Renew or drop? Using GoDaddy domain name appraisals!

godaddy

To renew or not? The one question that comes up tens, hundreds or thousands of times each year for every domainer.

Should you pay for the domain name renewal or drop the (bad) domain and save a few bucks?

There are many signals to help you determine if a domain should be renewed. The point I want to make here is that the GoDaddy domain appraisal tool can NOT be the main signal!

If you are determining what domains to renew or drop based on this tool then you are not doing this domaining thing correctly! In fact this tool can’t be any of the signals you use except maybe helping you find a similar sale. But then again you should have known this domain had value before you found this comparable sale.

I read on Twitter the other day about someone doing using this tool to renew or drop his domains. I can’t even begin to understand what he did before this tool was introduced!

There is no automated tool that can appraise domain names correctly. Putting some averages together in a tool does not really help domainers in their business. Every domain name is unique and also 99% of the time the owner has more data than anyone else to determine the value.

So what domainers need to do is learn how to evaluate domains and spend the time to do it! Appraisals or finding out what to renew or drop takes time. Accept that and then decide if you want to be in this business.

Here are 10 things I examine when deciding what domains to renew and what to drop.

GoDaddy domain name “appraisals”

I can not even start to describe how bad this algorithm and tool is and how much it is hurting everyone that uses it. But I will to sum it up below. (More detailed posts to come as I have been testing this tool for a year now.)

First of all the algorithm is bad. By bad I mean very very bad. So bad it is useless in any sense.

Its main problem is that it can’t differentiate a good domain from a bad domain. Yes, it will probably recognize a 3-letter .com or a dictionary .com domain has value but you don’t need a bloody algorithm for that.

Whatever, and I mean whatever!, domain you input the price is almost always between $1,000 and $15,000. Again, we all know the average price of domains sold is somewhere in there.

The domain Imeanwhatever.com is valued at $1,047 and is of course NOT registered!


The main thing this “tool” does is make some clueless people register domains like this or renew domains like this thinking they will be rich.

Do you even know how hard is to find unregistered domains that you can sell for $1,000 is? You need to search thousands of domains using many tools to even find 1 that could potentially one day sell for $1,000. Yes, this godaddy tool spits them out constantly.

The second main problem is that the algorithm doesn’t seem to learn from new domain sales. Even if a domain sells for $25,000 at GoDaddy and the sale is actually shown in the the Godaddy appraisal tool the “algorithm” does not seem to acknowledge that. The least the algorithm could do was give more weight to newer sales. It doesn’t.

This tool is only useful so you can find some low end past sales as GoDaddy has stopped reporting sales but they actually do input them into this tool. So if you know that a domain sold at GoDaddy there is a good chance that you will find the price. Well there is one more use for it…

Sold.Domains

About Konstantinos Zournas

Konstantinos studied Computer Engineering and Computer Science in London and lives in Athens, Greece. He loves domains and building websites. He is online since 1995, learned about html in 1996 and got into domains in 2002. He started the OnlineDomain.com blog in 2012.

20 comments

  1. uh… godaddy has at least five different algorithms they use. some are for things like buying mike berkens domain portfolio. others are for making money from suckers. if godaddy was willing to pay 1% of their appraisal for domains it would be simple to make $1000 a day just hand regging them. such is life.

    • Konstantinos Zournas

      Well, their bulk tool is a whole different ballgame! They buy at 1/10th (at best) of their own appraised value and sell at x2 to x10 of their own appraised value.

  2. Godaddy’s appraisal tool is borderline “false representation”. Additionally, it is false representation imho to display the following message when searching on whether a domain is available:

    “XXXXX is a high value keyword that has an average sale price of $2,433.00.”

    They are not taking into consideration the number of hand regs for $8 that never sold. Which = $0 sales price.

    They really need to qualify this language with “reported, aftermarket sales from a small subset of public sales”.

    Their language is erroneously inferring the replacement value of any specific domain is substantially higher than reality, which consequently leads to higher purchase and renewal rates for junk domains. Which, in my opinion, is misleading and false representation.

    The appraisal tool also does not go over $25K, manipulating consumers into believing the delta between junk domains and true premium domains is less than $25K. False sense of reality.

  3. GoD’s tool would be funny IF GD’s tool was meant to BE a joke…but it’s not…so it’s actually sad…if you understand it’s not to be taken seriously.

    Perhaps a caption or pair of ‘s just about the domain entry line might help?

    “This tools ‘advice’ is for entertainment purposes only.”

    • Konstantinos Zournas

      It is sad and I said it is doing a disservice to the industry.

      It is harming 100% of people that use it to get a valuation. From people that think they can buy a one word .com for cheap to the people that register junk domains for $10 and expect to get $1,000 the next day.

      Guess who is the only one not harmed by this “tool”?

  4. Godaddy’s valuation tool heavily overvalues hand registered domains and heavily undervalues truly great one word dotcom’s. This tool only helps them get more hand registrations from their customers. I challenged them over a year ago to sell me some of their one worders at their own tool’s valuation. Didn’t happen.

  5. I’ve seen multiple domainers say that they base their renewals on GoDaddy’s domain appraisal tool.
    Some of those domainers I thought knew what they were doing, obviously I was wrong.

  6. <<>>

    Please credit the author idea from Namepros

    namepros.com/threads/godaddy-value-tool-vs-sold.1119205/

    • Konstantinos Zournas

      Never read that, sorry. I think I have been to Namepros twice in the past 2 months and for not more than 2 minutes each time.

      I just visited your thread. Stop spreading lies. Never stole your “idea”. And I never delete comments.
      BTW if you want to know why I wrote about GoDaddy not updating their prices check a tweet from @alangdunn and @yofie about Aquaman and my reply.
      That is from December 20th:

      Now put aquaman.com into the godaddy appraisal. I have 2 screenshots of that because appraised price actually went down a few days after the sale.

      • Konstantinos Zournas

        I have been meaning to write about this since January 2nd (1st screenshot) and also made a screenshot on January 9th (2nd screenshot) when the price went down.
        I didn’t post that here because I will write a separate post. If you allow me…

  7. Meanwhile, then where are the people who could and should be speaking up about “Estibot” and this:

    https://domainnamewire.com/2019/01/16/my-favorite-domain-names-in-the-namescon-auction/#comment-2252940

    • Konstantinos Zournas

      I thought we decided that estibot was also useless years ago?

      These companies are so short sighted…

      • Konstantinos, there have still been pockets of resistance among those in important positions, silent lately as well, but right now I’m saying that people remaining silent is also the problem, a very big problem. Especially as a relatively high profile event like the NamesCon auction is such a flagrant example of how everyone is harmed by the automated “appraisal” phenomenon’s influence on the real market we are all in business to serve beyond the insider’s den of other domainers. This type of phenomenon is merely the tip of the iceberg and has real consequences on the real world market of end users considering purchasing domain assets for use in the real world. And hopefully you saw all the few comments where I linked.

      • To summarize, people should be objecting to this Estibot figure appearing in such a way at such an event, loudly, because it is doing real harm.

      • Konstantinos, check out this latest timely example of how the consequences are real, and the phenomenon has been and continues to poison the end user mind and market:

        https://domainnamewire.com/2019/01/23/scratch-foundation-files-lawsuit-against-scratch-org/ (paragraph four, and see comments).

  8. It is an automated tool which has some good uses. It is not made to determine if you should renew a domain or not or what exact price you should sell a domain name at. But it does have value in giving you more data points to make a decision on. It may show that a domain you think has little value scores high and give you more reason to go investigate it.
    I think it is especially useful in bulk. It allows you to quickly take 50k names or so that are expiring and then pass them through the tool and see what it thinks of the domains which gives you another few data points to help you pare down that list quickly.
    I especially like the probability of a sale data points which are included in the bulk tool. So you can see what we think will likely sell in addition to the price point. Many names may show the same price point in the appraisal but vary widely in how likely we think it is they would sell in the Secondary market within a year. We give you our estimate of how likely it is it would sell at an expired auction, how likely we think it is that it would sell at $500, and how likely it is we think it would sell at the appraised value.
    Again this is an automated tool and you have to look at the domains yourself and determine which ones are good to buy or not and which ones you think will sell but it does help to have something to use to get more data. We are using machine learning and are comparing it to millions of actual sales so it is a large enough data set.

    As far as aqua man we don’t update pricing with the tool daily it is done quarterly so it will likely reflect a higher sale price next quarter and that keyword was probably trending down q4 when you saw it updated early January to reflect the previous quarter not the recent sale of the domain. The reason we do that is we want a bigger data set to compare it to.

    I’ll be talking about the tool at Namescon on a domain valuation panel and also providing attendees to Namescon with a code to get 100k bulk appraisals with our tool which provides many more data points than the one at a time appraisal on our site and is designed more to help bulk users/investors. If you are at Namescon you can get the code at our booth.

    I don’t think we advocate anyone using the tool alone to make buying decisions, there is a disclaimer there for a reason. But we are for providing more data and being more open. I also don’t expect everyone to agree with the tool blindly 🙂

    I hope to see you at Namescon in a week. If you are going let me know and we can get lunch or dinner one day if you’re up for it

  9. > “It allows you to quickly take 50k names or so that are expiring and then pass them through the tool and see what it thinks of the domains”

    That is the only only practical use I see for such things as they now exist which has any possible degree of meaningful utility – but only for domain industry insiders, and ultimately at a huge cost overall to themselves and even to end users holding valuable assets; *as well as* all the other industry players whose business it is to make money from the phenomenon of domain names directly and indirectly – in short, to everyone. I would suggest for consideration that the truth is that it is short-sighted to think otherwise.

    I know I don’t need to tell anyone the place concepts like “image is everything” and “perception is everything” hold in society. When these “appraisal” services are presented and represented as being “appraisals” and “estimated values,” that is the point at which Humpty Dumpty falls off the wall. The real world end user market becomes aware of and sees these “appraisals” and “estimated values” and is effectively “poisoned” by them. I’m sure many have also experienced this explicitly when dealing with the real world end user market far more than me.

    The idea of “comparables” is also extremely flawed; anyone thinking clearly and honestly about the matter can see that. Domain names are not “residential real estate,” which is what perhaps most people at least in the US can relate to when considering the idea of “comparable” and “appraisal” and where such an idea has the most validity. Even if such “tools” get it in the right ballpark occasionally, outside of a real living human mind there can be no sufficiently and consistently valid and “not harmful” assessment of “comparables.”

    The most recent egregious example of crypto.com at $48,000 from Estibot while it sold for $12 million is hardly the only one like that potentially in the millions of dollars category (including one that already even did have a real multi-million dollar offer but which Estibot “appraises” at low $x,xxx). I also doubt very much I am alone in saying the Estibot “appraisals” under the best domain names for the current upcoming NamesCon auction – which the whole world just has to be made to see under each listing – are beyond absurd by any honest real world consideration of the affected domains. It is merely a pure *fortuity* that a domain like crypto.com is so great that it can overcome that kind of “market poisoning,” but not every valuable and even “great” domain is so fortunate. And for all we know maybe the $12 million that really did happen this time would be significantly greater had it not been for the likes of such “services” – in which case everyone involved with domain names directly and indirectly including Go Daddy loses out.

    If those who provide such “services” really care about fair play and the health of the market, and even their own bottom line, then I’ve already seen someone suggest in the blogs before what in my view would be a good compromise idea since these “services” are obviously here to stay. And that would be removing all dollar signs and denotations of suggested monetary value in favor of simply showing relative numbers. Additionally, eliminating all notion of such figures actually representing “appraisals” and “estimated values.” I’m confident less harmful terminology could be invented, such as perhaps something like “SVI” (“suggested value index”) or the like for instance which does not mislead the end user public into thinking they are receiving an actual “appraisal.” Not only do I think that could go a long way toward helping what is a very real problem which doubtless many of us have already encountered from prospective customers in the real world of end users, the real customers we all seek, but while I can’t speak for Estibot given the kind of business it is, I would definitely suggest this type of change would probably also be good for and benefit the Go Daddy bottom line in the long run as well.

  10. I had the habit of renewing, there comes a time to change, and now I’ll better buy for two years view, this time websites, write niche content, links, sell advertising spaces and from time to time receive offers to buy domains (.com) I disregard because the offers are lower than what I get each month on a website and domain of my property, if doing so is because the domain parking does not make money like last years.

    I know with all the premium domains of Uniregistry.com and other registrars in Namescon 2019 for sale in Auction, those that do not sell and four months left to renew follow with website and if I see that it does not lose steam and make money with changes of niches of market where there is more to make money I renew a year and then we will see, many domains let expire before renewing again because they do not give money with a website.

    Happy Day. Jose

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