Online Auctions Enable More Bidders to Participate
YOUNGSTOWN, Ohio – At times, live auctions seem more like entertainment than a business transaction. Bid callers rattle off incoming bids at speeds that border on incomprehensible while ringmen dash through the crowd looking for the next bidder. Bidders throw their arms up trying to get auctioneers’ attention and, for big-ticket items, behave with abandon.
With the rise of online auctions, though, bidders are trading that excitement and camaraderie for convenience. If one or two lots in particular stand out at an auction, bidders no longer have to wait for them to come up. No longer is there a need to miss an auction because of work.
“We’ve sold things online to guys three miles away. But they’re stuck at work the night of the sale, so it’s convenient for them,” says Ken Baer, an auctioneer and real estate broker with Baer Auctioneers Realty in Rogers. “Or they can set bids and let the computer do the work for them.”
The number of online auctions has taken off in the past five years, perhaps more than half of all conducted, say those in the industry.
At George Roman Auctioneers in Canfield, Chris Roman says most of the auctions his company holds are online, although it still holds hours for on-site inspections to allow potential bidders to look over what’s available.
For auction houses, the benefits of online auctions are twofold. First, it greatly reduces labor costs. To put on a live auction, companies need employees to move items from a seller to a warehouse, unload them, organize them and set them up for auction. For online bidding, workers can take pictures of the items at the seller’s home or business, bring them to a warehouse and then ship them to the winning bidder, eliminating several steps.
Then, there’s the numbers factor. On a good day, an in-person auction will draw a crowd of a hundred or so people, almost all of them from the area. With the internet, sales are open to people around the world.
“We’ve shipped sterling silver to Singapore, Schwinn bikes to Japan, old TVs to Canada,” says Paul Basinger, owner of Basinger Auction Service, North Lima. “There’s no limit to where buyers come from. We sent fold-out bathtubs to a guy in Texas.”
Chris Roman estimates that between 20% to 25% of the auction lots, as well as the dollars spent, come from outside Ohio. Canada is a frequent international destination and there’s a buyer in Australia who regularly buys antiques from the Canfield auctioneer. So many items need to be shipped, he adds, that Roman Auctioneers has stopped sending items on its own and instead contracted with a shipping company.
At Baer, the online-live split for auctions is fairly even. One of the biggest factors in determining whether an auction will be held live or via the internet, he says, is the logistics. If there’s no room at a seller’s house for all the items to be set out, or if there’s insufficient space for all bidders, then it will most likely be held online.
Also among the considerations for Dick Kiko Jr., CEO of Canton-based Kiko Co., is how common an item is. If there’s nothing special about a bike up for sale, there’s no point in auctioning it online and shipping it across the country.
“If it’s antique and very unique, then do it online. Why would I convolute the sale of a basic item by shipping it to California? It doesn’t make sense to me. But if it’s specialty, put it online,” he says.
In most cases, he adds, if Kiko Co. has an item up for bid online, it will be done as a simulcast, allowing online bidders to go against those on-site for the auction. Through this style, about 25% of the bids submitted to Kiko are done online, he says.
“Auctioneers can capture the best of both worlds,” he continues. “We can do an online auction and end it with an on-site auction. At the end of the online auction, that bid competes with the bidders on-site. … They’re both very effective and both have their place.”
While he doesn’t conduct online-only or simulcast auctions, Jeff Anglin, owner of Anglin’s Auction Service, Youngstown, offers absentee bidding through his website. The process allows for bids submitted online to be considered along with those offered at Anglin’s auction house. Where simulcast allows online bidders to offer more than one bid during an auction, an absentee bid is placed only once.
It’s a service he’s offered since he started his company in 1985, but with the proliferation of online auctions, the internet has allowed him to expand his customer base.
“You leave a bid with me and then we bid for you,” Anglin says. “I choose to stick to live auctions but we are growing in online. There are people that are old-school who don’t want to go online and deal with all that. A lot of them have had problems with online [bidding].”
While it does limit the number of bids a person can submit, absentee bidding doesn’t limit the size of the customer base. Anglin has shipped items, usually small household items, to winners in other states.
For clients concerned about getting the most bang for their buck, the auctioneers note that online auctions tend to result in higher prices for comparable items.
“Our experience is that prices are up significantly from on-site auctions and bidder participation is up 40% from what it was [on-site],” Roman says, noting that it’s the convenience factor that drives participation. “At work you can be doing whatever you need while bidding,” he explains. “You can be going down the road and bidding in one of our auctions. It gives a lot more flexibility.”
Although more and more buyers have moved their bidding online, there remain those who prefer live auctions, all auctioneers agree, usually long-time auction-goers.
“When we get into the older group, they don’t like online auctions. They miss the camaraderie of joking with people during the auction,” Basinger says. “The younger generation doesn’t want to sit around waiting for a few hours for one item.”
Pictured: Ken Baer of Baer Auctioneers says logistics determine whether an auction is held live or online.
Copyright 2018 The Business Journal, Youngstown, Ohio.
Published by The Business Journal, Youngstown, Ohio.
CLICK HERE to subscribe to our print edition and sign up to our free daily headlines.