Why your business needs a Domain
Taking your business online is now a necessity to keep up with the competition, to do that; you'll need a domain name.
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Choosing the Best Name for You
You've decided that you want to own a domain name. There's just one problem, you're not sure how to choose a good one.
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Direct Navigation
As the Internet matures, the number of potential customers online is growing and with it, the number of ways to promote your business online. More...
Summary Value
Rate of Sale has an enormous affect on domain portfolio valuation. There are two major ways to increase domain sales revenue, increase the volume or increase the price.
Rate of Sale X Domain Price = Revenue
Increasing the volume requires more buyer exposure which is a marketing distribution issue. Increasing the price involves either an increase in the value perception of the potential buyer, increased distribution to add fuel to the demand, or increasing the price without increasing value perception which will have an adverse effect on volume.
If the domain aftermarket can increase its marketing footprint and dramatically increase its distribution then rate of sale will increase. If rate of sale is increased even marginally it will drastically increase the total portfolio valuation due to the increase in domain sales revenue.
Portfolio Valuation = (Traffic Revenue + Domain Sales Revenue - Traffic Loss) * Year Multiple
Following is an example of how domain sales volume can cause dramatic fluctuations in domain valuation.
- 10,000 domains
- $150,000 annual traffic revenue
- 0.5% domain sales rate
- $1,500 average sale price
- 10 year valuation multiple
- Valuation = ($150,000 traffic + $75,000 sales)*10 = $2.25 million (50% Improvement over traffic)
| Rate of Sale | Sales Revenue | Traffic Revenue | Total Revenue | Valuation | Valuation Increase |
| 0.5% | $75,000 | $149,250 | $224,250 | $2,242,500 | 50% |
| 1.0% | $150,000 | $148,500 | $298,500 | $2,985,000 | 99% |
| 1.5% | $225,000 | $147,750 | $372,750 | $3,727,500 | 149% |
| 2.0% | $300,000 | $147,000 | $447,000 | $4,470,000 | 198% |
| 2.5% | $375,000 | $146,250 | $521,250 | $5,212,500 | 248% |
| 3.0% | $450,000 | $145,500 | $595,500 | $5,955,000 | 297% |
| 3.5% | $525,000 | $144,750 | $669,750 | $6,697,500 | 347% |
| 4.0% | $600,000 | $144,000 | $744,000 | $7,440,000 | 396% |
| 4.5% | $675,000 | $143,250 | $818,250 | $8,182,500 | 446% |
| 5.0% | $750,000 | $142,500 | $892,500 | $8,925,000 | 495% |