Valuating a domain name 1

What is the domain name valuation

Domain name value can be objective or subjective matter. While you can personally think that domain name you own or you are going to purchase is of an excellent value either for business or hobby purposes the facts can be quite contrasting. In order to be objective about domain name value you need to either hire a professional to make a domain name appraisal or have use of an automatic valuation tool. Beside the price of a said process there are also huge differences in methods and thus end result of both types of process. In conclusion domain name valuation is not something you can easily grasp like you would real estate valuation, it is far more complex with many more variables involved in the process.

What is the domain name appraisal

Domain name appraisal is a process where automatic tool or a human professional takes a dig into domain name statistics and various metrics and come up with a reasonable value for that particular domain name. Since the process itself is not straightforward and that there are no written scenarios about how it should be done properly the appraisal process of domain name valuation is highly volatile matter. Basically appraisal can be divided in two general groups, one being the valuation of domain name for re-seller market where most important metrics are keyword based metrics and valuation of domain name for end user market where other factors like domain name branding ability come into play. In either case you can end up having very different valuation results from different appraisal tools or services. You can either choose to trust a source or you can average on few different cheaper appraisal services.

Domain name valuation – Automatic tools

There are many tools like Estibot which can make an educated guess about your domain name value. However, same as with all automatic tools, the tool is as smart as the person developing it. Estibot is among most popular tools and their automatic appraisals are very good for an automatic tool. However the weakness (or strength) of an Estibot valuation as with most of the automatic valuation tools present on the market is that end result can be used for informational purposes. You would not set your selling price or set your bidding price on a result coming from an automatic valuation tool.

Domain name appraisal – Professional valuation

Professional valuation is always being done by a person or a team of professionals evaluating each metrics, statistics, market demand and many other factors before reaching a conclusion and making the report for you. That said professional appraisal can be very expensive, partly due to the manual labor involved and partly due to top price paying for a professional help (like in any industry). You would likely set your price according to a trusted professional valuation of domain name you are selling, similarly you would not bid more than the professional has said the domain name is worth. Due to domain name appraisal professional valuation being expensive you would not go and appraise domain name whose worth for you is dismal.

Domain name buying – gotchas

When you decide to buy a domain name the appraisal or valuation of said domain name can be of great help. However bad appraisal or valuation of the domain name you are shopping for can hurt you financially. If the domain name you are in market for is not critical to your business you can get away with no appraisal at all or using free tools like Estibot and similar to average bidding range before you buy. However if you are hunting domain name for your company or product brand you should be serious and use professional help on the matter.

Domain name selling – gotchas

Similar thing happens when you are about to sell your domain name on the open market. Appraisal or valuation of the domain name you are going to put on the open market can help your sale but if done improperly you could end up being unprofessional seller and called names even as being scam business. It is a good idea to get free valuation from automatic tools and if they all agree on an average price greater than ten thousand dollars you should get a professional valuation. By selling domain name valued highly and with a trusted professional valuation you have far better chances to make a sale.

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