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November 12, 2008
Live
Internet Bidding?
Also
known as “Simulcast Internet Bidding” is internet bidding in real time
during a live auction; this was a great idea, perfected in the late 90’s,
unfortunately it has grown into something that was never intended by its
creators. Cunningham & Associates, Inc. was the first auction company in
Arizona to simulcast an auction on the internet. We helped two of the
third party internet bidding companies perfect their platforms back in the
90’s and in 2000.
So why
don’t we do more internet simulcasts?
Simply,
it is because internet simulcasts have become a playground for seller and
shill bidding. This was never the intent of the creators of companies
like Proxy Bid, but this has unfortunately become what they have evolved
into. It is difficult enough to monitor seller bidding at live auctions,
it is impossible to monitor and prevent it on the third party internet
bidding platforms. Our own internal internet bidding system is a little
easier to keep clean than the third party systems, but it is still more
difficult than good old fashioned live bidding. This improper internet
bidding is a problem that eBay, for example, spends an enormous amount of
time and resources in an attempt to prevent.
Seller
Bidding: When the Consignor or Seller of an asset bids on his own asset
in an effort to artificially increase the bid against a legitimate
bidder. Seller bidding is illegal in absolute auctions.
Shill
Bidding: When the auction company knowingly encourages a bidder to bid up
an asset he has no intention of really buying, again, in an effort to
artificially increase the final bid.
Cunningham & Associates, Inc. and AuctionAZ.com, LLC actively monitors and
prevents Seller and shill bidding and we prohibit these activities at all
our auction even when they are not absolute auctions.
We have
proven over the past few years when our results have been compared to
those of auction companies which regularly simulcast their auctions that
the internet simulcasts do not improve the results. Maybe more
importantly, customer satisfaction plummets when auctions are simulcast,
mostly because most auction companies who do them make the internet
bidding preferential to live bidding. They do this by making it easier or
cheaper to register, or by giving tie bids to the internet, etc. Internet
simulcast were originally intended to provide the opportunity to bid only
when the bidder was absolutely unable to attend the auction live, it was
never meant to become easier or preferential to attending the auction in
person.
How do we
make sure that people can bid at our auctions when they cannot attend the
auction in person?
In some
cases, like with our auction November 6th, we will still do
internet simulcasts; this bidding will be done on our internal system and
will be closely monitored. We will require more information from our
internet bidders, not less, tie’s will go to live bidders, etc.
However,
the best way for bidders to bid at our auctions if they cannot make it to
the auction in person is to either leave us an absentee bid or to bid via
telephone. These methods achieve the same service as internet simulcasts,
but allow us to monitor and prevent seller and shill bidding.
We look
forward to seeing you at our next auction!
-- The
Cunningham's
past newsletters |
