findtim
Top Contributor
everyone knows i am terrible at "anglish" but that post just does not read right? posted by anthony, written in "third person" and not signed, so who wrote it?
am i wrong?
tim
Farm Machinery
- Thread starter chris
- Start date
everyone knows i am terrible at "anglish" but that post just does not read right? posted by anthony, written in "third person" and not signed, so who wrote it?
am i wrong?
tim
Chris.C
Top Contributor
If it's a domain like this that you can't afford to lose, I'd definitely have at least $2000 on as soon as it was listed...
We've all seen NetFleet and Drop have issues in the last 5 minutes of auctions or maybe the bidder has technical issues.
I know I once wanted a domain so bad that I had loaded my tablet onto NetFleet's site with a separate mobile internet connection just in case something happened with my laptop or its internet connection so I could immediately login via my tablet.
So the moral of the story is I'd rather be winning with to 5 minutes to go and ready to put my final (more substantial) bid in the final seconds, than only putting a bid in with seconds to go and having some technical issue.
"Price" is what you pay, "value" is what you get.
What I was trying to say is, I understand why it was "priced" at $8000, but I think it's value is well into $XX,XXX.
Of course the reason why the domain didn't sell for more is precisely because not many, if any, farm machinery dealer's marketing managers turned up, or if they did they were not aware of how to extract that value from the domain to justify paying $XX,XXX.
But I'm not really a domainer, nor are 50%+ of people on these forums, they have some other background, ie SEO, web development, etc
Yes, if you were only a domainer it would be a bit of a gamble paying $10,000+
But you are assuming only domainers are bidding at auctions. If anything there are more end users (or developers) winning the quality domains these days than domainers.
My point was that if you were an end user (ie a farm machinery dealer/manufacturer) $10,000 would be an absolute bargain for a domain like that.
Now you are just making assumptions Snoopy.
Yes I buy and sell domains occasionally, but it makes up less than 10% of my income, I also have a day job and side business that have nothing to do with domaining...
My day job being I'm the national marketing manager at my family's industrial equipment sales company. We had over $15M revenue last year come from online leads alone, it will be $20M this year and we are not even a big fish in this industry...
Whilst we don't sell farm machinery - we operate a business that would be very similar to your average farm machinery business and if the equivalent domain came up for sale in our industry we'd be paying $XX,XXX in a heartbeat and whilst it would require some discussion I wouldn't even be surprised if we decided to pay $100,000+.
And if we as a medium size business in our industry would pay that, the big players with branches of every major city of the country should be willing to pay at least 2 or 3 times what we are willing to pay.
So if I was the marketing manager at a farm machinery company I'd be devastated that that domain sold for only $8000.
Just because the companies in that industry are behind the times doesn't mean they won't wake up.
Some smart cookie will start advertising and make a killing and then the rest will catch on - that's how capitalism works - money flows to the best opportunities.
In our industry we are now $4 - $7 a click and probably selling a piece of equipment worth less than the average piece of farm machinery and we spend a healthy $XX,XXX on AdWords EVERY MONTH.
So the improved CTR and lower CPC from using that domain in your adwords campaigns alone would pay for the domain in under 6 months!
If their is a 2% type in rate of the Exacts of that domain that would mean 80 visitors a month. If each of those visitors are worth say $5 in profit, the domain would pay for itself in 2 years in type in traffic alone.
The farm machinery industry is probably just where our industry was 5 years ago when we first started with AdWords, ie back in 2007 when we were paying $1 click and it was us and 3 other companies...
Ahh the good old days.
Anyway Snoopy I respect your opinion a lot mate - but when it comes to real world businesses utilising domains - I think you seriously under value.
Philip Littlewood
Top Contributor
Only being a novice at this - I am not that familiar with the snapnames platform - but by the sounds of it there is a story....
neddy
Top Contributor
snoopy
Top Contributor
Chris.C said:
The most obvious enduser with a very similar name that likely loses some traffic to this did turn up. They are also the main bidder on adwords and spend a lot on domains, that is why this name went for a very high price in my view.
Not really a domainer? You're here constantly talking about buying and selling domains. I'm passing you the dntrade nonsense hat for the day.
snoopy
Top Contributor
One of the founders was exposed shill bidding on their own auctions. Went on for many years. Bidding early with a proxy is a bad idea when the item is being sold by the house.
Chris.C
Top Contributor
HAHA as I re-read my post I was thinking "I really shouldn't post this", but when you've written that much on a Friday arvo you just get to the point where you're like "stuff it" let the chips fall where they may...Brace yourself Chris.
That said, looks like Snoopy too the high road on this one, or probably more likely, it was too late on a Friday to be debating too much without a beer in hand...
Yes CarSales won - but the price that a domain goes for is not set by the winner - rather the person who bids the second most.
For a domain like this to really start getting into the $XX,XXX you need CarSales and at least one other savvy online farm machinery dealer.
I'd like to think that companies like Machines4u, AgTrader, TradeFarmMachinery, etc were also bidding. Yet I don't think these guys are REAL end users.
These directory sites tend to make $2000 - $7000/year per dealer they sign on, and they might have 30 - 100 dealers, within the farm machinery category.
So best case scenario they are bringing in $700,000 in REVENUE - so I wouldn't think of these guys as true end users.
Even a middle tier farm machinery dealer will bring well over $700,000 a month in revenue. Their potential profit from traffic related to farm machinery is far greater than the likes of CarSales.
A large scale farm machinery dealer, with dealerships around Australia will bring in millions in revenue every month.
Then of course there are the buyers with really deep pockets and fat margins, the manufacturers, like Case, New Holland, John Deere etc
But of course, it's all about who turns up and bids on the day...
And as you have correctly pointed out their aren't many farm machinery dealers even utilising AdWords yet, so that's a good indicator of an "uneducated" market in regards to online marketing.
And when it comes to manufactured goods it's rare to see a manufacturer themselves bidding (even though they stand to gain the most) because historically they like to separate themselves from "sales" and leave that to "dealers" so they can stick to their core competency of "manufacturing" and and in Australia's case, given that Australia doesn't actually manufacturer much high end equipment, it's especially unlikely that international manufacturers are going to turn up to AU domains auctions if they aren't even chasing the COMs yet.
But it's only a matter of time before they wise up. Capitalism, like Darwinism, is survival of the fittest - you can only keep your head in the sand for so long.
Even in my family's industry I remember telling my father 5 years ago that I feared the day where the major manufacturers entered the online marketing realm in earnest and just outbid us on everything (domains, ppc, seo, content production, etc) because they they have the marketing budgets to do so...
And for about 3 years to my shock in spite of the obvious trend of the web playing an increasingly important role in capital equipment sales the majors didn't enter the online world in any significant way.
Then about two years ago a couple of them started dabbling and now two years on they've significantly increased their market share (as have we) and those with their heads stuck in the sand are struggling.
And today almost all of the major are starting to dabble, and just a month ago I was contacted by one of their marketing managers to talk about out us not using their brand in our Google AdWords campaign (which is perfectly legitimate in the eyes of Google if no trademark complaint has been filed)....
This is the first company of about 10, that has wised up to the fact that companies like us have been getting a free ride bidding on their branded terms for over 5 years and in some cases we've even out ranked them organically because they didn't design their sites in a search engine friendly way...
I suspect the other 9 won't be too far behind.
So much has changed in the last 5 years - 90% of our sales used to come from traditional media - magazines, direct mail, yellow pages, telemarketing etc.
Today 25% of our sales come from those sources and it costs just as much if not more.
I don't know if anyone else on these forum is in a marketing management position and is across a lot of marketing mediums - but from the data I'm seeing the last 6 months has seen a rapid fall off in traditional medium effectiveness.
I don't know what it is - but it's like something has changed - maybe its because everyone now has an ipad and a smart phone - but if this trend continues I suspect 2014 will be the first year where we cant justify spending any of our $500,000/year marketing budget on magazine, direct mail or yellow page adverts...
I like think that's really saying something.
And companies without premium domains like farmmachinery.com.au and going to be that much more dependent on Google/CarSales which just makes it a lot harder to control your own destiny.
Yes I have bought and sold a number of domains, but I don't make my living from buying and selling domains.
So yes I'm a "domainer" but at the same time I'm not really a "domainer".
snoopy
Top Contributor
So who is the other savvy online farm machinery dealer?
There is one obvious buyer in my view, carsales.com.au. Personally I suspect it was domainers up against them, and I think the domainers may have been partially motivated by the development done on farmmachinerysales.com.au.
carsales.com.au has got many strong reasons to buy this domain, and other companies in the space do not. My gut feeling is carsales is losing some traffic to farmmachinery.com.au that is possibly worth several thousand to a domainer.
I doubt it personally. Carsales is at the top of adwords, if someone else was able to monetize a lot better they'd be at the top.
Chris.C
Top Contributor
I agree that there would have been a few domainers bidding, and if I was willing to throw a couple of grand at it, not doubt other domainers with deeper pockets were right in the mix.
Other companies in this space have a a big incentive to buy this domain and develop it - it undermines their main strategic competitor...
I think the more important thing to note is that farm machinery dealers aren't utilizing adwords at all... this to me indicates and uneducated and uncompetitive market. So this will change in time.
In the industries I'm involved non of these "directory" sites are competitive in AdWords - the manufacturers and dealers all outbid them by a substantial margin.
I'd suspect the carsales network probably has a profit maximization point of about 50 cents per visitors compared to dealers $5 per visitors.
neddy
Top Contributor
For new and old alike, this is a worthwhile story which was well summarised by Ron Jackson of DN Journal:
http://www.dnjournal.com/archive/lowdown/2009/dailyposts/20091104.htm
(Because it's an old post, it takes a while to load from archives - it shows as "not found" for about 30 seconds).
Ashman
Top Contributor
Very interesting story Neddy, thanks for providing the link. This story is a must read for all domain investors.
