SEO

Yahoo Selling Off Domain Names : Unloads Contests.com for $380K

Yahoo, which we all know has been cutting back substantially and looking for sources of extra revenue, has devised a new plan to bring in some income by clearing out it closet of premium domain names on the open market. Last night, Yahoo sold Contests.com in a live online domain auction.

What makes this story quite stranger however, is that Yahoo sold the domain for an incredibly cheap price, $380,000. Getting barely 6 figures for a domain name like Contests.com, which almost any 5th grader can build a business plan for in 10 minutes, makes for another embarrassing move by the company.

Yahoo picked up the domain name Contests.com during the $5.7 billion acquisition of Mark Cuban’s Broadcast.com , surely there is a major loss going on somewhere in this equation.

MG @ TechCrunch compares the Contests.com price to other domains which have moved in the past year, such as Toys.com for $5.1 million and Candy.com for $3 million. Perhaps the price has something to do with only 7 external liks pointing to the site, which is ridiculous (AND the new owner is now getting links from TechCrunch and other news outlets because of the buy and cheap price) … but the value in such a no-brainer, Yahoo probably could have sat on this domain and gotten more revenue from it down the road, if not from type in traffic alone.

I’m pretty sure that I could have developed Contests.com to be a moneymaker, and I know that some Yahoo staffers in their SEO and publishing department could have done the same thing in their sleep, so why does Yahoo need to unload this domain for $380K right now? Beyond me.

What are your thoughts on this and what would you have done with Contests.com?

Screen Shot 2014 04 15 at 7.21.12 AM Yahoo Selling Off Domain Names : Unloads Contests.com for $380K
Loren Baker is the Founder of SEJ, an Advisor at Alpha Brand Media and runs Foundation Digital, a digital marketing strategy & development agency.
Screen Shot 2014 04 15 at 7.21.12 AM Yahoo Selling Off Domain Names : Unloads Contests.com for $380K

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17 thoughts on “Yahoo Selling Off Domain Names : Unloads Contests.com for $380K

  1. I’m not sure I would say Yahoo is “clearing out the closet” of it’s premium domain names, but keep in mind that Yahoo owns thousands of domain names.

    Contests.com is NO Toys.com or Candy.com . Most contests that I see are Free, so it’s a bit harder to make money on then selling toys or candy.

    Was the sale “cheap” for National A-1 (the buyer)? I think it was a pretty fair price for the market conditions at this point. The reserve was set at $150,000 and brought 15 bids in, so it could of sold cheaper.

  2. I agree with you that it’s dirt cheap. As you say, any 5th grader can use that domain and begin aggregating promotions from major players in one place for a very nice sum. And that’s just one possible scenario. I’m sure there are others that are probably more profitable, but heck, it’s only 9 am and I’m just shaking out the cobwebs. Yahoo just did their shareholders another disservice by throwing money out the window. Well done.

  3. I’d say they were lucky to get $380k. If they didn’t have Contest.com to go with it, then you only have half the value. “What the address?” “Contest.com” “No, it’s plural, Contests.com”

    Personally I think Yahoo! was fortunate to offload that for $380k in today’s climate.

  4. I agree that the $380 k is both to low to sell it for and a fair price for the current market. The thing I don’t understand is why now?? Why sell and get less than you would in a years time?? Your only extra expense would be the yearly ICANN fee.
    Here is an idea that I would have tried. Hold a “contest” for the web design team that can come up with the best business plan and design. Then host it, server your ads on the site and see what happens. Again, nearly zero upfront cost for Yahoo! and they still retain the asset.

  5. I must dissagree to what has been written here.
    The domain in question is most definatly not toys.com. Links get discounted anyway when a domain is bought. A new registrar = no weight from links unless the site stays as it was before the domain was purchased.

    Second. How do you make money from FREE contests?

    OK I agree advertising on the site but it would not be as easy as toys.com that is even easier to spell/remember/promote. Kids love toys. Kids love the internet.

    How many times have you just clicked off a site that is trying to promote something for free?

    I rest my case.

    LJ

  6. Decent price for the buyer and seller from an outsiders perspective right now. Just a bad move to sell premium domains and not utilize them. I guess it’s just not the ‘direction’ they were heading.

    It blows my mind they can auction off a premium domain that was part of a 5.7 billion dollar acquisition, instead of developing into a revenue generator.

    Hard to believe yahoo would be offloading premium domains because they need cash.

  7. I think it’s perspective. My first take was – I could use an extra $380k right about now and that surely would be less than the $80 million I am visualizing, it’s more than my entire company’s annual revenue this year…

    Once I got past that particular perspective though, and actually stepped (very briefly mind you) into the very uncomfortable shoes of Yahoo’s by now exhausted team of “OMG our 20th century belief that we have to continually drive new revenue models or we’re a miserable failure” managers, I think what they must have thought was it was a good idea at the time.

    Except they should have had a minimum bid – probably at least seven figures yes?

    Just look at some of the potential for about a better approach here in this one blog article and comments. It seems anyone EXCEPT Yahoo Management has the vision to see that potential. Then again, that speaks volumes about the flawed thinking over there doesn’t it?

    Kind of like AOL, MySpace, and so many others. Here’s the issue though – Yahoo, (AOL, MySpace and all those others as well) isn’t run by entrepreneurs is it? Nope. It’s run by stuck-in-a-box corporate MBAs who are vastly incapable of thinking so creatively, or who, upon hearing drastically creative and visionary concepts, slap those suckers down faster than you can say “too risky” or “we didn’t think of that so it’s not an option”.

  8. It’s very easy to say that it was cheap after the auction is over. It’s much easier to spend other peoples money (or criticize someone when they sell) then it is to put your money where your comments are :)

    If you are paying this sort of money for good domains lmk too because I’ll put you on an email list with some premiums for sale. There’s never been a better time than right now. ;)

    If this were “joe cybersquatter” the story would be about how some “jerk cybersquatter raped someone for $380k for a domain name”. Because it’s yahoo everyone is linkbating up their sites with this story. Pretty lame.

  9. I think that it is a fair price for such a domain name. I don’t think that contests.com is comparable to toys.com. Market value is market value. The market determines the price. If it represented a higher commercial price, I think it would have fetched it.

  10. A product is only worth as much as someone is willing to pay for it. Period.

    In a year or two, developed or not, the buyer may be able to sell it for more. Maybe.

    I liked the comment from Mikeok regarding holding a contest – that is original thinking that could have really developed the property into something of greater value.

  11. Agree with most of the sentiment here, they were lucky to get that much money for the domain. The estibot value is 170k so they got more than twice that appraisal. Also, like many said, most contests are not money makers – it’s not a clear product for sale like Toys.com.

  12. Decent price for the buyer and seller from an outsiders perspective right now. Just a bad move to sell premium domains and not utilize them. I guess it’s just not the ‘direction’ they were heading.
    Decent price for the buyer and seller from an outsiders perspective right now. Just a bad move to sell premium domains and not utilize them. I guess it’s just not the ‘direction’ they were heading.
    free ebook islami

  13. Contests.com is NO Toys.com or Candy.com . Most contests that I see are Free, so it’s a bit harder to make money on then selling toys or candy.

    Was the sale “cheap” for National A-1 (the buyer)? I think it was a pretty fair price for the market conditions at this point. The reserve was set at $150,000 and brought 15 bids in, so it could of sold cheaper.

  14. What I dont understand is why now? and for a very lower price?

    I would use contests.com like a website directory site. So this would be a place for contest holders and participators.

    Anyone who holds a contest (on any category like internet marketing, web design etc) can submit their contest details in this site. Anyone who wants to take the contest can visit this site.

    I will make money with advertising.

  15. The sale would be nice for any small business. Considering that Yahoo has many experienced programmers and a marketing department I am surprised they did not first offer the domain name for sale at a set price. Would not take many resources to throw a few hours at trying to market their domain portfolio.