Why do cards at auction sell for more?

[Leon]

I would like to hear some thoughts on why cards sell for more in auction than privately? I can't count the number of times I have seen a card (or owned one) that wouldn't sell for a long time at a fixed price. Then when put in a good auction setting, with a low starting price, it goes for more than the previous fixed price that was on it. I put one card in auction one time and forgot to take it off my fixed price site. The card sold for more than the fixed price and the buyer asked if he could get it at the fixed price. I said it was an auction and that was the price, I just forgot to end the private listing.
I have some ideas but would like to get others views..

[Howe’s Hunter]

Auctions generate more "buzz" than a fixed price selling. One person might have wanted it, but put it in an auction setting and suddenly, there are several interested in it, and it creates a frenzy.

[ullmandds]

I think there are a lot of reasons...exposure to more people...the competitive nature of an auction may cause more people to bid/bid more than they may have anticipated, loss of another desired lot may cause people to bid on other items.

[ILTBOC2]

My theory is that people have invested their time in watching an auction for however many days leading up to it. When it's time to bid they are less likely to "let it go" due to the time investment as compared to a fixed price item that may likely be there in a few more days/weeks, etc. Subconciously, people want to see a positive outcome to their time investment....aka...winning the auction even if it means paying more. Just my thought.

[Edwolf1963]

A few random thoughts on this (..in no particular order)

1. Better merchandising in auctions houses (generally speaking) - pictures, notes/descriptions, etc.

2. Impulse, thrill of the competition. Versus other buyers, being outbid and getting "back in the game" (much like the impulse of live auctions, raising the paddle one last time) 'I'm not going to let him/her snag that card from me!" - Fixed prices don't give you that sense.

3. Momentary lapse of thought, outright forgetting or overlooking the juice. Fixed focus on the price looking reasonable, below market value .. only to bid, then realize that total cost may take you well above

4. Exposure. Some well-established, well-known auction houses have (or seem to have) greater name recognition, legacy, exposure. IE: Goodwin, REA, Huggins & Scott, etc. Example: Ask yourself how many times you geared up and bid strong/stayed in the game for REA - especially since they're (up to this year) once a year.

5. Peace of mind. There's (perceived and real) greater risk via eBay and private seller listings not knowing who you are dealing with, quality/authenticity of the card or merchandise, etc. Most auction houses stand behind what they sell and will protect buyers in cases that warrant.

[dougscats]

Interesting question, Leon, but I'm uncertain about a couple of terms:

By auction, do you mean an ebay-type auction, or an auction house, or perhaps both? Or something else, like a Net54 auction?
Also, when you say privately, I'm confused. Do you mean a BIN price or store price on ebay? Or are you talking about a private listing on Net54, for example? Or something else?
I think you may have different answers, depending. Thanks for any clarification.

I have very little experience at auction house bidding, but on ebay I sometimes let a BIN item just sit on my watch list, sometimes to my regret. There's often not a great sense of immediacy with BIN, and I may tend to mull over the price/a best offer at length.
More often, I don't even look much at BIN items, as many prices are outrageous, and I figure the good deals are already gone. In fact, due to time constraints, I often screen out BIN, and I don't think I'm alone in this practice, so I may not even see your good deal.

Doug

[packs]

I know when I see a card for a fixed price I'll try to get it for a lower price than advertised if I can. But if it's a free-flowing price like in an auction I'll try to win against the competition.

[conor912]

Competition, baby. There's a reason AH watch lists tell you what you're currently "winning" and what your currently "losing". As collectors, we hate "losing" an item. It's how we're wired. I know I do, but for me it is more about price validation. When winning an auction, i like knowing that there are numerous underbidders as it reassures me that I would most likely recoup at least most of my money if I ever chose to sell.

[scooter729]

I think some people feel that with a fixed price, if it was a good deal then someone else would've bought it already, regardless of how fair the price is to start.

Everyone seems to want the best deal, and many feel that doesn't come from a fixed price these days. I don't agree when it comes to the BST here, as I have found many items priced very fairly and made purchases.

[T206Collector]

I always feel that if the price is fixed and it hasn't sold then that means you are over paying.

If you win an auction, it just means that you are paying over the next highest bid. You have more confidence that that bidder will still be there when you go to sell.

[thecatspajamas]

There also seems to be the sentiment that if an item is up for a fixed price today, it will probably still be there tomorrow, and the day after, and so on. The buyer can procrastinate pulling the trigger while they pursue more urgent purchases. Put it in an auction-type setting though, especially with low starting price, and that feeling of "oh crap, it's gonna be gone forever" sets in and stimulates the buyer to bid.

[Stonepony]

Yep, its the competition. Tough to lose out on a card you want because you couldnt pull the trigger on an extra $1.50

[glchen]

On ebay, many buyers exclude BIN's from their searches. Also with BIN's, many buyers are not sure that they are paying "fair market value" and believe they may be overpaying. With auctions, the buyer believes that they are paying the market price.

[ullmandds]

I agree in that BIN's are typically viewed as overpriced...to the point I never look at them!!!

[triwak]

One word: Alcohol.

[wonkaticket]

While it’s not always the case I can think of two cards recently that sold for way way more in private deals than they ever would have at auction. I can’t really share details but I can tell you it was much much more than an auction would have returned.

I think this happens more than we know but due to the private nature we just don’t know about it. I also will say they have to be significant or tougher cards were not talking run of the mill pre-war etc.

[drcy]

For big auction house auctions, it has always been my idea that there are well monied people who don't have the time or inclination to comb eBay and stick to the big auctions. They may feel the big auctions are more reliable, from authenticity to processing & shipping of a $20,000 order.

[Leon]

Originally Posted by wonkaticket

While it’s not always the case I can think of two cards recently that sold for way way more in private deals than they ever would have at auction. I can’t really share details but I can tell you it was much much more than an auction would have returned.

I think this happens more than we know but due to the private nature we just don’t know about it. I also will say they have to be significant or tougher cards were not talking run of the mill pre-war etc.

First to answer a question above. My initial post was just auctions vs private sales in general. Any ole auction, I wasn't being picky or specific.

As to your comment John. I have lived that scenario many times, buying and selling. But those cards in those private sales probably (mine weren't) weren't listed publicly and not selling before going to auction.

[Bosox Blair]

Originally Posted by glchen

On ebay, many buyers exclude BIN's from their searches. Also with BIN's, many buyers are not sure that they are paying "fair market value" and believe they may be overpaying. With auctions, the buyer believes that they are paying the market price.

This (above) is generally my thought on the question.

I think there are so many bloated BIN prices and ridiculously high asking prices at card shows and card shops that a stigma attaches to private sales in a buyer's mind. I approach every private sale price with a high level of skepticism.

Despite saying and believing this, I have done way more deals on this Board in the last 3 years than I have done BINs on eBay in 15 years...

Still 95%+ of my buying is via auction.

Cheers,
Blair

[sbfinley]

Sometimes, especially with major auctions, one (or all) of the items I really have my sights on blow past my budget. This usually results in another drink and a "not leaving empty handed" mentality.

[Sean]

I agree that there is always the thought that a BIN is overpriced, that is why it hasn't sold yet.

I also think that during an auction we can become emotionally invested in a card ( say a Merkle/ Pirates) and end up bidding more than you planned rather than lose the item at 4 AM.

[Cardboard Junkie]

Big time auctions tend to attract the "Whales", collectors who probably never surf ebay with the "bottom feeders", (like me). The upside, as we all know is that on occasion we score a great "deal". The downside, (for me) is I usually get "creamed" in the big auctions. Dave

[EvilKing00]

An auction should generate a lot more buyers also a low starting price will get more offers.

[iwantitiwinit]

I think in general collectors of sports cards and related memoribilia are competitive people. There is definitely a competitive aspect to auctions and the bidding process. We don't like to lose and in an open auction setting that competitiveness rears its ugly head in the form of macho bidding.

[rhettyeakley]

There have been times in the past that I have kinda wanted a card and see it for sale via BIN and will make note of it that if there is nothing I want more I can always go back and buy the BIN I had my eye on. Sometimes that card will be relisted several times and it will remain on the "back burner" to me. Then the seller will decide he wants money and puts it up for auction and then I know it is now-or-never time and I end up bidding what the initial BIN price or slightly higher to get it. I almost always have some cards that people have for sale on my wish list but other purchases take priority.

[Herpolsheimer]

Competition.... Human Nature carries a competiveness.... No one likes to lose.... Hence, auctions create the playing field where our behavior will drive up the price.... Even to the point where alphas will overpay...

[Brian Van Horn]

I have not read the other posts:

Why do cards at auction sell for more?

Adrenaline and greed overcome market value. If you get two guys who want something, the middleman, i.e. the auctioneer, profits.

Also, if you have one guy who really wants the card and the auctioneer knows it and is a little loose with shall we say ethics, the shill or phantom bidder comes into play.

To a large degree, the auction route is what the card market has been relying on for a while. Card shows and trading amongst collectors lag behind.

[Texxxx]

I think auction houses also have a tendency to get the people that are not collectors but are buying for investment. They don't know much about the cards and getting them from auction houses gives them a little more since of security that the cards they are buying are legit. The people that buy for investment are poor money managers to start with so paying to much does not click with them.

[Bored5000]

With regard to eBay auctions, I think a big reason is that searchers filter out BIN listings. There are so many BIN items that are vastly above market value that it often seems like a waste of time to plow through seemingly endless listings of people hoping to get 3-4 times what an item is worth.

For me personally, I usually filter out BINs because it is usually a waste of time to view the BINs.

[familytoad]

Why do items sell for more at auction?

I think its because in a fixed price , private sale , there is no underbidder.
In the auction, presumably the underbidder wanted to "win" too.

[frankbmd]

In the fixed price or private sale the market value is determined by the fixed price or seller. Sellers cannot be trusted. (Axiom #1)

In the auction setting the market value or winning bid is determined by the idiot who bid a few dollars less than the winner. (Axiom #2)

I would suggest that the "deal" is a competition between the buyer and the seller , and not a competition between buyers.

In the first "fixed price" scenario, the outcome can be modified by what is commonly known as dickering. Some sellers will dicker, some buyers will dicker, but not all of either group are willing to dicker. Hence the need arises for the auction scenario to accommodate a deal between at least one non-dickering participant.

In the second "auction" scenario, the dickering seller and the non-dickering seller are all eliminated from the equation. The dickering buyer cannot dicker with a non-dickering seller. Therefore buyers, both dickering and non-dickering, rely on the infinite wisdom of the previous idiot whose bid they raised, to reassure themselves that if they are not paying too much, because someone else, the prior bidder, was more than willing to pay almost as much and he must know more than seller. This of course can lead to unjustified inflation of sales prices.

I see the so-called bidding war as the validation of market value independent of the evil seller, who relinquishes all control of the process in this format, whether he is willing to dicker or not.

This argument does not invalidate any impact of supply and demand on the ultimate sales price.

So that's pretty much the answer in a nutshell. If you have any questions, don't ask.

[Zach Wheat]

Originally Posted by Bored5000

With regard to eBay auctions, I think a big reason is that searchers filter out BIN listings. There are so many BIN items that are vastly above market value that it often seems like a waste of time to plow through seemingly endless listings of people hoping to get 3-4 times what an item is worth.

For me personally, I usually filter out BINs because it is usually a waste of time to view the BINs.

Agree with this poster. I don't have a lot of time and generally filter out BINs. Once in a while I will go back and sort through all of the listings but with the changes finding what I want is more difficult.

[Wymers Auction]

Auctions are the oldest and best form of selling items known to man. I am a bit biased.

[toledo_mudhen]

And Finally - the auction houses do a MUCH better job of marketing any given item on the front end. The auction house website (or in some cases full color glossy magazines) provide "in depth" descriptions and really nice photo quality images of both sides of the card. This, in turn, leaves a prospective bidder with a sense that he will be bidding on something "special" and the feeling that he is going in fully armed with the information needed to predetermine the price range he might be willing to pay.

On the other hand - nothing irritates me more than finding a particular item on feebay where the seller provides a single fuzzy image (usually taken at an angle with a cell phone) and then the seller goes on to provide a few words that simply reiterates the auction title. These sellers "just don't get it" and use ebay simply as a dumping ground for some "stuff" they have laying around.

I value (monetarily, aesthetically, and historically) the things that I purchase in this hobby and I need the seller to recognize this and cater to those needs.

[barrysloate]

You can't assume that everyone who buys something knows what the item is worth. In the case of a fixed price sale, a buyer may see an item listed for $1000, have no idea if that's fair, and pass because he does not want to later discover he overpaid badly.

But if he sees the same item in an auction with a bid of $1100, he's not afraid to bid $1200 because he thinks he could probably get nearly all his money out of it down the road.

Of course the answer is much more complicated than this, and I am citing just one aspect of it.

[Exhibitman]

Better-heeled class of clientele; plenty of six, seven and eight figure incomes as compared to the great unwashed masses who shred Ebay hunting cards. Ebay tends to attract the bottom feeders [no offense; I am one]. Not many $5,000+ Ebay cards but lots of them in a good auction. Lots of other good answers too that undoubtedly play a part but the socioeconomic status of the auction house customers is the key IMO.