Setting the right starting price for each item in your online silent auction can make a huge difference to sale outcome.
Too high and you might deter people from bidding, too low and there may not be enough demand - but setting it just right? That’s the best way to maximise your fundraising results.
Here are some tips that will help you price your prizes:
There are many factors that go into determining a fair price for an online silent auction item, but one of the most important is what bidders will consider reasonable. With a little internet research, physical items like golf clubs or wine glasses are relatively easy to price. While more unique collectibles may take some research time before they're priced out properly.
Auctions may include genuine one-off experiences that are especially hard to price. Think dinner with a celebrity or an exclusive meet n' greet with a popular music artist! In these circumstances, it's important to think about who will be buying and how strongly they are likely to bid.
For example, a concert ticket plus a meet n’ greet with Adele would be highly sought after. It’s reasonable to assume bidding will be strong and the price point can then be at the higher end. But what’s the higher end, you ask?! Good question and there’s obviously no fixed answer but you should be able to find examples online of similar experiences that can guide you to a price.
Just make sure you reflect your audience’s demographic and likely bidding range in your final figure. An auction attended by mostly college students will have a very different price range compared to an auction attended by CEOs.
The starting bid price is there to make things easier. On any given online silent auction item the starting price should encourage as many early bids as possible which will create competition between bidders.
It’s important to note that if the starting bid is too low you may attract plenty of bidders but the momentum may fizzle out too early and you won’t reach the price potential. If you start too high you may deter bidders from participating.
We recommend that the start price is between 60-75% of the retail value or ‘fair price’. We find this is low enough to entice people to bid, but also high enough to secure an excellent return.
While 60-75% is a good benchmark, use your judgement if you feel the item or audience warrant it. For highly sought after or rare items you may feel confident at pushing the starting bid price higher, towards the 85-100% mark. For less attractive items, or for items that are early in the auction, you may choose to go lower, e.g. 40-55%, to generate lots of bids.
Pro Tip– remember that starting bids are different to minimum bids. Minimum bids are the point at which an item can be sold. Your starting bid many therefore be lower than your minimum bid (if you choose to set one).
The price of consignment items will depend the consignment provider’s terms. GalaBid supply items on a no-risk basis - if the item doesn’t sell, there’s no cost to the charity or non-profit.
If the auction item does sell, everything above the cost price goes straight to the fundraiser.
To maximise returns on your consignment prizes, consider adding around 20% to the cost price to get your starting bid price. Given your consignment prizes are generally the marquee items, e.g. luxury holidays or one-off experiences, this should be enough to attract bidders and secure a generous winning bid.
Minimum bid increments are a great way to keep the silent auction bidding moving at a reasonable rate. Nobody wants a prize item to get bogged down in tiny increments e.g. 5c at a time.
Set your minimum bid increments according to the starting price. For lower priced items you can set smaller jumps, e.g. 5-10% of the starting price.
For big-ticket items, don’t be tempted to set very high bid increments. Smaller uplifts will make the tail end of the auction less daunting for people to either maintain their bidding or join in.