If you want to know how much a house is worth, there are a number of online tools that you can reference. Similarly, there are a number of online tools for determining the valuation of Internet real estate – domain names.
Online valuation tools can help you determine the price of your domain name. The three most commonly used domain name valuation tools are Estibot, Valuate, and Website Outlook.
While no tool or formula can provide an exact value for a house or a domain name, they can assist by providing a ballpark estimate. Estibot and Valuate use the same valuation algorithm, which is based primarily on keyword metrics including previous sales data and cost-per-click data, whereas Website Outlook provides a value based on website performance indicators such as Alexa traffic rank, backlinks, and Google Page Rank.
In order to demonstrate domain valuation tools in action, a domain name that I own – VideoGameWriting.com – will be put through each online tool.
In the white search box, type in the domain name VideoGameWriting.com, and click the Appraise button.
The valuation page indicates that VideoGameWriting.com is valued at $230.
Why is VideoGameWriting.com not worth more than $230? The video game writing market is not a common monthly search, but the domain is worth any value an end-user will pay to acquire it. In my opinion, the domain name is easily worth 10 times the appraisal value. The domain value of $230 is the value Estibot determines as the keyword value. Again, the rule of thumb is to research the overall value of a domain name to determine the market value.
Notice the keywords “video game writing” separated? This is correct. Make sure the keywords are in proper order. Misplaced words may appraise a domain lower than expected, or increase the value of a domain name that is actually less valuable. If your keywords are in improper order, click the “change” link to change the keywords (e.g., change “Scriptwriting Jobs” to “Script Writing Jobs”).
As shown below, the keyword phrase “video game writing” generates average search results of 1,010,000, which means that there 1,010,000 resulting pages indexed by Google for that keyword phrase.
Actually, Google shows 1,060,000 results, which indicates a lag between Google’s index update and Estibot. The keywords appear in Google with quotes around them to indicate that we are requesting an exact phrase search. Valuable domain names can have less than 100,000 average keyword results. Nonetheless, 1 million average keyword results is a fairly high number.
The average keyword results are right under the keywords. Most of the time, you will notice domainers mentioning their domain name generates several million Google searches. However, they’re suggesting the keywords as scattered instead of being together (broad match instead of exact match). The 108,000,000 keyword results shown below is not an accurate indicator of quality search results, especially since every scattered keyword is counted as a result.
Continuing down the Estibot valuation report, below demonstrates the value in the search popularity.
The search popularity of 175 is also found on the bottom page of Estibot, is the number of times the keywords are searched in the United States. In Estibot, the number of global searches is located above the local searches. VideoGameWriting.com generates above 1,000+ globally. Local searches above 1,000 are good.
Good domain names can have less than 1,000 searches, and sometimes even no searches. The domain name’s value really depends a number of factors, including the market value, past sales, and demand. DN Journal provides domain sales reports that demonstrate that end-users are willing to pay high prices for domain names, while others pay less than the appraisal value.
Visit Valuate.com. Type the domain name in the box, and click on the Valuate button.
Valuate’s appraisal is exactly the same as Estibot: $230.
If a domain name has an Alexa ranking, it will be displayed in the Traffic column.
The CPC is the cost per click for the “video game writing” keywords. The $1.58 is the average amount advertisers pay to bid on the keywords. The ad competition is low, demonstrating there are few advertisers competing to advertise in the video game writing category. However, the video game writing industry is quickly growing, and will definitely gather more steam once the Writer’s Guild of America continues to showcase their annual Video Game Writing Awards for the best video game writers.
The CPC adds value to domains with competitive CPC. Keyword domain name that have online education, loans, and college degrees, for instance, have highly competitive CPC rates.
The only difference between Valuate and Estibot valuation systems is that Estibot offers more keyword metrics stats such as global searches, overture, and Google Page Rank.
Website Outlook Valuation
Website Outlook is a website valuation tool – as opposed to just a domain name valuation tool in the two tools listed above.
In the white box near the upper right side of the screen, type the website name VideoGameWriting.com and click on the Calculate button.
In the Overview area, VideoGameWriting.com appraises for $335.80.
You can read that the domain has zero backlinks, and the Alexa Traffic Ranking is shown as 7,183,257. However, the daily ad revenue of $0.46 and the 153 page views are inaccurate stats. For the most part, such values are an estimate of what a website will make once it’s developed.
Website Outlook’s web valuation tool is effective in appraising websites with Alexa Traffic Ranking, high unique traffic, a good Google Page Rank, and backlinks. Top performing websites such as Google, Yahoo, IMDB, Facebook, MSN, AOL, and others will appraise anywhere between 7-10 figures.
Additional Domain Valuation Tips
Online valuation tools can be useful to generate approximate domain name appraisal values, but there are many factors to consider when appraising a domain name.
Website Outlook is a good tool for a high performing website with many backlinks, a good Google Page Rank, and Alexa Traffic Rank, but keyword value has no real value on Website Outlook.
The most valuable domain such as AutoInsurance.com may be worth $17,100,000 million on Estibot and Valuate, but only appraise for $5,840 on Website Outlook. Why? The domain name AutoInsurance.com is not being utilized to its fullest advantage. The domain’s performance stats are lacking compared to most high performing domains such as the branded websites that most web users tend to use on a daily basis. Estibot and Valuate appraise some keyword domains high, whereas they may under appraise valuable domains low. In order to research to assess the value of a domain name, you will need to use domain valuation tools, assess the market value (product, niche, service), and compare past sales to determine an accurate appraisal value.
Online domain valuation tools are only to be used for research purposes, and should not serve as the final buying or selling price. If nothing else, domain valuation website such as Estibot, Valuate, and Website Outlook are useful in determining the difference between keyword and website appraisal values.
In the end, the value of a domain name or website is what the market will bear – what someone is willing to pay. Everything else is merely an estimate.
[Photo credit: Alan Cleaver]
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