Negotiating – Counter Offers

The leeway you have to negotiate a deal for a particular domain name depends on a number of factors, including:

• The maximum amount of money you are prepared/able to spend to secure the name
• The importance you place on securing a particular domain
• The initial approach you used in contacting a buyer

Like any business transaction involving goods without a preset price tag, the success of any domain name deal you close will depend on your negotiating skills. Ideally, you convince the other party to accept less money for the name than you would ultimately be prepared to pay, while, at the same time avoiding the perception that they were shortchanged. At the end of the negotiation process, both parties should be able to walk away satisfied.

Most of the following strategies can be used in a buying or selling situation. A few slight revisions of the sample letters could turn your negotiating skills into a powerful tool, allowing you to buy low and sell high for big profits.

Domain Name Negotiation Tactics

Ask For More Information

A request for additional information can sometimes prove very productive in the course of a negotiation, especially if you can ask for information that the other party doesn’t have available (or doesn’t want to disclose). For example, if you know that the domain name is not pointed at a “live” site (and therefore that the owner cannot have any idea of the traffic it is receiving), ask them:

Before I can make a decision about the domain name, I would like to know how much traffic your domain receives every month. This will help me understand the value of the domain name.

There’s a chance the owner will respond stating they don’t know how much traffic the domain name is getting, since they’re not currently using it. At this point, you can take advantage of the seller’s lack of knowledge about the value of their domain in order to make them accept a lower offer than they might otherwise be willing to consider.

Make Sure Time Is On Your Side

One effective way to end a back and forth negotiation at a price more in-line with your budget is to inject a sense of urgency into the proceedings. This can be done using any number of pretexts:

Judicious use of a fast-approaching deadline can sometimes be enough to make a potential seller accept a lower price than they might ultimately want out of fear that they might otherwise lose the deal completely. You can take advantage of the fact that many people value guaranteed money today higher than the possibility of more money at a later date.

Keep in mind this approach can also backfire. Experienced domainers aren’t easy to convince into selling one of their domains for a low price. Hurrying them through the process could make them suspicious and stop communications altogether.

If you’re selling a domain, sometimes it’s better to try and slow the process down. Once a prospect sees that you’re in no real hurry to sell the domain, they might consider a more reasonable offer. If you rush through the process as a seller, the buyer will likely assume that you’re anxious to unload the name and therefore will keep all offers low.

There are times that slowing the process down as a seller can backfire though. While you’re trying to hold out for more money, your prospect might decide they can find a better deal on a different domain or they may develop a case of preemptive buyer’s remorse and abandon your domain completely.

Make It Easy For the Sellers to Get Their Money

You may be able to keep the price of a domain purchase down by taking a risk and paying the seller directly rather than taking the extra time and precaution of going through an escrow service. By gambling that the seller is honorable and will go through with the transaction after they’ve received payment for the domain name, you may be able to make the transaction quicker and more affordable.

If you have access to an instant payment system such as PayPal, you can offer the seller some or all of the money for the transaction up front. For example:

Of course, this tactic leaves you open to any number of problems, especially if you don’t use a signed contract. The safer way to tempt the seller with ready cash is to inform them that you’re ready to load the money into an escrow service upon their acceptance of the offer.

Make Good Use of Your “Partner”

Sometimes, referring the transaction to a “difficult partner” can help you secure a better deal. For instance, you might respond with the following:

After allowing 2-3 business days to elapse, you could follow up your earlier email with something like this:

A final word

If you took the advice in the previous section on making your initial offer and concealed your identity behind a free email service and an innocuous name, you still have a second chance even if your first negotiation flounders. Just wait a few days after your initial contact, then set yourself up with a new identity/persona and try a different approach to see if it works more in your favor.

If all else fails, try using a domain broker. Even expert domainers have used such services with great results. A broker’s experience is in dealing with people and assuring them that they’ll be getting a fair price, while still bringing the price down for their clients. Sellers often will heed an established broker’s advice long before accepting an offer from an unknown individual, with no reputation in the industry.