Higgins and Scott Auction bid increments good for the buyer, bad for the consigner

[Kenmarks]

I was just looking over the current Huggins and Scott auction. They have some really great items!! I was noticing some listings with lots of bids and was surprised by how low the current high price with so many bids. Seemed to me the bid should be higher with so much activity.

Just to pick out one lot as an example see:

1914 T222 Fatima Cigarettes Grover Alexander Rookie - SGC 2 Good

The starting bid was $250 and after 22 bids the current high bid as I write this is $775. Most auctions have a 10% bid increment, which if my math is correct would have the current high bid at $1850 not $775, a difference of $1075!!

As a consignor I would not be happy with this. However I looked at the H&S rules and it clearly states the increments as

$50-$249 increment of $10
$250-$999 increment of $25
$1000-$9,999 increment of $100

Using their increments the high bid of $775 after 22 bids is correct. I assume the thinking is to get more people to bid. And I understand that if the increments were to be 10% some of the bidders may not have bid which would bring down the $1850 figure above. However I have to believe the bids would be higher than the current bid. Just my take.

Curious if the increments H&S uses would cause pause for consignors? Have any of you who have consigned in the past known this? If so how did it work out for you? Were you pleased? Did your item go for less, what you expected or more?

If you were looking to consign to an auction house would this knowledge sway you not to consign or encourage you to consign with H&S?

Maybe I am forgetting/missing something. I would be interested in others thoughts.

As a footnote, I am not a consignor in this auction.

[swarmee]

Just emotionally, the smaller bid increments would get more action from a larger variety of bidders, who are now invested in attempting to win the item. And rather than having to spend $250 to bump from $2,500 to the next bid, they can go less than half of that and take the lead.
Kind of like when you watch Storage Wars on TV and they're going $500, $600, $700, then bidding slows down and the auctioneer accepts a bid at $750 rather than calling SOLD at $700. Locker might still get one or two increments and sell for $800-850 rather than the $700 if it weren't for that half-bid.

[jayshum]

Here are the bid increments for REA. Some differences but still fairly comparable up to $5000. Then REA jumps to $250 while Huggins and Scott stays at $100.

Minimum Value Maximum Value Bid Increment
from US $ 0 to US $ 99 US $ 5
from US $ 100 to US $ 199 US $ 10
from US $ 200 to US $ 999 US $ 25
from US $ 1000 to US $ 1999 US $ 50
from US $ 2000 to US $ 4999 US $ 100
from US $ 5000 to US $ 9999 US $ 250
from US $ 10000 to US $ 24999 US $ 500
from US $ 25000 to US $ 49999 US $ 1000
from US $ 50000 to US $ 99999 US $ 2500
from US $ 100000 to US $ 499999 US $ 5000
from US $ 500000 to US $ 999999 US $ 10000
from US $ 1000000 and above 5%

[UKCardGuy]

I find that large bid increments actually hinder bidding.

I've stopped bidding on items many times because the minimum increment is large enough that it's not viable for another bid. If the increment was smaller, I might have had one more bid.

[BobC]

Originally Posted by swarmee

Just emotionally, the smaller bid increments would get more action from a larger variety of bidders, who are now invested in attempting to win the item. And rather than having to spend $250 to bump from $2,500 to the next bid, they can go less than half of that and take the lead.
Kind of like when you watch Storage Wars on TV and they're going $500, $600, $700, then bidding slows down and the auctioneer accepts a bid at $750 rather than calling SOLD at $700. Locker might still get one or two increments and sell for $800-850 rather than the $700 if it weren't for that half-bid.

What John is saying.

C'mon, pretty much everyone knows the real action doesn't start in online auctions till things hit the extended bidding period, and usually AHs don't allow people to bid during extended bidding unless they'd placed a bid before then. The more people still able to bid, the better the chances there will be at least two people to really drive the price up.

A lot of times people see various things in an auction they're interested in, but only bid on a couple so they don't overextend themselves and go way over their budget. And then if later on during extended bidding they get shut out, they can't now go back and bid on those other items of interest because they're now locked out of extended bidding on them.

In the long run, you would normally expect an auction item to end up at about the same winning bid, despite the bid increments. Just look at live auctions where the auctioneer will often cut the final bid increments to eke out every last dollar from the bidders.

[quitcrab]

Cards are going to sell for what people want to pay no matter the size of the bid increments, that simple.
Huggins and Scott will get good final prices for the seller…. They do a nice job and would not be in the business for the last 30 years if they didn’t.
Scott

[BobC]

Double post!

[ALBB]

I think they would get more bids/bidding if the increments were smaller

[bobsbbcards]

The increment should be a penny.

[Empty77]

I agree with the replies that in the end each item is going to sell for whatever the most interested person is willing to pay, despite the bid increments.

Personally, as almost exclusively a buyer (and of low-pop things infrequently available), I'm perfectly happy if the bid increments are enormous, so as to dissuade other bidders from even bothering to be in the way of something I want.

This would support the thesis of the comments about lower increments increasing action, and be the opposite of OPs suggestion that small increments are good for the buyer---depends on whether a buyer's primary interest is the lowest possible cost, or increasing the odds of definitely being the ultimate winner.

[cgjackson222]

Originally Posted by BobC

What John is saying.

C'mon, pretty much everyone knows the real action doesn't start in online auctions till things hit the extended bidding period, and usually AHs don't allow people to bid during extended bidding unless they'd placed a bid before then. The more people still able to bid, the better the chances there will be at least two people to really drive the price up.

A lot of times people see various things in an auction they're interested in, but only bid on a couple so they don't overextend themselves and go way over their budget. And then if later on during extended bidding they get shut out, they can't now go back and bid on those other items of interest because they're now locked out of extended bidding on them.

In the long run, you would normally expect an auction item to end up at about the same winning bid, despite the bid increments. Just look at live auctions where the auctioneer will often cut the final bid increments to eke out every last dollar from the bidders.

I agree with this and want to reiterate how important bidding is during extended hours. The more people that have already bid on an item, the better chance of a bidding war in after hours. And obviously there will be more people eligible to bid if there are smaller bid increments. For the same reason, I don't think it is in the consigner's interest to allow "straight bids" as a bidder can bid up the price in one fell swoop and prevent anyone else from getting in bids at lower prices.

[BobC]

Originally Posted by cgjackson222

I agree with this and want to reiterate how important bidding is during extended hours. The more people that have already bid on an item, the better chance of a bidding war in after hours. And obviously there will be more people eligible to bid if there are smaller bid increments. For the same reason, I don't think it is in the consigner's interest to allow "straight bids" as a bidder can bid up the price in one fell swoop and prevent anyone else from getting in bids at lower prices.

Charles, That is a great point about making significant "straight bids" early on. Any AH allowing that would let a bidder be able to significantly deter potential competition in many cases.

In fact, if an AH were smart, what they would do is actually decrease the bidding increments the farther into extended bidding an auction runs. Someone faced with having to make a $500 bid to take over the lead is going to be a lot less likely to bid than if they only have to bid $50 to take the lead in bidding. It is easier for someone in their minds to justify continuing to bid when the increment is small, simple human nature. Would likely eke out a lot of higher ending prices for the consignors, across the board.

[Empty77]

But regardless of whether those changes would be good for buyer or seller, it would definitely be bad for human health; some of those events already go until 4 or 5AM ET. It's already madness.

[JustinD]

I didn’t realize this chat was going on in multiple spots till Bob pointed it out.

I think the thinking in this one is a lot more in line with actual studies on psychology versus the auction house thinking with greed instead of logic. Those with ridiculous bid jumps are leaving money on the table far more than not.

[BobC]

Originally Posted by Empty77

But regardless of whether those changes would be good for buyer or seller, it would definitely be bad for human health; some of those events already go until 4 or 5AM ET. It's already madness.

Can't argue with that at all. But most people look at us card collecting junkies as weird to begin with, so they're not going to have any sympathy. LOL

In truth, I don't think it would really make things that much worse overall. On a few items here and there with a couple of dedicated bidders, you'll likely always have some auction lots like that. Just depends on how the AH has their bidding terms and rules set up, and if they are conducive to creating some long, drawn-out auction lots like that.

[BobC]

Originally Posted by JustinD

I didn’t realize this chat was going on in multiple spots till Bob pointed it out.

I think the thinking in this one is a lot more in line with actual studies on psychology versus the auction house thinking with greed instead of logic. Those with ridiculous bid jumps are leaving money on the table far more than not.

Justin,

I think it might even be a combination of psychology on the part of the bidders AND greed on the part of the auction houses. Still, as I already pointed out in one of these two threads, I am a bit amazed that so far none of these online auction houses has done as most live auctioneers will do, and cut the bidding increments as the bidding for a particular auction lot winds down. Shouldn't be that difficult to program into software. Who knows, with the various AH owners on here, maybe some will see these posts and start hitting up their software providers for such a change. Would make sense to me at least.