When we all start out in this business we get to hear the stories of Scott Day, Frank Schilling, Rick Schwarz and believe that maybe one day we will be able to count ourselves amongst their number.

I remember when I started out I hand regged about 100 names and thought fabulous wealth was only a few months away. After a few weeks I was still patting myself on the back over my wise investments, so I regged 100 more. I took a look at the names that were selling and compared them to mine and further convinced myself that mine were of a much better quality.

Three months later and not a sniff, what on earth was wrong with these buyers I thought? I’d advertised them on the forums for 4 and 5 figures and no one had snapped these gems up. Either they couldn’t see the fabulous value these names represented or I had made some mistakes.

So I started to do what I should have done in the beginning - read what people with experience had to say about the business. What was selling, what wasn’t selling, who had the most informative blogs and what strategies had worked in the past to build great domain portfolios.

After about a month of reading I realised my hand regs weren’t going to get me rich and what was needed was a change in strategy.

I’d read on Namepros that the only way to make some decent bread in this game was to spend some serious money on names others had undervalued. So I started hunting around, and then I hunted around a bit more. Finally I got lucky and managed to buy Foom.com for $950 (I sold it a few months later for $21,000) and with this one under my belt I charged ahead and have continued adding names to the portfolio from all areas of the domain market.

I mentioned in a prior post how I had one of my best periods for selling names recently and this is because I changed strategy again. My prices at the time were too high as I was holding out for the end user prices and sadly at that level I just wasn’t getting any bites.

So if something isn’t working you fix it, and I subsequently reduced my prices to a reasonable reseller level and suddenly my Domains started walking out the door.

Sure I would have gotten more if I’d held out for an end user, but I’d rather have cash in my pocket now than imaginary dollars in my fantasy bank.

So now I’m asking reasonable prices for good names and constantly keeping my portfolio turning over and gradually upgrading the names I own.

Also if you take a look at the wider economy you’ll see that we are in the midst of an economic storm that looks like it’s going to get worse before it gets better. This will of course have a knock on effect on domain prices, and as much as we like to think we’re somewhat insulated from the wider economy this is not the case. Some areas may be less effected than others (Premium .com’s, etc..) but believe me, there is nowhere to hide when a recession strikes.

So I guess what I’m saying is price your names reasonably if you wish to sell them. I’m constantly amazed at some of the dialogue I have with sellers and their unrealistic price expectations. For example, I spoke with Mr X the other day about a nice LLL.com – I started off by offering him $10,000 – his counter proposal was for $250,000. After quite a few more mails this man still hadn’t budged. He’d seen a news article a few years back about a 3 letter name selling for this figure and that is what he wanted. It’s doubtful he’ll ever get his price and he’ll continue holding the name until it’s either worthless or he’s grey around the temples.

Now when it comes to implementing a successful domain strategy you must start thinking of your investments like a general does his troops. Have a plan in mind and do everything you can to execute it, but the plan cannot be set in stone, it must be fluid and flexible to allow for opportunities and dangers on the horizon. So watch the stockmarket, look at trends, study markets and industries that are close to ours and see what’s coming next that’s both good and bad.

But whatever you do don’t bury your head in the sand and stubbornly refuse to budge as this will damage your business and your bank balance.

I think we’re going to have a very interesting year ahead of us and I’ll be looking closely to see what impact the vanity TLD’s have on the market, as I think their may be some good opportunities in this space. But I’m not going to start guessing yet – I’d rather see how it plays out in the beginning and then move forward once a trend has been established. Sure I might miss out on the amazing Reg fee deals – but after having been burnt in the past I’d rather have thinner margins and definite winners than the potential of hitting a home run but also losing the lot.

James

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