[Hidden-tech] eBay Newbie Questions

[Daniel Fried]

Ed,

Most live auctioneers are paid go-betweens, just like eBay.  Just like eBay,
the seller sets a reserve price, and if the price isn't met, the auctioneer
will announce it after the bidding and the item will be unsold.

Ebay was purposefully set up to allow for a faithful reproduction of this
system, although they have added other options that are not as practical to
manage in a live situation.

Anyway, my point is that your categorization of a "live" auctioneer deciding
to refuse to sell an item as being different from the eBay reserve model is
seriously flawed.  In a live setting reserve prices are also set in advance
and it is generally assumed that all items at a live auction have a reserve
price.  The auctioneer will not (in most cases at least, there may be
exceptions I don't know about) do the deciding.

As for my knowledge of this, I did have some initial talks about doing web
development for a "live" auction house a few years ago, and although they
didn't really go anywhere, we did talk about the live vs. eBay models so I
could better understand their business.

-Dan

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A key difference, however, is that a 'live' auctioneer can refuse to sell an
item, even if there have been several bids but none has met the perceived
value (or "real" minimum).

As others have pointed out, if you have set a Reserve on eBay and someome
matches or exceeds it, you are obligated to sell it, regardless of whether
the price met your expectations.

So, setting a low reserve may entice people to bid, but there's an inherent
risk.

Ed

----- Original Message ----- 
From: "Daniel Fried" <dan at creativeconstructs.com>

Actually, the reserve price mechanism eBay uses mirrors the time-tested
system used in live auctions.  It may seem silly, but lower starting prices
get more people interested and bidding against each other.  Statistically,
once people enter bidding, they are likely to continue past a price that
they may not have chosen to enter at.

-Dan

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