GoDaddy Auctions raising minimum bid to $25

Higher starting bids will go into effect for auctions starting Monday, October 30.

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GoDaddy Auctions will raise the minimum bid in expired domain auctions from $12 to $25 on October 30. The increase will apply to auctions that begin on that day and won’t affect auctions already underway.

GoDaddy tacks on a domain renewal or transfer charge, making its effective minimum bid around $35.

The change begs the question, “Wait, you can win a domain name with an initial $12 bid?” My experience has been that many other people pile on after I place a bid.

But clearly, many people are winning auctions for less than $25; otherwise, GoDaddy wouldn’t make this change. It ran the calculations.

GoDaddy (NYSE: GDDY) has cited softness in the aftermarket for declining revenue growth, and expiry registry partner Tucows (NASDAQ: TCX) has also noted declining revenues from expired domains. This change will should increase the revenue per expired domain for GoDaddy and its partners.

While nobody likes higher prices, it’s worth pointing out that GoDaddy’s starting bids are lower than SnapNames/Namejet (typically $69) and DropCatch ($59 if more than one person is interested, although lower prices are available for uncontested backorders).

Dynadot, Sav, and Namecheap offer lower start prices but have fewer exclusive partnerships than GoDaddy and Snap/Jet.

Importantly, the change will not impact GoDaddy Closeouts. Those will continue to start at $50 and go down to as little as $5 on the last day.

Customers with legacy $10 backorder credits can continue to use them to place initial bids. If they win, the credit will count toward the final price, so a $25 winning bid will be charged at $15 ($25 minus $10) plus the renewal/transfer charge.

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