If you are looking for an inexpensive way to start a business or a means to boost sales of your existing business, try online auctions! Many small business owners and home-based entrepreneurs have discovered online marketplaces as their primary or alternate sales channel.
Internet auctions like eBay, Liquidation.com, and uBid.com, can bring substantial benefits to your business. Attracting tens of thousands of buyers, auctions can help you increase sales, liquidate excess inventory, and acquire new customers cost-effectively. With basic listings as low as $0.10 to $0.90 for more bells and whistles, auctions can be an effective way to get new customers and increase your website’s visibility.
Success Factors in Selling at Online Auctions
Selling at auctions, however, is a different ball game compared with the traditional techniques of selling. To get the sales, you must employ the following factors:
1. Suitability of product for auction.
Some items seem to inexplicably sell better or worse than others. Those that sell well include collectibles, electronics, and items with narrow but intensive appeal. As auctions attract more buyers and sellers, even commonplace items such as used clothes; vacuum and cookware are finding audiences in auctions. Bulk items (referred to as “lots”) of books, clothes, scrapbooking materials, and software also generate active biddings.
2. Presentation of the Item.
The success of your auction will greatly hinge on how well you present your product, particularly your title, description and page layout. With thousands of items listed in most categories, a good title with searchable keywords ensures that your item can generate the eyeballs that it needs. To get the sales, however, you must have an easily read description of your product. The more comprehensive and descriptive, the better. The advanced technological capabilities available to us have given rise to a more demanding consumer who now expects sellers to present all information available. Buyers at auctions put a premium on the accuracy of your description, so mention any cracks or discoloration in your product, lest you be accused of misrepresenting the item.
A good quality (and original) picture is also a factor in increasing your chances of selling your item. The study “What Factors Drive Final Price in Internet Auctions? An Empirical Assessment of Coin Transactions on eBay” by Charles A. Wood, Assistant Professor of Management at the University of Notre Dame found that items for sale with accompanying descriptive photographs tend to sell at a price that is 11.3 percent higher than similar items without pictures.
3. Seller Experience and Reputation.
The researchers further identified what they call a reputation score effect, where sellers with higher reputation scores, derived from previous buyer feedback, sell items at a price premium 6.8 percent higher than sellers with lower reputation scores.
New sellers with zero feedback oftentimes find it hard to move their products, even at very attractive prices (think $0.01 as starting bid!). Experts suggest that new sellers should first get their feet wet at auction trading, by buying items from experienced sellers to learn the selling process involved, particularly fulfillment and delivery. By buying items, new sellers can accumulate feedback and begin establishing their credibility in the online marketplace.
4. Clear Terms of Sale.
Auction buyers expect to see all terms of sale, including the total shipping cost, method of shipping, all payments accepted listed, how soon you expect bidder to contact you & when payment is expected. Clearly indicate in your listing when you ship your items (next business day after payment is received or until after the check clears). The more detailed your terms of sale, the greater the chances of moving your products.
5. Length of the bidding.
Auctions that last longer tend to attract more bidders. EBay currently offers free listings for 50 items per month, and charges an additional $0.05 per month for select items, and $0.30 for others. Experiment how your product performs, and how quickly (or slow) it attracts bidders. Unique, one-of-a-kind products may benefit more from longer listings, while common products with established auction buyers may be able to attract bidders even for a short listing period.
Recommended Books on Selling at Online Auctions:
- The Garage Sale Millionaire: Make Money with Hidden Finds from Garage Sales to Storage Unit Auctions and Everything in Between
- eBay Unleashed: A Beginners Guide To Selling On eBay
- Selling Online 2.0: Migrating from eBay to Amazon, craigslist, and Your Own E-Commerce Website
- Sell It on eBay: A Guide to Successful Online Auctions (2nd Edition)
- eBay Secrets: How to create Internet auction listings that make 30% more money while selling every item you list