What Is a Domain Auction and How Do They Work?
You can purchase almost anything at auctions. That includes priceless art, fine wine, vintage cars, and even exotic animals.
You're likely familiar with eBay, the most famous auction site on the web. But you may not know that some websites offer something different entirely at auction: website domain names.
Some of these web page address names have exceptional value and sell for surprising amounts of money.
A domain name site for auctions on the web is a service that allows people to buy and sell domain names in one place.
You can bid on previously registered domains that owners want to sell or have allowed to lapse.
Here's what you need to know to navigate the domain auction process.
How Does a Domain Auction Work?
A domain auction service works like your local auctioneer or eBay. It involves each seller setting an initial price and deadline for a domain sale.
People can place offers on the domain name until time expires.
Some auction sites have auto-extension features that prolong the deadline. The tool discourages people from placing last-second offerings, also known as sniping.
Some individuals at domain auctions hope to purchase expired domains at low prices and resell them for a higher price.
The selling party isn't always looking to turn a quick profit. A business may not have a use for its existing domain.
Additionally, other people may have expiring domain names that will soon hit the free market.
How to Auction a Domain Name
The first step in selling a domain is to find the right marketplace. If you've purchased domain names before, you can use the same host website.
You'll need to set up a registration for an account.
Next, determine an appropriate sale price for your domain. Some auction sites have price valuation tools that take care of pricing automatically.
As a rule of thumb, an older auction domain name often carries a heftier price tag than a new one, but many contributing factors exist.
Once you establish a price, it's time to find interested consumers.
You can upsell your domain name by denoting the website traffic volume and your income earnings. You should also mention the domain's age and expiration date.
After a user wins the auction, use escrow to complete the sale. A website like escrow.com can help you secure a safe and seamless payment through services like Paypal. Don't forget to transfer the domain to the winner, too.
All registrar companies have their own rules for transferring, so you may need to visit their online resources, support page, or blog for assistance.
Where to Auction Your Domain Names
Here is a list of the best domain auction sites currently available. There are many more auction sites you can easily research yourself.
You can find more than 19 million domain names for sale at Sedo. The popular site has added a twist to the traditional auctioning model, thanks to its active domain auctions.
A domain name must have at least one purchase offer to initiate bidding, or the selling party can pay a one-time fee of $59.
If you want to acquire a site, Flippa is a go-to destination.
It recently expanded its offerings to include domain name auctions and, to date, has completed $200 million in sales. You can list an expiring or new domain name for $9.
The domain-name investing community frequently uses NameJet. The active auctioning site sells tens of thousands of domain names, including CPT.com, which went for $69,000.
While NameJet doesn't charge an owner to post, it does take a commission on each transaction.
The Evolution of Domain Names
How did we get here? Answering that question requires understanding the purpose of domains on the World Wide Web.
Domain names serve as a substitute for IP addresses, helping to simplify finding information online.
Domain names come in two forms: top-level domains (TLDs) and secondary-level domains (SLDs). A TLD has a URL that ends with .com, .edu, .org., .net, or .gov, while SLDs precede TLDs in the URL. SLDs typically reference the company that registered the TLDs.
Domain names took on increased importance in the wake of internet advertising. Businesses would run advertisements on websites with a click-through link embedded in the ad.
The website owner would charge a specified rate based on the number of clicks on that ad.
Domain name auctions evolved following the release of the Google pay-per-click auctions.
The system enabled buyers to place bids on specific keywords that appear when someone enters a search query.
The advertising model led to an ecosystem of domain name auction sites for advertisers and internet users.
Protecting Your Assets
Make sure to protect your assets, whether you want to buy or sell a domain. Buyers should double-check the records for a name's availability.
The last thing you want is to bid on something that's not available. Also, use a reputable domain auction house that offers buyer protection plans for customers.
Sellers can use escrow or smart contracts during sales. The process involves a third party handling the transaction instead of the buyers and sellers.
The intermediary takes care of the payments and domain transfer for a small fee.
Try Domain Auctions Today
Looking to make some extra money with domain names? Auctioning provides a convenient and efficient way to post and sell your digital assets.
Check out our rankings to see which expired domains can boost your business and global search rankings.