How do you decide which domains you want to drop?

One of the things I’ve always found interesting about the domain investing world is that people often focus on their wins, the names they sell, and ignore all the garbage they drop. The reality is that all of us, even big investors and small, drop domains all the time, it’s a reality but one that isn’t discussed as much as the sales. Of course this makes sense since it’s a lot more exciting to sell a domain name for big money than to drop hundreds or thousands of dollars in domains.

What differs between investors is the criteria they use to determine which domains they drop when a renewal comes around. Some investors have detailed heuristics they use, others just go with their gut. I’ve used a relatively simple formula over the years and can tell you that I’m still learning every year so it’s definitely far from perfect.

Here’s what I look at:

First I only look at dropping names I’ve paid less than $100 for, that’s just me, other people may have a higher or lower number. Next I look at the number of inbound offers, if I’m not seeing at least one real offer a quarter, I usually drop the name. Sometimes before I drop a name I’ll reach-out to 2-3 potential buyers and see if they want to buy it for a few hundred dollars. This at least gives me the opportunity to make a profit and in some cases double or triple my investment on names that I would otherwise drop.

At the end of the day I want to have a portfolio full of names that I have paid a pretty penny for and know are valuable, or I’ve paid less than $100 for and I’ve seen are valuable (or at least think are) based on the inbounds I’m getting. Of course everyone has a different time horizon and I don’t need to sell all of my names or even 10% of them this year to be satisfied. What I do look for is making sure I’m seeing real value from my investments which means making more money off of my domains than I put in, and beating what I could have made if I threw my money in the stock market or real estate.

As I’ve said many times before, even though I’ve been investing in domain names for close to ten years I definitely don’t consider myself an expert. I’ve never done this full time and I don’t plan to. So don’t take my heuristic above as a rule I think you or anyone else should follow, I just wanted to share my own strategy with you since I think it’s never fair to ask a question unless you’re willing to answer it yourself.

So now it’s your turn. How do you decide which domains you want to drop? Comment and let your voice be heard!

{ 4 comments… add one }

  • joe February 1, 2017, 12:42 am

    Since you were my online mentor in 2010 I’ve dropped more than 90% of my domain names, the reasons not to sell, make money Moniker of my own domain names with advertiser ads, struggles and fight to get the best of Myself and what I see of you.
    http://www.Uniregistry.com comes out of nowhere, discounts for domain name registrations. Com and new extensions, an illusion market but inoperative, also make money just like to make Moniker with my domain names of a word, three letters and a number, two words, one of them CPC $ 24.50 good money for each Click, I did not see anything.

    I have pen drive file as proof, just in case.

    Change of registrar before selling everything on my website at prices of three figures through a website of valuation domains that announces Konstantinos Zournas, in http://www.onlinedomain.com those of two words, the ones of 3 letters and a number if the number of premium by Have another valuation website partner affiliate to Sedo, Flippa, and two more., I will try to earn some money if you think good to buy and from here register more than 50 of a single word and use my own ads with the collaboration of brands Known for an average price per month, three, six months and nine months three of gift and with traffic of users each month from social networks, with a good strategy of its own.

    Surely I will drop several domain names because the illusion of a beginning in the last two years was different had the best of my life, it is not the market are the record companies and their founders who use and manipulate without knowing the truth Of a long way that they have traveled before but like, I wonder to get so high, always something more must have and one of the reasons could be this money clean at the expense of the domain names of others who are your customers account.

    Throughout life and his own way, he stumbles but nothing happens because he opens his wallet full of money, closes the door latch and starts again.

    The one who patents is for something if you have not done your project well do not take it to the market because he will always be lame and those who believe in his project by name and level, will limp a lot more.

    Reply
  • Aline February 1, 2017, 7:56 am

    Thanks for sharing your method. Choosing what to let drop is definitely an ongoing process especially with the market changing all the time. I just think of all the people who let their 4L chips drop before the boom. Ali Zandi just tweeted that he purged 14,000 domains from his portfolio. Besides inquiries, one thing I check is how many times people bothered to check the Whois info on the domain. Not that it means much, but 0 across the board can be the tipping factor. On the other hand, high numbers may mean that others see value there (or maybe they’re just curious).

    Reply
    • Morgan February 1, 2017, 10:49 pm

      Thanks for the kind words @Aline and great point about checking how many people check the WHOIS info. What tool are you using to determine how many people are checking your WHOIS?

      Reply
  • Igor Mironyuk February 1, 2017, 1:52 pm

    If I register domains that I research good available with popular generic words that means commercial interest and product or service related. Year after year I get better and better names. That domain what I registered year ago I think bad now because I improve my domain skills and knowledges.
    And yet one thing: I saw on Sedo other domainers’ domains in category Business – Transport and Logistics services – Moving services. Oh my God, no words but complex of letters or real word with some letters before or at the end. I do not understand this absurd.

    Reply

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