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April 03, 2015

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Lift Off:  How New Sales Platforms are Sending the Domain Aftermarket Into Orbit - Sedo.com and GreatDomains

While NameMedia’s AfternicDLS and Fabulous.com's Domain Distribution Network have been getting a lot of attention lately, aftermarket giant Sedo.com has hardly been standing still. In June they acquired one of the original big name sale venues – GreatDomains and quickly reshaped it into an upscale venue for short term auctions.   

We got together with Sedo.com CEO Tim Schumacher to talk about how Sedo has developed over the years and where they are headed now. “Sedo began as a tool to bring domain buyers and sellers together; to facilitate the trade of domains," Schumacher said. "Until roughly a year ago, Sedo used an offer/counter-offer system exclusively. In addition to this method, we now have an auction system and, as you mentioned, GreatDomains. 

"With so many users now buying and selling domains on our marketplace, we really wanted to expand and build on the way domainers either buy or sell. Thus, we introduced the auction in 2006, which was a great success. Acquiring GreatDomains was the next logical step in offering our clients more choices in buying and selling. Sedo has always had a great mix of domains listed on its marketplace, from obscure to premium. Adding GreatDomains to the mix reaches out to those specifically looking to buy and/or sell premium domain names."

 Tim Schumacher 
Sedo.com CEO

Schumacher noted "Sedo also just concluded its first GreatDomains monthly auction.This monthly auction had a great turnout with more than $1 million in sales, including Chinese.net, Supernatural.com and Debit.com among others. We will be conducting these auctions each month, and the next one starts August 16, 2007 and will run for a week.”

With the new higher profile Sedo has bestowed on GreatDomains a lot of domain owners will want to get their names listed there – but the site is not meant for every domain. Schumacher told us, “As GreatDomains is a premium domain platform, we will accept only high-quality one or extraordinary two-word .com and .net domains.  To have your premium domains listed on GreatDomains, you’ll need to have a Sedo account.  Once you have a Sedo account, list the domains you wish to sell. In the “Domain Management” portion of your account, check the box by your premium domain name and choose “Apply for Top Domains Listing.”  A Sedo broker will then review the domain name.  Once a domain is listed on GreatDomains, it is automatically listed on Sedo.  Any domain that can transfer ownership can be listed at Sedo.”   

Sedo is a truly international company, having built up successful operations around the globe. They have practically owned the local resale markets around the world as seen in their dominance of our weekly ccTLD sales charts. With some territories experiencing far faster growth rates than the U.S. this strategy has been one that has served Sedo extremely well. We asked Schumacher to talk about how the company reached this position and how they will be able to maintain it against competitors who are obviously going to want a piece of the pie.  


“As you mentioned, Sedo itself is a very global company, having started in Germany with a very international staff.  While remaining loyal to our own international roots, the international community has remained loyal to us.  We have (and are continuing) to act upon requests made from all over the world.  While we can’t implement every request, finding solutions that reach literally the entire world has meant gaining international clients,” Schumacher said.  

Schumacher added that a lot of the companies others might view as competitors are actually seen as partners by Sedo. “Fabulous and NameMedia are great companies, with whom we’ve worked together for years. As partners, we are mainly an additional sales outlet for their domain portfolios, and especially given Sedo’s strong audience both in the U.S. and abroad, we sell hundreds of thousands of dollars worth of domains for large portfolio holders like Fabulous and NameMedia each month.”    

Some portfolio owners have traditionally been reluctant to sell domains but with the ongoing expansion of the aftermarket many are thinking about taking some cash off the table. Schumacher  commented on finding the right balance between PPC, sales and development when considering how best to monetize your domains.


“I think for each individual, it is up to them to decide how they want to make money with their domains,” Schumacher said. “Currently, “developing names” is a big buzz, but let’s face it: one person or one company can only develop very few names at a time. So, I think developing makes sense only for a small handful of names or maybe even just one. Hey, Ron, take yourself as an example – you developed one name, DNJournal.com into what is by far the leading media covering the domain name space and you did a terrific job on this --- but could anyone do this equally well with 100 domains? (Editor’s note: I know I couldn’t!). The rest needs to be monetized, and this is currently mostly done via PPC, but Sedo and others work relentlessly to experiment with other monetization methods.”  


“Apart from monetization, I totally agree that every domain seller should pay attention to the domain sales channel.  Obviously the domains with a lot of great traffic will have more leverage in terms of a sales price, but I also think domainers are becoming more realistic in their expectations of sales prices," Schumacher said. "If you have a domain that doesn’t have traffic, any return on investment is good, and selling a domain like that is the only way to realize this. So, selling domains and maximizing the proceeds from domain sales should be definitely on every domain sellers’ agenda.”


Schumacher has been a popular speaker at domain conferences where he often shares his view of current and future trends in the industry. We asked him if  he thought the domain boom would continue to run at full throttle and if so, where some of the better investment opportunities might be.  

Schumacher speaking at T.R.A.F.F.I.C. 
New York June 2007


“Well, the aftermarket has indeed being very strong lately, so I do think that – while overall domain scarcity will increase – we will see lower values in some areas. So, diversification is one big trend I see coming.  Nobody wants to have all eggs in one basket, so it makes total sense to diversify domain portfolios to include more ccTLDs and new gTLDs like .info or .mobi (both of them are my favorites in regards to new gTLDs),” Schumacher said.


IDNs are also going to be big. When we had MSDOS, the fact that you could only use English-language characters for filenames and other stuff was common knowledge, just like with domains today.  But other characters are a very natural thing for everyone who’s first language is not English, so it comes naturally to people – it just takes a few years. But that’s one thing I’m really bullish on.  It takes time, and implementation isn’t easy (Sedo.com is actually one of the only IDN-compliant domain portals, but even we have still a long way to go to get everything IDN-ready, a lot of things still don’t work on IDN), but it will come - For sure!” Schumacher declared.


“Portfolio sales are also on the rise.  We see more and more activity at Sedo regarding that too, and it does make sense for both buyers and sellers (I’m happy to be contacted from both sides if someone wants to buy/sell domain portfolios, by the way)”, Schumacher concluded.


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