Updated: Mar 27, 2020
Many feelings may be evoked when you hear the word auction, I get that. Many people think of foreclosures, “losing the farm,” or a last-ditch effort to sell depressed property, but I’d like to challenge that thinking. Auctions have been a popular selling method for hundreds, in fact thousands of years, and for good reason. Placing something up for auction can be the best way to realize the true fair market value of an item, easily and efficiently. However, sentimental value and a lack of education to an items true or current market value can often leave sellers disheartened or frustrated with the results. This further spreads the negative connotation. I get that and deal with it every day. Education, research of market trends and a good honest conversation are key.
Let me circle back to the misunderstanding of the word auction. It’s just another sales method. One I am very fond of, but I know it’s still a dirty word to many. In fact, the National Association of Auctioneer’s Advanced Marketing Program even suggests dropping the word entirely from your advertising efforts. Let’s just call it a sale on a particular date that you, the buyer, get to decide what you pay for “it.” Kinda like an old School William Shatner "Name your own price." I see it as a way to introduce those not familiar with auctions to our subculture. EBay, Live Auctioneers and Invaluable are great online platforms that have introduced auctions and bidding to the mainstream culture, but many of these sites have given way to “buy it now” options. We are a society accustomed to instant gratification. Remember sending away for something in a mail order catalog and waiting 4 to 6 weeks for delivery. You might have even have mailed in a check to pay for it. Remember checks? Now, you can have it later today with Amazon. The auction business is catching up or giving in to this and many are now offering a “buy it now” retail price, so you can have it your way. Like Burger King or Give the people what they want... but I still think we are missing out on potential. I guess I’m a little old school that way.
I still believe in auctions for many reasons. Most importantly, no one is ever going to pay more if you have a set price. If an asset is desirable, competitive bidding has been shown to drive the price beyond the typical used retail price. It’s often seen in firearm auctions, classic car auctions and fine art auctions, just to name a few. But it happens in many asset classes as well. I will always remember a J W Fiske Newfoundland Dog Statue we had at a sale. The family had it on consignment with a $1,500 price tag on it for several years when they called us to liquidate their booth at an antique store. They were fearful of “just letting it go” at an auction. “What if it only sells for a couple of hundred?” they asked. Well, it sold for $17,500 at the auction. Why? Auctions work. Most auctions are now worldwide platforms with online bidding that expose assets to tens of thousands of bidders. And when two people want something, there can be auction fireworks. I hope this gives you pause to reassess your thinking the next time you see the word auction. I know it’s been entrenched in your programming and it can be hard to break age old thought patterns, but I believe if you do, you will buy or sell at an auction very soon. They are fun, they are exciting and yes there are deals too, so don’t be so quick to judge. You might just have found your newest shopping addiction.