Morning Folks!!
Well well, what seems to be a solid formula for independent evaluation of "Exact Match Domains".
Not only a solid formula, but the article appearing in Forbes gives domain valuation a lot more street cred. Domainers now have something to point to. Something to base your price on and it's not from any of the phony valuators out there.
"Present Domain Value = Number Of Global Monthly Average Searches x $1 Cost Per Click (CPC) / Number Of Years Required To Be No. 1 In Search Engines From Today
Essentially, you are valuing the EMD on global search volume provided by Google Keyword Planner and factoring in the amount of time it will take you to grow the domain to the No. 1 position in search engines.
For example, in 2016, the global monthly average of “VPN” was about 8,800,000. At $1 per search and four years to become No. 1 in Google Search results, this still indicated that $976,730 was a great deal.
Example Formula = 8,800,000 Monthly Searches x $1 CPC / Four Years = $2,200,000"
This formula comes from the CEO of VPN.com and the article appears here.
It's a GREAT article and ALL domainers should read and re-read.
Also remember that after you achieve your #1 seo spot, the domain itself will still be paying dividends and the value still rising. If you want to invest in domain names, you should be targeting these type domains.
So put your EMD domain to the test. Remember, it MUST BE AN EXACT MATCH DOMAIN! Close is only good in Horse Shoes and Darts! And it mainly, if not exclusively, applies to .com domains.
Now I also think there are other factors that weigh into the exact value of any specific domain. Lots of considerations and factors. But this formula is a serious baseline.
Rick Schwartz
Matt
This formyla may have worked a decade ago but not today.
Vpn.com is nowhere to be found (mobile, android). Most results are articles, information, or appstore. Google now serves also persobalized results as well as gives allot of weight to timely results, both throw those formula way off.
Rick Schwartz
Can you explain why? And remember formulas have variables. It could be discounted or there could be an added premium. It’s just a standard starting point And for an industry that has no starting point and no ending point, seems like a decent try.
Matt
Google changes its algorithm all the time. A decade ago, before mobile, before personalization, before the many changes they’ve added since, this could have made some sense. Today we’re living in a different world and Google gives “algorithm weight” to things they didn’t before. They have thousands of indicators and they add/change them daily to serve what they consider to be the best results. For the most part though, almost anything “above the fold” is now Google related and not organic results (think appstore links, maps+local, news articles, Twitter). That means, even if you’re #1 for a given term its not nearly as beneficial as it used to be a decade ago where #1 delivered massive amount of traffic to your site.
christopher brennan
i think it depends on what you want an emd for. if you are a carpenter living in phoenix looking for leads from a small website then it doesn’t really matter what google does, phoenix carpenter dot com will get you work and it also looks great on a business card. but these domains are for bottom feeder domainers. in the top end domain market where competition is fierce perhaps google might affect emd value. but there are other search engines where emd’s with little work in less competitive niches can be high on page one.
Snoopy
The article is written by a domainer?
Find.Ventures
i like this formula :-)
thanks for sharing it with us
Sigma
I used a free Keyword Search Tool: https://searchvolume.io/
Used the Forbes VPN formula. Then I used Estibot’s Broad and Exact search for comparison. For example, a domain that I receive a few daily CPC $ on every few days is Rosuvastatin.com (of course Google receives a few thousand dollars off my parked page every few days).
Using the free keyword search tool to get the CONSERVATIVE avg. monthly searches: 12,100 x 3.83 (CPC) /2 (years) = $20,489 ( floor). Using the Estibot search data the number is much higher. But the formula provides a floor minimum for pricing EMDs worth considering…
Sigma
Here is a free Keyword search tool that you can all use for this formula (conservative avg. monthly search results): https://searchvolume.io/
Best used as a ‘floor pricing’ model.
I searched ‘porno’ ‘rosuvastatin’ ‘lesbian’ ‘Japanese women’ to test out the VPN Forbes formula. Interesting results indeed.
Mark Thorpe
But Google said that Exact Match Domains (EMD) are not relevant anymore.
Most domainers (not me) drank that kool-aid.
Thanks to those people who dropped their EMD’s so I could acquire them.
Have a great day!
Steve B
Correct. Google shows synonyms in search results. EMD’s may matter in close calls.
staff
While the great EM domain name can help it stand out (Resonate) in a competitive market, the name itself isn’t a substitute for the reputation (People decide, Google follow). It seems like author is/was not involved in brand naming process for a Great Brand Name.
VPN.com – A strong name can’t fix a bad presentation (designing a brand-style asap). For VPN you go with the Brand name s.a. strongvpn .com, not the niche name.
Why do people use Google vs Type-in?
Gold .com – Fair Play rules & competition law? (SSL out of date – redirect to kay .com)
Cloud .com (vs iCloud .com)
IBM .com for cloud, servers, storage, etc (redirects to Softlayer .com, Bluemix .net etc.)
etc
You can use the end of a tree branch (niche) to start a new tree (niche) or create a new branch field (sub-niche).
R P
The equation doesn’t take into account the lower prices paid per click in all forms of paid advertising.
Exact match domain = higher CTR = lower CPC, and quite often a higher CVR. Assuming site is competitive in inventory, pricing.
How much is it worth to pay 25% or 50% less per click than your competition on the exact same search term, and have a higher conversion ratio?
Tony
This is not groundbreaking. I probably many other domainers have been using similar equations based on Google search stats and CPC for over a decade now. Andrew Rosener detailed his own equation on DomainSherpa.
It’s led me to owning names like AFib.com, Tachycardia.com, Nebulizer.com, Nightstands.com, Podiatrist.com, etc.
Rick Schwartz
This does not have to be groundbreaking. The point is it circulating through major board rooms throughout the world.
It reaches way past domainers. That’s the point
Jeff Schneider
Hello Rick,
We agree with you,this is an important Inflection Point, with far reaching ramifications. JAS 8/14/18
Gratefully, Jeff Schneider (Contact Group) (Metal Tiger) (Former Rockefeller IBEC Marketing Intelligence Analyst/Strategist) (Licensed CBOE Commodity Hedge Strategist) (Domain Master )http://www.UseBiz.com
Jeff Schneider
Hello Rick,
Not only are we at a critical inflection point for (.COM Equimoditty Platform Asset Tax Shelters) We also see a quickening Manifestation of a Future explosion in Online Businesses being lead by (.COM Equimoditty Platform Assets). The Wealth generation for (.COM Equimoditty Platform Asset Holders) will in our opinion be Staggering.
JAS 8/18/18
Gratefully, Jeff Schneider (Contact Group) (Metal Tiger) (Former Rockefeller IBEC Marketing Intelligence Analyst/Strategist) (Licensed CBOE Commodity Hedge Strategist) (Domain Master )http://www.UseBiz.com
Jeff Schneider
Hello Rick,
Banks are targeting saving account holders to invest in high risk capital instruments. Many Banks do not understand Fiduciary Responsibilities. This is a recipe, for disaster in the making. This will end very badly. JAS 8/21/18
Gratefully, Jeff Schneider (Contact Group) (Metal Tiger) (Former Rockefeller IBEC Marketing Intelligence Analyst/Strategist) (Licensed CBOE Commodity Hedge Strategist) (Domain Master) http://www.UseBiz.com
Jeff Schneider
Hello Rick,
Selling your listed stock investments and replacing with (.COM Equimoditty Platform Assets) ,actually is a much smarter asset play. Especially when we see an extreme Bear Market already in play.
JAS 8/22/18
Gratefully, Jeff Schneider (Contact Group) (Metal Tiger) (Former Rockefeller IBEC Marketing Intelligence Analyst/Strategist) (Licensed CBOE Commodity Hedge Strategist)
(Domain Master)http://www.UseBiz.com
Jeff Schneider
Hello Rick,
The Big Money Center Banks are encouraging Savers to take safer deposits and put them at risk in Risk Assets. Many Big Money Center Banks are at historically high percentages of Risk Assets. This is a recipe for disaster in the making. This will End up very Badly.JAS 8/22/18
Gratefully, Jeff Schneider (Contact Group) (Metal Tiger) (Former Rockefeller IBEC Marketing Intelligence Analyst/Strategist) (Licensed CBOE Commodity Hedge Strategist)
Domain Master http://www.UseBiz.com
Jeff Schneider
Hello Rick,
Our Marketing Intelligence Think Tank (Contact Group) , Projects a Cyclical Bear Market Bottom in the 2nd qtr. of 2020. Our Think tanks record is impeccable, as our many followers know.
JAS 8/23/18
To say we are overall Bearish would be an understatement. Extreme Caution is warranted. Stay away from being eventually Whipsawed in Bond Markets. Collateral damage will threaten some Money Markets. Derivatives,Libor, Stock Buybacks, when you strip out these MASSIVELY MANIPULATED Fundamentals, We have actually been in a Bear Market that We called the top on in January. Continue to dollar cost average Baba ONLY. Our Really Smart Money followers have huge profits and None of their original risk capital money at risk, right now. Make no mistake about it, We are in the 7th month of a ( DOW Bear Market ) JAS 8/23/18
Gratefully, Jeff Schneider (Contact Group) (Metal Tiger) (Former Rockefeller IBEC Marketing Intelligence Analyst/Strategist) (Licensed CBOE Commodity Hedge Strategist) (Domain Master )http://www.UseBiz.com
jeff schneider
Hello Rick ,
SEM (A Flawed Expansionary Model)
All SEM Platforms lack Full Capacity Utilization Metrics. Googles glaring Anti-Competitive Stranglehold is standing in the way of Maximum Online Business expansion. This is a Strategic Reality.
The Google Search Engine Marketing Model, is more a business Suppressor than a business Incubator. It is a Marketing Platform that crushes competition and enables Incumbent Platform Monopolies to dominate and thrive over their competitors.
The SEM Model is a mass fraud that is holding down Online Business Expansion. The Economies who set free Online Business Expansion from the yoke of Search Engine Marketings Tyrannical Grasp, will be the Global Leaders of Sustained Economic Business Expansion. JAS 8/25/18
Gratefully, Jeff Schneider (Contact Group) (Metal Tiger) (Former Rockefeller IBEC Marketing Intelligence Analyst/Strategist) (Licensed CBOE Commodity Hedge Strategist) (Domain Master) http://www.UseBiz.com
Ibrahim Khan
Yeah, it is not new but it does gives enough information about EMDs for the mass.
frank meester
EM.domains [Exact match domains] is for sale
Start your own EMD market place
DNS
Not only is VPN.com not ranking on Googles first 5 pages but the website itself is not getting much of any sort of traffic. Only 1000 people approximately searches for VPN.com. I have a hard time taking advice from a someone who paid that much for a domain name & talking about evaluation when clearly their venture is utterly failing or not living up to its full potential.
The other issue that really bothers me is the estimation on when you will reach top page ranking. There is no guarantee that will ever happen. Music.com should be ranking for “music” by now, but its not. Google is pretty volatile with ranking websites. So I believe that part of the formula is the most damaging to the overall evaluation and why its not an accurate formula.
Jose
I have read with interest your post about Forbes.
I think it is a test of a past, for which there is no future with Google Keyword Planner before it was Adwords and now it is Ads but continue the same as Adwords.
Many of us know the principles of Adwords first position who win the auction amount to pay for each click, now it is the same, be first organic is SEO, and the keywords be in content as SEM.
The basic problem to make money in a period of 4 years is that a parking domain pay you for a keyword (domain) $ 100000 a month then give results of profit for when the time of sale for sale can have something important to negotiate.
I remember your words in the interview that you give after the sale Porno.com sell you a sensational $ figure, but what interests me most of your words because I buy porno.com and sell after more 10 years do not continue with this, before It was before and now is now.
At this moment I have 260 domain names 200 (.com) never before have as many as now, I want to enjoy life since my purpose is to save the domain market with a new parking domains which give profitable money for the domainer between them myself. (Then wait 4 years for sale).
Happy day.
Jose
Anita
Thank you Rick for pointing the article out. The key takeaways I feel are:
1. Forbes is a global influencer. This article will do the domain industry loads of good.
2. Whether used as a brand or not, Exact Match domain names will again take off in value.
3. We have another great article to point our not so savvy end users to. I hope more of these come into mainstream business news sources.
Cornelius S Murphy
You nailed it.
Wolfgang Möcklin
A great brandable with 25000 searches per month that ranks within one day would be worth ~$9 Mio as well after this formula. And eventually it will rank more reliably, *hint*!
Ian Mansell
Using one formula to value domains is as flawed as using one formula to value real property.
The only valuation of domains is an approximation based on the intersection between interested parties’ bargaining.
An owner of a domain can only hypothesise on the value range that all interested buyers could have. The illiquid nature of domains highlights the imperfection of valuation.
A buyer could value a domain on the basis of costs saved, brandability, new market development, opportunity costs or anything else that’s part of their assessment. The exact domain is intrinsically worth less to a small company than to a large company simply of the basis of the leverage they can gain, and incidentally vice versa depending on the potential perceived impact to the businesses growth.
A metric that uses an exogenous basis such as ‘how long to get to No 1’ is more about SEO etc which has nothing to do with the inherent name. If the domain was ranked 1 to 10 in terms of keyword match then it would have more logical merit.
My most recent 5 figure name acquisition was based on what it would cost me to build goodwill and the cost of floor space in the most expensive of financial areas in London (Mayfair). It would have been a few million minimum. But yet with a high calibre domain name as my front and the most minimal of space there I have the credibility of the most established of players, and given the rise of fintech etc I even likely look more relevant than those credible established dinosaurs.
Andrew Rosener
I came up with and published this formula (a more refined and sophisticated version) about 7 years ago. I made it public via DomainSherpa shortly after that.
Nearly every valuation methodology I’ve seen is based in principle on the formula I laid out first.
But you can NOT use a $1 CPC across the board. Stupid. Higher the CPC, higher the value (higher competition and logically more potential buyers).
Also, the time it will take you to be on page 1 is not possible to calculate.
What CAN be calculated is the competitive advantage of owning an EMD (ex: improved CTR, Higher Quality Score with Ad Platforms and thus lower cost to buy traffic, SEO advantages including anchor text back links, etc…).
You want a decision maker to understand what a domain is worth? Show them how that domain is going to REDUCE THEIR COST OF INCREMENTAL CUSTOMER ACQUISITION.
But I agree, its GREAT to get this out on Forbes, even if the formula is flawed.
DN Invest Ltd
I agree with you. Based on your AxBxCxD formula I made my own which is a modified and upgraded version of your formula.
In short, I added the SEO cost needed for reaching #1 and the Added Marketing Value which I am including as x1.1, x1.2 etc based on the name (it can be just x1 when the name not bringing AMV).
Bill Hartzer
It’s an interesting concept and I do like that there’s a formula used. As an SEO guy, the formula makes sense to certain extent. Except for this:
I wouldn’t use the $1 per click value across the board. I would use the average CPC (Cost Per Click). The average CPC value fluctuates, so it’s a better indication of current market value. Some keywords will get more popular and thus have a higher CPC. But then as trends fade, for example, and markets change, demand changes. For example, I bet the average CPC for “fidget spinners” has gone down over the past year. So, a related domain might not be worth as much.
Then, there’s the “how long it takes to be number 1 in the search results”. Let’s see… look at the example of “home.loans” and “vacation.rentals”, and them being in the top 10 search results within a few weeks without really doing any SEO. So that totally messes with that “number of years”.
Type-Ins
Bill what are you thoughts on type-in traffic ? Is it still relevant ?
DN Invest Ltd
I like the thing that domain value and this formula was mentioned in Forbes, but I think the formula is not accurate.
I have my own and believe it is the most accurate as it could be.
AxBxCxDxAMV-SEO= the most accurate fair value of a domain value (market value is not the same as fair value)
A = the number of exact monthly searches for the keyword (or keyword phrase) on the left of the dot
B = the number of the average CTR (Click Through Rate) on the result in the first position on Google (it is officially 32.5%)
C = the value of CPC (Cost Per Click)
D = turnover time (usually considered as 12 months)
AMV = added marketing value
SEO = the cost of SEO job that should be done to launch the domain on the first position of search engines
I will take one of my domains as an example. It is Furniture.World
A = 18,100 (for the whole keyword phrase)
B = 32.5% (0.325)
C = $1.15
D = 12 months
AMV = 10% (let it be just 10% so it is 1.1)
SEO = $10,000 (competition for the furniture world phrase is very weak if you ask me, when talking about SEO, and therefore $10,000 would be more than enough if you know how to do a proper SEO, or can be free if you are patient and hardworking).
*extra x0.1 because it is not a .com
Based on these data, Furniture.World has a fair value of $7,929.63
This is because 18,100×0.325×1.15x12x1.1-10,000*0.1=7,929.63
You can see this explained here: http://furniture.world/info.html#msg-box8-2r
(the text on the link is actually for the furniture keyword alone)
A detailed explanation about EMDs and their SEO value (which is still significant) can be found here: https://www.honorarniposao.net/single-post/2016/07/09/Kako-odrediti-vrijednost-domene
(use Google translate)
BTW, I own Furniture.World and it is for sale :)
Sebastien
Dear Rick,
First of all thank you for pointing the importance and value of EMD or like I used to say – EDM “Exact Data Match” which I believe is the same.
To get this in Forbes will get a few CEO/SEO Digital / Brand Managers realise their value now. I have been waiting for a reputable domainer to come out with a formula which would give us some directions of the real value of these EMD.
But until there is an interested buyer for your domain who sees a greater value in the EMD there is no point arguing on what is the best formula. For me the value of any domain name where ever a .COM or EMD which makes more send to have a gTLD such as HOME.LOANS which sold for $500,000 this Jan 2018 and so did VACATION.RENTALS mid this year for about the same amount. This proves that these EMD are value in the min 6 figures upwards.
I remember just a few years ago most domainers (The die hards .COM) would laugh hard at them EMD which I invested and argued about their EMD and BRAND / MARKET SHARE value.
This is a huge kick in the balls and I thank you for bringing this article up to the surface and what a better than that Forbes.
For those who are interested in acquiring the very best EMD I am throwing out here as this is the best news I have read in a few years of coure after reading about the sale of both domains mentioned above. My question to you Rick, is what would be the value of these domains considering the global Horse Racing Gambling is in $100Billion in ASIA. I own the very best EMD .RACING such as
ASIAHORSE.RACING + HONGKONGHORSE.RACING + MACAUHORSE.RACING + SINGAPOREHORSE.RACING + 14 more …. I am looking for a sound partner to launch these and go after this global market. (Affiliate/ Banner Ads / Database growth etc….) Read the proposal here https://www.sportsgambling.news/premium-racing-domains-sale-asia-sa-nz-india-uae-usa/
I am open to a WIN – WIN deal.
Do note hesitate to contact me.
Best regards,
Sebastien STAUB – The DomainBrokerMRU
RENATA BARNES
Nobody is mentioning the click through ratio of the searches per month of 2-3% this figure has to be divided by the amount of searches to get an accurate reading.
Furthermore providing you know what you are doing when it comes to SEO you can get a website on the first page of Google in under a year.
So multipling by the number of years is NOT an accuarate explanation, by the original post maker, who obviously does not know enough about budgeting for PPC advertising as he would have know about the click through ratio.
Just because your ad/website is searched for does not neccassarily mean it will be clicked on.
Jeff Schneider
The Mother of All Tax Shelters ! (NO REALLY) !
Ever heard of the term (.COM Equimoditty Platform Asset) ? You all will be hearing more about these amazing Financial Instrument terms. These Financial Instruments belong to a rare class of Institutional Quality Investment Hybrids of Domain Names.
(.COM Equimoditty Platform Assets) are Strategically Superior (TAX SHELTERS), whose Internal Compounding Multiples actually compound internally Without Cash Infusions. They are the purest (TAX SHELTERS) to ever manifest. You are all probably wondering why you have never heard them in these definitional terms before ? ANSWER : There is fierce competition for these rare assets. The Really Smart Institutional Money circles do not want you to know about these Strategic Tax Sheltered Cash Cows. Institutional Non-Disclosure Sales of (.COM Equimoditty Platform Asset Tax Shelters)have been at the highest levels, We have ever experienced.JAS 8/23/18
The true power of any Tax Shelter is its ability to compound internally Tax Free. An investment in a (.COM Equimoditty Platform Asset), puts you in the commanding drivers seat with a one time Money Investment, thats compounding internally, totally free of Taxes. These Fundamental advantages are Super Charged , by the fact that almost always these (.COM Equimoditty Platform Assets) increase in value due to their Rarity. Because of their rapidly increasing values, there is often, No need for further Cash Infusions. Making them the most Powerful Tax Shelters ever Created. This all adds up to supplying Pure Raw Tax Sheltered Asset Build Up. SMART! REALLY SMART!
We (Contact Group) are recommending, Selling your listed stock investments and replacing with (.COM Equimoditty Platform Assets) ,which are a much smarter asset play. Especially when we see an extreme Bear Market already in play. JAS 8/29/18
Gratefully, Jeff Schneider (Contact Group) (Metal Tiger) (Former Rockefeller IBEC Marketing Intelligence Analyst/Strategist) (Licensed CBOE Commodity Hedge Strategist) (Domain Master) http://www.UseBiz.com
Jeff Schneider
Hello Rick my old friend,
Yes We (Contact Group) have prevailed as owners of (.COM Equimoditty Platform Assets)The victory is sweet justification for those who grasped the Real Foundation of Digital Commerce,(.COM Equimoditty Platform Assets).Yes they still remain steadfast in the Marketing Platform of the Digital Age. Congrats to every none of you believers. JAS
Gratefully, Jeff Schneider (Contact Group) (Metal Tiger) (Former Rockefeller IBEC Marketing Intelligence Analyst/Strategist) (Licensed CBOE Commodity Hedge Strategist) (Domain Master) http://www.UseBiz.com
Jeff Schneider
Hello Rick,
We envision a coming Golden Age of Online Business expansion. The Internets Digital Platforms are a near perfect business Expansion Conduit , that when left un-monopolized in free Open Markets could spread economic expansion on a global basis.
Bottom Line : SEM (A Flawed Expansionary Model) All SEM Platforms lack Full Capacity Utilization Metrics. Googles glaring Anti-Competitive Stranglehold is standing in the way of Maximum Online Business expansion. This is a Strategic Reality. The Google Search Engine Marketing Model, is more a business Suppressor than a business Incubator. It is a Marketing Platform that crushes competition and enables Incumbent Platform Monopolies to dominate and thrive over their competitors. The SEM Model is a mass fraud that is holding down Online Business Expansion. The Economies who set free Online Business Expansion from the yoke of Search Engine Marketings Tyrannical Grasp, will be the Global Leaders of Sustained Economic Business Expansion. JAS
Gratefully, Jeff Schneider (Contact Group) (Metal Tiger) (Former Rockefeller IBEC Marketing Intelligence Analyst/Strategist) (Licensed CBOE Commodity Hedge Strategist) (Domain Master )http://www.UseBiz.com
Jeff Schneider
Hello Rick,
Todays market action (9/18/18) , is a classic example of a (Bear Market Trap) . Our Think Tank (Contact Group) called the Dow Bull Market ((TOP)) in January of this year.Regardless , continue to dollar cost average your Baba positions JAS 9/18/18
Gratefully, Jeff Schneider (Contact Group) (Metal Tiger) (Former Rockefeller IBEC Marketing Intelligence Analyst/Strategist) (Licensed CBOE Commodity Hedge Strategist) (Domain Master ) http://www.UseBiz.com