How To Lose A Potential End-User Sale

I had an interesting experience this week that I wanted to share with all of you. It’s a great lesson in Business 101 as well as a good example of how to screw-up your chances of making a sale to an end user. It all comes down to the fact that at the end of the day, businesses don’t do business with businesses, people do business with people.

So here’s what happened. As many of you know, I work with startups and Fortune 500 companies to help them acquire domain names for their business. I do not broker domains for investors but instead help real businesses get the domains they are looking for. This year alone I’ve done close to $850,000 in deals, I can’t talk about any of them, but if there’s any way I can in the future you can bet I will!

One of my clients contacted me inquiring about a few domain names they were interested. None were category-killer by any means, in fact most were mediocre three-word .COM, but the client really wanted one of them and had a six-figure budget for the name. So I emailed all the domain owners asking what price they might be looking for.

Of the people I emailed (six in total) three came back with a price range, two said they didn’t want to throw-out a number but would consider an offer, and one guy was just a complete jerk. It was the guy who was a jerk that I didn’t quite get, he wasn’t sitting on a six-figure domain, it was a name worth maybe $10K-$20K (and only to the right buyer) but if he got six-figures I can tell you he’d be jumping with joy. So what did he do?

Rather than throw-out a range or ask me for an offer he responded by saying, “If you really wanted the domain you would have made an offer.” Poof, no deal. We emailed six people and sure, not all of them gave a range, those that asked for offers, we submitted offers to, but this guy lost the deal by being a jerk. While I myself also push potential Buyers to make an offer, I simply ask for an offer. This rude response let me know right-away that this was not someone I would ever want to do business with, and since my client had plenty of other options, we bought a different domain.

If you want to lose a potential end-user sale, be a jerk right away and watch people avoid you like the plague. Not only did we not respond to this email, but I’ve marked down the owner so I know in the future to stay-away from this guy. If he would have simply said, “I only accept offers and will not throw-out a price.” We would have made an offer, but by being rude and showing he was someone that would be a complete hassle to do business with, we looked the other way.

Now just to be clear here. I’m not talking about a category-killer one or two-word .COM, and I’m not talking about any big Domainers that we all know. I’m talking about a guy with a mediocre name and a missed opportunity. Like I said in the beginning, businesses don’t do business with businesses, people do business with people. Responding rudely to an inquiry is a great way to lose a potential sale, and you never know who is making the offer or what their budget is so you might just miss that one big chance.

{ 12 comments… add one }

  • Nadia May 10, 2012, 8:28 am

    Great advice – you never know who’s on the other end of an email exchange, so it’s better to err on the side of being polite. I still haven’t figured out the art of the whole “make offer” tactic. It seems like most of the time when people approach you first, they’d rather deal with hard numbers than some domainer’s lofty expectation of what he/she “might” be able to get for the name. Interesting story!

    Reply
  • Tom May 10, 2012, 8:40 am

    With so many low ballers emailing mid range potential domains, why should domain owners be expected to give up domains at your expected range. If you are contacting them, for their domain, you should be ready, and willing to bring an offer. If they have a number that is higher in range, than what you THINK it is worth, well maybe you don’t know the domains significance to it’s current owner. I tend to overpay for domains, that are personal to the industry I am involved in, and part of that is emotion, and part of it, is keeping it away from others in the same industry.

    Rick S actually offered advice opposite to this, he wasn’t interested in your offer price, when you are talking domains you feel are worth 10-20k, this person may not be an industry insider, and have a working knowledge of day to day domain prices. Personally, I don’t blame the guy.

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  • Ms Domainer May 10, 2012, 8:43 am

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    I agree that the guy acted like a total jerk; he could have responded in a polite manner.

    On the other hand, since you were approaching the owner, you should have made the first offer. I must admit, I find it irritating when a potential buyer emails me with no offer, just a vague interest. It smacks of “low ball.”

    But as you said, being polite costs nothing and may result in a large sale. I usually email back and say, “Thank you for your interest in _______.com. Please make an offer.” If the potential buyer is serious, he/she will do research and make an offer.

    You did the right thing by then making an offer to those who showed good business sense and proper etiquette.

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    Reply
    • Morgan May 10, 2012, 8:49 am

      @MsDomainer – completely agreed! A response like you recommended is all that is needed and then an offer would have followed. I think we all know that whoever makes the first offer usually loses so on the buy and sell side I’m always looking for the other side to throw out a number first.

      Reply
  • Morgan May 10, 2012, 8:44 am

    @Tom – we are always ready to make an offer if that is what someone would prefer, all they have to do is ask 🙂

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  • Mark May 10, 2012, 9:29 am

    Hi Morgan:

    Interesting point you’ve made.

    I personally feel great when a prospect I have contacted as a potential buyer is particularly polite. Usually, prospects are polite, sometimes curious and even conversational. It feels great to open a dialogue even if no transaction occurs.

    On the other hand, some jerks email me back every four letter word and treat my proposal like I am gutter-scum.

    Yay for the polite and curious people out there! Hope they make lotsa dough.

    Reply
  • Gene May 10, 2012, 9:34 am

    Even though domain names are unique assets, it’s really unwise for domainers to insist that the an inquirer throw out an offer first. Sellers of real estate, cars, stocks, and …any other asset you can think of (maybe except for artwork) set the price that they’re willing to accept.

    This whole notion that ‘if I move first I’ll be leaving money on the table’ is really stupid and ultimately harms all domainers. If you have ‘priceless’ names, then, at the very least, you should tell a buyer that “I’ll entertain offers above $ X….”, but I reserve the right to seek a higher bid. The alternative is to simply tell the inquirer that “the name is not currently for sale, but thank you.” That’s a perfectly acceptable answer.

    All these other games are absurd. Professional traders dont’ worry about ‘how much they left on the table’ when they’ve closed the trade. They simply move on to the next one. Someone’s ALWAYS going to leave money on the table; and if you’re the type of person that can’t tolerate the thought of that happening to you, you’re simply a greedy bastard. Period.

    Reply
  • david May 10, 2012, 9:35 am

    Sound like someone who reads Rick Schwartz blog?

    Reply
  • steve May 10, 2012, 9:39 am

    He said mediocre domain and not a low ball offer.
    The guy should have said , 15k and nothing more and he might have got it.
    Mediocre domains will sell for $500 to $2000 but we don’t know the domain, just that it was mediocre.
    After 10 years if this guy still has the domain we will know it was truly mediocre.

    Reply
  • Arseny May 11, 2012, 12:07 am

    I really don’t understand why people reply in such manner – he would save much his energy replying with the amount he wants.

    I’m trying to figure out what he would lose if would answer you and you would turn out to be some scammer? Any ideas?

    Reply
  • Rae May 11, 2012, 7:02 am

    Bottom line, there’s no excuse for acting like an ass.
    And, if you are one, like that guy, don’t advertise it.

    Reply
  • Morgan May 11, 2012, 7:21 am

    @Rae – couldn’t have said it better myself!

    Reply

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