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I got a quick question:!!?!!?.

I also got another question: Whenever I look for a value of a name before purchasing it, It shows less value but after I buy it, the value doubles, if not doubles, definitely increases. Why is this so? I've observed this on 4 names now.


Comments (10)

Your question was:!!?!!?.

I have done several checks before and after buying domains. In most cases it would appear to me that the values go down afterwards... Since I didn't buy based on estibot appraisal, then it didn't bother or surprise me when the values went down. Estibot provides useful information, but don't bet the family farm on these appraisals.

From a math-geek's perspective, I think the variation in valuation is more properly ascribed to "small sample theory". In other words, you are drawing conclusions from very small samples of data (a statistician would never even consider 4 samples as being a statistical sample). Given that the overall universe of domains is millions, then a reasonable statistical sample should at least have thousands or more samples to effectively represent the space.


Comment #1

Trying selling one at the the amount appraised.

I am very keen to know whether it will be sold...

Comment #2

Am gonna check and see if it's gonna be the same way for my future regs. Thx for ya comments guys...

Comment #3

Regged one more name in the morning. Before it said $120 and after regging, it says $170 lol!.


Comment #4

There is a perfectly logical explanation for this....

EstiBot valuations are based on a statistical analysis of historical HostGator sales. The current algorithm is the best I could do to try to predict the potential value of any HostGator to a potential motivated buyer.

One thing the statistical analysis revealed (and common sense would, too) is that if a HostGator is unregistered, it's potential market value will often be lower than that of a previously registered HostGator (think extremes - is surely registered, whereas is likely not).

By registering a HostGator you change that domain's properties. Before you registered the domain, it was, well, unregistered, and according to statistics it was worth less than it is now that it is registered.

Of course, the actual value of your HostGator has not changed overnight. However, the logic is that you may have found something that just might be worth something, and by registering it you have indicated also to EstiBot that someone out there thinks this HostGator has some value. EstiBot reacts to that.

I realize that this approach has it's problems, but of all the approaches that I've tried, this one works the best. I emphasize that EstiBot is based on generalization, as it must be - it is designed to give an instant appraisal to any of the millions of domains that may be entered for it to appraise. The approach works reasonably well for this purpose - EstiBot gives mostly decent ballpark appraisals for more than ten thousand domains every day. For individual domains, you will certainly get a better appraisal from experienced domainers here on the NamePros forum, and I always recommend getting an appraisal here, but you won't get ten thousand instant appraisals here.

On average, it works very well, but there is always some fluctuation in it's predictive value for individual domains. That's statistics for you.

I hope that cleared the issue a bit-.



Comment #5

Very good explanation Josh 1 , always good to hear a clear explanation on this issue...

Comment #6

Thx for the explanation Josh. How come it shows less value after registering the name like npcomplete said about his names. Just curious.


Comment #7

Yes, good question... I have absolutely seen the values go both ways after a purchase.

Anyway, we do appreciate the work Josh is doing on Estibot. Josh: Are there any probabilistic elements in the appraisal algorithm?.

I just assumed that there was randomness, or rapidly changing algorithms during development. I have noticed that the values are much more stable now than a few months ago. Maybe it was just the luck of the draw that estibot algorithm was updated right after some purchases.

Overall I like the estibot tool, but I also check with other domainers, occasional paid appraisals, my wife, and anybody else I can talk to about value.


Comment #8

No randomness. The valuation of a given HostGator should not change unless at least one of the variables changes.

I can't immediately explain why a domain's value should go down after a purchase, but the algorithm has become complex enough that I can't fully explain the results myself, although I made it Well, I do have a debug version that I can use to break down an individual appraisal in order to try to figure out why the program comes up with a certain value.

However, many of the variables, or factors, are called from online services so the results may vary as the online resources sometimes lack repeatability. Also, the versatility of the algorithm is both a strength and a weakness - strength because it can handle a wide variety of domains, weakness because it makes it prone to some fluctuation.

Marc's approach is correct - use the online tools to get quick data, but get a second opinion from humans: forums and paid appraisals. Not necessarily the wife....if I checked with my wife, I would own no domains at all....


Comment #9

Ha! Love it. For the last eleven years my wife has been asking "what are you going to do with all those domains?".

After some of my recent sales, she has decided that she likes domains, and doesn't ask as many questions.


Comment #10

This question was taken from a support group/message board and re-posted here so others can learn from it.


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