Domain name brokerage: The work behind brokering a premium domain name.
So exactly what value & benefit does a domain name broker offer a domain name owner/client?
Very much like any other broker the real work starts once a price has been agreed and a 
contract signed giving the broker exclusive rights to broker the domain(s) for a specific period of time. For my agreements I generally ask for at least 90 days, but for certain domains I may ask for the agreement to be anywhere from 6-12 months.
Once the exclusivity agreement is signed the work can really start.
My Brokering Process:
Research: Phase 1
For every domain I broker I go through a very extensive round of research to establish potential buyers. And in addition to looking for ‘obvious’ end users I also have a brain-storming session that enables me to come up with any niches or potential buyers which might not have been included on my initial ‘obvious’ list.
A good example is my work on Hi.com where I discovered a number of niches to pursue. The following is an extensive, but not the full, list of niches uncovered:
- Buyers who can use ‘Hi’ as the shorter and more memorable Acronym option for their domain name.
- Companies within niches where the domain can also have an indirect Acronym tie-in e.g. Health Insurance (HI) or Home Insurance (HI). Obviously any company within the health or home insurance niche could use Hi.com as a great ‘social’ brand for any new product, service or app.
- The word is a great ‘social’ word so any niche related to social media is another avenue of potential buyers.
- As the word Hi is commonly used in place of the word ‘Hello’ it could potentially fit any niche within the hospitality industry. Whether that be corporate events management, hotel industry, or even customer support niches.
- Hi.com would also be ideal for a dating service.
Hi.com was eventually sold to a company who developed a great product for the hotel booking management niche and since the onset of the Covid pandemic they had to pivot their business, due to a slowdown/meltdown in the hotel bookings industry, and Hi.com is now used to front a new Cryptocurrency related business, with a clever tagline of “Let’s get hi together“.
Research: Phase 2
Once an extensive list of potential buyers is drawn up, the hard work turns up another notch as it’s now time to properly research every potential buyer and one of the first things I establish is whether a company on my target list is generating sufficient revenue to afford the domain name being brokered. There’s no point in wasting time trying to sell a 2-letter .com, worth $millions, to a company only generating $50,000/year in revenue.
But I also have to be conscious there may be companies with a low turnover who could secure future venture capital that could make them a potential buyer.
Research: Phase 3
Once a shortlist of companies is drawn up the next step is to establish decision makers, and/or the best person(s) to contact regarding a potential purchase of the domain name being brokered. This could include people from the marketing department and even the company Owner and/or CEO. And it’s imperative that whomever you use as your first point of contact that you are clear and concise about what you are selling and why they should consider buying the domain name being brokered. You need to quickly spike their interest, as you may not get a second chance.
Outreach
As part of my first contact with potential buyers I send them a Domain Value Presentation (DVP); a Powerpoint Presentation that outlines the many benefits of the domain name to their company. And as part of my research into each potential buyer I try to establish something useful, which can be found publicly, about the target company, whether it’s news of a new partnership or maybe a company statement about their long-term plans to expand the business. I then use that information to help fit in with my marketing of the domain name i.e. I highlight how the domain I am brokering can help with their long-term plans for growth/expansion.
Once I make the first contact with potential buyers it’s then the hard work of following up with each and every lead. I am not a big fan of cold-calling potential leads and although some brokers swear by this strategy, from my own experience I don’t want to catch people ‘cold’ as it’s not a great way to start a negotiation process. And I personally hate/detest when people call me ‘cold’ and expect me to instantly engage in conversation. In fact I find it very unprofessional, very obtrusive and I’ve had more success in giving potential buyers a good reason to get on the phone, when it’s the right time to do so. It’s something that works well for me.
Once a potential buyer expresses interest, this is where a broker really has to earn their commission. With some potential buyers they may not be aware of the value of premium domains so some education is needed at this stage. Plus there may well be several ‘objections’ as to why they may not be interested in purchasing the domain name e.g. domain name price can be a major objection so a good broker will always be prepared for such objections.
A broker will also have to spend time providing supporting data on domain valuation. And even more importantly a broker will need to build value into the domain name and clearly express the benefits of the domain to the buyers business. And even though all the supporting data may not help to sell the domain name it’s imperative the domain broker doesn’t leave any stone unturned when it comes to convincing potential buyers how the domain name will benefit their business.
Negotiation
And in the event a potential buyer expresses interest and make a serious offer it’s the job of a broker to be able to negotiate the best price possible for their client. A good broker has to be a good negotiator, who can extract the best price for their client, whilst at the same time also giving the buyer a sense they have had a great deal too i.e. the negotiation should end up with a win-win for both parties.
The negotiation process can be a long drawn-out process and may have many twists and turns and broker should also be able to advice their client accordingly if negotiations should stall or fail. For example a negotiation may stall or fail if the buyer is unable to make a one-off payment. So a broker can offer advice on potential payment options to help get a deal done e.g. an initial deposit followed by ‘x’ monthly payments.
Closing & Completion
Once a price has been agreed the broker will help with the sales transaction which is generally completed via an Escrow service such as Escrow.com. An Escrow service provides security for both the Buyer & Seller and a broker should be available to help both the Buyer & Seller in using the Escrow service, as it’s highly likely both parties may not have used an Escrow service to sell/buy a domain name.
Summary
As you can see, the work of a broker consists of a number of very important actions and all domain name brokers are worthy of their commission. And also note that if they are not successful in brokering a domain name sale they get absolutely nothing for all their efforts.
So, as a domain name broker I offer all my clients the following:
- Extensive research for potential buyers.
- Identify potential buyer decision makers.
- Create a list of benefits to include in a Domain Value Presentation (DVP). A DVP is created for every potential buyer based on their existing and longer term business objectives/plans.
- General marketing of the domain name through a Press Release.
- Specific marketing of potential buyers through LinkedIn and Facebook Ads.
- Ad-hoc marketing strategies to gain the attention of top-level executives. In the past this has included the sending of a cake to a head office with the domain name and a clever tag-line on the cake. On the cake it read: “<xx>.com – Less is More.”
And another strategy I have used successfully, for another 2-letter .com, is to send a box of business cards to the CEO and/or Head of Digital Marketing. The business card showed all their existing business card branding but their website and email address was replaced with the 2-letter .com domain I was brokering. The business card showing the domain for sale is a ‘very’ strong & powerful visual. - Negotiate a final sale price with potential buyers.
- On a successful sale I also help manage the domain sale transaction through use of an escrow service like Escrow.com.
If you’d like to take advantage of my domain name brokerage services then please get in touch today as I’d love to help you get the most for your valuable domain name asset.
NOTE: I have one of the lowest broker commission rates at only 10%. (The average is in the 15-20% range.).
And I offer an additional discount on my commission rate if you already have a ‘hot’ lead looking to purchase your domain(s) i.e. if you want me to negotiate with a lead who has made you a serious offer and I help to negotiate a deal with that specific ‘hot’ lead I will only charge a 5% commission.
Email: paul@mavendomains.com
Phone: +353 83 4246262
Skype: paul.haughney
