Domain Name Wire

Domain Name Wire

  • Yahoo Domain Sale was Win-Win

    1. BY - Jun 18, 2009
    2. Domain Sales
    3. 19 Comments

    Yahoo’s sale of Contests.com was a win for everyone involved.

    When Yahoo (NASDAQ: YHOO) sold the domain name Contests.com on Tuesday, the mood was upbeat. It was a relatively big domain sale from a big company for a lot more money than the seller anticipated.

    I was surprised to see some people questioning the sale. Larry Fischer made some fair points. TechCrunch went a little overboard, suggesting this was more than just a simple decision to sell an unused domain. (People who read the TC article took it a step further. Two commentors thought it was some sort of inside deal as a favor to the buyer. Gotta love conspiracy theorists.)

    Here’s my take: it was a good domain sale. The seller got more than they required and the buyer probably would have paid more.

    Yahoo set a reserve of $150,000 and was willing to take that much. The buyer was determined and probably would have gone higher had an internet bidder not pulled out at $360,000. But is $380,000 that bad for this domain?

    It’s true that the domain was inserted into the auction relatively late. That may have to do with internal reviews at Yahoo. But the level of promotion inside the domain industry was better than for just about any domain sold at a live domain auction: a solo email blast to qualified buyers. Buyers knew about it and there were many qualified bidders at the auction who decided not to participate. It was very different from Toys.com, in which only a handful of bidders were aware and kept the secret to themselves.

    This sale can only be good for the industry. So I’m just going to treat it as what it was: a good sale in which both the buyer and seller are happy.

19 Comments
  • What are your thoughts Andrew if it was promoted that “Yahoo is selling Contests.com at DRT” compared to most who were unaware Yahoo owned it.

    Do you think it would of sold for more simply because Yahoo owned it?

  • “It was a relatively big domain sale from a big company for a lot more money than the seller anticipated.”

    I’m glad it sold for 380K, but I find it troubling that Yahoo thought it sold for more than it was worth. Of all people, Yahoo should have known exactly what it was worth and the fact that in 2009 they are still somewhat clueless about generic domain values speaks volumes about our industry.

  • I would have to agree, David, But then again, with the deep pockets of Yahoo, Microsoft and the like they can take obscure name like “bing” and spend millions marketing it. With a generic name like contests.com, the name itself does some of the work for you so you don’t have to spend as much marketing. This is something they have yet to learn. I will say that domainers need to learn a thing or two also. All because you have a great name doesn’t mean it ends there.! You need to 1) develop 2) market

  • Historical biggest domain buyers were there, National A1 (auction winner) and Larry Fisher (Anything) are part of these top domain buyers in the world.

    If Larry decided to not bid it’s probably because he did not find the domain enough appealing (except idiot, all what you want).

    The domain sold for the maximum interested domainers were willing to pay at this moment.

    Everytime it’s the same, once a great auction happened most said it was a bargain.
    If it was a bargain why they did not participate?

    It’s probably true the auction has been poorly advertised outside the domain industry but I can tell you +90% of the domain pros known very well this name was for sale, because with TRAFFIC and Domainfest auctions this one is part of the 4 or 5 more inportant domain auction event of the year.

    My personal feeling is Yahoo though it was a good venue to auction their name, and it was.
    Because while there is not a very motivated buyer with a project in mind (end-user) only domainers are able to spend so much to buy such names.

    Contests are not toys, each name has his price!

  • Francois,

    Thank you for telling me I did not find the domain name appealing enough but that was not the case.
    In my opinion the name was worth considerably more than the sales price.

  • This domain has the social networking thing going for it… It will take a lot of money to turn it into an actual business though.

    Yahoo wasn’t up for the challenge, we’ll see what National A-1 will do. But we all know what it will be — parked!

    Score :)

  • RT @dnnews: Yahoo Domain Sale was Win-Win – http://tinyurl.com/krfkwo

  • Then Larry, why did not you bid if you find it appealing? You estimated it was overpriced?

  • Domain Investor says:

    June 18, 2009 at 6:37 pm

    Francois, maybe it is none of your business?

  • Francois,

    A kid in a candy store wants to buy every piece of candy, however, that doesn’t mean he does.

  • Domain Investor,

    thank you for writing what I was thinking.

  • Ok guys, make sense.

  • It’s not difficult to buy domain for 50~100 years of PPC revenue like this one ($10~$20 per day). In every auction there are some domains like this. What’s difficult is to buy domain for under 10 years PPC revenue…

  • It is hard to compare contests.com to a domain like Toys.com, because in my opinion I don’t think people who enter contests care that much what domain they are on. I have a bunch of good contest domains like WinContests.com, BigContests.com, EnterContests.com, PrizeWinner.com, etc.) and I think those would do just as well for a big contest site. I am not saying they are worth anything near the price of Contests.com, but they sound just as good to the end user. Yes, Contests.com would do better in the search engines, and yes it has built in traffic, but those factors are only worth so much. I suppose contests.com would be an industry leading domain for a business to business company that provides contest related services, but there are much fewer of those types of companies out there than there are toy companies. Also keep in mind there is a big difference between sweepstakes (like Publishers Clearinghouse) and contests (contests require skill, they don’t just have a random winner). End users usually don’t know the difference or care, but this distinction would be very important to a company buying the domain.

  • […] Yahoo set a reserve of $150,000 and was willing to take that much. The buyer was determined and probably would have gone higher had an internet bidder not pulled out at $360,000. But is $380,000 that bad for this domain? More… […]

Leave a Reply