The Hidden Wealth in Domain Names

[mandy]

How to draw the advertising industry into the secondary market for domain names is preoccupying the domain name industry this year. Domain industry convocations have been grappling with the issue, seeing it as providing an opportunity for the secondary market to scale up and achieve sustained profitability and liquidity...

The purchase of domain names to attract customers through direct search and the purchase of advertising on domain-name landing pages allows advertisers to track incoming clients and revenue, Sarid pointed out, leading him to refer to those online methods as ROI, or return-on-investment, advertising.

ROI advertising is not restricted to direct search or domain-specific advertising, he said, but can extend to online advertising in general. Ad industry people are brighter than domain investors, Sarid said. Few domain investors know how to run a business, he said, only how to manage domain names...

full article: http://ecommercetimes.com/story/V07c9hnA...ames.xhtml

[accentnepal]

the new Domain Distribution Network (DDN) service being launched globally by the Australian company Fabulous.

The secondary market for domain names is the selling of previously registered domains, usually for higher prices than registration and renewal fees. It currently is highly inefficient. Most buyers never find it. Prices either are "make an offer" or have several more zeros at the end than reason would dictate. There is no assurance that the seller will complete the transaction and escrow often takes months.

Enter Fabulous. While spewing MBA platitudes at a alarming rate, those Aussies put their finger on a major imbalance that they could ride to great success -- and immediately dropped it. Their plan: secondary market domains sold alongside new domains. Sophistcated search to locate the most relevant names. Participation of the largest registrars. Fixed prices. Immediate change of ownership upon payment. Low fees.

Scratch that last. Despite early claims of a few percent, it now seems the seller pays 20 - 40%. At Godaddy, the first major registrar involved, the seller also pays a per month listing fee of several dollars. 

It is possible that another company will rise to compete with Fabulous, offering less jargon and more realistic commission levels. And if they really can sell average domain customers many secondary market domains then the value of good domains will rise exponentially.