You may not realize it, but there's an entire niche of the hosting industry dedicated to domain flipping; the art of buying and selling domains. The premise of domain flipping is simple; an individual or company purchases domain names at a cheap price and "parks" (holds) them until a willing buyer eventually comes along. If you sell it at a profit, you've succeeded. While it sounds simple enough, it can be difficult to make little more than a few extra dollars if you don't know what you're doing.
Furthermore, it's certainly not a way to make a fast profit. Some domain flippers hold onto domains for years. For example, Chinese drone maker DJI originally had a website at DJI-Innovations.com and later had to purchase DJI.com from its owner for $300,000. There are many other successful stories of domain flipping. And with that in mind, here's what you need to know about getting started:
Getting Your Starting Budget Together
The good thing about domain flipping is that you can start with a few dollars. If you have a bigger pot to start with, you can get a premium domain that might sell for a much more premium price. For example, Page Howe bought Seniors.com for $100,000 and sold it for $1.8 million. Of course, the average person doesn't have $100,000 laying around and even if they did, there's no guarantee the domain would flip at a profit anytime soon (or at all).
While this might mean risky business for some, the risk is pretty low for newbies who are prepared to invest a few dollars and get creative. The average domain costs around $10 to $12, making it a feasible purchase for anyone. If you have at least one hundred or a few hundred to start with, you can buy a handful of domain names in bulk and increase your chances of flipping. During your early stages, it's important that you treat domain as a side gig until you figure out what your best strategies are and start making money.
Searching for Profitable Domains
The truth is, there's no magic wand for domain flipping. Domain flipping is a little akin to gambling, but once you strike a tune, it can feel like counting cards. That being said, there are ways to search for domains that are more likely to make a profit later down the line. In that regard, researching potentially profitable domains is like working the stock market.
A good place to start is by taking a look at expired domains. Expired domains are great because their registration is about to expire and they're already on the way to being sold. As a result, they're cheaper than other domains in some cases, and have already established traffic and domain authority. Before you purchase an expired domain, be sure to study its history.
Two other solid strategies include buying short domains and local domains. Short domains are easy to brand and remember, so they're in higher demand. Acronyms and short, simple words are typically good bets. Local domains include a city or town. For example, if you live in Brooklyn, you might buy BrooklynCafe.com.
Finding the Buyer
Unfortunately, the waiting game is the toughest part of domain flipping. When you buy a domain, you're banking on the idea that someone will start a company that contains some or all elements of your domain, or that your domain resonates with an existing brand. In many cases, this means you end up waiting quite a few years before it comes along. However, there are some options you should explore to help make potential transactions go much smoother.
One way to do this is to create a free landing page that lets website visitors know you're selling. Include contact information and any other information that might be relevant to a sale. You should also list your domain on a marketplace, which is common practice for domain owners. Marketplaces are like the eBay of domain names; potential buyers can search, bid, and make offers. Some marketplaces have complex policies and fees, so be sure to go through each of them carefully before you commit. Additionally, be sure to keep your contact information on the WHOIS database public.
Lastly, another way to sell your domain is to work with a domain broker. A domain broker helps you find interested parties that are ready to buy and can negotiate on your behalf. Their job is to help you turn a profit; sometimes that profit is much larger, while other times you might score a small profit. Either way, it's the broker's job to sell at a fair market value while still looking out for your best personal and financial interests. If you have numerous domains to sell and don't enjoy the salesman aspect of the job, you can find a reliable domain broker on a platform like Flippa.
