Ordinary Goods and Service
General rule of thumb for pricing ordinary goods and services:
START the bidding at about 40-50% of the retail, then divide the remaining value by 5 to engage a typical back and forth bidding exchange.
Here is an example:
Yummy Restaurant donates a $100 gift certificate
Starting bid should be $100/2= $40-$50
Increments should be $50/5 = $10
AUCTRIA has a built in all-auction pricing policy that saves time and by setting the starting bid, minimum bid increment, and buy-it-now price for your silent auction items, making this part of the process quick and easy.
UNIQUE and HIGH VALUE GOODS & SERVICES
Unique goods and services or those that have a high value can be speculative. Start too high and there is the risk of getting no bids, start too low and by auction close time, it might be purchased at at an undervalued price.
START the bidding at about 40%-60% of a realistic retail value, then divide the remaining value in bite sized chunks to quickly elevate the donation.
Here is an example:
A vacation package is donated with a retail value of $3,000
Starting bid should be between the $1,200-$1,800 range
Increments should be between the $75-$200 range
High Value items do well at live auction too. Live auction permits impromptu modifications. If the starting bid gets no activity, then the auctioneer can immediately lower the starting bid and adjust it accordingly.
KEEPSAKES & PRICELESS
Tailor items that are one-of-a-kind keepsakes or local and priceless experiences. Exclusive auction items will garner interest to the overall event, as well as the auction item itself. Keep in mind the past buying practices for starting bids.
- Do create the image of exclusivity.
- Do create a description with lots of details.
- Do create in the description how bidding on this auction item will delight the buyer.
- Don’t be apprehensive to start bid prices on these a bit higher too.
- Don’t start the the bidding at last year’s final sale price either; leave room for the bidding process to start and flush out.
Considerations with a keepsake, is it ‘valuable’ to only a subset of the audience, for example Mrs. Smith Classroom parents. If this is the case, start the bidding on the higher end, but with smaller increments to draw bidders into the action and remain captivated. To capitalize on the rarity of the item, the description should be detailed and play up the sentimentality. If there are multiple types of keepsakes, such as, school projects, try to be consistent with the starting bid and let the market forces dictate the natural flow of bidding.
Here is an example for simple projects:
Each class created a coveted group art project
Starting bid should be consistent: perhaps $25-$30
Increments should also be consistent, perhaps $5-$10
Here is an example for more complicated projects:
Class created a photo book that was created and printed costing $30. Starting bid should consider at least the cost for actual craft materials, +25-50% or more. Increments should be 20% of starting value.
Starting bid should be between $37-$45
Increments should be between $8-$9
Priceless items are those that truly do not have a retail value but do have an utility or emotional value. For instance upfront reserved parking, front row seating at an event, or an opportunity that is out of the ordinary like principal-helper-for-the-day. The priceless opening bid can be in the higher range. The bid increments should also be a bit larger in relation to the general goods. The total number of bidders for priceless items tends to be lower so make each bid increment count.
Here is an example:
Upfront Reserved Parking or Front Row Seating at an Event
Starting bid $50
Auctria features a PRICELESS category and pricing for such activities. Listing an item as Priceless draws attention to the item. In Auctria simply list the price as -1 and Priceless will show on the website and catalog.
This has a two-fold benefit for the charity: 1) the retail value is not artificially inflated on reports and 2) the Priceless items can stand alone for marketing purposes.
Keep in mind that this information is based on past auction experiences however it is only a guide.
The basic principle to stay consistent with auction item types and this should yield success!