The way auctions close?

[jefferyepayne]

Originally Posted by dog*dirt

As a buyer I prefer ending lot by lot but as a when consigning I prefer late auctions.

Why? There's no evidence that closing auctions lot by lot reduce the $$$ a consigner gets. IF properly marketed and people understand the auction ends lot by lot, anybody bidding at 4am could make the same bid at midnight.

The reason auctions go so late is because the current auction format encourages people to stall late into the night hoping their competition will give up. I don't see how this helps the final price of lots.

Yes, I understand there are particular scenarios where in a lot by lot format you can't bid on everything you want and may lose out on things but I feel a lot more is lost by consigners from people who would otherwise bid just giving up. I understand you can use max bids but there are plenty of downsides to that as well.

I am a big fan of lot by lot auctions as mentioned previously.

jeff

[nolemmings]

The reason auctions go so late is because the current auction format encourages people to stall late into the night hoping their competition will give up. I don't see how this helps the final price of lots.

Agreed.

Leon, I don't know if it would change my bidding if the AH was to extend payment terms but I know I would not want to wait for my money as a consignor, or maybe have someone back out from payment down the road leaving who owes what to whom. If the AH wants to take on the risk of those problems, maybe by paying the consignor in full immediately and taking some sort of vig on extended payments then that would be different.

[roce4e52]

I think the extended payment plans would work well if set up right. They seem to help PWCC for Ebay sales. Some may argue that there are other reasons they get such high prices, but I think their payment plans are a large incentive to buyers. I do not know the terms they offer for buyers/sellers, except it is only for higher dollar items. I would buy more from an AH that offered this service.
Would it be legal to require a minimum deposit that would be split with the consignor and AH if the buyer later defaulted? That might make it less of a PITA for both. Also, could the consignor have a say in offering that option to buyers? Some might need the money faster.
As far as auction ending times. I want to pay the least as a buyer and get the most as a seller. Has any real research been done on this?
BlLL d0naIds0n

[ncinin]

Clean Sweep tries to combat late night closings by increasing the buyer's premium after 1:30 am and I believe increases every half or full hour after that.

That system still creates a snipe situation. A few lots I really wanted in past auctions I would make a bid at 1:29 so if anyone would bid after me would have to pay a larger buyer's premium. So far that has been successful each time.

Ultimately see no real solution that all would agree with.

[Luke]

As a buyer, I just don't want any particular card (s) bad enough to stay up watching these auctions all night. I put it my max bid with the AHs i trust and go to bed. I don't bid with the ones I don't trust. If the closings happened at a normal time, i would get involved, but the current system seems pretty much insane to me.

[nolemmings]

Originally Posted by LukeLyon

As a buyer, I just don't want any particular card (s) bad enough to stay up watching these auctions all night. I put it my max bid with the AHs i trust and go to bed. I don't bid with the ones I don't trust. If the closings happened at a normal time, i would get involved, but the current system seems pretty much insane to me.

Exactly. If you place 5-6 max bids and go to bed, only to find out they all were topped at 3:45 a.m., then your money slept. But if they were topped earlier because the auction was ending sooner, you might still get that urge to win something and extend your max bid(s), particularly if you saw they were all topped and you adjusted your goal to just trying to win one or two.

Barry is right "And bidders who have to eventually go to sleep are bidders who aren't bidding, so the auction house is leaving some amount of money on the table." Saying that night owls bid late doesn't mean: a) they would not have bid earlier if required to by the rules and b) doesn't account for money lost from those who went to sleep while still willing to spend.

[glchen]

I was thinking about this to see if there was a way to combine the best options for both the all lots at once closing method and the each lot closes on its own way. The advantage for the each lot closes individually is that you don't need to stay up all night to figure out if you've won the lot. However, if there are 10 lots that you are interested in, and you only have a certain budget, then you may end up not bidding on certain lots in order to try to get the ones you want. However, if you end up losing those lots, you usually can't go back to your other lots, because those lots have also closed by that time. You can do this for the auction where all lots close at once, but you usually can't go to sleep either.

This may be too complicated, but what if you set up these rules:

(1) You must place an initial bid before extended time in order to bid on that lot during extended time and after.

(2) On the closing day of the auction, you have a longer extended time, say from 7pm EST - 10pm EST. All lots in the auction stay open during this time. However, if there are no new bids on a lot during this extended time, the lot immediately closes once extended time is over.

(3) When extended time is finished, all lots that received a bid during extended time enter the 30 minute individual lot by lot closing method. As usual, if the lot does not receive a bid after 30 minutes, the lot closes. Otherwise, the 30 minute timer resets.

The advantage of this is that it allows auctions that don't have may bids to just close early. You realize what you have won and can use that information in the next extended time. The disadvantage of course is confusion on what lots are going close at what time.

A similar idea is do the all lots close at one time with the 30 minute rule but with a tweak.

(1) As before, you must place an initial bid before extended time in order to bid on that lot during extended time and after.

(2) On the closing day of the auction, you have your extended time start at 8pm EST with the thirty minute rule. However, the timer does not reset after 30 minutes. Instead, the first extended session ends after 30 minutes, e.g., 8:30pm EST. All lots that received a bid during extended time will be open during the next 30 minute extended time from 8:30pm - 9pm EST. If there were no bids, the lot would close. This would continue for multiple extended sessions, where hopefully more and more lots would close. At a set time, say 11pm EST, the extended sessions would be shortened to 15 minutes. Then at 1am EST, it would again be shortened to 5 minutes.

This method may give buyers more clarity on whether they've already won an item or the price is now above their max bid, so they have the option to move onto other lots. Or it could cause mass chaos and confusion since bidders again may not know which lots are closing at what time.

[Centauri]

My 2 cents:

I think the best auction style to maximise returns for the consigner is string style - one after the other. If one missed out on an early item, then one might be more inclined to go for the later item. Example: I was watching an ebay auction of 3 game used bats, each ending on a seperate day. The bats were same player, same model, no material differences between them. The first went for $160, the next $200, the last one $230. There was clearly an element of desperation as the options dwindled.

As for payment - I really don't see a better option than credit card. Bump the premium if cost is an issue, but if the buyer doesn't have a credit card, I wouldn't trust them on in house credit anyhow.

[dog*dirt]

Jeff,

It's just my experience, last night I went to sleep at 1:00 AM Eastern time, when I awoke my consignments closed at $700 above the level it was when I went to sleep. That was on multiple items bid up by $25-50 increments.

However, you do bring up good points and I very well may be wrong.

[pawpawdiv9]

Leon- as for the payment plan- Would it be better to have the buyer use a Credit Card. Then you can surcharge a fee on that.

[oldjudge]

There are very few ways for an auction house to get into financial trouble, but extended payment terms is one. I agree with the poster who said in lieu of extended payment terms to take credit cards or PayPal. Let the financial professionals take the credit risk. Concentrate on what you know how to do.

[x2drich2000]

As a small time buyer, I agree I would utilize a line of credit for a larger purchase. In the past I've had individual sellers hold an item while I saved up the money to pay, but from an auction house prospective I think this could be dangerous if the buyer backs out. Then again I don't think it would be too much different than the buyer simply not paying.

One way I've seen an auction house (can't recall which, maybe clean sweep?) discourage later bidding is to have an increasing buyers premium. The way it works was if you put your max bid in before 10pm you paid a 15% premium, between 10-11pm a 16% premium. Between 11-12pm, a 17% premium and so forth. No matter if your bid was increased later in the night, you are locked into the premium set when you put the bid in. This allows people to switch to a different lot but at the same time it encourages them to bid earlier so they can pay a lower premium.

DJ