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Tuesday, March 13, 2012

Study Shows $17m Drop In 2011 Sales at Sedo


Domain name sales totalled $84,431,965 through Sedo in 2011, the company's 2011 Annual Domain Market Study that includes a review of the fourth quarter. However this was a significant drop on the 2010 calendar year when there was $101,438,953 in sales, a drop of $17,006,988. However it should also be noted that the $13 million sale of sex.com was included in 2010 figures.
Reflecting the drop in sales value, the total number of domain names sold also dropped to 39,951 from 43,499 in 2010. The declines could at least in part reflect the ongoing global financial crisis.
As expected, .COM domain names dominate the sales for the year, accounting for 44 per cent of all sales, while .DE came next accounting for 18 per cent. Third with six per cent of sales was co.uk then .NET (5%) and .EU (4%).
When looking at statistics provided by Verisign and HosterStats, the sales for .COM domains were also in proportion to their global share of registrations, with .COM accounting for around 44 per cent of all registrations using figures for the end of the third quarter in 2011. However .DE accounted for around 6.5 per cent of registrations.
Sedo also reports .CO and .ME entering the top ten sold top TLDs for the very first time, which they believe supports the case for new gTLDs and their potential for success. While these newer extensions increased in value, the traditionally strong .COM also increased, demonstrating that while there is promise for newcomers, .COM domains will retain their value.
Interestingly, the country with the most buyers of domain names through Sedo was Germany with 27 per cent of all buyers, followed by the United States (24%) and the United Kingdom (11%). Sedo's German origins would have an impact here, but nonetheless it is still surprising as Sedo has a significant presence in the US.
The report also shows the most common sales types are marketplace negotiations (offer/counter-offer), which accounted for 40 per cent of all sales for the year, while Buy Now sales accounted for 30 per cent of sales, up from 25 per cent in 2010. Sedo notes a strong growth in Buy Now sales can be traced to the growth of the promotion of the SedoMLS Promotion Network. And Buy Now could become the dominant form of domain purchase soon as in the fourth quarter this type of sale accounted for close to 40 per cent of all sales.
The continued increase in Buy Now sales, as well as growth in median prices for sales made over the SedoMLS Network, reveal a shift in end user behaviour. More buyers are interested in fast domain purchases, as well as the ability to purchase premium domain names from a recognisable environment, such as their preferred registrar.
"This year we saw domain buyers increasingly turn to sources like registrars to purchase their domains, so we're excited to be playing a key role in providing these buyers with the greatest choice of domains names," said Liesbeth Mack-de Boer, Chief Sales Officer at Sedo. "SedoMLS places sellers' domains in front of millions of potential new buyers, and our goal for 2012 is to make buying a domain as easy as registering one for the first time."
Almost half (47%) of all sales were sold in the price range up to $500, while 38 per cent of sales were in the $500 to $2,500 category. While the $2,500 to $5,000 category was next (8%), the proportion of sales in the $50,000 and up category accounted for four cent of sales, edging out the remaining two categories combined.
Length of a domain name is also an important characteristic, and it was domains with eight characters that were the most popular with 3,500 sales, including Sedo's biggest sale of 2011, gambling.com. There were over 3,500 domain names sold for domains with over nine and ten characters as well.
Average prices for various TLDs were mixed. The average price for .COM dropped, largely due to the record breaking sex.com sale, from $3185 in 2010 to $2775 in 2011. However .NET sales were stable, .ORG dropped dramatically from $2217 to $1289 and .INFO increased from $795 to $990.
Among the top six ccTLDs there was again no consistency with average prices of .DE domains increasing slightly from 2010 to 2011 ($1514 to $1530), while .AT domains increased from $1000 to $1177. But .FR more than halved in the average sale value from $6768 to $2386 while co.uk also dropped significantly ($2008 to $1273). Sales of .EU domains increased from $706 per domain to $1169.
Median sales of domains showed more consistency, as .COM showed a steady increase, with the median price of domains increasing from $550 to $650. There were decreases in the median value of .NET ($590 to $555) and .ORG ($591 to $510), while there were increases for .BIZ ($407 to $424) and .INFO ($416 to $418).

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