$8.95 Domain Names Transfers from Dotster

Zetetic: Domain Resales Net 377 Percent Gain

Zetetic has studied domains that have been resold more than once since 1996, and finds an average return on investment of 377 percent, with the average name being bought and resold in 12.5 months.

Zetetic, a domain research and appraisal firm, used its database of of more than 8,000 resales, and found 74 domains that had been resold in the secondary market at least twice. The median buy price for a domain name was $891, which was resold within 8.8 months for $1,450, resulting in a 83 percent return on investment. The average sale saw a much higher ROI of 377 percent, and was boosted by the inclusion of men.com, which sold for $1.3 million in 2003. The median represents the mid-point of sales - with half of all names selling for less, and half selling for more - while the average divides the total sale by the number of names, and can be influenced by a small number of high or low sales.

"These numbers uncover a golden nugget we always knew was there – there’s lots of money to be made in domain names," Zetetic Analyst Keith Pieper said. "Several people have made million dollar fortunes reselling domain names, but you don’t need millions to speculate in this market."

Not all transactions were moneymakers, according to Zetetic. Twelve of the 74 domain names resulted in a loss while four experienced no change in value. That reflects the uneven nature of the domain name market. Some sales will be monstrous home runs, but 21 percent - about one of every five resales - will yield no profit at all.

That's an important fact to realize for Internet entrepreneurs who are just now becoming interested in the domain name market. Yes, you'lll see lots of eye-popping numbers for resales, but you'll hear a lot less discussion of the unprofitable domain sales.

    •   Posted by RichM May 31, 2005 | Permalink | Newsletter

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    Zetetic: Domain Resales Net 377 Percent Gain - May 31, 2005


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