DomainLore Blog.uk domain aftermarket and .uk drop catching plus anything that goes…

Last year I wrote how 3-letter domain names should still make a very good investment.

Looking at ongoing 2-letter landrush auctions, I wonder how to justify the spend.

Without taking into the account meaningful LL combinations and genuine bids from end-users such as Google, Facebook…etc (ehmm.. wait, who is that person bidding against them?). Most, like 90% of the names, go for £2,000+. I struggle to see how these prices favour investment. How much a reseller, paying 2-3-4k for LL.co.uk, expects to get back from the end user? 10, 20k? And when? In the next 5, 10 years? Once domains have gone for good?

Yes, 2-letter domains are a novelty (for .uk ccTLD), but this doesn’t make them immediately so hardly desirable for the end users, who somehow learned to survive without them in the last 20 years or so!

LL.co.uk is nice, short and cute, but not that short, for instance, if compared to the same length LLLL.com.

On the other hand, 3-letter domain prices dropped on the re-seller secondary market from around £500, to £300-350. To get 10x return, 2-letter investor must find 20k+ end user. I don’t see how end users are lining in queues to pay that. Would LL.co.uk appeal for people as initials? Yes, if you ask person on the street, he’ll likely be happy to pay £12 in renewal fees to own that.

3-letter investor needs to sell for just £3000-3500 to get the same (or in most cases even better) return.

I sold many 3-letters and 5k is an absolutely sane amount to ask, as perceived by the end user. I am not sure about asking 20-25k from someone, who’s unfortunate enough to trade as ‘Smiths Icecream’ instead of ‘Peter Smiths Icecream’. It can also be debated that having a 3-letter domain name offers much more distinctiveness.

Yes, the scarcity of 2-letters is a factor worth considering. Still, it would be interesting to know what is a ratio of two and three word named businesses in the UK.

Tomorrow second portion of names going on the auction.

I do not think I will be winning anything. I paid £1,000 to enroll in 100 auctions, apparently – money wasted, but I look at it as a ‘peace of mind’ amount, which would have helped to avoid kicking myself, if these names were going off the hammer for a few hundred.

So starting today, Sedo is going to charge 15% commission to ‘sell’ domains for me.

Time to disagree..

I don’t believe their service as it is adds value. For me at least.

I’ve several open negotiations at the moment.

In one case, buyer has contacted me by e-mail but it seems wasn’t happy with the price range offered, so he didn’t reply but went to bid via Sedo, probably not expecting that there will be a 15% surcharge which I will obviously add to the price. Looks like the best he can do is communicate using Sedo’s template messages “please justify your price”. Tyre kicking.. I don’t need Sedo for that.

The other buyer has visited my “make an offer” landing page, but then again decided it must be better to negotiate being anonymous, has checked that the domain is listed on Sedo, did bother to registered an account (buyer created 1st of August).
He apparently doesn’t think that when his offer came in, I would check my landing page logs, find how and where from he arrived and quickly determine what organization he represents.

Do I need Sedo to aid these people to stay anonymous, instead of talking to me directly?

Nope.