The blogs lit up last week with the news that eBay was granted US Patent 7,702,540 regarding “computer-implement method and system for conducting auctions on the internet”. Here’s the abstract.

Methods and apparatus for a system for facilitating electronic commerce transactions with a first data storage location for holding information about an item for auction from a first participant in a data packet network, a verification process that verifies the user identification of the first participant in said data packet network, the verification process confirming a user identification before allowing the participant in said data packet network access to place information about an item for auction in the system, a display process for displaying information of the item for auction to a plurality of data packet network users, the display process displaying an advertisement with the item for auction to the plurality of data packet users, an auction process for receiving bids on the item for auction from at least one of said plurality of data packet network users, the auction process also verifying a user identification from said at least one of a plurality of data packet network users before allowing receipt of the bid and a notification process for notifying the plurality of data packet network participants that said bid was accepted by said system.

eBay's Internet auction patent

It’s unclear if eBay will actually protect this patent, first filed in 1999. Speculation exists on both sides, with one camp saying that eBay will use licensing as an additional revenue source and another camp saying that eBay’s continued deemphasis of its auction model in favor of fixed prices means that they likely won’t be interested in using this patent.

How are you betting? Let us know in the comments.

PayPal has a bad rap among auctioneers. When polled during education courses, very few auctioneers admit to using the service due to reasons ranging from the fee structure to the preferential treatment of buyers during disputes to the simple fact that they don’t like PayPal’s parent company, eBay.

It may be true that PayPal’s fee structures have historically been higher than the rates charged to auctioneers by credit card companies. It may be true that it’s easier to find a credit card partner – such as NAA Cashless Commerce – who understands the auction industry enough to work for the auctioneer instead of the buying customer during dispute resolution. It also may be true that PayPal has been seen as a tool of the enemy by auctioneers who are afraid of eBay because they consider it to be competition.

All of these reasons to avoid PayPal notwithstanding, we feel that the times are a-changing with regards to electronic payments. The remaining days of the daisy-chained transaction fees charged by vendors and merchants and banks and credit card companies on every single transaction are waning.

Twitter cofounder Jack Dorsey‘s latest endeavor, Square, allows credit card transactions to be completed on iPhones. Imagine buying Girl Scout cookies and having your credit card charged by a 13-year-old at your front door. Paying digitally for smaller-value transactions will – and must – become second-nature for us as these technologies mature.

PayPal is opening up its tools in order to evolve from it’s current function as a payment option to become a transaction platform. These tools, called the Paypal X Developer Network, allow developers with great ideas to use PayPal’s tools to make payment processing easier and cheaper without having to know how to transfer money or deal with the bureaucracies inherent to banks and financial institutions.

Just as the credit card revolutionized the way we pay for goods and services by replacing cash, this new crop of digital transaction technologies leveraged on PayPal’s tools will affect the same type of revolution, not by interfacing with or serving as credit cards, but by supplanting them.

Five years ago, the concept of paying bills on the Internet was downright foreign and scary for many users and service providers alike. Some users still avoid electronic commerce, but most banks and service providers now support it – some even incentivize it by taking a couple of dollars each month of the bills of users who use automatic electronic payments. As more and more Americans accept the convenience and security of digital transactions, there will come a point in the not-so-distant future when an auctioneer who only takes cash, checks and credit cards will be leaving money behind from potential customers who no longer utilize any of these outdated forms of payment.

AuctioneerTech - Auction Podcast

You’re listening to the AuctioneerTech Auction Podcast. Today is Friday, 11 December, 2009. auctioneertech.com – technology, auction and auctioneers, auction tech for the auction industry.

Hello and welcome to the 20th episode of the Auction Podcast from AuctioneerTech. My name is Aaron Traffas and today we’re going to talk about the trends and shifts in buyer behavior that find consumers looking for items instead of auctions and what we auctioneers should do about it.

It used to be easy. Bidders used to check the auctions section in the newspaper for something to do on the weekends. We used to put an ad in the classifieds that listed the type of auction we were holding, trusting that the customers wanted to come to the auction. If you hold it, they will come.

Not anymore. Now, instead of looking for auctions to provide needed entertainment and activity, consumers are taking every opportunity to find a gap in their busy schedules that might provide much needed rest. Weekends are for chores and sporting events and movies, not traveling somewhere in hopes that there might be an item of interest that may or may not sell to a competing bidder anyway. Regular consignment auctions everywhere are noticing a decline in physical attendance, and with a few exceptions due to asset type or geography, it’s becoming clear that the interest consumers have in spending hours at auctions is waning.

What does this trend mean for the auction industry? Does it mean we should pack up our gavels and Half Mile Hailers and go home? Of course it doesn’t. It means we must recognize this change in consumer buying habits and adapt. There is still value in the secondary market. Consumers are no longer looking for auctions, they’re looking for items and they don’t really care how the items are sold. If we present better information about the items to the prospective bidders, they’ll make the effort to make the purchase.

An auction event is a collection of auction items. We auctioneers realize this marketing tactic, and it’s what sets us apart from other one-off competitive bidding sites like eBay. It allows us to more effectively advertise and use economics of scale to keep our costs down and to  do a better job for our sellers. What we need to understand and respect is that we must be more granular in our advertising and extend past the event and down to the item level.

The Internet is the obvious answer as a mechanism to list the items at our auctions. Since traditional media is becoming more expensive and less effective every day, our efforts should be focused towards driving customers from our traditional advertisements to our websites. Only there do we have the ability to convey the amount of information at essentially no cost to our clients.

What kind of information should we present and how should we present it?

Descriptions
The more information we convey, the better we can serve our bidders. Aspects such as year, make, model, style, color and condition are obvious components to a good description. If you list an item and someone asks a question about it, use that question as a tip to add the answer to the description so the next possible bidder won’t have to ask the same question.

Pictures
Digital cameras are cheap, and so is the film. A big memory stick and some freely-available picture processing software makes it amazingly easy to present many pictures of each item.

Sale order
Consumers don’t want to wait. While you don’t have to know the exact minute an item will sell, publishing a sale order on your website will let a bidder know when he’ll need to be at the auction or, in the case of Internet bidding, in front of his computer. Provide a sale order and don’t break from it.

While our websites are the most important places to present all of this information, they are not only places we should post our items. Internet auction calendars such as the National Auctioneers Association’s auction calendar, Global Auction Guide, the National Auction List and AuctionZip provide free or inexpensive venues to list our items. Craigslist, niche forums and bulletin boards are other places that may take a little more work but may generate a significant benefit for our sellers and our bottom lines.

The amount of information we can convey about each item is substantial. The more details we post for each item on our websites and those sites listed above, the more likely consumers are going to be able to find our items through auction- and non-auction search channels. If a consumer looks for an item using Google and we’ve posted that item on multiple websites with a link back to the auction listing on our site, that consumer is more likely to find our item and participate in our auction. If the item isn’t listed in the auction description, the consumer won’t know about it and will make a purchase from somewhere else.

It sounds like a lot of work. We can’t simply string out the items in a windrow on the lawn on the morning of the auction. Picturing, cataloging, data entry and item-level marketing are all important but labor-intensive and expensive components to modern auction preparation.

Buyers are looking for items. Our sellers are looking for buyers. Technology gives us new ways to advertise items to buyers for our sellers. The next generation of successful auctioneers isn’t going to be successful because those auctioneers have the best chant or the longest company histories . They’re going to be successful because they’ve figured out the most efficient workflow to present the most information in the most places about each individual item they’re selling.

That’s it for episode 20. Have a happy holiday season from AuctioneerTech and we’ll see you in 2010 with more episodes, interviews and the continuation of our video podcast series.

You’ve been listening to the Auction Podcast from AuctioneerTech. If you have suggestions, questions or comments, or are interested in being a guest, please let me know by going to www.auctioneertech.com/feedback and leaving a message. You can also post public comments about this or any other episode, as well as find show transcripts, on the Auction Podcast page of auctioneertech.com.

Jeff Johnstonbaugh, COO of BidSpotter, talks about RemoteBidder, BidSpotter, Internet bidding and the future of the industry. You can play the episode or download it for later using the links at the end of the transcript, or you can use iTunes or your favorite podcasting software to subscribe to the Auction Podcast. Enjoy!

You’re listening to the AuctioneerTech Auction Podcast; today is Wednesday 5 August 2009. My name is Aaron Traffas and joining me today for the third in the Vendor Interview Series is Jeff Johnstonbaugh. Jeff is Chief Operations Officer for BidSpotter Incorporated.  Good evening, Jeff, and thank you for joining me.

Jeff JohnstonBaugh: Hello Aaron, it’s a pleasure.

AuctioneerTech: Jeff how did you get started in the auction industry?

JJ: Well, trading and buying and selling and going to auctions has always been in my family. I started working I was about thirteen in the restaurant business, by the time I was twenty-one I was fairly burned out on that career, and so I was buying and selling a lot of equipment at auctions for restaurants and building restaurants and the auctioneer whose sales I attended most them asked me to come and work for him. That was about 1982 and at it’s been twenty-seven years ever since. So it’s worked out okay.

AT: And you were working in what capacity for that auctioneer?

Oh, I started out as a set up and ended up as an auctioneer and ended up as a sales manager and I actually ended up buying his business when he passed away after I’d worked for him for about fifteen years, just your ordinary local, regional neighborhood business auction company.

And maybe we should preface that a little bit – where are you from, where was this and where are you at now?

I’m still up in the Seattle area where I was there and so I actually purchased Jesse Jones Auctioneers and ran Jesse’s company for several years until I got distracted by this whole Internet thing.

And tell us a little bit about this distraction, as you call it, and what drove you to BidSpotter.

Well, like a lot of people, I saw the allure of the Internet and decided to pursue that dream and I was actually working at nordstrom.com at the time, I was interviewing for a position internally and the president of the company stepped out of our meeting for a while, which obviously made me nervous, he stepped back in and said something which made me even more nervous, said Jeff I’m doing to do something I’ve never done before, I checked with the Nordstroms and we’re going to refer you out of the company, which obviously panicked me. He actually was an angel investor sitting on the board of a little company called LiveBid which was one block down the street and he referred me down to them so I took a walk down the street and it turned out that that was just about ninety days before they were purchased by amazon.com and the fellow who was the sales manager there was well known to me because I had taught him bid calling a few years before, and so I hired on with LiveBid and the online adventure continued.

When was that that you hired on with LiveBid?

I want to say it was 1998. It’s interesting; we got enough experience Internet now that it’s starting to get lost in the fog of time. But yeah, we were bought by Amazon and Amazon had an interesting strategy. Amazon saw that eBay was coming after retail so they took at a shot, Amazon saw eBay was coming after retail, so they took a shot at auctions for a while to force eBay to refocus on their core business and it was very effective and one of the things they wanted to do was make sure that eBay didn’t get to buy LiveBid company nor Yahoo Auctions and we were at Amazon for about eighteen months. I had the opportunity to work with Sotheby‘s and I had the opportunity to help develop the first beginnings of different platforms and sort out how industrial auctions and different from consumer auctions and all that sort of stuff. So it was very formative years and very exiting times.

Sure. How then did that job description segue into BidSpotter?

Well, Amazon decided that its strategic move had run its course and after about fifteen months or eighteen months they let us all go. Some friends of mine, Bill Foot and Jeff Harris, went off to form BidSpotter.com, I took a year off and then later joined them and BidSpotter has grown very steadily from a very small company to what we have today which is working quite well for us. One of the unique circumstances that sets BidSpotter apart from other competition is that there’s never been any outside investments. We’ve been cash-flow-positive and work form within our own means since they started out with their own severance checks and it’s built slowly but it’s built very solid. So we are very proud of that.

That’s very somewhat unique in these days of tech startups and Internet companies and it seems like everybody is taking venture capital from various places and having something that is completely organic and as you put it a cash flow positive entity from the get-go is something to certainly be proud of. You say that Bill and Jeff started BidSpotter and then you joined them shortly thereafter. How did you know them? They were in LiveBid, is that right?

Correct. All of us that founded and originated BidSpotter were from within the Amazon group. We joined with some fellows from Canada, Inet Softglobe was the name of their company and they provided the bidding engine around which all of the BidSpotter website is wrapped. And so it’s grown on that basis and now the fellows from Inet and the original founders of BidSpotter are all partners in the deal, but again, there’s never been any outside investment and there’s never been any debt taken on and so its worked out pretty well.

So how long would you say that you were a bid calling auctioneer, is that something you still do on the side, is that locked away as a part of your past, how long did you do that?

I probably did that very actively with one or two sales a week for a dozen years, and something I still can do and I’m 6happy to do, but for me primarily now its pitching in to help somebody else or for a good charitable cause, I don’t actively pursue auctions although I do still cooperate and consult with friends on big projects and so forth occasionally.

Sure. Well Jeff, tell us about BidSpotter, how would you describe BidSpotter to somebody in an elevator? What does BidSpotter do and what kinds of Internet bidding does BidSpotter support?

BidSpotter.com

Okay. BidSpotter is a website where folks primarily go to buy industrial machinery, plant machinery; I like to say things that make you money. The ways that BidSpotter works with the traditional auctioneers is to provide technology for a Web simulcast where you can bid against the live crowd in the room with the traditional auction, a strong area of growth in future trend, is the timed auctions, the online auctions that are more of an eBay style auction but we still present them as an event as opposed to random items in this gigantic mishmash of offerings. Each of our auctions, whether it’s a timed online auction or a webcast auction, appears in a calendar fashion, it gets its own standalone credibility. The buyers tend to migrate amongst the items there and consolidate their shipping and figure out how to work with one rigger or machinery mover to get the stuff home. They develop a relationship with one auctioneer to buy multiple items at that event and then they package up the goodies, pay the bill and go home. The timed auctions are far more popular with our European clients and we do have a very strong European representation. We also are active in South Africa and the live webcast auctions are really the bread and butter of the American industry although it is a growing segment. I would say that the main reason that BidSpotter trended toward the industrial machinery sales away from its generalist origins has to do with the demands of the industrial auctioneers, the ways that they like to do aggregates and groups and with a privilege and frequently change their mind about how stuff is going to be offered depending on how the crowd receives their proposals of how to give you choice on the next hundred or you’ve got to take the next five or put them all together or what have you, and the BidSpotter platform has always been very facile and very, very quick to present with clarity, those different means of grouping and choosing items and those seem to be a requirement primary of the industrial auction culture.

You mentioned something in that description that kind of focused my attention and you mentioned how you list the auctions as events especially for your Internet only, your timed auctions. You list them all as an event and it is essentially a group of items in an event as opposed to as you put it, individual items in a sea of staggered ending items. Why do you feel that that is important? And I’ve noticed that that’s the primary difference between the way that we as auctioneers market items as opposed to your traditional eBay sellers or eBay style sellers who will list individual items with varying seemingly random closing times, why do you feel its important to list items, Internet only items, in events as opposed to on their own?

Well, I guess for me it goes back to the way Jesse used to run his auction business. My original auctioneer mentor Jesse Jones was an antiques dealer and that’s the perspective he came from, but he was always collecting something, whether it was schoolhouse bells or parish prints or flow blue or Tiffany glass, whatever it was, and he would gather these little bits and pieces together for a year, two years or five years, and when he had enough of whatever it was then he would create an event auction and he knew that by creating an event, the value of the item was far superior to the little bits and pieces and odds and ends that he picked up along the way. So when you had an auction of Maxfield Parish prints, suddenly you drew the attention of Maxfield Parish print collection community. I think that the way we as auctioneers approach the process, especially the industrial auctioneers, it’s generally about a building clear-out. So you have a focal point to begin with. This plant made this number of seats or they made those General Motors cars or they made these plastic water bottles. And so obviously all the items have a cohesiveness to begin with because they all contribute to making that product. But furthermore, you’ve got a geographic focus and you’ve got a timing focus. And an auctioneer works out an advertising budget that’s amortized across might be a hundred lots, might be a thousand lots. He is working on a labor budget that’s focused on getting out of the building in sixty days. So that event focus makes us very different than the person who is trying to sell one antique teddy bear that they found at the flee market and they want to throw it on eBay and find the other antique teddy bear buyers. Our product comes with a built-in focus and therefore it behooves us to go with that flow and maximize the advantages that we have, being so focused.

Remote Bidder

Jeff, BidSpotter recently, relatively recently anyway, came out with the RemoteBidder platform and product and you’d mentioned what BidSpotter did and what its strengths were especially in relation to asset type and market. What then is the cause for RemoteBidder and what is its target and focus?

Well, I think that everyone knows by now that in the end of last year, eBay left the live auctions space. And we had actually had a deal with eBay from 2004 to 2006 and we decided of our own accord to pull out of that deal because we didn’t see them supporting auctioneers as auctioneers in the way that auctioneers need to be supported. So with the news that eBay was leaving and knowing that the primary, the vendors, the most successful vendors, the biggest vendors in that consumer goods, fine arts and antiques kind of space were, by and large, resellers of eBay platform, we decided to go ahead and put up a product to approach the consumer market but approach it with the needs that the fine arts and antiques buyers in that culture wanted. What I’m finding as I pursue this business is that there are distinctive and unique cultures, even though we use the word auction across all of them, the guys that are buying livestock at auction have very distinct different needs and demands than the guys that are buying cars, they are different than the folks that are buying arts and antiques and industrials and so on and so forth. So with RemoteBidder, we partnered with Antique Week and Antique Trading Gazette to try to establish as quickly as we could, the broadest email list bases and customer bases that we could, and then we are actually using technology for the live bidding platform from the folks at ATG Media which we think is superior at serving the consumer good demands, it just – its prettier, it provides bigger images, it provides a different style of presenting the information that the fine arts and antiques folks are more receptive to. And its growing slowly like any new brand and new business it takes a long time to get the thing off the ground but we are very pleased with where it’s at and we are very happy with our partners at Antique Week and Antique Trading Gazette and we expect big things in the future.

And so you’ve kind of mentioned that – first of all, when did RemoteBidder have its first auction, when was it launched?

January this year, January 2009.

Are there any major differences outside of demographic focus and asset type – I guess those are some pretty substantial differences. How close is the technology between BidSpotter and RemoteBidder and what makes these platforms different from other competing products and platforms?

Well, the technology for the RemoteBidder platform has been tested with the saleroom.com in the UK for about the last 18 months to two years. So we know its solid technology, but it is a Flash programming based technology instead of Java which BidSpotter uses; Flash is installed in substantially more home user computers already, so it makes it more accessible to folks. Also its informed by a lot more knowledge about how people pursue personal entertainment or the things that they’re going to buy in life as opposed to the machines in the machinery business. So it is a lot more amenable to enjoyable browsing and sorting out and watching just the items that interest you and that sort of thing as opposed to the machines which are by and large dictated by “does it meet the specs and is it a catalogue item and lets cut the chase and get this done with”.

Something that you want because it is desirable to you not because it’s a commodity that fits your specifications of what you need to buy

Exactly, exactly. A lot of it has to do with just being able to cut through the clutter. At some point, these different auction sites reach a saturation point where you can hardly take it all in and so it’s helpful to have a different channel on the TV so to speak.

Sure. What would you say the biggest benefit is to building a bidding platform for a specific market as opposed to one of the larger more generalized other competing platforms?

Like I said, I just think it’s the ability to tailor to a cultural need. I cannot envision the day for me when I am just as happy having heavy equipment auctions with bulldozers and road graders on the same platform as diamonds and vases. Those different users all approach their computer differently, I mean, for one thing, by and large, the consumer good users are a much older demographic, they are much wealthier demographic and they have just a different set of expectations. The guys that are high tech and very, very dialed in their computers that just bid like mad men on the server auctions and lab equipment auctions, they have a lot less need for support and they have a lot less need for a happy touchy-feely kind of experience than your consumer goods folks who are really buying to entertain themselves, they are buying to have the enjoyment of it. So, the whole thing needs to be a very enjoyable experience. Quite frankly, a lot of our industrial users would get frustrated with the enjoyable parts of the experience, they just want to cut to the chase, they want to buy what they want to buy and move on. And that’s the main difference. The technology underlying it, there is a lot of varieties for technology, there is a lot of ways you can approach it and I just think it all needs to be driven by the nature of the event and the nature of the customer you’re trying to appease.

So what are some differences in the product offering for auctioneers between the two services? If I am an industrial auctioneer and I utilize the BidSpotter service, what kind of advantages do I see either in a pricing model or a feature set as opposed to if I am an antiques auctioneer and I’d like to utilize the RemoteBidder platform?

I would say the primary benefit from the perspective of the auctioneer is going to be the marketing assistance. BidSpotter has an amazingly well-dialed and database of industrial buyer as opposed to RemoteBidder which is accessing that great mailing list that Antique Trading Gazette has throughout Europe and Antique Week has in the US. The technology is going to appeal to the different buyers so they are going to get a smoother and happier customer. I would say on the industrial side, they are a lot more demanding and I guess the primary difference of the BidSpotter platform is not so much the software but the skill and the mindset of the people running the business. The folks that are taking the remote sales or the implementation specialists who are out on the ground and can actually wire phone system or Internet connectivity for a couple of hundred thousand square foot plant without breaking a sweat and make sure everything goes off perfectly. Whereas antique auctions are primarily from a well known venue and auction gallery that’s a lot more controlled situation, the folks with BidSpotter, the BidSpotter auctioneers are a lot more inclined to want to hire our staff to take care of things for them, the folks at RemoteBidder are a lot more inclined to handle themselves and they want an easier interface that is more readily accessible. They want the simplest way to achieve the audio instead of the way that most accommodates the challenges of working on the road. Basically we run them as two different businesses and those two different businesses address the needs of the clients and the clients are radically different. The guys that sell ancient Chinese antiques have a completely different approach than the guys that sell bulldozers from a vacant lot in the middle of the Midwest.

You mentioned the implementation specialists and with the approach that each is a separate business, what are the different implementation options for each one. In other words, if I am an auctioneer, how technical do I have to be as far as the way that I interact with the service, do you offer a turnkey solution, do you offer a self service solution, do you offer a mixture of both? What does it take someone to utilize either service?

That’s an excellent question, and again it all goes to what the auctioneer would like to have. We completely consider our business from the perspective of being in service to auctioneers. We can run the whole thing for you and literally be another staff member on the ground at your sales site with you and that is generally the way that the auctioneers who are running multiple millions of dollars of sales with us a year like to have it be. As a matter of fact, its very, very common for our clients to pick favorites amongst implementation specialists and ask to make sure that James or AJ or Mario or whoever it might be, is in attendance at their event in particular because they work so well with them. That’s going to be the case where we send someone out with a big sachell full of gear and they make it happen, whatever needs to be done to make sure that you can hear and you can connect to the Internet – the whole works. The other end of the spectrum, both platforms are completely capable of being turned over to the auctioneer in-house staff and run completely self-sufficient. Again I would say that the remote bidder platform is easier for an operator within the auction house to run, it has less bells and whistle therefore there is less clutter on the user dashboard and its just a little easier to understand. In the middle of that is a very economical compromised that is something that I originally worked out back at Amazon and has become an industry standard which is the remote broadcast. And the remote broadcast simply is putting a cell phone usually, with a headset, on either the auctioneer – which works far better – or as an alternative, to a ring man or just a clerk on the ground, where the headset can pick up the noise from the PA system. We use that feed from the auction floor to run the bidding from one of our office computers and when a bid comes in from an authorized and approved bidder, we relay that bid back to the auctioneer via the cell phone and the bid is process that way. The advantages are that it saves all that expensive travel and trying to run the auction that may or may not be able to support technologically. The disadvantage is you’ve got a couple more links in the communication chain and that’s why I said it works better if the auctioneer wears the headphones themselves because there’s just a couple less links in the chain because you’ve got this message being passed from bidder to the computer to our computer, our computer to our persons, thoughts and brain and then they say it over the phone and that person using the phone has to relay to the auctioneer and even if all this happens in a couple of seconds, those elements of the chain can be a frustration to getting a bid in very quickly. My recommendation for remote sales is they are best done, and this is kind of standard practice for our bigger clients, if they’ve got a huge auction, they tend to have someone there. If they’ve got a modest size auction, say its going to be under a couple of hundred lots and it’s a fairly simple situation, most auctioneers in that case will be selling a little slower, a little less stress, a little less pressure, and then not bearing the burden of traveling and so forth is a perfect situation to use remote broadcasting. All three have their place and all three are very good tools for an auctioneer to use depending on what their circumstance is.

What kind of pricing structures are associated with each of those three options and is there a difference in the pricing structure between BidSpotter and RemoteBidder? And what kind of volume would an auctioneer need to have to justify utilizing either service?

Well you know, it’s interesting because the volume to justify has been a question that goes back a long ways. I remember when we first started this with LiveBid, the event fee was twelve $12,500 per event, I could guarantee you the Internet wouldn’t keep working, I could guarantee you no one would bid, but I could also guarantee you that every single live television news truck in town would be outside your auction talking about your auction that night in the local news. So the value was a little strange then. You fast forward to ten years later now and the event fee is down to $350 on BidSpotter, the event fee for RemoteBidder is $500, and that’s just a consideration of the fact that we sell so many more lower price point items on RemoteBidder that in order to stay in business ourselves we have to charge a little bit more event fee. The percentage that we expect as a buyer premium bump on both is the same, 3% to folks that win online bids, so that’s pretty simple math. $350 bucks is not a big advertising hit or $500 for RemoteBidder is not a big advertising hit for most sales. Its kind of more of a question of where do you want to push your business. I know that we have several clients – I would say Gallivan Auctioneers is probably the  best example – who readily acknowledged that they used us with the online broadcasting as a very integral part of building their business to make sure that they were investing in reaching further and further and expanding their geographic boundaries every time and as a result, they may have taken a lot of sales early on that other people might have deemed not worth spending money on. So the value proposition isn’t always about does this auction justify it, but sometimes the value proposition is, can I use this as a tool to help build my business and establish myself as a very forward thinking, ambitious and technologically sophisticated auctioneer who is availing themselves with every marketing resource they can come up with. Sometimes that’s the value proposition that an auctioneer needs to consider. I would never put a specific dollar amount on the deal but I will say that it is much more common for our auctioneers doing lower gross volume sales to run the software themselves and my standard description of the person who can best run that in-house is if you have a niece or nephew who is between he ages of seventeen and twenty-five and grew up in the auction business and they play video games all their life and they have no fear whatsoever about a computer, there is no doubt whatsoever they can run any of the online auction platforms very successfully for you.

That’s a pretty good analogy, I know that my years playing Counter Strike probably suited me very well for being able to click the bid receive button. Jeff, I’m going to switch gears just a little bit, I’m looking at a press release from – the published date is very early June of this year – that talks about the BidSpotter.com announcing a dealership liquidation program. Tell me a little bit about what that program is and who that targets.

Well, you know, its been announced with General Motors and Chrysler in the last sixty days at the most, that they are going to be closing thousands and thousands of auto motor dealerships across the country. We started seeing some of these dealerships and they were generally about a $100,000 auction and looking at different resources I’ve noticed that a lot of them are going to local auctioneers who have never done anything online before because the relationship and the business isn’t coming through Chrysler, is not coming through General Motors, its coming through the owner of the dealership who is a neighborhood businessman and knows the neighborhood auctioneer. So what we did is we put together a package that really simplifies the whole process for, especially for an auctioneer who has never used us before or maybe never done an online auction before, and we took the different flavors of implementation out of it, we know from our experience that the best way to run one of these moderate sized auto dealership auctions is to be on the phone and do a remote broadcast, and we know that we can support this very effectively with a discount nonetheless. So it’s a $350 event fee, flat rate, implementation included for any dealership, and it doesn’t even have to be an auto dealership, it would be a John dealer dealership, it could be a moped dealership, but dealership auctions, they’ve got a special featured category on the BidSpotter homepage and that’s something we think that auctioneers across America are going to be busy with for the rest of this year at least and probably six months after that. So we put out a special offer to support our local auctioneers. I think what really drove it home for me was when I saw a couple of dealerships in Casper, Wyoming, and I just know that we don’t have an industrial user base in Casper, Wyoming, amongst client auctioneers and it brought home to me that these are going to come from all different directions and hopefully it’s a chance for these auctioneers to have an opportunity to try it out and see if they like it and we want to keep it simple, and straightforward.

That’s an exciting new program from you. What are some other features from either platform that we can look forward to, to seeing released in the future, what kind of development is going on, on the backside?

The most exciting features we’ve got coming along are along the lines of client integration. I know that for a lot of years a lot of auctioneers have had a strong debate of whether or not they are building our business or building their business and whether or not they want to drive their clients, their bidders to a portal website like BidSpotter. Coming in the future, the technology has come to support the idea that the sale can appear equally well in both locations and bidders who are loyal users of BidSpotter can find the event on BidSpotter calendar, they can log in, register, get approved, all that good stuff, and they will perceive that they found the auction through BidSpotter. But we have coming out shortly opportunities for auctioneers to embed a tool or a page within their website that allows branding with their logos and their colors to be able to traffic from directly within their site and maintain more of the feel that you’re working right within the auctioneer’s website. So really it’s going to be the best of both worlds. And those tools are in development, we except to roll those out in the fall. In conjunction with that, we are also focusing very heavily on back office systems. We have a channel partner in the UK that should allow us very shortly to be able to offer a very comprehensive package of enterprise management software for auctioneers to use that will do all your basic accounting functions and track your consigners and print your invoices and all that good stuff that you need to do, live at the sale site as well as with the online purchases because obviously when you get in these timed auctions and so forth, you have the dilemma where 100% of the bids and the bidders are coming through the website, but you still need to put them through an enterprise management software back office system that allows you to get the invoices out and check your bank deposits and make sure everything is as it should be so you’re running your business properly.

And so, let me jump in there, you’re talking about a web-based clerking and cashiering system, is that right?

Yes.

So someone, and let me form this question, for the real time live streaming auctions where I have a crowd in attendance and I’m taking bids from the floor and I’m taking bids from the Internet, will the system support then the recording of the winning bids for both Internet bidders and on-the-ground bidders and let me generate invoices all from this one spot?

That’s exactly what we are shooting for.

Nice.

On the customer side there’s also a lot of nice stuff coming along. There are new cultural things, new cultural expectations in the realm of the online auctions, some of which are bleeding over from eBay and some of which are kind of driven by the fact that we are event oriented, and people are going to want to be able to manage their favorites and their watched items and their items they are bidding on in a much more focused way. And so we are developing a lot of tools along those lines to allow people to dial in a little more tightly from the bidder perspective what they are interested in. And we think that will lead to more loyalty and better focus and more follow-through when it comes time to finalize the bidding.

One more follow question to what you described as essentially and a combination portal / integrated solution. That will provide auctioneers the ability to have the same inventory set hosted on his website as well as on BidSpotter or is one or the other?

No. The goal is to have the inventory data and the bidding exist in a space between the two and all we are changing is the way it is viewed from one perspective or another. So yes, it should be exactly the best of both worlds and whether it’s a live or timed auction won’t matter. The bidding will be competitive amongst all the bidders but their perception of where they came from and where they are existing on the internet will be colored slightly differently based upon where they began.

One more question on that. Do you anticipate a different pricing structure for an auctioneer utilizing that option and also is there a difference in the pricing structure between a real-time bidding auction and a timed auction?

At this time we don’t. You know, we have never done a whole lot of differentiation pricing-wise because we’ve really just always built whatever tool next seem to be most in demand and it’s a very competitive market and so we haven’t put out a lot of “gee, now we are going to get you to pay more for this and pay more for that.” The a la carte thing is never been anything that’s been a very much interest to us. So instead we are all about trying as best as we can to maintain the pricing structure we have as low as we can and just keep throwing more features out there as they are either brought to our attention by auctioneers, which is where most of good ideas come from, or whether they seem to answer a recurrent problem or a recurrent bidder demand.

What are some of the features that you offer that you are seeing of your most successful auctioneers utilizing? What are some of your most successful auctioneers asking for as far as feature sets, and what are they doing to set their auctions apart from the rest of your client base?

To be honest, I don’t think that the successful auctioneers are dependent upon a technology or something that we are providing. I think that the biggest difference and the most successful auctioneers for online auctions really comes down to their mindset regarding embracing the online bidders as real people, actual bidders who are just as genuinely interested in making good purchases and doing good business as the folks on site, it just so happens that they are at a remove, whether it’s a time management situation because they cant go to the auction because its their daughter’s wedding rehearsal that evening or whether they cant go to the auction because they are twenty-five hundred miles away. The biggest challenge for auctioneers is always about vetting the bidders and making sure they are doing good business. And we certainly appreciate that with my own auctioneering background, I’ve done enough bankruptcy court sales where the building has to be cleared in time and the bills have to be paid in time and I’ve even done sales in cases where I was liable for any deficit if someone didn’t pay their bill. On the other hand, if I am honest with myself, I have to admit that I usually have no more guarantees that someone is going to follow through with their purchase when they have registered live in person. We certainly don’t track whether or not people leave the sales site before they’ve paid and we don’t do a whole lot when they register except maybe scan a driver’s license and so, you can draw direct analogies between doing good business in live auctions on site in person and doing good business with folks online. My experience has always been, through the ten years of doing this, that the percentage of people who are flakes online is just about the same percentage of people who are flakes in real life, we don’t see anywhere near the kind of fraud concerns that eBay has and I think that is because we are event oriented and we are focused on a whole package, and its still a process, you have to participate and actively, you cant swoop in and steal a bunch of laptops and swoop out like they do on some of the different online platforms where you can use fraudulent credit cards and so forth, but my advice to auctioneers has always been and the guys that do best are the ones that make the effort to reach out to every registered bidder, pick up the phone, see if they answer the phone, see if they sound like a good Joe on the other end and make that human connection, and the auctioneers that accept the most number of registrants are doing the most business and selling the most items. The auctioneers that have the most prohibitive, restrictive deposit demands and registration requirements and a lot of documents and so forth are the ones who are not seeing very many transactions with their online bidding.

That’s a great point in that the higher your barrier to entry, the less participation you are going to have. I mean, it’s a pretty direct relationship I think, on that. Talk a little bit more in-depth if you would about the various options that an auctioneer might have as far as bidder qualification and what maybe the most permissive policy and the highest barrier to entry policies may be.

Well, its kind of interesting because at the last Industrial Auctions Association Conference, Bruce Schneider with Schneider Industries came to us and said we had restored his faith in humanity, because he approves everyone and he’s never had a real problem. On the other hand, the other extreme, we have some of the guys who stick to the old school New England auctioneer policies where you’ve got to put a twenty-five percent deposit down, but they are not considering that from the perspective of the bidder. If you’re a guy in California and you see an auction for a bunch of audio video movie gear, and you think you want to bid on this stuff and you only know of the auction from the Internet, you go online and you register and you see that this guy wants you to send him ten thousand dollars cash – wire transfer – before he lets you bid. Well from the perspective of the guy in California, the bidder, that sounds like the definition of Internet fraud. You don’t know who that guy in New England is, I don’t care if he’s been in business for two hundred years, his name isn’t meaningful to you in the California market, you just know he’s asking for ten grand upfront before you can buy fifty thousand worth of equipment, or forty thousand. So there is the disconnect. Now, we are working very closely to try to establish something in the realm of a Paypal type payment process that is focused on the needs of auctioneers where you are moving actual money and you don’t have a whole bunch of recourse to cancel the deal after you’ve taken the goods and so forth. Most auctioneers right now are working in the middle ground and what we do on our platforms is, we have all the forms to request whatever the auctioneer requires. So if they wish they can request a driver’s license, if they wish they can request banking references, if they wish they can request credit cards for either just a deposit or for transacting the deal, we do not provide payment services at this time but its certainly something we’ve been in consideration of and maybe in future years we’ll be offering that service, we would certainly never require it but as an opportunity and as a feature for auctioneers that maybe something they wish. At the end of the day, it seems to me the guys that apply some common sense discretion to the folks registering online and the ones that use some of the resources that are there to vet some of the bidders and so forth, they do fine. There is an occasional problem, but my experience is that the occasional problem since 1999 is very much the same as the occasional problem before 1999. You just get a guy who gets excited, gets over his head or he doesn’t understand auctions and you’ve got to deal with the situation occasionally. It’s a rare situation. But nonetheless, when you look at that form of requesting approval to bid, if they haven’t spelled their name right or if they’ve got a phone number with eight digits or what have you, well then you know you’ve got a problem or you want to follow up and investigate a little further. If they are a name well known to you as most of our industrial auctioneers have well known clients they’ve never met in person, then you automatically approve without hesitation and its very much like the same policies you use to vet your auction bidders in the past, its just on a new venue.

How does registration work? If I’m a bidder and I find an auctioneer’s item or inventory set on BidSpotter.com and I decide to register into that event, I obviously have some steps to go through that are dependent on what that auctioneer requires for that event, but once I’m registered into that event, can I then reduce the number of steps I have to go through to bid in another auctioneer’s event? And the follow up question is that if there is a communal buyer set, for lack of a better descriptor, can one auctioneer make comments about a bidder that can be seen by another auctioneer?

You’ve hit on a couple of features that are inherent to what we do. I spoke earlier about the differences between BidSpotter and remote bidder and the ability to have a set of bidders who are automatically approved because they are known to you is one of those nice features that we have with RemoteBidder. Because again, if you traditionally sell duck decoys at all your auctions and you’ve got a buyer who always comes looking for duck decoys, then he’s going to be there sale after sale and there’s no reason for him not to and you’re going to know who he is so you can automatically approve that bidder as someone on your good list so to speak. And that’s a nice feature to have. We are a little more wide-ranging I will say on the BidSpotter side and it is very common for someone to come in completely unknown, buy a few machines, settle the business and go away and not bid again for five years until he needs more machines. On that side we do have a system of auctioneers being able to leave comments about bidders and I would like to see auctioneers use it more frequently because it is a very good communication tool when someone does fail to pay their bill or so forth. One of the comments we’ve had in the past about bad bidders is why don’t you block them and never let them register again based on email address. Well, the easy answer is, because someone goes out and gets another Gmail or Yahoo account address and they become unknown to you. I’d rather keep an eye on the guy in the way that we know him and be able to communicate amongst the auctioneers, you know what, this guy hasn’t paid in the past you need to make sure you get deposit or find out what the situation was. But again, those are uncommon things, I’m very happy with the feature we have with RemoteBidder where you could your whitelisted bunch of bidders because it does save time and energy. And again, in the consumer good space, you have a lot more repetitive buyers.

We talked a little bit about some of the things that some of the successful auctioneers are doing with regard to even a paradigm as it relates to Internet bidding and customer registration. What are you seeing as far as some of the mistakes that some auctioneers are making that had they done things a little bit differently they could have done a better job with the Internet bidding and the relationship with those Internet bidders at their events?

You know, I think the number one area for improvement and the thing that seems to separate most the successful online auctioneers and not just the folks that sell the most online but also minimizing and mitigating challenges and problems after the sale, are the level of cataloguing. And I have catalogued hundreds if not thousands of auctions. I know how much work it is. I know that auctioneers often put out disclaimers that it doesn’t matter what I say or what this catalogue is, you are buying as is under your own inspection. Well, that kind of stands at odds a little bit with the circumstance that an online buyer finds themselves in where they are completely dependent upon the auctioneer for description. There is a trend amongst industrial auctions for folks to go down and inspect and then bid online later and I imagine for consumer goods there is still a fair amount of people doing that regionally as well, but you seriously have a lot of people who need to depend on you, because they’re never going to see the item until it arrives in their possession after you ship to them. So the difference between cataloging table as the whole description, and one small low resolution snap shot as opposed to getting very detailed and saying this is mahogany, Ethan Allen table with four leaves and so on and so forth, and putting in three or four images. One of the biggest advantages we have in our RemoteBidder site is how easy it is to manage multiple images and I believe that multiple images is a level upon which all of the different live auction broadcast sites are competing, because the more that that person can see for themselves, the better it works out in the long run for everyone. And a very good example I know came from a recent auction we did with OK Automobilia, it was kind of a fun auction because we run it on both the BidSpotter platform where they have done auctions annually for the last seven years under the name Vic’s 66, which they recently sold hence the new name, and we ran it on the brand new RemoteBidder platform. And between the two online platforms, we did about forty or fifty percent of the auction total gross and it was split pretty evenly between their folks that knew to come to BidSpotter and the new folks in RemoteBidder. But there was a situation that came out after the sale, a fellow had bought a sign – this was a sale of Petroliana and automobile signs and gas pumps and that sort of thing – definitely those kind of guy toys that a demographic works very well for. And the fellow came in and he looked at this sign which had been a hanging sign and it was two sided. And one side which probably had been against the building for years was gorgeous and the other side was very rough. And not to put it too lightly, the guy came in and basically blew a gasket. He said, “You know, I bid exclusively online, I couldn’t come look here, I’ve driven hours to pick this thing up and now I see you hide the back side from me.” And the auctioneer very calmly said, actually sir, lets go see what we had online, because he knew there were photographs there of both sides. In this case the client hadn’t availed themselves of it but it had been offered to them had they wished to look it over and do a little more due diligence and at the end of the day the guy paid his bills, said, “Golly, you know what, to be honest, I think maybe I saw that other side, I just I don’t know what I was thinking I got caught up in the bidding and you’re right, it was there and I need to pay my bill because I bought it and that’s fair.” So that extra effort by that auctioneer to snap one more picture really saved a situation where there could have been a dispute that was without a good resolution. And so I think that’s the place for most auctioneers can avail themselves best, and if I had a magic want and there was one thing I could say to the auctioneers as my rule, I would say catalog it the way you’re going to sell it, and sell it the way you catalog it. Because one of the biggest frustration we get with bidders in industrial sales is when we have a bidder who carefully pours over hundreds of lots of tooling and drill bits and so forth and picks out the twenty that he needs for his business and leaves very good absentee bids and events at sale, and then the auctioneer comes in and says, put the next twenty together, put the next twenty together. And so all over a sudden who left a hundred and ninety dollar bid for his one lot is outbid by the guy who is spending two hundred dollars for twenty lots. And it really didn’t serve anyone’s best interest but the set up guy wasn’t really in tune with the auctioneer ones and so on and so forth. Its important to remember that these folks online don’t have a good way to holler out and say hey, could you sell out 147 separate, I really just need that one piece. So that would be my magic wand wish. I think that most of the opportunities for improvement and more success and less challenges after the sale fall in the realm of cataloging.

Is this something that you’re seeing improve over time, the diligence that auctioneers are using as far as cataloging their auctions and what are some other overall trends you are seeing in Internet bidding in the auction industry?

Absolutely. I had to go to the auction in 1999 of one of the most preeminent industrial auctioneers in America at the time, who later rolled up his business with DoveBid and then now has rolled it back out again. And he was of the mind that people didn’t need to hear the auction, and they certainly didn’t need a picture of every item because there’s just no point. So I went a day early on my own nickel and I took a picture of the lot. And that was the first auction where we did more than 25% to the online bidders. And we made a believer of him that day. Since then, I think the auctioneers understand that its very important. We have a few holdouts who refuse to offer every lot, we have a few holdouts who refuse to take pictures of every lot, but by and large, everyone now is a consumer online frequently enough that we are all beginning to have a shared set of expectations. And we’ve all shopped at Amazon enough, we’ve all shopped eBay enough, we’ve all done Harry and David online for Christmas shopping and all these different things, and so providing that and meeting that expectation really, really sets a level playing field amongst all the bidders and you’d be surprised. What I’ve found over the years is that the online bidders are interested most in the twenty percent of your merchandise that represents eighty percent the value. So you don’t need a whole lot of action online to generate a whole lot of money. I know that in a recent sale two weeks ago, because of a partnership between their client and my client, we ended up going head to head with one of our primary competitors broadcasting the same auction at the same time and they sold a lot more lots and they sold about $17,000 out of the $600,000 sale, and we sold a $117,000 out of the $600,000 sale. And the difference primarily was a $70,000 lot and a $30,000 lot. So being dialed in the right demographic and the right mailing list could make a really big difference. But also, on the auctioneer end, providing the tools they need to make an intelligent buying decision and if you’re willing to risk spending thirty grand or seventy grand. Or we’ve actually had a single million dollar bid online and it went just fine. So it’s all about providing the information needed and setting it up so they can feel confident when they place their bid.

Well, that’s it for Episode 19. My guest tonight was Jeff Johnstonbaugh, COO of BidSpotter.com. You can find out more about bidspotter at www.bidspotter.com and about remotebidder at remotebidder.com. Thank you very much Jeff for joining me this evening.

Thank you, Aaron. I appreciate the opportunity.

You’ve been listening to the Auction Podcast from AuctioneerTech. If you have suggestions, questions or comments, or are interested in being a guest, please let me know by going to www.auctioneertech.com/feedback and leaving a message. You can also post public comments about this or any other episode, as well as find show transcripts, on the auction podcast page of auctioneertech.com.

Thank you for listening, now go sell something.

Walt Kolenda - AuctionWally, image via auctionwally.blogspot.com

We have to admit that we’ve been following recent events at eBay with a little bit of schadenfreude. We’ve always held the position that someone who sells on eBay isn’t an auctioneer. eBay is the auctioneer that outsources the work of listing items to its sellers. Over the last few years, we’ve seen eBay shift the priority from competitive bidding to its Amazon-like storefront model.

As eBay begins what many believe will be a long and drawn-out slide in favor of many more nimble competitors, we have to realize that there are many thousands if not millions of eBay sellers who make their livings from eBay transactions.  The loss of the largest auctioneer in the world means that companies like traditional-auctioneer-focused Proxibid and up-and-coming Bonanzle will have a migration of sellers eager to find a seller-friendly space to set up shop.

One of the most visible sellers using Internet auctioneers has been Walt Kolenda. Unlike our Auction Podcast, which is focused on traditional auctioneers, his AuctionWally Show is a podcast focused on helping and education sellers who use sites like eBay and Bonanzle. Here’s the description from his Talkshoe page.

On the AuctionWally Show you’ll find comprehensive coverage of the auction world, online and off. Content includes niche antiques and collectibles education, interviews with leaders in the industry, and an off-beat humor.

Recently, in an effort to get to the bottom of why eBay hasn’t been more responsive and loyal to its seller base, Kolenda wrote a comment on the eBay Ink blog which he also ran in his column in the Examiner in which he publicly requests eBay CEO John Donahoe appear on a future episode of his podcast. We’re waiting to see what becomes of this challenge.

AuctionWally – http://auctionwally.com/
Auctions and Antiques Examiner – http://www.examiner.com/x-312-Auctions-and-Antiques-Examiner

Have you heard the AuctionWally Show? What do you think? Leave a comment with your thoughts.

We’ve received some search traffic from users searching for the phrase Auction Listing Specialist. As involved as we are with the National Auctioneers Association (NAA) and not ever hearing of such a course or designation, we decided to search it out as any responsible skeptic would.

It seems that Auction Listing Specialist is a course offered by a Delaware company called Auction Work at Home. It looks to be an instructional course for eBay users, not auctioneers. From what we can tell, the concept is that the service farms out to its members the labor for creating eBay listings and processing the sales and rebates on merchandise sold.

Skimming through the extremely long information page that describes the service, you can find an asking price of $197. You’ll also see warnings at the end of the page about how the price will soon go up substantially, how there are very limited time benefits available for those who sign up immediately and how today is probably the final day before they reach their limit. It seems there are only so many people who can take the course, though the material advertises elsewhere how over 1,000 people have already taken the course. Smart money says that the page hasn’t changed in some time and won’t for some time.

You’ll see the claim that “this is the only certified program in the world for auction listing…”. We think that the program isn’t so much for auction listings but rather for eBay listings. While eBay uses competitive bidding for some of the listings there and can technically be described as an auction marketplace, auctions are rapidly becoming a minority of selling methods on eBay, and calling an eBay training service an Auction Listing Specialist course seems like it might open the door for some people to mistakenly assume that the course is for auctioneers instead of eBay users.

We couldn’t find in the offer materials the name of the person or agency who certified the program and didn’t certify any other programs. While it’s the first and only eBay listing program we’ve seen, we haven’t look very hard for any others. We know for a fact that the Auction Technology Specialist (ATS) course offered by the National Auctioneers Association is a course certified by the NAA Educational Institute and that it does a good job instructing auctioneers how to do a good job listing items for real auctions. It is the only technology and auction listing course offered by the National Auctioneers Association.

The business model description includes references to a fixed profit of something like $13 per listing. This information suggests that each listing would have a fixed price or a minimum, which means that the listings wouldn’t really be auctions anyway. If the listings are truly auctions, the business model would have to ensure that at least $13 profit was made on each item, but capping the payments to the person listing the items means that any additional profit, based on the sales price less the cost of goods sold and less eBay’s commissions, wouldn’t go to that person.

The materials also reference processing rebates. We’ve purchased items from eBay that have had the bar codes cut off and now wonder if such products might have originated from services such as this one.

All in all, this program makes many claims and statements that deserve a skeptical investigation. It may be a viable and profitable enterprise, but we’ve studied it enough to know two things. If we wanted to be more educated about listing items on eBay, we’d visit the eBay Learning Center. If we wanted to learn how to be better at listing items for auctions, we’d take the Auction Technology Specialist course offered by the NAA.

UPDATE: After this post was published, I tried to close the tabs. Two JavaScript pop-ups prevented me from doing so. One pop-up offered an additional $50 discount which brought the price down to $147 and the other strongly encouraged me not to leave. I’m still not gong to say this service is a scam, but if it isn’t then why does it employ the same JavaScript pop-ups commonly used by scam sites?

We start the new year with an obituary for eBay Live Auctions, not to be confused with eBay Live!, the eBay convention for buyers and sellers held regularly in cities around the country. As of the first of the year, the website ebayliveauctions.com now redirects to www.ebay.com.

eBay Live Auctions was the division of eBay that allowed live auctions to take some advantage of eBay’s enormous bidder pool. Through the use of authorized providers such as iCollector and Live Auctioneers, auctioneers could post inventories and accept real-time Internet bidding like many other providers, but with the help of eBay’s bidding community which is still very large.

The downsides to eBay Live Auctions  were many. eBay treated it like an unwanted stepchild by not allowing the items to be found by searches using the default search bar on eBay’s home page. The link to get to the live auctions always seemed buried and hard to access. The providers charged a percentage of each item sold to an Internet buyer in addition to a hefty setup fee per event.

Still, other Internet bidding providers charge a percentage of each item sold and eBay’s huge community still provided thousands of eyes on the live auction listings. The biggest problem was that eBay’s buyers are not auction buyers. While they may be much more familiar with Internet transactions than Joe Allbox, they balk at terms such as as is and buyer’s premium and simply don’t understand that there should be bigger punishments to not completing transactions than negative feedback. Unfortunately, eBay’s unwillingness to disclose personal information, to say nothing of credit card information, to the auctioneers it was attempting to serve made it very difficult to ensure buyer performance for transactions with eBay’s customers.

All in all, the death of eBay Live Auctions  will be good for the auction industry and eBay. eBay has been good for auctions, but eBay Live Auctions has blurred the lines between eBay’s style of auctions and the methods of Internet auctions practiced by auctioneers, causing bidders to not understand how real auctions work. As eBay rearranges its deck chairs after hitting the iceberg, eBay Live Auctions is one of many logical cost-cutting culls.

As for those companies who had business models built around eBay Live Auctions, it seems that they will continue to operate by attempting to build their own buyer base, a task that is not hard as their auctioneer-clients will advertise their portals while advertising their events.

Did you use eBay Live Auctions or one of the providers associated with the service? What are your plans? Will you continue with the provider or switch to a different solution?

It’s time for a little year-end housekeeping. With all of the top lists being created regarding the previous year, we couldn’t help but join in with a top list and a review of everything we’ve done so far. Here are our top six posts that we like.

1. ATS designation – Auction Technology Specialist for auctioneers
2. Today is a special day, vote for science
3. Example RFP for new or redesigned website
4. Accessible websites, more RFP ideas
5. Purple Wave unveils grouped extension system for equipment auction
6. Never use letters in advertised phone numbers

Aaron Traffas, CAI, ATS, CES is the author of AuctioneerTech

Here is our year in review, with a summary for each month. Don’t forget that you can always go straight to the posts for any given month using the links in the side bar on the right.

July
While the site launched in September, we cheated a little bit by scraping from other sources and populating it with a few related posts made previously on the NAA discussion forum as well as aarontraffas.com. We covered the NAA forum, Ubuntu Linux, and PDF tools, as well as mentioned hosted exchange, some other email clients and Google Apps. We touched on how Internet Explorer is a great browser so long as it’s fully patched. We talked about how while Windows Vista is slower than XP in speed, it’s superior to XP in many ways that count such as security, stability and forward compatibility.

August
We  only scraped one post for August, and that was a short post about Flash and website usability. We dove much deeper into the topic with a series of posts in November.

September
The site launched on September 8, but September 2 featured a scraped article from aarontraffas.com about the release of Google Chrome, which held our attention for a few weeks until we went back to Firefox and Opera. We covered OpenOffice 3, noted that eBay is declining and only accepting Paypal, and had the first article about auctioneers. We discussed advertising for Internet only auctions and Apple’s new iPods, as well as evangelized about Secunia, Twitter, and Skyfire. We migrated from one laptop to another and showed how MozBackup and Belarc Advisor help make the process easier. We examined how phpList makes bulk email list management easier for auctioneers and we also had two posts about PDFs showing that you should use them sparingly and never use Adobe products when the alternatives are faster and cheaper.

This author took part in the Kansas Auctioneer Association bid call competition at the Kansas State Fair and has a live blog from the experience as well as a video to prove it. The experience was the catalyst for a position post on why state associations should use computerized tabulation for bid call competitions.

September saw the first five Auction Podcasts as well as the listing of the series within the podcast section of iTunes. The episodes were based generally on content from existing posts on AuctioneerTech. There was the primier on advertising Internet only auctions, a tech roundup covering several shorter posts, and podcasts covering PDF and phpList.

Robert Mayo. CAI, CAGA, AARE was featured on Auction Podcast Episode 7

October
The first post in October was one of celebration after finally figuring out how to prevent the nasty screen flickering found when using an external monitor on some laptops loaded with Vista. While we were talking about multiple monitors, we showed how Synergy can be used to share your mouse between multiple computers, not just multiple screens. We noted and showed examples of how auctioneers are using WordPress for auction sites and described in depth the new Auction Technology Specialist designation offered by the NAA.

A new resource list was created that is an ongoing project listing all companies and providers involved with auction clerking, cashiering and Internet bidding. We showed how OpenDNS makes the web faster and safer, and how Google Adwords allows auctioneers to find a very targeted audience in a very short amount of time. We announced a critical security update for Windows and explained the importance of keeping your data encrypted while showing how Truecrypt makes it crazy-simple to do. For collaboration needs, we talked about how UStream makes it easy for auctioneers to broadcast video of events for free and how ShowMyPC and LogMeIn make Internet meetings free and much more simple than other expensive solutions such as GoToMeeting or WebEx. For those auctioneers who want to be a little geeky, we gave away the secret to a free education at W3 Schools.

Brandon Harker with Auction Flex was featured on Auction Podcast Episode 9

October’s podcasts covered Internet bidding as well as Adwords and OpenDNS. October found the first podcast guests in interviews with Robert Mayo of Mayo Auction and Realty and Brandon Harker of Sebae Data Solutions, makers of Auction Flex.

November
In November, we caught election fever and wrote about the importance of science in society and of ensuring that our elected officials understand the importance of science and technology. We discussed how hosted Exchange lets companies share Outlook contacts and calendars properly without the headache of managing an Exchange server.

We got geeky with files and talked about how 7-zip is the best compression utility and how a Drobo will let you sleep at night. We broke a story about AVG flagging one of the files in Adobe Flash as a virus, and we’re still getting several visits each day to the website from users searching for information about flashutil10a.exe.
Toward the end of November,we launched a series of discussions on what could go in an RFP for an auctioneer looking to build a new or redesign an existing website. Thanks to our friend Rob Spectre for posting some additional topics. We repeated that it was easy to use Google Docs to build simple web forms and wondered aloud if having auctions on Black Friday was a good idea.

Darron Meares, CAI, MBA, CPPA was featured on Auction Podcast Episode 10

November saw the Auction Podcast shift from being rehashed content on a separate page to new content included on the main page. November’s podcasts included an interview with Darron Meares of Meares Auction Group, a show on how open source software makes life easier and reduces expenses on software, and a controversial episode explaining that in many cases if you’re shipping auction items you’ve failed in marketing.

December
We continued our discussion about RFP ideas with some notes and comments about accessible websites. We looked from a marketing perspective at the importance of never using letters in advertised phone numbers, making sure an auction website had the upcoming auction calendar front and center with thumbnails, and ensuring that video is distributed properly. We also emphasized how important it is to be careful when browsing, and showed that Firefox users can browse freely and safely when running NoScript.

There were some interesting ideas covered such as Mahalo’s introduction of human-powered answers, as well as a New York auctioneer offering to negate the buyer’s premium in exchange for prepaid transactions. The National Auctioneers Association released the NAA Newsroom and Auction Answers and some dude royally ruined an auction by the Bureau of Land Management. Purple Wave released a new twist on the Internet only bidding model, a grouped extension feature that extends the entire group if a bid is received in the last few minutes.

The final Auction Podcast of 2008 covered dual agency with regards to absentee bid implementation. The final posts of the year included articles on letting your computer help science when you’re not using it, using Foxit Reader’s new typewriter tool to write on PDFs for free, and using Mint to automatically track your finances. We thanked you for racking up over 1000 listens to the Auction Podcast and encouraged you to go vote for the coolest tech of the year.

Going forward
It’s been a great four months; thanks to everyone for the kind words. Thanks to all of you who have left comments or feedback in response to articles or other comments, your participation is immensely valuable. Thanks to the guests who have been featured in podcasts and thanks to the guests who have already committed to podcast appearances in 2009. Have a safe and happy New Year’s Eve. We’ll see you next year.

Auctioneers educate consumers with launch of Auction Answers

The National Auctioneers Association has recently posted Auction Answers on its home page. The document is a PDF with answers to many common questions, such as “What is the auctioneer really saying?” and “Why sell at auction?” Auction Answers originated in partnership with USA Today and its semiweekly feature, Auction Showcase, which advertises auctions from around the country.

“Auctions fascinate consumers. They’re not only entertaining and fun, but also a great place to buy and sell goods and assets,” said NAA President Randy Wells. “For many, auctions can be intimidating and confusing at times. The goal of Auction Answers is to clear up much of the confusion surrounding auctions, such as terminology and its process. We want every bidder to be prepared to bid on auction day and feel comfortable when they raise their bid paddle.”

In addition to launching Auction Answers, the NAA recently made available from its website a link to the NAA Auction Newsroom. This site offers links to news articles related to the auction industry. There are already several ways to get news about the industry, most revolving around setting a notification using Google Alerts or Google News. What makes the NAA Auction Newsroom different is that the NAA has already filtered the wheat from the chaff, so to speak, and eliminated all the non-relevant articles relating to eBay and other celebrity or non-professional auctions that would turn up in a search but not be related to the auction industry. “This is a very exciting tool because prior to this we could not replicate new stories due to copyright restrictions,” wrote Chris Longly, Director of Public Affairs and Communications for NAA, in an email. “I would add that members can place this link on their business website as well as another avenue to promote auctions.” Longly said the NAA Auction Newsroom would be featured in January’s Auctioneer magazine, so keep an eye out for yours in the mail if you’re a member of the NAA.

Over a quarter-trillion dollars in goods and services sold at auction in 2007, and it’s great to see the NAA take a leading role in evangelizing the auction method of marketing. We’ve mentioned previously some of the great educational offerings from the association, and we’ll be talking more about the USA Today Auction Showcase very soon.

Image via Wikipedia

Hello and welcome to the twelfth episode of the AuctioneerTech Auction Podcast for the week of 17 November 2008. My name is Aaron Traffas, and now that I’ve baited you with the catchy and possibly controversial title, lets examine the importance of local marketing as it relates to Internet bidding as well as a couple of shipping options if you find yourself in a situation where local marketing has failed and you must convey an asset to someone else who can’t make it in to pick it up.

Many auctioneers who turn to Internet marketing, especially Internet bidding, have the expectation that the items will sell to a foreign bidder, and for the purposes of this netcast we’re going to use foreign to mean someone outside of regular driving distance, perhaps even out of state or out of the country. While it’s possible to construct an advertising campaign that will accomplish this goal of selling items to foreign bidders, a much smarter play is to advertise locally first.

Let’s use the example I used in Auction Podcast Episode 2. If a car is worth $1000 and someone from another state has to spend $200 in time and fuel to come get it, he’ll only spend $800 at the auction. Someone across the street can bid the true $1000 because there’s not really any cost associated with item acquisition.

The ability for an Internet bidder to come in and pick up the asset from the auctioneer or the auction location is worth a lot. Part of the reason we see declining attendance at auctions, as well as a continued decline with eBay’s auctions section, is that people don’t want to wait. If I place a bid on item and wait for it to sell and then have to wait for the auctioneer or his agent to pack it and ship it to me, I’ve done a whole lot of waiting by the time I finally get the item.

However, if I’m a bidder and the advertising for a local event with Internet bidding has made me aware of an item in which I’m interested, I’m still probably not going to go to the auction, but I’m willing to bid more if I can go get the item immediately once I’ve been declared the winner.

I will concede that there are some niche asset types that have such a small or geographically foreign prospective buyer pool to which my examples and principals here aren’t applicable. Take, for example, the 40 Years of Star Trek auction that was conducted by Christie’s a few years ago. Because Trekkers are so geographically diverse, the global Internet marketing was crucial for the success of this event. Another example of the importance of global niche marketing can be found in some of the antique tractor auctions conducted by Aumann Auctions. The buyer market for antique tractors is so small and spread out that many times the only buyers who are willing to pay fair market value for the antique tractors are from far away. Without the global marketing, the tractors would sell for a much lower price because there probably aren’t very many serious antique tractor collectors in the greater Nokomis metropaulatin area.

The point is that its much better to use your Internet bidding as an option to entice local bidders to participate. Advertise to your local buyer base first if the items you’re selling are appropriate, because that local buyer base doesn’t have the costs of time, fuel and/or shipping that someone from far away will incur.

If you do have a high sell-through rate to foreign buyers, there is still an argument to be made as to whether to pack and ship the items yourself or turn to a third party such as the local UPS Store. Many auctioneers outsource the shipping, arguing that an auctioneer’s best time is best spent landing sales and working for his sellers. Some auctioneers have elected to hire additional staff and operate a shipping division, turning it into a proffit center. In either case, there are a couple of companies worth noting that can ease the pain of shipping larger items.

Navis at gonavis.com specializes in difficult-to-ship items like furniture and powersports. They have the ability to crate and palletize the items for you, so it essentially becomes a turn-key operation.

Uship at uship.com is an interesting business model that merges a reverse auction with the classic load-finding trucking dispatch service. They allow shippers – either auctioneers or bidders – to post loads that are bid on by service providers – trucking companies. They have an eBay-style feedback system for both shippers and service providers. They offer revenue sharing for their partners and they make it easy to include a widget on your website to allow prospective bidders to get their own shipping quotes based on average costs for like-kind items shipped similar distances at similar times.

Well that’s it for episode twelve. The last two episodes have been fairly short, but don’t worry. We’ve got some exciting interviews in the months ahead.

You’ve been listening to the Auction Podcast from AuctioneerTech. If you have suggestions, questions or comments, or are interested in being a guest, please let me know by going to www.auctioneertech.com/feedback and leaving a message. You can also post public comments about this or any other episode, as well as find show transcripts, on the auction podcast page of auctioneertech.com.

Thank you for listening. Now go sell something.

Darron Meares

AuctioneerTech – Joining me today for the second in the Auctioneer Interview Series is my friend Darron Meares, CAI, GPPA. Darron is Chief Operating Officer, auctioneer and lead asset appraiser for the Meares Auction Group. He is also a member of both the National Auctioneers Association and the South Carolina Auctioneers Association boards of directors. Good evening, Darron, thank you for joining me.

Darron Meares – Hey, Aaron, how are you? I appreciate the invite and I don’t know if I’ve ever had that good of an introduction anywhere.

AT – Well, introduce yourself to us. Tell us a little about your yourself and your background and how you came to be an auctioneer.

DM – Well, my name is Darron Meares. I am the Chief Operating Officer, now, of the Meares Auction Group. We had a little bit of a change in our company here lately and I don’t know if I’ve moved up the ladder or down the ladder, but still. I started in the auction business full time about six years ago. I’ve been in it all my life. My dad started a company in 1972. I think I worked my first auction about 1977-1978 running bid cards, the clerking tickets, things like that. I think I moved up from there to concession stand and then on up the ladder and I finally said, “Look, it’s time for me to get up in front of the crowd.” So, one of the first auctions he let me ring was with Ivan Broadwell and the PTL auctions. If you remember Jim and Tammy Faye Bakker, that was probably one of the first auctions I stood on stage in front of a large crowd and I was probably 10 or 11 years old. I traveled the country with the NAA. Probably my first convention was Las Vegas, 1981, and then Houston and on down the line. Being from an auctioneer family, my parents followed the NAA and the South Carolina association, and throughout the time in the profession I have been able to meet, greet and work with a good number of the leaders in our profession and I appreciate the opportunity that everyone has given to me to serve on the auctioneer boards in South Carolina as well as the national association. Other than that, I just do everything that I can to advance the auction profession and try to find new ways to advance our company and the profession. I teach a lot of CE seminars. As a matter of fact, I’m leaving November 20 to go to Cabo San Lucas to speak at the Industrial Auctioneers Association convention, so I do a good bit of traveling. My wife doesn’t like that part, but I think I’m setting a firm foundation for the next generation of auctioneers coming up.

Wonderful. What kind of firm is Meares Auction Group and what kind of assets do you specialize in?
Well, the Meares Auction Group is an umbrella for three companies. We have Meares Auctions Inc. which specializes in estates and collectibles, namely coin and firearm collections. We do a little bit of commercial and industrial. The second part of that company is headed up by my father, Larry Meares. That is Meares Land and Auction Company. And then we all join forces for Southeastern School of Auctioneering. It’s the only full-time auction school in South Carolina.

Well, I tell you that was something that grew out of the CAI class that you and I attended. We had had some discussions about some directions with the company and some things like that and one of the biggest things that I had seen in our area is the benefit, fundraising and charity auctions. The bow tie came along with the southern gentleman, which I don’t know how well I fit that bill, but, still, the southern part works. I went ahead and said, and most people that know me know that I’m a little bit different from the crowd, so with everybody wearing long-neck ties I decided to go a different route and pull some of the southern roots out and learn to tie a bow tie, thanks to my wife, and start wearing those. The Bowtie Benefits end of it came about because I needed a catchy title and bowtiebenefits.com was available on the web and I just added those two together. My goal for 2008 was 10 benefit auctions. So far this year I have either booked or conducted 22. One of my favorite events I look back on was the Gary Player Invitational. Gary Player, the professional golfer, moved his golf course design devision to Greenville, South Carolina. I had a chance to work with him this summer and they hired me to become their auctioneer for 2008 and 2009 and possibly 2010. So we’ve grown by leaps and bounds, there’s no doubt about it, and I love every minute of it.

Boy, it sounds like it. With all of these different venues that you are pursuing, I’m sure that you are not the only one involved. It’s great that you come from a family business. What are some ways that you keep your sales associates and your auction managers and everybody on the same page in collaboration and communication with each other?

Well, I believe in weekly staff meetings. There are some people that don’t believe in meetings. You know, they say that if you meet for 30 minutes in house you save an hour in the field. You meet an hour in house you save up to three hours in the field. So, I believe that if everyone is on the same page with the meeting schedule and we keep a standard operating procedure in place for different facets of the company, everybody’s on the same page. One of the things that we’ve instituted is, even though if somebody comes up and says, “Hey, I’ve got to have this auction right now”, we don’t do anything until we’ve meet at the weekly staff meeting. We bring proposals to the table, we talk about marketing, we talk about the structure of the auction – inside, outside, online, on-site, whatever it is – and everybody has a chance to voice their opinion. One thing that I like to make sure of is that anybody can voice their opinion. Now, of course, some people won’t do it. Some people like me do it more often, but everyone has a chance to do it in an open, non-threatening atmosphere where if somebody comes up with something off the wall, absolutely, let’s try it. If it’s something we’ve done in the past that hasn’t worked, we’ll bring it up and say, “Hey that didn’t work” and we’ll tweak it a little bit. But I think to keep everybody on the page you have to have standard operating procedures written down that everybody can look at and follow.

What are some of the main ways that you handle the marketing for your events? What are your favorite marketing venues? What are some things you have tried that have worked and some things that you probably won’t try again in the near soon?

Well, one that I will not try again is a billboard. It did not work for us. We got a little bit of traffic here and there to the website, a couple of phone calls – but nothing like a billboard should do. A billboard is mainly a reminder. You drive that venue every day, and – just say it’s on a main thoroughfare to somebody’s work – they see it, they see it, they see it – well, bam, it disappears. Literally and figuratively it’s still there, but in their mind it’s disappeared. It’s blended into the landscape and they don’t see it anymore. Of course – you and I have talked about this many times – the Internet. That is one of our biggest advertising medium that we use. You can stretch a dollar further…that the best way to stretch a dollar. If you got marketing dollars – just say you throw out a thousand dollar marketing campaign – you’ve got the Internet and various sources on there that are absolutely free. Craigslist is one. We advertise on realbird.com for some of our real estate auctions. I think it’s a $89-$99 dollars a year for as many listings you can put on it. The cool thing about RealBird is you take those listings and it gives you the HTML code to paste into Craigslist so that you don’t have a text Craigslist listing, you can have a RealBird flyer into your Craigslist listing. eNeighborhoods is coming up big for researching real estate neighborhoods and demographics. RealBird has a section on there that they can pull the school district information and things like that. eBay – the $150 classified listings – has worked for us. There are a thousand other websites out there that we’ve used from time to time. The AuctionServices email blast of one of the big ones that we’ve used for our collections when they’ve been online through Proxibid. We’ve also used the Proxibid slider adds that appear on the Proxibid homepage. We’ve done that and we’ve had good traffic from there. I’m trying to think. Email blasts, definitely. We try to send out at least one week. I like the way – there’s a company out there and of course I’m not going to hawk companies that don’t use – but there’s a company out there that always sends out an email blast that says there’s still time to register for you know, whatever event it is. I think that pretty cool and I’ve sort of tweaked that just a little bit, you know, registration’s open for this auction. Marketing with email. If you do it the right way and you use the first couple of lines of text that appear in Outlook and Zimbra and Eudora and however many client you have out there, that first couple of lines is the most important because that’s your attention grabbing part. You know, I could go on and on and on about this, but I don’t want to go too far because I’m teaching part of this in CAI II this year and I don’t want to go too far with it.

No worries there. What’s your position on on on print and traditional advertising – newspapers and direct mail – is that something that you continue to pursue? Are you reducing its importance?

Reducing it. Absolutely reducing it, and I’ll tell you this. What we found is – and you look at some of the [unknown] that are out there for print media – every everything in print media’s going down right now because people are looking more and more to their emails. You know if you carry a Blackberry or a Treo or an iPhone – something that gathers emails – you’re going to look at that and use that as a marketing tool more often than print. Now one thing that we have done, we sort of tweaked our print a little bit. We have an advertising contract with one of our newspapers here in the area and we go ahead and, you know, block off X amount of dollars per year so that we get a better rate. Problem with that is, you get a better rate per line but that means you got put in more lines to make that goal. Well, what we did, we looked into it a little bit further and found that the newspaper also does two magazines, they do fifteen different publications, four more newspapers – so what we’ve done is used our advertising contract to advertise in other areas. There’s an ad…it’s a 2×3 ad in a Wednesday paper in our main paper and it gives you a display ad for one day that you can put pictures, a whole lot more information in than any classified ad. So we’ve reduced it but we tweaked it a little bit. Postcards? We were doing the 5 1/2 by 11 size colossal post cards. We reduced those to the 8 ½ by 5 ½, and now we’ve gone all the way down to the postcard rate postcards and we get gang runs of those and send those out for $70-$80. And everything that we do, we drive it back to the electronic media. Everything that we do has our website at least two time on there so that it drives it right back to that media and we’re getting 15 to 20 to 30 new email addresses on our list every week because of things that we’re doing to drive people right back to it. I’ll tell you another thing I did at the auctions. I went out and did Vista Print – they give you 250 free business cards. I think it costs you about $7 or $8 to ship them to you or something like that. Well, anyway, we put our website on there. For free auction updates, login, put your email address on and we give those out. Another thing we do, we drop those in box lots at the auctions, in drawers in furniture just so that people will pick them up and login to our email. So to go back and answer the question, we still use print because of the age demographic here in our area, but we’ve reduced it.

You bet. Whenever you advertise, there’s always a desired action that you’re trying to get the reader to perform, and I’m squarely on your side where that action isn’t maybe necessarily anymore to come to the auction, it’s to go to the website to get more information because it’s so much cheaper to put the details on the website and use the more expensive traditional media to drive them there and to use it as lead generation for the website. Until recently, Darron, you maintained your own website. You relatively recently launched a new one. Who does it now and what prompted the switch?

Well, AuctionServices does it now. I went ahead and I gave it up. That was my baby for a while and it got to the point to where I wanted to keep up with everybody else in their websites and put some more out there and all of this. Well, I went ahead and I learned FrontPage. Well, FrontPage didn’t do what I wanted it to do, so I thought about buying Dreamweaver. Well, with the learning curve and things like that I decided not to. So with my Apple I used iWeb. I put something up, it looked good, but I still didn’t really want to maintain it. So what I’ve done is I’ve pretty much given it all over to Rick and his crew with AuctionServices. They maintain it. If I’ve got any changes I just shoot them an email, they change it. Based on the cost structure that we put in place, you know, any major changes of course we pay for those – but we went through and said this is what we want, build us a beta, let us look at it. They hit the nail on the head and it was what we wanted. Well, the main reason behind it is that you have to look at two things. You have to look at your time and your money and you got to figure out which one’s more important. Well right now, with me running the company and trying to take it in a different direction, my time is more valuable right now so I would rather go ahead and put the put the money in it, put the investment in it, and then take my time and put it elsewhere to replace that money and grow the company.

What software, Darron, are you using to clerk your auctions?

Auction Flex. We’re using Auction Flex now. We started with it after the convention in San Diego.

We’ll I won’t press you too hard about it as the last podcast episode was the interview with Brandon Harker who makes Auction Flex and you can find that at auctioneertech.com/auction-podcast or just go to AuctioneerTech and click on the links. But I am curious to know from you, as a user of Auction Flex, what were a few of the aspects that influenced your choice and what do you feel are its biggest strengths and what do you wish it would do better?

Well, a little history. Back in about ’82-’83 we started with CUS with one of their first systems. We started using it. We moved forward. We outgrew it. Now, of course, these programs have evolved, but at that point we outgrew it, went to another system. Wound up 10 years ago, I guess, with MAXA from JBS. We outgrew it and wanted something that had a little more expandability to it and actually we started talking with Brandon and Kris with Auction Flex in Madison, Wisconsin, I guess four conventions back, and trying to kick around some ideas and things like that. Well, we got to the point, we said, you know, it’s time for us to move on, we want a Windows-based system. I loved the DOS aspect of MAXA because it was a stable platform, there’s no doubt about that. But, this way we can go in and have the, you know if we decide to do multi-par, it’s on there. If we decide to catalog a different way, it’s on there. We can do the PDF catalogs and things like that are built into the system. The radios have been upgraded. We’ve got a hand-held unit we use now to clerk the auctions, and we’ve got a taller antenna mounted on our trailer now, on our clerking trailer, that allows us to move around with a handheld. So, positives? The Windows. I like the way it interacts with Windows, and I can go from from Excel and some other programs right back into it. The expandability – the ability to have a handheld. There’s a couple of cons. There’s a lot of updates that have come out here recently and, you know with each new update something changes on the interface and my clerks and cashiers have to go back in and relearn part of that and, you know, figure out what that new update is. They do a good job sending out a book, the problem is all of my support staff are not as computer literate as I am and it takes them a little bit longer and they have a steeper learning curve to to get to the point to pick up on those updates. I’m trying to think. That’s about the negative that I have seen here lately. Now I know updates are generally to make the program better to respond to a request from auctioneers, things like that, but I think that it could be expanded out, you know, two or three months or four or five months out before new update comes out. Other than that, we’ve been very happy with it. Customer service is very happy. What I wish it would do? To be honest it’s almost like the human brain. They say you use 20% of it. I would say we probably use 20 to 30, 40% of the software. There’s plenty more expandability that we haven’t tapped into yet. So at this point, I don’t know what else it would do or what else I would want it to do differently.

So you’re pretty happy with it.

Yeah, oh, absolutely.

So what then kinds of Internet bidding platforms do you use and what types of Internet bidding – as far as pre-auction only or Internet only or real time – have you used and will continue to use and how has the Internet bidding affected your business?

Well, I’ll tell you this. Proxibid is the only Internet bidding that we’ve used – of course outside of eBay. We were power sellers on eBay at one point and, you know, we went to – about five years ago, I guess, Proxibid had done an auction here in the area with another company and stopped by and justed asked us about it. We jumped on board and we’ve actually done – I believe we’ve done over 100 auctions on Proxibid now. Mainly we do live, online bidding, like we did today. I call it a hybrid where we started out with prebidding and then moved to the live platform. We did a coin auction today, about 300 lots on there. Now one thing that I have introduced a little bit in the past three or four months, I’ve been doing more than timed auctions on there for some of the ones where we don’t want to devote a full crew to  run a live auction so we’ve done timed. Another thing that I’ve done – well, actually, you and I both did – with the CAI fun auction. Putting it online, that was actually the first live benefit and fundraising auction that I had done on Proxibid and since then I’ve done three live, Internet auctions for benefits and fundraisers and I’ve got several timed auctions that we are adding to the mix now with some of the benefits of fundraisers. I’ve got an article coming out – should be in the next month or so – about how to use online bidding to sell the items that may not have sold at a silent auction in a fundraising auction. I’ve just seen that that has been a key to our business. We’re directly between Atlanta and Charlotte on I-85 corridor and we’re about 20 minutes south of Greenville, which is the second-largest city in South Carolina. The problem is, we’re in one of those areas that everybody says, “you can’t get there from here.” So even though we are really closer than people think, we don’t have as many people that come in the door. So we have to drive our marketing to get people in our door. So the Internet allows us to pull in bidders from all over the country. We’ve had bidders from Italy, Belize, Germany, Canada, Mexico – one or two more countries I can’t think of now – but that has been a key to us because, you know with real estate you look at location, location, location – well ours is country, country, country and people don’t really want come out to where our building is. We’ve been here since 1972 so we don’t really want to spend the money to move so we spend the money to do the Internet auctions and bring the people to us. I think the last coin auction we did – not the one today, but the one we did a couple weeks ago – I think we shipped to 26 different states. So that is the key to us using the Internet and it’s been a big push to our business.

What are some other cool and unique ways that you’re using technology to improve your business?

Image of Darron Meares

Oh, let’s see. Well, the funny thing is, and I just put my son son into bed, I work from home four days a week now. He just moved to a new school so, in doing so, my wife teaches at that school so she can’t be at home. So I said, well I’m 500 yards from the office, if they need me I can go in, so I’ll just change my schedule and I work four days from home. So, I’m doing a lot of instant messaging, MSN instant messaging, I do some iChats every so often on the Apple iChat. I’m doing a lot of emailing, doing a lot of conference calls through remote offices, GoToMeeting, Apple eMeeting – I think that’s the title – anyway…not Apple, the Adobe platform that they’ve got out now, I’ve done it with two different companies. And then e-faxing. So I’m trying to do everything I can to reduce the amount of extra hardware items that I have to buy for my home to move my office out here because one once he gets to the point where to he goes to four-year-old kindergarten then he’s going to be there all day and I’ll be able to move back to my office. But now that I’m here at home, I had to use technology to allow me to get out of the office. The funny thing about it, I communicate. I did three coin auctions – catalog and inventory – here at home and I did every bit of my email and communication through my Blackberry. I kept my computer on Excel. I didn’t turn on my email because I didn’t want it to flash up and get me distracted, so every time I got 50 items logged in, I checked my Blackberry, send email – so I did everything as a total, remote office at that point. It was cool. I liked it. I get more work done at home than I do in the office, there’s no doubt about it.

You teach at the Southeastern School of Auctioneering. You mentioned earlier how you speak at conferences, and you and I are both slated to teach at CAI this coming year. When you ran and were elected to the NAA board of directors, I remember you running on a platform of education and that was your main driver. What drives you to be so active in the auction industry and how does being active in the industry affect your business?

I tell you what, you start looking back and Derek Bok, the Harvard University president, said, “If you think education is expensive, try ignorance.” And on the flip side of that, Mark Twain said, “I never let my schooling interfere with my education,” so I’m seeing it from both sides. I said that in Orlando. I said that I wanted the education classes to be in all four corners of the country so that you wouldn’t have to travel all over the world just to see an education class. The Education Institute – I don’t know if I helped with that or anything, but the Education Institute has absolutely blown that up and they’re all over the country in different places. I feel that education is the key to this industry in a lot of ways. And let’s look at it from the Millennials and generation X. If you look at that, they are going to have an advantage on technology, but a disadvantage on face-to-face. Face-to-face communication right now is not going out, but it’s slowing being faded out to text messaging, emails, IMs, cell phones, things like that. So, if you go to the midrange – I said generation X, I meant generation Y – with me generation X, I’m right in the middle. You know, I’ve got my dad who’s been in this business for thirty-something years. I’ve got some of the ones coming up behind me that are the Millennials and generation Y. I’m in the middle because I grew up with technology. My first computer was a TRS-80 back in the early ’80s, and I picked up on that. But, I’m also in the middle to where I would rather sit down and record this in your office in Kansas than doing it over the phone, because I like face-to-face communication because I can read that person and see what they’re thinking, especially in negotiations. Start looking at the other end of the spectrum. You start looking at some of the more seasoned and veteran auctioneers, they are the ones – this industry is 55 to 57 years old range on average – so they are totally in face-to-face communication. They are totally into writing hand-written notes. They’re totally into a lot of these things, which is not a bad thing because I love that part of the business. But when you start looking at the education of the technology and the speed and things like that, they’re saying “Hey, wait. I got here by doing all these other things, why do I need these?” Well, the education bridges all three of those. It’s like a string of islands that are bridged together. And if you start looking at it from that point of view, you’re going to see that education is going to pull Millennials up and tell them what they don’t know and it’s going to help the more seasoned, veteran auctioneers at the other end to pick up some of these things that the Millennials know and it’s going to move back and forth. I love the fact that I’m right in the middle of all of this because I see it from both sides and I get it from both sides, which I think is great. My dad was the first one. He said, “I don’t know why in the world you want to do an auction on Proxibid.” And I said, “Look, they’re giving the first one free. If we don’t like it, if we mess up – we’re going to do our job the way we always do it – but if it doesn’t work, who cares? We’re not out any money and we go back to where we were yesterday.” Now 100 auctions later, he’s asking me, “Hey, are we putting this one online?” So the education part of it – I don’t think you can be in this business without the education part of it. There’s a lot of people out there that say, “No I’m not getting a designation,” “I don’t need it,” “I’m at the other end of the spectrum,” or “I can’t afford it” or whatever it is. Right now – and I’m not pushing anybody into spending any money on classes – but right now, as fast as this profession is moving, as dynamic as it is – I say that it looks like an anthill from the top down – you’ve got to have some type of education or some way to communicate with the other auctioneers so that you can go in and pull what they know. The way you’ve always done it may keep you at a level. It may be a baseline. You just may be at the perfect place, you’re making enough money, you’re putting enough money back, you’re giving enough money. Whatever it is, you may be there, but the education is going to tip you over that threshold and it might put you in another direction to where you might be able to accelerate some of those and also you might be able to pay it forward for the next generation that’s coming up, whether its your family or the next generation. Obviously, I’m very much in the education end of this as you can tell. But one thing that I did, I went in and I started in college in 1990, joined a fraternity – my grades and the schools grading scale didn’t match so I went home and I started working. I said, “You know what? I can work, I can work, I can work but I want something else.” So I went back 13 years later, finished up my bachelor’s degree, and I said, “Hey, I’m on this education kick.” And I went in and I went ahead and finished my master’s because I wanted to go in and figure out what the world was doing. I wanted to know what other businesses were doing. I’m reading Richard Branson’s new book, Business Stripped Bare, and it’s talking about how he’s taken the Virgin brand out there and some of these different businesses that he’s involved in, and that’s why I’m looking at taking our business in new directions. Without the education that the NAA and the South Carolina association and some of these other places I’ve been and picked up education – without them and the education they provide, I would probably be stagnant in this industry. The problem is, as fast-moving and dynamic as this industry is, if you’re stagnant somebody’s going to step right over you like a speed bump and move right on down the line. Now, I’m not saying that this is for everybody. There’s people out there – there’s auctioneers out there that are so happy with what they’re doing – that’s great, you’ve made it. And you know you’ve made it when you can say, “I can say no to this auction and still be OK,” “I can say no to this and still be OK,” “I can go for two weeks without having an auction, I don’t have to worry about it” – you’ve made it. But there’s some of us out there that feel like we need more. We need more. And it’s almost like having a pocked guide, Success Secrets of the Super Achievers and I feel like I’m writing a chapter in that because I’m trying to move forward. But the education part in my opinion is absolutely essential to what we’re doing.

Meares Auction Group logo

Well that’s it for episode 10. Thank you very much Darron for joining me.

Not a problem!

My guest tonight was Darron Meares from Meares Auction Group, which you can visit at www.mearesauctions.com – that’s meares auctions dot com.

You’ve been listening to the Auction Podcast from AuctioneerTech. If you have suggestions, questions or comments, or are interested in being a guest, please let me know by going to www.auctioneertech.com/feedback and leaving a message. You can also post public comments about this or any other episode, as well as find show transcripts, on the auction podcast page of auctioneertech.com.

Thank you for listening. Now go sell something.

In this episode, we’re going to cover the basics of Internet bidding including the different types of Internet bidding, or online bidding, and the different kinds of providers.

There are three main types of Internet bidding. Some Internet bidding providers allow some but not all of the types of auctions. I’ll cover some of the basics here, with future articles and podcasts building on these topics by discussing the combinations of the types of Internet bidding as well as going deeper into the benefits of certain types of auctions and providers.

Let’s begin by discussing the three main types of Internet bidding which are Internet only, pre-auction only Internet bidding, and real-time Internet bidding.

First, let’s address Internet only bidding. When the items sell based solely on the bids from the Internet, it’s an Internet only auction. Internet only auctions may have a bid caller and they may have a crowd, but when software is calculating the time remaining and the current and final bid prices, it’s an Internet only auction. Internet only bidding is sometimes referred to as an eBay-style or static auction, but those are horrific terms for it. Modern Internet only auctions have staggered endings and automatic extensions, more closely simulating a live auction. These modifications move the game so far away from eBay rules that there isn’t a legitimate comparison. The term static implies nothing changes. It’s very definition means fixed or motionless and the auction industry is doing itself an enormous disservice by using the word static to refer to this very active and exciting method of bidding. This method drastically lowers overhead, as well as provides a viable means of selling small groups of assets in multiple locations.

Second in our types of bidding is pre-auction bidding. Pre-auction bidding is the method of accepting Internet bids up to a point slightly before the auction begins to end and representing the Internet bids as absentee bids against the live crowd. This method offers the advantage of increased speed of the event as the auctioneer can see everyone who can possibly bid and doesn’t have to wait for an Internet bidder he can’t see. When the live crowd is done bidding he can sell the item and move on. It offers the convenience for buyers to place bids without having to attend the event or sit in front of a computer.

Finally, real-time bidding is probably the most common type of Internet bidding currently. The process involves an audio or perhaps video stream so that buyers can view the auction as it happens on their computers. They can place bids during the auction based on the audio and the display of the current bid price on their computers. This method has the advantage of allowing bids right up until the second the item closes, but forces users to wait in front of their computers until the items in which they’re interested sell. Many buyers no longer have that time available, or, when first seeing the auction, plan to sit in front of their computers during the event but forget by the time the auction starts to end.

Now let’s move on to the two classes of Internet bidding providers which are portal site solutions and integrated solutions.

When Internet bidding is offered but that bidding occurs on the website of a third party, that third party is a portal. That is, auctions from many auction firms are listed and the bidding is handled all within that site. This method offers the benefit of cross-promotion, where the customers driven to the site by one auctioneer may see the assets listed by another. The downside is that it makes brand-building very difficult and makes buyer retention next to impossible. This kind of solution is good for an auctioneer who needs results quickly. Examples of this kind of provider include Bidspotter, Proxibid, AuctionFLEX and NAA Live.

The concept of an integrated Internet bidding solution is less well-known in the industry. An integrated solution embeds the Internet bidding pages within the website of the auctioneer. The software may not reside physically on the auctioneers’ servers, but the website is built so that the buyer can’t tell the difference and never sees any logo or promotional materials of the provider. This method has the advantage of being excellent for brand building and buyer retention, but has the disadvantage of taking some time to build a buyer base. Examples of this kind of provider include JBS Software’s Maxanet and NextLot.

That’s it for episode six. I’m excited to announce that my friends Robert Mayo of Mayo Auction and Realty and Darron Meares of the Meares Auction Group have agreed to be the first two guests on the show, so look for those two interview episodes over the next two months.

You’ve been listening to the Auction Podcast from AuctioneerTech. If you have suggestions, questions or comments, or are interested in being a guest, please let me know by going to www.auctioneertech.com/feedback and leaving a message. You can also post public comments about this or any other episode, as well as find show transcripts, on the auction podcast page of auctioneertech.com.

Thank you for listening. Now go sell something.

Image via CrunchBase

eBay recently announced that in late October it will be eliminating checks and money orders as valid payment options for eBay sales. Remaining valid payment methods are as follows.

• PayPal, owned by eBay
• ProPay, partnered with eBay
• Credit or debit card payments direct to seller
• Payment upon pickup

There are several categories that are exempt from the payment restrictions, including vehicles, real estate, some machinery and the mature audiences category.

Two of the line-item questions on the FAQ are answered in a way that directly answers yes that eBay is trying to eliminate third-party checkout and no to the availability of checkout services offered by Google and Amazon. They say that they’ll work closely to integrate eBay Certified Solution Providers into their eBay checkout in 2009. I guess that Google and Amazon are not allowed into the club.

This change in the payment polices of the Internet’s biggest online auctioneer, a term eBay both needs and can’t accept, follows a fee-change-based depreciation of what used to be its core auction business in favor of more retail sales methods found in its Buy It Now and eBay Stores listings.

eBay can’t be called an auctioneer if it wants to maintain a lack of responsibility for the items sold and remain exempt from auction legislation. It’s biggest legal defense has been we’re not an auctioneer. Every news story, however, adds the tag to eBay like it would define an acronym. Even though it’s becoming more and more difficult to find auctions on eBay, and even though it’s becoming more and more expensive to sell items in a true auction method, the media still refers to eBay as an auctioneer rather than a storefront.

eBay has greatly affected the auction industry. There are auctioneers who were devastated by it and auctioneers who were built by it. Many people falsely believed that because they sold items on eBay they were auctioneers.

eBay has brought the term auction into the forefront of people’s consciousness. This rebirth is good and bad. While the auction method of marketing is now more widely known and understood, it’s also more frequently assumed that when you say auction you mean an eBay auction. The frequency of this assumption is diminishing, but auctioneers have a long way to go to teach the public that there are many other types and methods of auctions than what can be found at ebay.com.

eBay has leveled the playing field. Where once some auctioneers had a solid market for certain antiques and collectibles, eBay stole their buyers away with the lure of sexier, cheaper, like-kind assets. Why wait for 30 minutes at an auction when you can log in and get the item for half what you would pay locally? The other side of the coin finds auctioneers who used to sell rarities for pennies to a small local crowd. The use of eBay’s massive buyer base – by either the auctioneer or the local crowd – skyrocketed their items from $10 lots to $1000 lots.

I’ve always hated eBay’s auctions. I hated the waiting. I used eBay on a regular basis a few years ago, and I would always select to filter for Buy It Now events because I wanted to enact a transaction and get the item. I didn’t want to have to worry about having to worry about it again later. In the same way customers can no longer afford to spend a day at a live auction, eBay is recognizing that for commodity assets, customers are no longer willing to wait to know if they’ve made a purchase or if they have to continue to shop.

As eBay swings more and more away from an auction marketplace and towards an ecommerce storefront model, the aspects that differentiate it from services like Amazon and Google Product Search disappear. eBay has already begun to lose both its dominance and its extraordinary income. As it does, it will look for ways to capture more of the transaction costs. What is the first and most logical way to capture non-commission-based revenue? Take a percentage of the payment. Forcing users to use PayPal means they get to dip from the payment as well as the sale.

Now I’m going to go to eBay and look for my Halloween costume among their Buy It Now listings.