Beginners Complete Guide To Profitable Domaining

Domaining simply means buying and selling domain names for profit.

Yes, you have read it right.

You can buy/register a domain name for as low as $6-100 and can sell it for as high as thousands of dollars.

I am not kidding!

It’s happening everyday in the domain marketplaces.

Why start domaining?

Unlike with E-commerce stores where you need to worry about product delivery, custom duty , customer support, refunds etc, domaining is as easy as acquiring a domain, selling, getting payment and transferring the domain to the buyer’s account. 

As simple as that. No headaches. That’s why I love domaining so much.

Also, once you learn it well, it demands less time than other businesses. You can even do it as a side hustle. 

But wait…

Domaining is easier said than done. Profitable domaining demands enough knowledge in the domain market place, some budget, patience, logical thinking etc. 

If you enter domaining business without enough knowledge, you will end up losing your money and time like I did in the beginning. 

It is very embarrassing to lose time and money….right?

Yeah, I have been through this embarrassment. I have wasted about $2000 and two years of my valuable time in domaining without proper knowledge.

But, after two years of rigorous research in the domain marketplace, I am now able to see some handsome profits in domaining business after recovering the loss I incurred in the beginning.

If you are a beginner, do go through this guide to start learning profitable domaining.

What Is A Domain Name?

A domain name is simply “the name of a website on the internet”. Simply put, internet users can visit a website using a domain name.

Just like I call myself as Vijay, I call my website on the internet as PowerDomaining.com

Why use domain names?

Contents of any website are stored on a web server. Only Internet browsers can communicate with a web server using name servers/IP addresses. These IP addresses (ex: 198.67.1.255) are difficult to remember for internet users.

So, a domain name points a user friendly name typed on the browser, like PowerDomaining.com to a difficult server IP address like 198.67.1.255 to retrieve content.

Some Important domain name facts for domainers:

• No one owns any domain except Internet registry. When you register a domain, you simply lease it for 1-10 years by paying some annual registration fees. 
• Domains names do expire if you don’t register them before the expiration date. You can renew a domain for 1-10 more years before it expires.
• You can delete a domain if you don’t want to have it any longer. After deletion, it shall be available to public for re-registration.
• Domain registrars like GoDaddy manage domain names. You can transfer a domain from one user to another within the same registrar at any time. No restrictions . No locking period.
• You can transfer domains from one registrar to another registrar by sharing an Authorization/EPP/Secret code. You can get this code from your current registrar. As per ICANN.org rules, you cannot transfer a domain between any two registrars before 60 day transfer lock-in period. 

What Is Domaining?

The meaning of domaining is ” registering/buying domain names and selling them for profit”. It is completely a legal business. In fact, it is a way to invest your money and get returns. 

Domaining is a business model. You buy some valuable domains at low cost, market them and sell them to end-users/other domainers for profit. Obviously, we can call it domain flipping. 

Domaining is different from cyber squatting. Cyber squatting means registering a domain name that sounds similar to a widely known company or product. So, restrict yourself to domaining and don’t resort to cyber squatting.

Some words are trademark protected ex:Amazon. You must not include such words in your domains. If you do so, they may sue you.

Howmuch Can You Earn With Domaining?

Domaining is a vague business. It is not at all a passive income business model.So, you may not get repeated monthly payments. So, never quit your day job in hope of earning from domaining. I suggest you, try it as your side hustle as it requires less time once you learn the right way of domaining.

Some domainers are earning a living out of it and others are failing to sell a single domain.

So, it all depends on how smart you choose your domains and how smartly you sell them.

Some times, your luck may play a role too. If some business badly needs a domain you own and is ready to pay handsome amount, you are lucky.

On the other hand, no one may need your domains and you may have to let them expire.

You can have some idea of how much you can earn after you go through my Profitable Flips page

Well, you we seen some ins and outs of domaining. Now, lets move on to how to go about domaining.

Domainaing Step#1: Choose Your Domaining Strategy

Once you decide to start domaining, you need to make up your mind on how you are going to go about it.

You can do your domaining business in two strategies.

1.Domain Investing:

This strategy works like this. You set your budget. Buy valuable domains at lowest possible cost. List them for sale in various market places. Do your best to market them to right end users. You will wait some time like months or years till you get a right buyer. Sell it to the right end user and collect huge profits.

For example, a domain investor by name Michael Cyger, has bought give.io domain name for $800 and listed it for sale. He tried his best to reach potential end users. He waited for the right buyer. After 3.5 months, he sold the domain to a web hosting company mediatemple.net for $15,800.

Boom!!

A net profit of about $15,000 in just 3.5 months. He is so lucky to get a good buyer in less time of just 3.5 months. But, this may not work that quickly for every domain investor. Sometimes, it may take some years to get a high paying buyer. Anyways, domain investing is highly profitable only if you patiently hunt for a right buyer.

What if you don’t get an end user to sell even after trying for some years?

Well, you may say a complete waste of money and time.

But I say, “no” .

Once you buy a valuable domain, you can sell it to a fellow investor by auctioning it for a little profit. That’s why choosing a valuable domain makes a big deal in domain investing.

Hope you understood the idea of domain investing. Now, let us move on to the next strategy which is my favorite.

2. Quick Domain Flipping:

This strategy works like this. You acquire valuable domains in lowest possible cost on a marketplace. Flip it quickly for handsome profits on another marketplace. When I said quickly, it can be as quickly as in two weeks or in a month.

Well, you would say, “How come you get domains at low cost on one marketplace and sell at high price on another?”

The answer is: 

No/low reserve auctions. There are domain marketplaces that run no-reserve auctions. All expired domains are auctioned without reserve. That means, the highest bidder will get the domain. Final price is completely based on the demand there. So, we will hunt for valuable domain auctions daily to get them at lowest possible cost.

For Example, I have bought Yuph.com domain for $109 on Namejet auctions. I have quickly placed it on a one month no-reserve Flippa auction through a broker. The bidding reached $555 and I got about $400 profit in just a month.

That’s the power of quick domain flipping. Investors on NameJet thought, yuph.com is not pronounceable, may be that’s why they left it for me for just $109. But, bidders on Flippa, considered it pronounceable. That’s why it reached $555. 

This is the strategy of quick flipping. We study the minds of investors on one marketplace, get domains at lowest possible cost and sell  them on another marketplace for high price.

Key takeaway:

Domain investing requires big budget (may be as high as $100K), more time, more patience and more marketing skills. But, It is highly profitable.

Quick flipping requires small budget (may be as low as $500), takes less time to sell, more time to acquire right domains. But, It is not as profitable as domain investing.

Now, you completely understood the possible domaining strategies.

Now is the time for choosing your own domaining strategy. My strategy is quick flipping because I want quick profits, no matter how low they are.

Domainaing Step#2: Acquire Valuable Domains

Once you choose your domaining strategy, your next action is to get some valuable domains others really want to buy.

This is a very important step that makes or breaks your domaining career.

Three ways to acquire valuable domains:

Before you start, put yourself in the shoes of end users.

Ask yourself this question first, “If you were to start a business, would you like to buy this domain for your business?”

 You can acquire some valuable domains in three ways. 

1. Register new domains :

You can register valuable .com domains for as low as $8 for an year. Of course, almost all valuable .coms are already taken but there is still room to explore.

So, choose a niche/category. Do some research on what business start-ups are going to grow in the future in that niche. Check some comparable past sales in that niche.

The final word: Don’t register any domain before knowing what domains really sell. Follow my blog to learn how to identify a valuable domain.

2. Buy expired domains: 

Thousands of domains expire everyday. Some of them are highly valuable. They are caught by some drop catching marketplaces such as dropcatch.com, namejet.com etc. They auction expired domains and sell them to the highest bidder. You can bid on expired domain auctions and can get valuable domains at wholesale prices.

3. Buy domains by private acquisition:

Some valuable domains are listed at low cost on some domain marketplaces as “buy now” listings. This may be because the sellers either do not know how to rightly price the domain Or they may be in need of quick cash. Whatever may be the reason, you can hunt some marketplaces like ebay, sedo etc to get valuable domains at lowest possible cost.

Although these low-priced domains are not available all times, you do get them for lucrative prices some times.

Before you choose one or all of the above methods of acquiring a domain, you first need to rightly understand the market value of domain names.

How to rightly determine the value of a domain name:

If you buy valuable domains at low cost, you will end up in profits. On the other hand, if you pay too much for a domain without understanding current market rates, you will end up in losses.

So, you first need to better understand the domain marketplace.

How I ended Up Loosing money and time:

When I first started domaining, I have registered some non .com domains like .guru, .world and .io extensions. I have done this after seeing some high comparable sales on Sedo in hope of selling via Sedo auctions.

The result?

Only expenses. No sales. No profits. Very frustrating…

Why did not they sell?

After some research, I have learnt this, “these kind of domain extension rarely sell. That too only few end users prefer to buy these extensions. Domain investors do not prefer to buy such domains”.

Finally, I had to let them drop after a year of registration. A complete waste of money and time.

Had I read a blog like this before, I wouldn’t have wasted my money and time. I am telling this to save you from these kind of losses.

My million dollar advice for beginners:

As a beginner, I suggest you first try only .com domain flips, the king of all extensions.. Also, .com domains have high resale value and high demand. They are comparatively easy to sell.

So, never touch other extensions until you gain enough domaining experience. If you want to go for .net and .org, prefer dictionary word domains only.

Now let’s move on to the prime topic ” how to determine the value of a domain name?”

After researching the market for two years, I found that the combination of following three methods really works. 

1. First manually appraise a domain for yourself. You know better than an appraising bot does.
2. Consider only two bot Appraisals Godaddy appraisal and estibot appraisal.  
3. Consider past comparable sales

Key points to consider before manually assessing the value of a .com domain:

I emphasis these points are true only for .com domain extension

Dictionary Words. Dictionary word nouns are the highest selling domains. They touch millions of dollars. They are expensive to acquire. Remember commercial Word >> Noun >> Positive Word >> negative Word. You can check NameBio sales to have some idea. 

Domain length. The no of characters before .com. The shorter the better. Give preference to domains below 15 characters in length. It’s an industry standard. If it is above 15 characters, think twice before buying.

No of Words in the name. The less the better. Single word  > Two Word >> Three Word >> Four word. 

Strictly no hiphens (-). Hiphenated domains rarely sell. They are a hurdle for growth of any business that use them. Some believe, Google treats hyphen as space, let it be. Just ignore this fact. It does not work with domain names. 

No numbers: Try to stay away from domains with numbers in it. For example, Health256. But, some popular numbers like 365, 24 etc have some value. All numbered .com domains from single to five digits have some value. We need to study the market thoroughly before investing on them.

Broadness of the words :  Broad words are valuable than narrow words. For example, healthline is valuable than vitaminline. Health is a big topic and vitamin is just a part of it.

No of extensions taken: The more the better. Taken in more extensions gives a signal of high demand. You can use my TLD Checker Tool to check taken/available extensions for a particular keyword.

After manually assessing your domains keeping in view of above points, I suggest you take the help of two bot Appraisals too.

Consider Godaddy and Estibot Appraisals:

You have two leading domain appraisal tools in the industry. Remember, GoDaddy appraisal tool is king and estibot may be queen. Only king matters most of the times.

GoDaddy domain appraisal tool is the best of all for appraising domains below $25K. In fact, every day domain sales are based on GoDaddy appraisal only. It is completely FREE to use. 

Domain investors take GoDaddy appraisal seriously. I strongly suggest you consider GoDaddy appraisal before investing on domains. Domains with Godaddy appraisal of above $2K are considered worth investing.

Give your second preference to Estibot appraisal. This tool gives more emphasis on search volume of a keyword and its CPC. So, if you want to check how popular a keyword in a domain and the current CPC is , just have a quick Estibot appraisal. 

Estibot is a paid tool. Only two domain appraisals are free per day per an IP address. Remember, a domain can be highly valuable even though it has a $0 estibot value. 

Have a look at past comparable sales:

NameBio is a great resource to quickly check past similar domain sales. You can see details like domain price, sale date and sale venue. NameBio search has enough filters. You can search sales based on extension, venue, date, price range etc.

Look for similar domains having high price and more number of past sales. These may be worth investing. 

Key takeaway:

First manually appraise a domain to see if it is memorable, short, easy to type and pronounce, positive word, etc. If it passes your manual appraisal test, then move on to Godaddy appraisal.

Have a quick Godaddy appraisal. If it is above $2K, you can consider investing. If it is below $2k, then the name must be solid enough in other fronts.

Consider estibot appraisal only for keyword domains. Estibot is better for checking keyword search volume and CPC. Don’t reject a domain with high Godaddy value just because its estibot value is low.

Then finally consider some past similar domain sales on NameBio. If there are high sale values and high number of sales, then have a green signal for investing on those domains.

Domainaing Step#3: Market And Sell Your Domains

After acquiring some valuable domains, your next step is to sell most of them for handsome profits. But for that, you need to find some end-users/businesses that badly need the domains you own.

How to sell your domains to end users?

You should first show up to the eyeballs of end users when they really need a domain for their business.

To do that you should first know, “what do they do when they need a domain for their business?”

Well, let me give you some probable ideas:

• They may have some name in mind. They will do their best to acquire it.
• They may simply visit their favorite registrar like GoDaddy and search for some names
• They may simply Google search “Buy a domain/ Premium domain”
• They may ask their technical team or a domain broker to find a name for them.

The trick is wherever they go to buy a domain, you should do your best to show your domains to them. For that I suggest following things.

1. Create a for sale landing page for each domain:

when some business has some name in their mind. the first thing they do is visit the domain on their browser. They are eager to see where it takes them. If they see it is for sale, they probably are overwhelmed and may be ready to offer as high price as possible as per their budget.

So, when some business needs your domain, they should first know it is for sale. That’s why create a for sale landing page for each of your domain.

How to create a for sale landing page then?

It is easier than you may think. Just choose your favorite landing page provider out of leading marketplaces in the industry and point your domain name servers to them.

Here are some landing page providers:

Dan.com (Name Servers: ns1.dan.com, ns2.dan.com)

Afternic.com (Name Servers: ns1.afternic.com, ns2.afternic.com)

Uniregistry.com (Name Servers: ns1.uniregistrymarket.link, ns2.uniregistrymarket.link )

Sedo.com (Name Servers: ns1.sedoparking.com, ns2.sedoparking.com)

Dynadot.com (Name Servers: ns1.dynadot.com, ns2.dynadot.com)

I suggest you prefer a for sale landing page than parking income unless your domains have considerable direct traffic.

2. List your domains in Afternic Premium Network:

Afternic has a network of big domain registrars including Godaddy, Namesilo, Dyandot etc that help you sell your domains. Listing domains on Afternic is completely free. In fact, Afternic is a big bonus for we domainers.

Just list them on Afternic. They will show your domains to end users that search on various domain registrar. Afternic is known for great end-user sales.

3. List your domains on Sedo:

Sedo.com is a leading marketplace to buy and sell domains. In fact, Sedo has a record of big end-user sales.

Listing domains on Sedo is a completely free. List your domains over here to catch those end users on Sedo.

4. List your domains on Uniregistry:

Uniregistry is also one of the leading domain registrar and aftermarket. Uniregistry has some power to bring end-users for your domains.

Listing domains here is also free. Moreover, you need not verify ownership of your domains here for listing with Uniregistry.

5. List them on any other marketplaces that have some potential to bring in some buyers.

6. Reach out to some potential end users :

Prepare a list of potential end users that may be interested to buy your domain. For example, if some business operates on .net extension and if you own .com version of it, you can reach reach out to them.

If they are interested, they may be after you to acquire the domain.

Well, after listing them on potential end user marketplaces, wait for some months or years to get a right buyer. In the mean time , keep learning and keep experimenting.

Domain sales do not happen over night like a magic. you need to wait patiently and apply new strategies.

Well what if your domains have not sold even after waiting for considerable amount of time?

As long as you acquire valuable domains, you will never have to regret at an unsold domain. There is a way to get your money back.

What to do if your domains do not sell?

That’s why I suggest you acquire only valuable names. I mean, spend $4000 on a good CVCV.com domain instead of registering 400 useless domains for $10 each.

If you fail to sell your domains to end users, you can quickly auction them and get at least the price you have paid to acquire them. In fact, you some times get profit too based on the potential of the name you are auctioning.

Let’s see this strategy with an example.

One domainer bought alves.com domain for $2250 on 2011-08-31 in a Sedo auction

He listed it on Sedo for 10,000 Euros Buy It Now Price.

He waited patiently for a potential buyer till 2019. But he did not get any end user to buy this domain. So, after almost eight years hold time, he placed it on a Sedo no-reserve auction on 2019-01-28 .

The result?

The domain sold for $4999 on at the end of the auction. Instead of getting disappointed after waiting for eight years, he dared to put it on a no-reserve auction.

As the domain is valuable (first name of a footballer with $12.7K godaddy appraisal, it actually saved from from incurring loss and gave him some profit)

Conclusion:

Domaining is always profitable once you learn to invest on valuable domains. Understand the market well by yourself. Be a part of domain name communities like NamePros and learn as much as you can.

I am going to bring up more valuable articles on powerdomaining. Let’s explore the power of profitable domaining.

I invite you comment your domaining experiences here. If you want any domaining help, feel free to comment here.