What's a Domain Name Really Worth?

I’m often asked by people who own, or want to own, a domain name to give my opinion on what the "fair market value" of a particular domain name is.

I usually begin my reply by mentioning that the vast majority of domain names sold on the re-sale market go for less than $1,000. This is greeted by sighs of relief from the folks who want to buy a domain name, and gasps of incredulity from the folks who own a domain name: "Well, my domain name is worth much more than that…"

I then outline some (but not all) of the criteria that, in my opinion, make a domain name more valuable than others:

• .com extension (versus .net, .org, .ca)
• seven-letters or less
• no hyphen(s)
• easy to read in all lowercase
• easy to say and hear (passes the radio test)
• easy to type
• consists of word(s) found in the dictionary

While these criteria are helpful in order to gain a rough idea of what a domain name might be worth, I always caution people to take this with a grain of salt.

Why?

Quite frankly, there’s really only one accurate way to determine the "fair market value" of a domain name: a domain name is worth whatever the buyer is willing to pay for it. Period.

I’ve seen "$10,000" domain names trade hands for $1,000, and I’ve seen "$1,000" domain names trade hands for $10,000. In my experience, when it comes to domain names, beauty (and value) really is in the eye of the beholder.