of registrars and registries and marketplaces.
BrandBucket has risen to the top spot of the brandable boutiques, hell they were the first and their two biggest competitors were once sellers on their platform.
Some people love BrandBucket others loathe them. I have always been in the middle with the terms and conditions. I have always had good conversations with Margot Bushnaq and Michael Krell and my interactions with them have been professional and pleasant.
Michael is the most prolific seller on the website and every time one of his successes comes to light it seems others believe there is an unfair advantage.
I interviewed Michael a little while back and asked him about special treatment.
5) Some think that you get special perks for your own names on BrandBucket, can you put those rumors to bed ?
MK) 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.
In a recent post that highlighted Michael’s recent sale of Fondly.com, Joseph Peterson replied to a well wisher with this comment:
You mean: Damn, this guy gets a salary, disproportionate listing privileges, and a big marketing budget supplied by other domainers!
When another commenter called Peterson out, he replied,
What accusations? This is self-evident, as far as I can see. I think even Michael Krell would concede that
(1) He’s paid by BrandBucket, since he’s the Managing Director;
(2) He gets his own inventory listed on BrandBucket without the same hurdles faced by customers (i.e. submission, rejection, and listing fees);
(3) He owns a very large share of domains listed at BrandBucket;
(4) He contributes commissions and listing fees that are (in percentage terms) lower than the percentage of BrandBucket domains he owns. That means his inventory benefits from BrandBucket marketing to a disproportionate extent;
(5) He’s ultimately in charge of BrandBucket marketing campaigns, which spend money provided by other domainers;
(6) He is more likely to interact with BrandBucket buyer customers personally than BrandBucket sellers (who don’t get emails and phone calls);
(7) He will naturally think of his own names first because he remembers them, which naturally causes him to recommend his own names to buyers who approach him via BrandBucket.
Is any of this disputed? If I’m wrong on any of these points, I’ll cheerfully admit it.
How BrandBucket prioritizes the inventory showcased on its website isn’t something I can talk about with any certainty. Maybe it’s entirely owner-agnostic and doesn’t favor Krell’s domains at all. In that case, he’s a saint. Most people would prefer a system that features their own names. And Michael Krell would be able to influence BrandBucket’s algorithm in subtle ways to bias it toward his own domains if he chose to do so. Does he? I have no idea. Quite possibly not.
But the other points seem non-controversial. And they do give Michael Krell an advantage. Does that mean he’s “evil”? No. Of course not! But I don’t think domainers ought to be quite so easily impressed by people in an advantaged position that other domainers cannot replicate.
Fondly.com is a good name. Many of Krell’s names are good. But they wouldn’t sell with the same velocity if he weren’t BrandBucket’s managing director. That seems quite obvious.
This kind of conversation plays out on Namepros as well, where Krell has stated before that he gets no special privileges.
I think it’s time that BrandBucket comes out and makes some kind of statement to either back Krell up or they should have an understanding that the silence is hurting their brand with sellers.
The distrust in the marketplace is causing more and more listings put up on Namepros at wholesale, (those prices are down there as well) as some members believe they are at a minimum in a disadvantaged position, while others have abandoned all hope of making a sale.
Michael has always seemed like a straight up guy to me in the conversations I have had with him. I have asked in private about special perks and the answer was the same as the interview. To be fair I have never met him and have no info on whether he does or doesn’t get special benefits.
Disclosure on my part, I have 26 names listed on BrandBucket that was a portfolio purchase on Namepros at a wholesale pricing level. I have sold a few brandable names to Michael Krell at wholesale for a sum less than $150. BrandBucket has never advertised on any blog I own or manage advertising.
timely article cheers Raymond.
Well reasoned post, I like that you stay balanced. I am driven mad by people who go off like onlinedomain. The same can be said for the asskissers like ML.
It’s frustrating reading only about the success of Krell on brand bucket. I am sure there others who make a sale here and there but no one with the consistency of mr. Krell.
Sounds too good to be true. His sales are definitely a great sales pitch to everyone to pay your listing and art fee to list there, based on one high paid brandbucket employees highly successful sales. Believe it or not, you decide…
Since I’m quoted here, I may as well respond.
It’s indisputable that there is a conflict of interest for Michael Krell at BrandBucket. He can make more money by selling his own inventory than by selling his customers’ inventory. Plain and simple.
Let me emphasize, though, that a conflict of interest is just a temptation. People don’t always give in to temptation, so to speak. And this isn’t always a nefarious thing. Often, the owner of an art gallery is herself an artist with paintings on display. She’ll compete with other painters or sculptors featured there. But she’ll also facilitate their sales.
So customers aren’t just Krell’s competitors. BrandBucket needs to sell some customer inventory in order to keep variety on the shelves, hold onto traffic and customer-generated leads, and (most importantly) produce revenue to pay employees and marketing.
My assumption (which BrandBucket’s Managing Director is free to refute) is that Krell doesn’t pay the standard listing fees and 30% commission. I don’t know what he pays. Maybe a reduced rate. Maybe nothing at all. That’s for him to say. A lower cost for Krell implies 2 things:
(1) Krell’s inventory receives marketing exposure disproportionately paid for by other BrandBucket customers. (Some people will boo that.)
(2) BrandBucket’s revenue for paying staff and marketing itself comes disproportionately from customers other than Krell, which means he must help produce sales for others. (People should, if not applaud, at least give that a golf clap.)
I have no reason for thinking that listings on the BrandBucket website are biased to in favor Krell’s inventory. Simply haven’t looked. I could prove or disprove that hypothesis with a statistical study, but I don’t have time to test something I haven’t alleged and which doesn’t affect me.
In my comments earlier, the primary point I was making ISN’T that Michael Krell is (in any sense) “corrupt”. Even without cheating, Krell’s position gives him a huge sales advantage. Guaranteed marketing exposure for pennies on the dollar. The rest being paid for by other BrandBucket customers. That’s simply a job perk.
Michael Krell will sell domains at a higher rate and for higher prices than most of us can. You may be jealous. Rationally, in a sense, you should be. But don’t waste time worrying about it. That’s life. There are always people placed in positions that give them an advantage in this world.
Whether it’s worthwhile for domain owners to list their inventory at BrandBucket, given this situation, is a different question entirely. I don’t pretend to know the answer. Maybe it is. Maybe not. If you’re turning a profit at BrandBucket, then BrandBucket might be a good idea. If that profit is bigger at BrandBucket than it would be at Sedo or Namerific or with Etsy landing pages or with whatever else, then sure.
From experience, I know that a lot of sales that happen at BrandBucket would have happened elsewhere anyway. Someone just thinks up the name and visits the domain. But other sales are the result of BrandBucket’s aggressive marketing efforts, which are a tremendous boon to the domain industry as a whole.
30% commissions and lifetime exclusivity are more than I’d give any broker, personally. Especially if he’s not going to reach out to end users specifically promoting my domain. But that criticism applies to ALL market places following the BrandBucket business model. To me it *feels* like a bad deal, but my *feeling* could be proven wrong with actual numbers.
I had another potential conflict of interest recently. I was bidding on a name on one of the auction platforms, and at the end there were only Michael Krell and me left (he uses his real name as username).
My plan right from the beginning was to list the name on BB if my bid was the highest. But once I knew I had “won” over their managing director, I was a bit worried about listing it. Would it be rejected or accepted at a low price if Michael was the guy reviewing the application?
It has now, thankfully, been accepted at BB at what I believe is a “normal” price. But I must admit I felt a little bit uncomfortable listing it.
I don’t know if Michael gets any special treatment, but no matter what, he is one h… of a domainer that I think we should all admire. Even if you get all the support in the world, there is no way people are going to buy your domains in droves if they suck.
It’s good to see more blog posts about this topic. Honestly, the more I think about this, the more scammy it seems to me. BrandBucket has the least investor friendly listing policies of any domain name marketplace. 30% sales commission, a requirement to redirect the domain to their platform, and then a $10 listing fee for all domains. Meanwhile their brand ambassador, who has a special deal, floods the platform with his own names, and then goes on to hype the program to other newbie investors.
Nicely articulated Raymond.
Also, Joseph should start writing a blog…
BrandBucket is a fee rip off period. Why on earth would you pay the fees like that when Unireg gets more traffic and less costs, or pretty much any other platform but BB. I have several brandables and will never pay that to them in any way shape or form.
I have been very upfront regarding this issue. Here is what I told Raymond in an interview earlier this year that is also included at the beginning of this article.
________
“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.”
________
In addition, I also pay exactly the same commission rate (30%) for each of my sales.
If I was the only person selling names on BB, we wouldn’t be anything near of what we are today. My personal sales comprised only a small percentage of the $2.4 million that BB sold in 2015. Many others are selling names through our marketplace.
Michael thank you for replying. I agree with Raymond that Margot should come out and back you. She should say you get no special privileges.
Michael,
You have access to all the sales data and the sales teams !!!
You know exactly what names and types of names are selling and trending. Are you honestly suggesting this data does not influence your buying and listing behavior.
Obviously you would be buying the types of names that you know have a particular market and interest on Brandbucket based on your access to sales data.
Do you read and review the sales data at Brandbucket in your role?
@Rodger,
He should. Michael Krell would be ignoring both his own financial interests and BrandBucket’s success as a whole if he didn’t review all the data and attempt to stock domains that customers are more likely to buy.
Again, this just goes to show that Krell’s position gives him huge advantages when it comes to selling BUT that’s not necessarily an ethical issue at all.
Comparing a typical domainer who lists at BrandBucket with sales by BrandBucket’s Managing Director is just absurd. Apples and Oranges.
@Michael Krell,
Thanks for replying. This is in no sense an attack against you personally. Nor even a complaint against BrandBucket.
I must say, I’m a bit surprised that you pay the full 30% commission. Do you also pay listing fees?
What, then, is the benefit of being a “Brand Ambassador”? If that title confers no advantage at all, I mean. Same commission rate for BB ambassadors? Same listing fees? Surely, there must be some perk; otherwise why would anyone bother?
Presumably you bypass the usual submission / rejection process. I’m guessing that anything you wish to list is simply listed. Guaranteed listings would be 1 benefit to having a closer relationship with BB.
I don’t know the answer to this question, but do you get a chunk of BrandBucket’s commission revenue – perhaps a flat percentage or perhaps a bonus if certain sales targets are met? It would make sense to incentivize the Managing Director to get results in that way. Nothing wrong with that at all. Yet it could also be interpreted as a rebate on the 30% commission payments.
This isn’t adding up for me. BrandBucket’s Brand Ambassadors are domainers who go recruit other domainers to list new inventory on BB. You were an “ambassador” prior to becoming General Manager. Why would they / you want to do that? I mean, why recruit other sellers to compete against one’s own listings for buyer attention? You’d have been shooting yourself in the foot. Rationally, there must be some financial benefit to offset that – some special treatment.
Without differential treatment, nobody would have any reason to work closely with BrandBucket to recruit more sellers. Yet the details you’ve shared seem to imply that you’ve never benefited from any advantages. It seems to defy common sense. What am I missing?
Let’s unpack this statement: “As my personal portfolio has increased my sales rate has stayed fairly constant.” OK. Suppose you sold 1 domain in 10 when you had 100 domains listed at BrandBucket. Then you’d be selling 1 domain in 10 with 5,000 domains listed at BrandBucket. From 10 sales to 500 sales – revenue scaling up by a factor of 50 … or by whatever factor your portfolio has grown by.
I suppose that statement is offered as evidence that your inventory is given equal treatment with that of other sellers. Logically, it can’t support that claim. It isn’t a comparison between Michael Krell’s listings and listings by others. It’s simply a comparison between Michael Krell then and now. Then you were a BrandBucket ambassador. Now you are Managing Director. In both periods, you worked closely with BrandBucket and might have enjoyed some special benefits. So this statement only shows consistency of outcome for you.
Surely that’s the biggest benefit, isn’t it? The ability to scale up at BrandBucket in a way that other sellers presumably cannot. To maintain a very large inventory on the shelves and achieve a predictable sell-through rate on a bigger and bigger portfolio.
Other domainers would only be able to get a fraction of their domains listed, and the submission process would be far less efficient for them. They’re obliged to to buy multiple domains simply to get 1 listed. In contrast, Michael Krell should be able to buy anything he likes and get 100% of it listed. That’s a far more lucrative business model – and something BrandBucket customers cannot possibly replicate. Michael Krell can operate without wasted energy, whereas other domainers experience a high coefficient of friction.
Joey P for president.
I like the statement, we want to keep this small so a person can browse all the domains in one evening…All 33,000 of them…Good Luck on that one
Agree with JP on many points..really..Being able to see trends and evaluate at more efficient observations is of upmost importance…Or why dont you ask Frank Schilling that question…Being able to observe trends or sales of whichever area that is happening currently and then go get the inventory, I guarantee you as a standard domain investor, you have zero chance of seeing the REAL stats on sales..
These are not big problems.
My favorite BrandBucket.
Be patient and make great sales.