Flooding The Domain Name Auctions Will Not Get You High Prices!

Flooding the domain name auctions, even if the domains are of top quality, will never produce the best results and the highest prices. These auctions will probably get the highest reseller prices at best. When you see an auction event with 100 or 200 domain names that is not the best time to also put your 50 best domains up for auction too at the same or even a different venue.

For instance Namejet is doing something that I find puzzling and I would like to hear what you think about it. Namejet has been running competing auction events during high profile auctions like Project 94 or the 3rd premium .info Afilias auction.

Namejet ran a competing auction during at the same time the PIR Project 94 auctions were running with several 3 letter .org domains and a few 2 letter .org domains. PIR had several 1 and 2 letter .org domains. Some of the top prices  for the competing auctions were:
md.org $555,650
tx.org $19,100 Reserve Not Met
fl.org $15,333 Reserve Not Met

Sure md.org got a great price but none of the other 2 letter domains were sold. Also none of the 1 letter .org domains were sold and none of the 2 letter and number .orgs got bids over $10,000 except for the 2 above that were not sold because of the reserves.

Then during the 3rd premium .info Afilias auction, Namejet ran another competing event auctioning off 6 .info that were first auctioned off in the 1st premium .info Afilias auction. Here are the results (1st .info afilias auction results in brackets):
loan.info ($8,293) ->$6,200 Reserve Not Met
loans.info ($12,205) ->$9,655 Reserve Not Met
tax.info ($5,005) -> $10,805
bank.info ($5,060) -> $2,600
engineering.info ($2,693) -> $1,488
finance.info ($9,002) -> $4,555

From the 6 domains above only tax.info did well. All the others lost money. What is even worse is flooding with domains that were auctioned off just a few months before. I wrote about these flips on the “The .info domain flip: is it really possible?” article.

Then we have some individual sales that did much better that the flooding auctions.

Home.info sold at Afternic this May for $7,500 after being sold at the Go Daddy 2nd .info auction in December for $5,615.

Finance.info sold for the 3rd time in 3 months at Flippa for $5,500. That was just 12 days after it got $4,555 at Namejet.

And the biggest success story was Asbestos.info. It sold at Namejet on May 6 (3rd .info Afilias auction) for $1,040. It was then sold at Flippa for $6,750 on May 23. That was a $5,710 profit for the seller over 17 days.

Flooding seems to be confusing to the bidders and hurts all auctions. The Namejet auction were confusing to me because I though that I had backordered all .info domains from the 3rd auction event and when I tried to bid on engineering.info I couldn’t find it in my auctions. I then realized that engineering.info from a different auction event and fortunately it wasn’t too late and I was able to backorder it and win it. As you can see from the auction results, 5 of the 6 domains didn’t even get close to the price they got in December. Only tax.info sold for double that. I was able to get engineering.info for about half the price.

I don’t know about you but if I was PIR or Afilias I wouldn’t want Namejet competing with my auctions. Maybe the md.org and the tax.info prices were quite good (on different levels) but who can tell me that if these were auctioned off at a different time they wouldn’t do even better? Finance.info and asbestos.info both did better than Namejet just 10 days later at Flippa.

ICM Registry, the .xxx registry, did something similar even before the 1 year anniversary of the .xxx. Theyassigned asking prices on over 1000 reserved domains and put them up all for sale at once. Sure they have46 confirmed .xxx sales in the past few months but were these domains sold at the highest price they could get? The .xxx registry sold porn.xxx this past week for a price that I believe was in mid 6 figures. But this domain was not in the priced list and was negotiated privately. I bet ICM registry kept this domain apart of the 1000 so that they could get the best price. But because they need to present yearly sales and cash flow they flooded the market with 1000+, mostly cheap, .xxx domains and that had a consequence to ruin .xxx sales for most domainers. Michael Berkens wrote about it here.

If you had 365 3-letter .coms, would you put them up for auction together, put 1 every day for a year or hold on until the end user comes? Flooding the auctions with domain names will almost certainly attract resellers 99% of the time because you can’t possibly get 100s of end users to bid on an auction event. And resellers only have a certain amount of cash available. Afilias is running back to back .info auctions. They are having the 4th premium .info auction at Sedo. I think they should slow down a bit. What do you think? It seems that there are auctions running everywhere on expired and mostly on domains sold by their owners. Is the reseller market able to handle all these auctions? I don’t think so.