Appraisal Model

 

A brief explanation of how your domain is valued… 

ü      Marketability

ü      Name Length

ü      Brand Recognition

ü      Development Value

ü      Dot. Value

ü      Traffic & Revenue

ü      Industry Strength & Position

 

 Marketability

 Is this a name that is catchy and easy to remember?  Do you have to spell it for someone or explain the grammar? 

 The marketability of a name is among the most important features of the domain name due to the perceived use of the name in the market.  Companies look to brand themselves using their Internet addresses and therefore look primarily to the names that will give them the competitive advantage.

 Ultimately the overall market potential for the name and its ability to drive traffic and revenue to the business entity using it derives the value of a domain name.  If the domain name is well defined and the targeted market segment is easily identified by the name alone, this makes the property extremely marketable and thus highly valuable.  Particularly if the domain name is positioned in a strong industry segment.  (Again, domain names marketability and branding potential is a very subjective criterion.  This is where the appraisal model industry experience plays a very important role in the valuation process).

  

Name Length

 Short and sweet is generally best.  Single, recognizable words are considered better than multiple words.   The shorter the better as less letters means it’s easier to type and remember.   Number of words will reduce the score.

                        1-5 characters             =            Excellent

                        6-10 characters           =            Good

                        11-15 characters         =            Fair

                        16 + characters           =            Poor

  

Brand Recognition

 Brand recognition is key to the evaluation process.  Simple, familiar words are generally more attractive than complicated, hard-to-spell words and short, catchy names in attractive industry segments are also very valuable.  Note:  This is the most subjective component of our model and the appraisal model relies heavily on its industry experience in determining this valuation component.

  

Development Value

 The value of a property is based on the ability to use the property.  When looking at the development value of a domain name, can this name be built into an instantly recognizable site, whose name describes its content?

  

Dot. Value

 The market gives far greater valuations to Dot.com’s than Dot.net’s, Dot.org’s and any one of several other major TLDs.

 At this point, the Dot.com extension is the reigning king and easily commands much higher valuations.  Only the Dot.com extension receives an excellent rating in this category.  The others range from good through poor. 

 

Traffic & Revenue

 The basis for any successful operating website is it’s ability to generate business.  Websites that are receiving traffic are certainly preferred over those without traffic.  Sites producing revenue are even more attractive.  The bottom line is the number of visitors a site generates each month is a major factor in determining a domain names value. 

 

Page Views Per Day                 

5,000 +            = Excellent

500 – 4,999     = Good

1 – 499            = Fair

No Page Views= Poor

  

Industry Strength and Positioning

 The size of the e-commerce potential varies greatly from industry to industry.  Some industries have enormous potential for e-commerce business transactions, as evidence by the tremendous growth of the number of Internet companies around the world in many sectors, including financial, music/entertainment, communications, etc.  the appraisal model has compiled detailed, industry specific data to determine the amount of new money flow and e-commerce transactions being conducted in each of the major industry groups.  Its quite obvious to us that the venture capital money is a primary driving force in determining the most promising industry groups on the internet.   Positioning within the industry will impact and possibly reduce the final score.

 Top 10 Categories (by ranking): 1 - Business Services; 2 – Telecommunications; 3 - Financial Services; 4 - Entertainment/Music; 5 – Software; 6 – Retail; 7 – Healthcare Services; 8 - Medical Devices; 9 - Consumer Services; 10 - Biotechnology 

  

Final Valuation

 By utilizing the appraisal model, we estimate your current sales value for the domain TEST.NET at $104,579.00.