As discussed in previous posts on time management in the domain name industry, time is money. Sometimes, the best strategy is to sell domains in bulk to cut down on the opportunity cost of your time. If you could make more money spending your time elsewhere, then you should do what it takes to get these domains sold as quickly as possible and this most likely means selling the domains in bulk. If you’ve lost confidence in a domain market or want to reinvest your domain profits elsewhere, selling your domains in bulk might once again come across as an attractive option. There are good reasons to buy domains in bulk and equally good reasons to sell domains in bulk — I’ll discuss both in this post.

For the most part, domains don’t sell well in bulk and short domains are no exception to this, as this eBay auction which inspired this post will show.

The strategy in buying bulk aftermarket domains often makes sense — you can probably negotiate a better price, you may feel that lower quality domains might yield a higher return on investment over an extended period of time, etc. Selling domains in bulk might also make sense if you believe the market is about to fall, if you have so many domains that you couldn’t possibly sell them individually or if the average domain is of so little value that the opportunity cost of your time would make selling them individually less profitable than selling the domains in bulk. So there are reasons why it might be both wise to sell in bulk and to buy in bulk.

Why do I have a problem with this particular domain sale then? I just can’t figure out who their target market is. Before I go on, if you’re the seller of these domains, in no way was this post made to ridicule you, merely to learn from what is often a mistake to sell domains of significantly different quality in bulk lots.

Most of the domainers buying lower quality domains do so because they can’t afford higher quality ones (within their respective market segments) or if they’re buying in bulk, for one of the reasons I mentioned above (such as believing it may yield a higher return on investment long term). If we take the LLLL.com market as an example, many people buying the buyout domains are generally doing so because they can’t afford to invest in quad premiums or higher quality pronounceables. There are very few people who’ve invested $XX,XXX+ into domains below triple premium quality.

A good pronounceable LLLL.com can easily set you back $2000-$5000 in a reseller environment — many domainers don’t have a great deal more than that invested in short domains as a whole, so the thought of investing their entire short domain budget in a single domain seems irrational (and probably is if you’re not planning on developing it).

That’s what I just don’t get about these bulk lots with domains of different quality — who are they trying to sell to? Many domainers are interested in either buyout LLLL.coms or higher quality LLLL.coms — one or the other, not both. Similarly, we see many domainers who buy domains which generate revenue but stay away from domains which don’t — they really are entirely different markets and it doesn’t make sense to mix domains from one of these markets with domains from another. Would you put STOCKS.com for sale with the rest of your 6 letter .coms? Why would you put a name for sale like GQQG.com with 75 other LLLL.coms when that single domain is worth 1/3 the ending price for the entire lot? The seller clearly recognized that the domain had far more value than the average LLLL.com in the lot — we can see that the domain, it’s 2005 registration date, and expiration date are bolded and written in a larger font size. Why not sell that domain individually?

This goes back to what I was saying earlier — people who want domains of a certain type often aren’t interested in domains of a different type. In this case, it’s highly unlikely that many of the bidders were interested in both a rare LLLL.com and bulk, lower quality LLLL.coms. Rare domains are somewhat like old domains in that they cater to a small niche of domainers, however they hold very strong prices among those domainers. Having a title such as “76 LLLL.com Domain Name Package 2,3,4 L Clearance Sale” is not the kind of title that would suggest to a rare domain or even higher quality domain investor that higher quality or rare LLLL.coms are to be found in this lot — when I read that title, the first thing that comes to mind is “I got a whole lot of LLLL.coms that will be expiring soon and I’m not interested in renewing them so someone might get a deal”. That’s fine and a deal someone got, however this is not the right image to project with higher quality domains nor should higher quality domains be sold in a lot which projects that image.

I’m going to have to start paying more attention to eBay myself when deals like this are being had. The triple premiums shouldn’t have been auctioned with the lower quality LLLL.coms either. I can understand why it was done in this case — many of the domains are within days from expiration, so good on the seller for at least being able to recover some of his investment, however if you’re not interested in renewing your domains, you really shouldn’t be waiting until the very last minute like this until the point that you’re forced to take whatever offer you receive.

Related posts:

1. Effectively Selling Bulk Domains
2. LLLL.coms are HOT on Godaddy Auctions
3. Some LLLL.com Data