In the foreign exchange market, it is not uncommon for people to trade and make a tonne of money (or make huge losses) trading currencies (money) that either does literally does not exist, or change hands. It is like investing real money to play a virtual game with real life consequences. These virtual trades do impact the real exchange rates.

Over the years a lot of the domains that are reported as sold do not really resolve to a website. Why did these buyers spend all this cash to buy something that they did not intend to use?

Domain names for a long time have been treated like the foreign currency market. A domain name is flipped over and over for a profit, with the buyer having one main goal of selling later for more than what he paid for it.

As we are now having a shortage of cash in the world economy and the prices of almost all commodities are falling as a result of a recession, domain buyers are now seriously considering a what uses a domain name can have before they make the purchase.

In my opinion, if the domain name cannot be put to any use, except for some eternal hope of flipping later, then it is useless and have no intrinsic value.

So what can you do with a domain name when you have bought it?

Redirect The Domain
If the domain receives targeted traffic suitable for an existing website that you own, it will be beneficial to redirect traffic from the domain name to the existing website. This can end up costing you less in advertisement and marketing.

Park The Domain
You can park the domain name with a domain parking service provider and earn some Pay-Per-Click revenue. Learn more about domain parking here.

Develop The Domain
Develop a website that sells/resells products and/or services, provides information and/or supports the services of another website.

Build A Company Around The Domain
You can build a company around a domain name. Examples are Amazon.com, Shopping.com, Business.com.

If you can’t put a domain name to one of the above uses then it may very well be useless.

Something is only worth what anyone is willing to pay for it.

The same applies to a domain name. As much as a domain seller may wish to command six figures for his dot COM, he may soon realise that his expectation is just a fantasy.

As I have written before, if you are trying to price your domain names, simply ask yourself one question, how much would you be willing to pay for this domain name if you were the buyer?

There are indeed various factors that influence the value of a domain name. The domain extension plays a key role, where dot COM’s are worth the most, followed by dot NET. If the domain name consists of a single dictionary word, then it is also valuable.

The shorter the domain name, the more valuable it is likely to be. Other major factors that can positively influence the price of a domain name include:

- the popularity of keywords that the domain name consists of,
- the ease of spelling and memorising the domain name,
- the lack of trademark infringements
- the branding potential of the domain name
- recent sales data for similar domain names
- the industry/sector that the domain name relates to

There is no fixed or globally accepted standard of valuing domain names. If you ask ten different domain experts to value the same domain name, you will most likely get ten different valuations.

The key therefore to getting the highest price for your domain name is to take it to the right market: end-users. By end-users I do not mean the average web surfer who will be visiting the developed website.

I am rather referring to the person or business that will own the domain name and be responsible of developing the domain name into a brand and marketing the website to customers.

End-users are the people who will put the domain name to maximum use and will mostly likely be pumping a lot of resources into the development of the domain name. These are people who will be bold enough to take a domain name beyond a logo, and attempt to turn ideas into successful businesses.

A third-world student wishing to use a top quality premium name for a college assignment will value a domain name at $60, as that is the maximum he might be able to pay for it.

A well-capitalised businessman will on the other hand be willing to pay $60,000 for the said domain name, as he knows how much advantage the domain name could give to his business.

So, a domain name then, really, is only worth as much as the end-user is willing to pay for it. If you know your domain is worth $10,000 and some lunatic comes by offering $100, ignore the offer. He is not the end-user you are looking for.

The only problem is, you may have to do some serious work in finding the right end-user for you domain name.

It may help if you highlight the benefits and potential of your domain name when marketing it. Let a buyer instantly realise the true potential of a domain name, even if his intension was only to use the domain name to blog about his dead cat.

If you are really unsure of the value of a domain name, you may want to consider getting a domain name appraisal. Whereas domain appraisals cannot dictate or enforce the price at which a domain name is sold at, it can give you valuable insights into any potential the domain name may have.

Source: concurringopinions.com

It is really not uncommon to see domain marketplaces flooded with overpriced nonsensical domain names. As a matter of fact, “overpriced” is an understatement.

I used to demand some exorbitant prices for some average domains as well when I just entered the domain space. However, as you “grow up” and learn more about the domain industry, you tend to match market realities with expectations.

Over the years, I have received literally hundreds of offers in all shape and forms for my domains. I ignored many of them in the first few years, as I saw my domains as kids that needed to grow up before kicking them out of the house.

I only really started focusing on selling domains about a year ago.

When I started eBusinessDomains.com in July this year, I intended to only list domains that could successfully brand ebusinesses. This resulted in only a small portion of my portfolio qualifying for listing.

So, if you are one of the hundreds of domain owners who have emailed us requesting listings on eBusinessDomains.com, please don’t take it personal. I didn’t find it worthwhile to list over 4,000 of our very own domains at eBusinessDomains.com.

Now, let me address the main purpose of this post.

I have received so many offers and enquiries from people who either have no clue or just think they are too smart.

These are the people who offer $100 for a domain that is clearly worth at least $2,500, and insist that the offer should be accepted.

A common argument used goes like this: “you only pay $9 for the domain, so most of the money is profit. By selling for $100 you are making at least 10 times more than what you paid for the domain name”.

First of all, as long as I keep on paying the registration/renewal fee, I am the owner of the domain name. I will sell for whatever I want to sell for. If you can’t afford it, go and get another domain name. Tough luck.

Who are you to tell me how much I should sell for, or how much profit I should make? Do you know how much I paid for the domain name? Are you aware of the fact that not all domains being offered for sale were hand-registered? Have you heard of domain flipping?

You know, I would love to upgrade my BMW X5 to a Ferrari or Lamborghini. But I don’t think I can go to Ferrari and say “sell me a F430 Spider for only £60,000 as most of your money will be pure profits for you”.

Pay me what my domain is worth, unless I offer you a discount.

Now, I am not being arrogant. I do take pride in selling my domains to end-users who then turn the domains into powerful brands. It’s like seeing your kids grow up to take high office or enjoy illustrious careers.

I am not asking for an arm and a leg. I do sell for reasonable prices. There is no point pricing yourself out of a deal, when the next potential deal for the said domain name may take years to come by again.

The other common sorry-ass tales include:

- I am a poor student, and need the domain for a small project;
- I just need the domain to start a blog;
- I live in “X” third-world country and can’t afford any more than $xx;
- I am going to obtain a trademark for that term, so you should sell while you can and
- We don’t pay that kind of money for a domain name in our country (often the price tag is just $500, and the seller quite often lives in the US).

I am happy to negotiate with people you are trustworthy, mature and serious about business.