Information Centre

Ever wondered what your registered domain names may be worth? The answer is somewhat - actually very - complicated.

If you have a portfolio of domain names, it can be exciting to see the mad figures some registrants are offered for a web address.

The reality is while some domain names are certainly quite valuable, these tend to be in the minority.

An individual buyer may offer a high price if the website address fits with a specific business need - and there are no suitable alternatives (which is pretty rare these days). Another situation where a very high price may be offered is if the domain is a generic single word or a short two-word common term .com; something most registrants are unlikely to have in their portfolio.

There are also cashed up companies around buying large numbers of domains, but some of them are more interested in names with added value; i.e, established sites.

Even then, what you may be offered could be very low compared to the amount of effort you have put into the site over a number of years.

Unfortunately, these are aspects potential domain buyers simply won't care about and acquisition companies tend to work with formulas for valuation.

For example, let's say you have a content site that generates revenue from advertising and your traffic comes primarily from organic search traffic. The company will want to know about traffic levels, expenses and how much revenue you generate a month. It will then will usually use a multiplier to determine an offer amount. This multiplier could be anywhere from x10 to x20 assuming minimal operating expenses - maybe more in special circumstances. Still, even at x20, this might not add up to a whole lot of dough; particularly if generating revenue hasn't been your focus.

Beware Of Dodgy Appraisals

Some registrants get so curious as to what their domains are worth, they decide to get them appraised. 

Free, automated appraisal services aren't worth the pixels they are displayed on. They work on very rudimentary aspects, such as traffic to the site (figures that may be incorrect), inbound links (without deep analysis of quality), age and length of domain name.

Unfortunately, many paid appraisal services will not provide an accurate value either - and in some cases, this is intentional.

Back in 2010, we published a news item on domain name appraisal scams and it's sad to see those same scams are still in operation today, fleecing registrants of their hard-earned cash and building up false hope. It's worth taking a look at that article to see what you need to watch for.

As in 2010, the advice is as true today as it was back then - a domain name is worth whatever someone is willing to pay for it, rather than what someone else says its worth.