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The buying and selling of domain names can be a lucrative online business. Several domains have been sold over the years, sometimes for 100 times the purchase price. In this guide, you will learn how to start a domain brokerage business and how to make it profitable.
Below is the top 10 most expensive domain names ever sold:
For instance, a $10 investment on this site led to a $2600 sale. The Joseph Kleitsch oil painting was purchased for around $100 and later appraised at $500,000, according to this Godaddy blog post, which shows that with the right approach, flipping domains can be profitable.
If starting a domain business is something that interests you, here’s how you can set up a business in domain-selling at little to no cost. There are many domain brokerage companies that do this already with great success.
Odys.Global is a digital marketing company that focuses on selling premium domain names. They check domain marketplaces to find high-quality domains set to expire and actively bid on auctions to secure them. After they acquire and secure the domains, they recreate the brand and put them for sale.
If you want to find out more about ODYS and their business, check our ODYS Global review.
Table of Contents
Set a Budget and a Business Plan
Like most businesses, you’ll require a plan and a budget. Your experience, strategy, and learning pace determine whether you buy or sell.
First, create your own domain to host the website- that’s your marketplace. Proceed with generating traffic around the site. This will bring potential clients, boosting the chances of making a sale.
Though it’s hard to recommend a perfect starting budget, $500 would be a good place to start. Using this as your starting capital, buy several high-potential $10 domains. Expired, dropped, or a mixture of both will work well.
Invest only what you can afford to lose. As you gain momentum and experience, consider investing more and working on your business full-time.
Pick a Profitable Niche
When looking for names to buy, the niche you select is important. Choose niches that feature content that’s always in demand. Topics that remain popular over a long period.
Examples are money and finance, sports, food, small business, e-commerce, and so on.
Here’s how you can pick a profitable niche:
- Do a market trend analysis to find potential domains likely to be in demand in the future.
- Browse the current best-selling domain names. Check the recent sales at marketplaces such as Flippa, Sedo, and NameBio.
- Look for dropped or expired names on sites like JustDropped.
Nailing an in-demand niche is a surefire way to start a profitable domain-flipping business.
Determine the Value of Your Domains
The goal is to sell one of your domain names for thousands of dollars, if not millions. And the first step is determining what makes your site valuable.
Here’s how you do that in three steps.
Find Out The Price Of Similar Domains
To set the price of your domains, know what other sellers are charging. Since prices are subject to change, use your purchase price as a baseline. Sites like DN Journal will give you an idea of a three-week sales performance.
Use a Domain Appraisal Service
In this next step, you’ll do an appraisal of your domain. Sites like Estibot can help estimate your website’s potential value. Measuring domain value based on comparison to other sites, traffic, and conversion growth rate.
Research Buyers’ Price Range
Buying and selling domain names works like an auction. You’ll need to research what potential buyers are willing to pay for similar sites to yours. To get this information, put your names up for sale. Have a reserve price – that is the minimum you’ll accept. Make a sale if your price is met or a higher offer is given.
Identify Your Potential Buyers
To grow your business, you need to look for potential buyers.
Here are 3 ways to do that.
- Use EstiBot lead generation tool. Just enter your domain, and it’ll recommend potential buyers.
- Use domain brokers like Media Options and Tobyclements to identify buyers and sell them for you.
- Google – Do a Google search for the keywords in your domain and see who is willing to pay for it.
Adopt Different Sales Strategies
Use different sales strategies when trading in domains.
Here are three ways to do that:
- Set price – This is the price you set for your domain names. If a client meets it, you make a sale.
- Auction – where buyers make bids, and you sell to the one with the highest.
- Offers – This is where you make offers to potential buyers.
Never Rush to Make a Sale
After putting in all the work, you shouldn’t rush to make a sale.
Follow these steps instead:
- Determine how much your domain is worth
- Decide how to sell it
- On the WHOIS directory, make sure your contact information is public
- Optimize your domain listing
- To receive payment, use an escrow service
- Transfer the domain
Know the Risks Involved
Every business is exposed to risks. And in the domain buying and selling industry, you’ll have to contend with issues of:
- Legality – dealing in trademarked names can result in a lawsuit.
- Liquidity – it may take time to sell the domain and convert it into cash.
- Subjectivity – unlike stocks, it’s harder to quantify the value of domain names.
Starting a new business presents numerous opportunities and potential. While operating on a modest budget, you can pick a profitable niche that’ll drive up the value of your domains. You’ll be assured of making good sales by adopting the right sales strategies and knowing the risks involved.
