Unless I’m missing something, GoDaddy’s Domain Name Aftermarket (TDNAM.com) really screwed up a great thing they had going for domain buyers. Their Expired Name Auctions had always set a minimum bid of $10 for every expired name. It didn’t matter if the name was a premium name or a crap name. If it was a good name, the bidding naturally caused the price to be bid up to its free market value.
But GoDaddy has just changed the rules. They are now making a determination as to the value of the expiring domain names that they consider “High Traffic” names, and are setting a higher (often MUCH higher) minimum bid on those names. The minimum bids for High Traffic names begin at $20, and as of today, go up to $2,010. You can see the current listing here.
I checked their FAQs to learn about these High Traffic names. They say that these are names that are “parked on our name servers and have above average daily traffic” and are “Names identified as High Traffic are among the top 1% of all the expired domains that enter TDNAM on a daily basis.”
As for the pricing, they say “Our analysis on the traffic patterns of these domains suggest that the pay per click revenue potential is high. We’ve adjusted the minimum bid upward to reflect a percentage of the revenue potential. The minimum bid amount is based on the traffic patterns we expect over the next 12 months. Regardless of the minimum bid amount, we feel the pay per click potential per year exceeds the minimum bid.”
But, here’s the problem, illustrated in the FAQ that answers the question: “Can you provide specific traffic information?” The answer: “No. Our analysis is based on actual traffic today and expected traffic in the future. Our analysis model predicts future traffic based on many factors. Even though we are confident with our analysis, we understand traffic and click-through rates can vary.”
A better solution would have been to go ahead and categorize these domains as High Traffic names, but share their traffic statistics. Then, let the bidding proceed naturally from $10 as before. This would have benefited both the buyer and GoDaddy.
The buyer would benefit because with stats in hand, he’d feel better about bidding on a name like ultrabbw.info, instead of trying to guess at the stats and starting the bidding at $1,100!
GoDaddy would have benefited because most all of these names would have received bids instead of having their auction expire with no bids what-so-ever becuase the opening bid was so high.
I’ve picked up 84 names from TDNAM in the past couple months. I very much like it and appreciate the ease at which I can sometimes pick up a name for $10. But, it isn’t all $10 bargains—good names almost always get bid up to their free-market value; the last name I bought was $755. There was no need for GoDaddy to restructure the Expired Names Auctions in a way that artificially set the opening bid. I sure hope that sites like SnapNames.com and Pool.com don’t follow suit.
It just doesn’t feel like an Expired Domain auction to me any more. It feels more like I’m dealing with a name broker. And that’s a shame, because I really love my daily TDNAM hunts.
If I’m missing something, please correct me in a comment.
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