A few months ago, when my wife was still pregnant, I registered the domain name “Babycation.com.”
I had been making jokes with a friend about how my time off from work for paternity leave was going to be one big vacation where I’d get to catch up on lots of book reading and TV. (Not surprisingly, I was wrong on that.) I took to calling my paternity leave my “Babycation” and while we were discussing this, I checked and saw the domain name was available.
I bought it for about $10. And forgot all about it.
A few days ago, I got an e-mail from someone who wanted to buy the domain. The man said he and his wife were starting a baby-related business and wanted to use babycation.com.
I wasn’t sure how to respond. In the e-mail, the guy didn’t say he wanted to purchase the domain itself, just that he wanted to use it for his business. Did he want to rent it? Was I going to become some sort of virtual slumlord? What if I sold the domain name and he went off and created the next google.com? What if babycation.com became a billion-dollar business? Should I ask for a cut of the business instead of selling the domain outright?
I wrote back asking for more details. The guy replied that he and his wife had just had a baby and wanted to start a small business. He was interested in buying the domain name, which would be a pretty easy process on my domain registrar, godaddy.com.
I asked a friend of mine who works in the Internet business what he’d do. He’s sold several domains over the years, some of them for established sites that had lots of traffic. He suggested I offer it for sale for $1,000, a pretty crazy profit margin, but not unusual for a domain that somebody wants to buy.
I wrote the guy back and told him I would sell him babycation.com for $1,000. I told him in the e-mail that I was open to negotiation and would very likely accept a lower offer. (Check out my hardball tactics.)
He wrote back and he and his wife just had an idea for a small business and that there was no way they could pay that kind of money. He didn’t make a counter-offer. He gave up.
And now I feel terrible. I feel greedy. I feel like I should write the guy back and offer to give him the domain on the cheap and help him and his wife out.
Then again, all I’m going by is a few very short e-mails from a guy I don’t even know. How do I know that this newborn even exists and that I wasn’t being approached by a domain hoarder?
A few years ago, I lost a domain name for my personal site when I forgot to pay for its renewal. It was snapped up quickly by a domain hoarder based in Colorado. I wrote him a letter and made phone calls asking for the opportunity to buy it back. The guy tried to sell it back to me at a price I couldn’t afford. I told him that the only reason that domain name got traffic was because of all the work I’d put into establishing the site. He told me to write him a letter via certified mail listing the reasons that the site belonged to me. He made me jump through a bunch of hoops to get my domain back. Then he told me I couldn’t have it. I really hated that guy.
I ended up purchasing a similar domain and putting my site back up at that address. In the end, it was the content of the Web site, not the domain name itself that was important. My readers followed and within a year, traffic to the old domain dried up.
If this guy were to register a similar domain name, would anyone care if it’s called babycation.com or babycation.net? Or even baby-cation.com?
I’m not sure exactly what to do now, but it’s made me think about the value of a name and how hard it is to know what a simple idea is worth.
What do you think? What should I do?
[Via Austin360]
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Comments
One thing for sure: use the
One thing for sure: use the auto-renew option in your domain management.
Approaching domain owners with ideas
I wonder to myself sometimes what would be a good course of action if you have an idea for a premium domain that is being parked, and the domain owner won't sell it, but you reckon you can make them more money than parking revenues.
Should you rent the domain, either with a fixed amount per month or offer them a slice of the idea's profits?
And how do you do that without getting buried deep in legal paperwork (its at this point I expect most people to decide its less risky to just use a non-premium domain)? How do you know the owner won't take your idea and get rid of you some point down the line and have someone else run the show?
It occurs to me these problems have something in common with commercial real estate. Landlords of retail property can jack up rents or kick the tenant out, but would they start a business themselves on the property?
Re: Ethics , Renting etc.
I agree these are tricky questions. I've been trying to come up with a domain sales price formula based on a dollar figure multiple of traffic to a parked page, i.e. if the domain gets 40 uniques a month just sitting there parked, what's a fair price to charge for it in the event someone makes an offer. But that implies an element of generic, which isn't necessarily what someone looking for a brand would want. Trying to determine the face value of a brandable domain name (like pickydomains) is practically impossible. Except that we know what pickydomains charges people- $50. But you DO occasionally run across a domain brand (I own sharingtones.com, for example) name that is obviously perfect for a web service of some kind. Those are going to disappear like the generics did- how to determine a price if someone comes calling?
As far as renting or leasing domain names- I do think that one of the larger corporate domain companies or registrars will come up at least an elegant way to 'do it' in the next little while. If you own a Geo like, atlantapersonalinjury.com for example- it certainly makes sense that you would find a way to lease the space to an Atlanta attorney for a monthly fee (includes web design and SEO?!) rather than sell it outright. But what to charge and based on what?
I have a few Geos and have been thinking of doing some kind of a test that would offer free ad space- the business would only have to honor a discount coupon that would only be available off the site. At some point we (myself the domain owner, and the business being advertised) would come to know what the domain, or the traffic, was worth, and could then charge accordingly.
babycation.com ? I think you were right to come back with $1000. Anything less than the $4-600 you might have ended up at the end of negotiation hardly seems worth the trouble. You shouldn't feel bad. John Reese (famous domainer/internet marketer) tells the story of feeling so excited about selling a domain for $1000, only to find out a few weeks later that the buyer then went on to sell the domain for $1,000,000.
When you see how many of these obvious and simple questions have yet to be answered, does it not seem to you that there still may be some room to find a niche and grow a domain business after all?