Formula for Appraising Exact Match Domains
Last December we wrote an article about tips on appraising domain name prices. Learning how to correctly price your domains is critical in domain sales as it can cause you to either lose a sale or leave money on the table. Neither is good. That particular article dealt with pricing domains in general, but Michael Gargiulo, CEO of VPN.com, has written an excellent article published on Forbes.com that describes his formula for pricing exact match domains (EMD’s). We recommend you give it a read. He owns VPN.com so he knows a thing or two about high-value domains.
EMD’s is a very important and valuable category of domain names. Domains, especially 1 and 2 words, are of high value when the words that form the domains are an exact match to a popular search phrase. 3 or 4 word domains can also be of high value, for example, if the city name or industry name contains 2 words, as in the case of “New York Real Estate”. And they must be dot com. What makes them so valuable is for 2 key reasons.
The first reason is type-in traffic. People tend to enter the domain into the browser if it is a popular keyword. The second is that having an exact match domain will improve search ranking if the content is authoritative and the site is well optimized.
High-value domains is an area of significant concern for domain sellers because they don’t want to leave money on the table and may worry about the domain appreciating in value in a few years. The buyers are also concerned because they may not understand the price and may be affraid to overpay. So the article is educational to both sides and can serve as a way for you to help potential buyers understand the price of the domain you are selling.
Has the value of EMD’s depreciated over the years? Michael states in the article: “The exact match domain industry is healthier than ever before thanks to several factors: internet size and growth, the original dot-com extension, age, demand, search volume, branding, and the inherent SEO value that is unmatched with nearly all other marketing and branding investments.”
Without giving away too much, his formula for pricing EMD’s takes into account search volume, CPC, and keyword competition. It is interesting how Michael uses these factors in the equation that arrives at the price.
The benefit of having a formula like that of Michael’s is that you are able to provide a logical justification for the price of an EMD you are selling that a buyer can understand.
The article is: Exact Match Domains: How To Price These High-Value Assets. You should check it out.
As mentioned, Michael Gargiulo is the CEO of VPN.com. He also is the CEO of ProxyServer.com and came to fame from his site, CoolMathGames.com that was featured on Domain Name Wire for having a law suit levied against it back in 2014. He built that site plus 2 others to over 3 million visitors a month.