.CO.UK auction at Sedo was a bust! Only 7 domains were sold for a total of $10k

[dvdrip]

http://onlinedomain.com/2014/05/14/news/co-uk-auction-at-sedo-was-a-bust-only-7-domains-were-sold-for-a-total-of-10k/

 

[bulkcorn]

http://onlinedomain.com/2014/05/14/news/co-uk-auction-at-sedo-was-a-bust-only-7-domains-were-sold-for-a-total-of-10k/

 

[DaveP]

Eurgh what a shambles of an auction... Enough said. People crying out to build something bigger and better than Sedo.... Any takers?

 

[Jamie101]

Not surprised unfortunately. Last time I used sedo (some of you will probably remember) for a co.uk of mine it ended up being well below multiple offers I got on here.

Sent from my GT-I9300 using Tapatalk 2

 

[Brassneck]

This http://www.telegraph.co.uk/earth/earthnews/3313749/Recycle.co.uk-breaks-UK-domain-name-record.html - seems a very long time ago. Seems to have been pretty much downhill ever since.

 

[ian]

Sellers and buyers all let down by the poor service of Sedo and their inability to differentiate a quality domain from a dog! The sooner they buck up, the better the marketplace will be. I won't be using them any time soon!

 

[Brassneck]

Sedo are pretty lazy and have to take a big part of the blame for the auctions failure but it'd be interesting to see how much effort the registrants put in to generating interest.

I think most domain portfolio holders are pretty lazy too. In the past if you have had a constant stream of sales you probably have made zero effort to market your domains. I've no idea how many or how effective UK domain brokers are actually out there - would be interesting to know how much effort (on average) would be needed to achieve a proactive sale for a mid 4 figure generic.

Stephen.

 

[Brassneck]

Sellers and buyers all let down by the poor service of Sedo and their inability to differentiate a quality domain from a dog! The sooner they buck up, the better the marketplace will be. I won't be using them any time soon!

Despite Sedo's ineptitude it may also be the case that really there is little appetite for UK domains at the moment. A lot of people on here say they would have bid if x,y,z had happened, but it's much easier to say those things than actually stake money on something. You see it all the time with the domainlore auctions when somebody says a domain was a real bargain and they would have bid if they hadn't been walking the dog, watching Eastenders, or some other excuse.

 

[RobM]

About time sedo closed up and left. Bye. You won't be missed.

 

[Retired_Member39]

I have not done to badly out of Sedo, and I'm sure there are quite a few other Domainer's both UK and International who are the same. I think Sedo could do a lot worse than recruit a Veteran from one of the domain forums to improve things.

 

[Retired_Member38]

I think the article said there was 109 domains listed. Pitching that number of names to end users would have taken massive resources and would have been rendered pointless by the unrealistic reserves set on most names.

Sedo are pretty lazy and have to take a big part of the blame for the auctions failure but it'd be interesting to see how much effort the registrants put in to generating interest.

How much effort could realistically be put into promoting turds like artritis, jewelryinsurance and menshoes?

Someone should have flushed the shits and then actually promoted the good stuff. Along with a clear, 100% guarantee re the .uk issue.

 

[Edwin]

Every domain auction I've seen on any platform/venue (including the live domain conference auctions) has suffered from the "we need to have domains for all budgets" flawed reasoning.

Because it's easy to see that's where the intent started, but it inevitably mutates into "... so let's put this junk in because it's going cheap with a low/no reserve".

A domain auction has to have a SMALL number of HIGH quality domains. Limit the number of names to 50 absolute max, but that's an upper limit not a goal i.e. if only 22 decent names were submitted, then have 22 names.

After building up the initial list, go through and throw out all the great names that are priced at "wouldn't it be nice but nobody who will see this auction is going to pay anything like that much" - a name worth £100,000 on the very best day with all the luck in the world and the perfect buyer isn't going to reach £100,000 at auction, so if that's the reserve forget about it.

Thing is, no auction venue is willing to be as brutal as I outlined above, because it focuses the spotlight on the fact that, actually, people don't trust that auction venue enough to supply sufficient domains to make for a decent auction.

 

[Edwin]

To those moaning that Sedo never promoted the names, if it's so easy to sell names for £50k+ why aren't people getting off their arses and selling them themselves rather expecting miracles from Sedo in return for a measly 10 or 15%?

That's not really a fair comment. If you take a name that "could" sell for £50K+ that means the seller's commission will be of the order of £5,000-£7,500 or more. Hardly measly - that's a month's full time salary for a sales person covered out of a single commission!

If you look around, the only other "product" I'm aware of that sells for anything like the same order of magnitude of commission is property. An estate agent often has to do a massive amount of work, including a significant amount of prep work (home visits, measuring, photos, floor plans, etc. etc.), advertising and marketing, and all the follow-ups through to completion, before they see a penny in commission.

So why should a venue like Sedo expect to realise that level of commission simply by doing an email blast to existing newsletter subscribers and sticking a banner ad on their website, without any personalised/proactive effort?

Yes, the domain owner could in theory sell the same name just by "waiting" for a buyer to drop by - just like a home owner could sell their house with a little "for sale" sign in their window. But in practice that makes the chances much, much slimmer in both situations.

Where is the equivalent of the "estate agent" for high grade, high end domains? To date, I've never seen ANY domain broker willing to put in a fraction of the effort that a good estate agent does to earn their commission.

The comparison shouldn't be "how much effort does a 'domain agent' have to put in vs a domain owner to achieve a sale" but "how much effort should a 'domain agent' put in to earn £3K, £5K, £10K+ in commission?". The answer should be "a huge amount" but for some weird domain industry-specific reason it isn't.

 

[Murray]

To those moaning that Sedo never promoted the names, if it's so easy to sell names for £50k+ why aren't people getting off their arses and selling them themselves rather expecting miracles from Sedo in return for a measly 10 or 15%?

I've not seen people saying sedo should easily be selling names for 50k..

Myself and other people have said the reserves were unrealistically high, they were one off end users prices.

I don't think the domain owners care if they didn't sell, they got their domains some exposure for free and were in no danger of losing them cheaply.

If they really wanted to sell they would have set their reserves to 10-15k

 

[Edwin]

Edwin, taken at face value you're right, the thing is, an estate agent has some control over the price his client is trying to achieve whereas if the reserves on some of those names are anything to go by, Sedo don't, so in reality the chances of them finding a buyer are slim making their commission rates irrelevant.

Sedo has total control: they can simply say "no" to brokering a particular domain name with a reserve they see as unrealistic. Job done, problem solved. There are over 10,000,000 domains just in the UK namespace (and over 10x in .com) so it's not as if they're short of opportunity!

But if they're going to claim their 10-15% it's fair to expect them to do a solid amount of actual work to earn their commission - something which is clearly not happening at present.

The point I was trying to make (perhaps poorly) was that peoples expectations of Sedo are unrealistic. Selling names at the level of some of those reserves is a tough ask yet some people seem to think they didn't sell because of a mixture of being surrounded by poor names and a lack of promotion by Sedo when in my opinion they didn't sell because the prices were unrealistic.

Whatever the reason, the fault for the "no sale" lies at Sedo's feet. Either they could have tried harder, or they could have refused to take unreasonably priced names - either of which would have produced a "better" outcome. But they didn't. So it's "their fault" in this case.

This market has changed dramatically, the big investors have moved on and the easy money has gone.

The problem I suspect has always been around this idea of "easy money". Domain brokers saw domain owners making "easy money" so they thought "why should we put in a whole lot of effort when they're making 9x what we are for doing nothing at all?"

But that's the way of the world - somebody who owns an asset is in a completely different situation from somebody who hopes to earn their keep from commissions on the sale of other people's assets. Yet domain brokers behave as if the domain industry is a special case and normal economic rules need not apply.

It's very very simple. If a domain broker wants to EARN £3K, £5K, £10K+ in commission then they should do an amount of work commensurate with that amount of commission. It is totally, utterly irrelevant how much/little work the domain owner did for the other 90%! It just comes down to effort put in vs pounds in the domain broker's pocket.

To address the point of commission, a friend of mine negotiated the commission rate on a Sedo brokered $1 Million sale down to zero so if you have a problem with their rates or feel they're unreasonable, then like in any business, it's up to you the customer to negotiate terms that you are happy with or take your business elsewhere.

That's interesting, but focuses on the wrong problem. The issue with Sedo (and other brokers) is not that their commissions are too high, but that they do very very little to earn those commissions. If they were proactively pounding the pavement bringing in end user buyers at end user prices for high quality commercial domains, then I doubt anyone would begrudge their 10-15% commission.

But as it stands, Sedo & co expect to be rewarded to the tune of thousands of pounds for doing virtually nothing at all (reasoning that 'virtually' is still 'more than the domain owner is doing now')

The rot starts with escrow fees, when you think about it. At 3%, Sedo is earning the same as an sole estate agent might hope to earn if they're very, very lucky - but that's just for hanging on to the buyer's money for a couple of days and processing some (mainly automated) messages! Contrast that with what the estate agent has to do (which I touched on in my earlier post).

Yes, 3% makes sense if you're talking about a sale in the £xx to low £xxx region - but the solution is to have a minimum escrow fee (say £20?) and a very low percentage (say 0.25%)

That would then make the fee for actually FINDING A BUYER for a domain name look that much more realistic/appealing at 10%. Because right now, it's only just over 3x what Sedo can earn from hanging on to a buyer's money for a couple of days. At a 0.25% escrow fee, finding a buyer becomes worth 40x more...

 

[mojoco]

I was the high bidder on one domain in the auction. While my bid fell a long way short of the reserve, I would have paid more than my bid amount.

Is it unreasonable to expect Sedo to contact high bidders after the auction and attempt to bridge the gap between the highest bid and the sellers price expectation / reserve ?
If I was a seller, it is something that I would have taken for granted that Sedo do as part of their sales process.

Had they have contacted me soon after the auction I would have increased my offer. Too late now, I have lost interest in the domain and moved on.

 

[Edwin]

Mo, don't take this the wrong way but to me this just shows apathy on everyones part. Sedo didn't care about their commission enough to try and push for a sale, the owner of the domain didn't care enough to ask a Sedo broker to contact you to try and negotiate the sale and finally you didn't care enough to contact Sedo or the seller.

Who's to blame?

Sedo.

They don't own the domains so the onus is on them to WORK to EARN their commission. The domain owner is delegating the responsibility for the sale to Sedo in exchange for handing over what (seen dispassionately) can be a very substantial amount of money in the form of a commission on success. A small part of Sedo's task is to make it super-duper-ridiculously easy for potential buyers to get the domains they want if they are able to pay the asking price (or if they are close and the seller is willing to drop down and meet them) by maintaining a proactive, open dialogue with them. Remember, a bidding buyer has already self-identified as "interested" in the domain name - you couldn't ask for a "warmer" lead!

This table makes the situation crystal clear...
- The seller: owns the asset
- The buyer: owns the money
- Sedo: owns neither component of a potential deal - not the domain, not the money - but still wants to get paid (a lot, in "real world" terms). Since they own nothing at all they have to WORK HARD for their money (which, on the evidence, they're unwilling to do)

 

[Edwin]

I disagree. No one cared enough to push for a sale and to me all are equally to blame.

So you don't think that Sedo are the "weakest partner" since they don't own anything they're selling, nor do they have the funds to be the buyer?

That mirrors what I was saying about "economic rules weirdly don't seem to apply in the domain industry"

 

[mojoco]

Mo, don't take this the wrong way but to me this just shows apathy on everyones part. Sedo didn't care about their commission enough to try and push for a sale, the owner of the domain didn't care enough to ask a Sedo broker to contact you to try and negotiate the sale and finally you didn't care enough to contact Sedo or the seller.

Who's to blame?

Why should the seller have to ask Sedo to contact me? Why should I have to contact Sedo ? Sedo are the ones operating the platform and getting the commission. It's in their interest to do so without being prompted from the buyer and or seller.

If you are into sales, you strike while the iron is hot. Immediately after the auction ended, Sedo should have had a discussion with buyer and seller to see if there is any common ground to be found.
If you go to car auctions that it was happens all day every day with vehicles that did not reach the reserve. However worth noting, a car auction will not accept entries where the reserve is out of touch with realistic market expectations.

 

[ian]

I disagree. No one cared enough to push for a sale and to me all are equally to blame.

Why would the potential buyer do the leg work offering more than bid? Surely that is a quick way to paying more than ideally you'd like!

The responsibility lay firmly at the feet of Sedo as the agent and the seller as the owner.

I was willing to pay for a domain at the reserve value and all I wanted in return was for Sedo to confirm that the transaction would be swift to ensure I got the .uk too; they didn't even have the courtesy to reply, other than a single statement on the other thread avoiding the question. Shame on them.