Thought Convergence will be launching Aftermarket.com this week joining a very crowed space of domain name sales/broker platforms.
Currently the major players in the Domain name broker/Auction space include Sedo.com, Afternic.com, Moniker/SnapNames.com. NameJet.com, and some smaller players including Latonas.com, BoxCar.com, Francois Carrillo from Domaining.com set of sites including Cax.com, NumericDomains.com, PremiumDomains.com; as well as Flippa.com (which also sells developed sites) and the newly re-launched Bido.com.
Of course their are several brokers that also send out daily to weekly lists of domains they are privately brokering.
Like I said there is no shortage.
So with so many companies in the space what can Aftermarket do to stand out.
In my opinion the best thing they can do it stop dead beat bidders and non-performing sellers.
None performing Sellers occur in several situations. One situation is, when domains are placed for sale by someone other than the owner and sold off. In this situation the auction house only finds out after that sale that the person who placed the domain into the market place did not own the domain. In this regards Aftermarket.com enjoys a distinct advantage as its parent company also owns DomainTools.com which it should be able to use for its benefit to make sure that every domain in the marketplace was submitted by the owner of the domain.
Another situation where you have a non-performing seller, is where after a domain has been sold in the marketplace the seller simply refuses to transfer. Usually this occurs when the Seller believes the domain has sold well under value and refuses to complete the transaction.
Likewise, Buyer often seem not to pay for their purchases.
Recently we have seen six figure sales not complete at public live auctions, online auctions and through marketplaces.
At the TRAFFIC auction last month 2 six figure domains that appeared to sell in the live auction, Shock.com and BVI.com were put back into the silent auction after the auction house was “unable to make contact with the buyer”.
Non-paying bidders are pretty commonplace at Namejet.
Although much less frequently than NameJet.com, I have gotten emails from Snapnames.com that notify me that they are rerunning auctions where buyers failed to pay for their purchases.
When a Seller of 7 legal domains elected not to transfer the domains after they sold at auction for some $200K, the marketplace which held the auction refused to file suit against the Seller for non-performance. Moreover the terms and conditions that make up the contract at Sedo, did not specifically give the buyer the right to collect its attorney’s fees and costs from the non-performing seller leaving the buyer pretty much without any practicable enforceable rights.
Since writing this blog about 3 years ago, I have only heard of one situation where an auction house has filed suit for their commission for a non-completing transaction and that was Oversee.net suing for its commission over the sale of Ad.com.
So if Aftermarket wants to stand out from the crowd out of the box, why not ENFORCE a strong policy against non-paying buyers and non-performing sellers? Yes it will cost some money in legal fees. But if the terms and conditions of the site are drafted properly suits can be brought in Aftermarket.com home market, forcing those subject to suit to come to LA, to defend themselves.
My guess is that strong enforcement, each time, every time, out of the gate will stop the dead beat bidding and the non-performing buyers, quick, real quick. So take some of that marketing money and put it where your mouth is, telling the community unlike other sites and platforms if you play games here, its going to cost you.
Along the same lines Aftermarket’s terms and conditions must give violated parties the tools they need to enforce there rights if they so choose by allowing the winning party to collect its attorney’s fees and costs from the losing party if they elect to file suit to go after a non-paying buyer or a non-performing seller.
it could be useful to write a post with a comparison table between all these services
Firstly, the handle of the poster:
@”the suborbital space tourism is TOO dangerous”
I’m not this person. If anyone suspects it is me because I own SubOrbitalTourist.com, which I bought half a decade ago, I don’t ever post anything in the domainer space that doesn’t clearly ID me.
That said, this is the BEST blog article on domain auction regulations I’ve read. We’re supposed to be professional in this business, yet we get this auction trash on certain domains all the time. I did some research on Sotheby’s, and found that less than 1% of the bidders default on paying for their purchases. In my company’s brokerage for more confidential clients, several times this has come up to where I had to change the buyer policy requirements. If you couldn’t come up with a initial “best faith” deposit at least 20% of the domain you were trying to buy, then you weren’t considere, regardless if you threw out a BIN price.
Back in 2007 when I helped design Aftermarket.com (before it was called that), one of my suggestions was that all bidders for domains with reserves $10k or more MUST put up a minimum “bidding deposit” of $2k to the auction service to qualify for the right to bid on the domain . If the bidders all “qualified’, then they could proceed in the bidding process, either offline, online, or by phone. Those bidders who didn’t get the domain could carry over the deposit to the next domain auction or get a refund within 15 days after the auction.
That would take care of the posers. This would also build serious buyers for a particular domain, and all eyes would be watching. I know it would work. I think that this would eliminate the “post a price and run” types.
Great article, Em-Bee.
At Cax.com (and his associated vertical marketplaces) we solved last September most of the problem by asking a no refundable life time fee of $10 to can list or bid domains.
It’s nothing but enough to stop fake bids, and have sellers better check their reserve before the auction begin. And it’s working!
The other main problem is from sellers listing domains they don’t own (most of the time by error). This should be handle soon as we nowhave access to a robust WHOIS API to can control an ownership or ask for ownership confirmation to the registrant email.
So mike, how would they inforce US law overseas?
IMHO domainers don’t collaborate enough… they choose to compete instead of team. selling names through a helping hand and giving a decent commission always beats the sum of $0.00.
I use a tool that sells domain names, I call it the telephone…
Shahram
They may have to block “customers” in certain countries that do not have a legal system in place which would uphold rights.
For example lets say you have a buyer or seller located in the UK that defaults.
They get sued in California and the either defend themselves or a default judgment is entered. So Aftermarket can take that default judgment and hire counsel in the UK to enforce it and collect on it, no problem.
If the customer lives in Iran then you know you don’t have that option and you have to block that customer from doing business.
And another one joins the list – I wonder how they will do compared to the other bug players in the market. Writing a comparison, would be a very useful tool to many people
I have to agree with Bruce, it seems like more of a competition instead of domainers working together. Hopefully my free platform could join the list one day.
aftermarket.com is online