Commissions Are Changing at GoDaddy

GoDaddy is one of the leading websites to go to if you want to buy a domain name. They’re also behind GoDaddy Auctions, the ideal place to go if you’re looking to sell a domain to someone else. Their domain aftermarket, or secondary market if you prefer, is also covered by Afternic, along with their more recent acquisitions of Dan and Uniregistry.

As you might expect from having a range of marketplaces to try selling domains at, you’ve got a range of commission formats going on as well. One of the four sites under the GoDaddy umbrella could prove far cheaper than another to sell at.

But that’s all changing this year.

February 1st will see a flat 15% commission rate brought into play at all four aftermarket sites.

So, is this higher or lower?

It depends which marketplace you’re using at present. The lowest commission was previously 9%, while the highest was 20%. So, those currently paying 20% are going to be delighted at the drop to 15%, while those paying 9% commission per sale, well… you can guess the answer to that.

There is another step to this though. The 15% commission will only apply to those domain names that use nameservers from Uniregistry, Dan, or Afternic when they are sold. If they are using any other nameservers, the commission leaps to 25% instead.

GoDaddy has listed some examples on its website, using two sales made via the old commission rate and the same two on the new commission rate (assuming they’re using their nameservers). They take one on Afternic and one on Dan, the latter of which has the soon-to-expire 9% commission. Afternic has 20% commission at present.

Adjusting to the new 15% rate for each gave a higher payout on the Afternic platform, as you’d expect, and a lower one on Dan – also expected. However, by putting the two together, as they did in their example, the overall payout for the two sites was better.

This does show that someone selling multiple domains might well come out on top if they are currently selling via Afternic, since the commission is going to drop by 5% over there. Those selling only on Dan are not going to be as pleased though, given the increase of 6% from 9% to 15%.

They do say that most people are likely going to end up paying less, but a change in any commission model is never going to suit everyone. Perhaps the biggest element to be aware of here is the huge jump in commission rates taken from the sale if you’re not using their nameservers as described above.

If you are in the domain aftermarket and could be affected by this move, bear in mind that you have until February 1st to continue with the current commission model. You may also want to crunch some numbers in the meantime, depending on which sites you currently sell via, to see how you might be affected after that stage.