2023 Review of Domain Sales and Acquisitions and 2024 Predictions with Tess Diaz

• Jan 15 2024
• by Tess Diaz

2023 was an important year in domain name sales and acquisitions. Discover the most significant trends and what to expect for the industry in 2024, with Tess Diaz, Director of Channel Development at it.com Domains.

While making a fresh start into 2024, it’s important to invest time to reflect on industry trends in order to pull inspiration to focus our attention in the new year. The domain name aftermarket is one of the most dynamic segments of the overall internet industry, with a robust 7% yearly growth expected till the end of 2030.

Across all TLDs (top-level domains), there were 359.3 million registered domain names at the end of Q3 2023, and this number continues to grow. However, the structure of domain name sales looks different each year – so let’s take a look at 2023 in retrospect. 

The numbers: 2023 in domain name sales & acquisitions

Last year, the aftermarket witnessed over 763k domain name sales. About 19% of those deals for a total of $139.3M were valued over $100. Majority of sales were valued below $100 totalling circa $11.5M. 

Despite the .com domain posting losses for the first time in history in 2023, the majority of the most expensive sales (and all deals exceeding $1M, for that matter) were still in the .com TLD. Help.com topped the list of domains sold in 2023 with a $3M value, followed by Max.com ($1.8M) and Hurt.com ($1.5M). 

Rank	Domain	Price	Date	Venue
#1	help.com	$3,000,000	2023-01-10	Above.com
#2	max.com	$1,800,000	2023-11-05	NameExperts
#3	hurt.com	$1,500,000	2023-11-05	Private
#4	you.ai	$700,000	2023-10-06	Sedo
#5	ecl.com	$600,000	2023-03-26	K-Ventures
#6	socrates.com	$600,000	2023-10-24	LegalBrandMarketing
#7	pfa.com	$450,000	2023-10-24	ApexMoon.com
#8	giveaway.com	$400,000	2023-02-22	Sedo
#9	betting.online	$400,000	2023-10-19	Radix
#10	peace.com	$400,000	2023-12-14	Sedo

Of note, Max.com, the second most expensive domain sold in 2023, was bought by HBO – the television network behind iconic shows such as Game of Thrones, Euphoria and True Detective. The company has acquired Max.com ahead of rebranding its HBO Max service to Max. 

Premium .COM domain names like Max.com reduce the steps it takes for a consumer to arrive at their destination. As the 2010 NYTimes bestseller (and one of my favorite books of all time) Switch highlights, each step reduced increases conversion, satisfaction, and repetition of behavior. Given the competition with B2C media consumption, the trend- and payoff- with premium domain acquisitions has remained high: for example, Facebook acquired FB.com in 2010 for $8.5M, Amazon bought Prime.com in 2018, and Elon Musk re-acquired X.com in 2017. Domains ending in .COM  continue to hold the highest credibility and authority in the consumer mindset.

2023 Domain Name Sales Trends

Last year brought a few notable trends in domain name sales and acquisitions into the spotlight. Mirroring the overall market tendencies, such as looking for cost-efficient solutions and capitalising on AI surge, the domain name market continues to evolve and mature. Let’s explore those a bit further.

1. Average Sales Value Dipped

Compared to 2022, last year was marked by two changes. Firstly, as mentioned above, only 3 out of top-10 public domain names were sold for more than $1M – down from 9/10 in 2022. Secondly, the ‘average order value’ or the average size of deals has dropped by nearly -19% – from $244 to $197.

Notably, the drop comes from the total volume of sales valued above $100, while the average value of sales below $100 stayed stable compared to previous year. 

There’s a clear signal in the private and public domain transactions of 2023: the increased interest in affordable domain name solutions for businesses of any size. With the economic equality gap continuing to widen, we see this in domain sales: lower end and super premium sales volume grew most significantly. Expect results that are fascinating, busy, and lucrative in 2024 for those who apply this trend with new generative AI in domain registrations.

2. Hunt for .ai Domains

It’s impossible to review 2023 in the online industry and not mention AI. The wave of interest starting with the surge of ChatGPT and continuing throughout the year with generative AI solutions kept almost every online business alert for opportunities.

The domain name market is no exception. “AI” was the most searched keyword on Sedo, the global domain name and website marketplace, in the period between June to December 2023. It effectively replaced “NFT,” a strong phenomenon of 2022, but this time the pricing drove higher and the staying power seems longer. In the domain aftermarket, the .ai tld was second only after the .com with the highest average price at $26,441.

And for the first time in history, a domain name in the .ai zone broke into the top-10 of most expensive publicly-reported domains sold in any given year (and in 2022, there were none even in the top-100). 

The sale of you.ai for $700k to Dharmesh Shah, Founder of HubSpot, was the largest publicly reported .ai domain name sale of all time. Other domain names such as stack.ai, npc.ai, service.ai and agents.ai were also in top-50 sales of 2023, each traded for more than $100k. Overall, nine domain name sales in .ai made it to the top-100 deals of 2023.

2023 was definitely a breakthrough year for the .ai TLD. Some quick figures: there was a 4x growth in domain names registered in that zone between June 2022 and the end of last year, but .ai domain names slowed down in 3Q 23 as it eased to $1.3M from $1.8M in 2Q23. Given that .ai is a country-code domain zone belonging to the government of Anguilla, it will be interesting to watch the country continue to develop the rules and regulations for all users of .ai domain names. in the .ai names in 2024.

3. ccTLD growth

The case of the .ai zone belonging to a country, but used to communicate the association with the AI industry, is actually an example of a wider trend for using ccTLDs (country-code top level domains) as generic ones. 

Similarly, the prices were surging in the .io zone, nominally assigned to the British Indian Ocean Territory. Tech startups demonstrate a growing interest in the .io domain names. In 2022, three of the .io names were sold for circa $100k each. In 2023, there were also three major sales in this zone, with hero.io ($125k) and eleven.io ($121k) breaking into top-50 sales of the year.

For branding and affordability, the appeal of the .io domain zone for tech companies is intuitive and natural. It’s clearly associated with the IT industry, and there are more names at more affordable prices available in .io than in .com extension. Domain name solutions that incorporate affordability, creativity, and clarity of purpose – in this case, for the IT community- is a trend that has continued year over year, with a very specific uptick in 2023.

Overall, geo domain interest and ccTLD registrations steadily grew in 2023 and will continue in 2024, with a significant portion stemming from brand risk mitigation and security factors, along with ongoing globalization.

4. New TLDs on the rise

While the .com zone has dominated the list of the most expensive sales, and the .ai has witnessed a rapid growth among ccTLDs, another notable trend of 2023 was an increase in interest (and consequently, the prices) for the new top-level domains (nTLDs).

For example, betting.online occupied #9 position in the top domain sales chart, being sold for $400k. Notably, it was acquired by Patrick Gerhard – the same buyer who purchased casino.online for $200k back in 2017. 

Although some investors were cautious about the .app domain zone, hello.app domain name was sold in 2023 for $115k and w.app – for $96k. Other nTLDs such as .cloud, .win and .club have also registered top dollar sales in the past year.

This trend actually continues from 2022, when quite a few .xyz and .org domain name sales appeared in the top-100 sales chart. However, large deals happening in the tech-specific nTLDs like .cloud, .online and .app are signalling the desire of the IT companies in communicating their connection to the industry right through their domain name. In this sense, the growing interest towards the .it.com third-level domains does not come as a surprise, as it’s a great alternative to clearly demonstrate industry ties, business intention, and brand connotation, all in one. Plus, with the upcoming new gTLD round, we’ll continue to see users adapt and adopt outside of .com.

2024: Further Predictions

In addition to the predictions peppered above, watch out for a few more trends defining the industry in 2024.

• With the general population continuing to crave connection and community, localization and customization are key. 2024 will see increased aftermarket activity and prices with geo targeted domains and increased ccTLD registrations.
• Storytelling is a strong and growing trend across industries and particularly in marketing. Even the food industry is citing storytelling as a top driving factor. Storytelling, in the domain world, translates to more understanding of premium domain values as strategic investments (after all, domains are words!). Expect premium domain pricing and demand to rise.
• With global situation uncertain,and economic volatility expected from crypto halving event, look for some interesting divestments, hopefully from some major brands with unused or under-utilized premium domains.
• Security continues to be a driving factor in many markets, including ours. Web3 will continue to be adopted by visionaries and risk mitigators, while it will also continue to become more accessible and more integrated via packages with Web2.
• Generative AI will impact search engines in ways I cannot imagine, and also domain name registrations. 

Keen to stay on top of the domain industry trends? Visit it.com Domains’ blog and follow us on social media.

---