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how to determine the value of a domain name

Your domain has real value. It could be the name of the future well-known brand or a popular business so it is important to find out how to determine the value of a domain name.

When it comes to the domain name’s worth, it can range from a few dollars up to as much as seven-figures. It’s similar to how a real estate market works. You will get the domain’s value and purchase something that could eventually become an invaluable venture.

The worth of a domain name is the amount that a buyer is willing to pay to acquire it. It takes practice and many trial and error attempts before you can devise your own method of coming up with a good asking price for a domain name. Many consider the various methods of how to determine the value of a domain name a form of art.

Here are some known techniques in appraising a domain name:

1. Use domain appraisal services

These services calculate the worth of a domain name through algorithms. They largely depend on SEO-related dynamics, such as keywords, cost per click, monthly searches, rank in Alexa, and the number of searches.

This is a good start since you’ll have ideas about how much your asking price should be. Different services come up with different price ranges. Use numerous services to compare and get estimates.

2. Get acquainted with domain sales

Familiarize yourself about the types of domains getting sold recently and for how much. Check sites with updated domain sales reports, while keeping your own domain in mind. Make your comparison according to factors such as similar keywords and length to narrow down the range where your domain likely belongs.

Since only a small number of sales get listed on these reports, you can rely on this method alone. You can do this to compare, but you still have to perform other methods in order to come up with the most competitive price. This method, however, will enlighten you about the prices in which various domain names have been sold for.

Factors that Affect Domain Name’s Prices

What is a sellable domain name? You have to look at your domain and determine if it’s something that people would want to buy. Here are the top factors that you need to consider to get this done:

1. The shorter the better.

You can demand a higher asking price for shorter domains since they are difficult to find.

2. Popular top-level domain (TLD).

While you can sell domain names with different extensions, more buyers prefer .com and it will yield a higher asking price. You can also find potential buyers looking for domain names with regional TLD like .uk or .ca. It’s a smaller market but it offers a high asking price for domain names.

3. Proper spelling.

Use the right spelling of words all the time. Do not alternate u for you or 4 for four or for. While you can still sell names with words using alternate spelling, you cannot ask for higher prices. If you are aiming for higher figures, you have to ensure that all words in the domain name are spelled right.

4. Understandable when spoken.

Make sure that your domain name passes the radio test, which means that it sounds good and people will remember after hearing it. It must be easy to recall and easy to spell as well.

5. In demand keywords.

More keywords in your domain name will not yield higher prices. The keywords have to be meaningful and balanced. There are free tools from Google that you can use to gauge the interest of the keywords found in your domain, which include the following:

  • Google AdWords Keyword Planner
  • Google Trends

6. Older domain name.

A domain name that has been around for a while has better SEO results than a recently-registered type. The older one has already been ranked and indexed by Google. You’ll also have more reasons to increase prices when selling something you’ve had for a longer duration of time.

7. Brandable.

In this instance, you don’t have to pay attention to high-ranking keywords for your domain name. You can even use a word or words that you’ve only made up. But, make sure that the domain name sounds good, has an impact, and something that would stand out. New companies prefer buying available domain names than paying a higher cost to get the first choice they had in mind. Create something that will sound good and look like a good representation of certain brands or industries.

8. Domain names with pre-existing traffic.

It adds value to the name since it already has an audience so its new owner would not need to worry about its discoverability.

What should you do next after learning how to determine the value of a domain name? If it’s still not yours, then you have to decide if you’ll buy it or not. If you own the domain and you found out that it has a good value, renew the name and protect it. A good domain name makes a worthy investment.

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