Pricing Your Silent Auction Items
Setting the right starting price for each item in your live or silent auction can make a huge difference to the sale outcome. Too high and you can deter people from bidding, too low and you may not maximise the potential profit.
The ideal is to start at an item price that’s enticing to bidders, will encourage plenty of competition and yield a sale that produces a great return for your cause.
Here are some thinking points:
1. What’s the Fair Price?
A fair price is what bidders will consider reasonable for a particular item. Physical items such as golf clubs or sunglasses are easy to find a price for. It should only take a few minutes online research to work out what people are prepared to pay.
Unique items, such as sports memorabilia, can be a little trickier. However, online marketplaces such as Ebay or Gumtree should give a good guide as to the market value.
Auctions may include genuine one-off experiences that make finding a price precedence tricky. Think dinner with a local celebrity or an exclusive meet n’ greet with a music artist.
In these circumstances it’s important to think about your audience and gauge their appetite for the experience. If you have largely middle aged guests who are likely to have children or grandchildren, a meet n’ greet with Taylor Swift could be a perfect gift for them to buy. It’s reasonable to assume bidding will be strong and the price point can then be at the higher end.
You should be able to find examples of similar experiences online that can guide you to a price, but make sure you reflect your audiences demographic and likely income range in your final figure.
2. What’s Your Starting Bid?
The starting bid price on any given auction item is to a) encourage as many bids as possible and b) generate as much revenue as possible.
If the starting bid is too low you may attract plenty of bidders but limit the return.
Start too high and you may deter bidders from participating.
Galabid advises clients to start bidding at between 60-75% of the retail value or fair price. We find this is low enough to entice people to bid and high enough to secure an excellent result.
While 60-75% is a good benchmark, feel free to be flexible 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 on 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).
3. Consignment Items Are Priced Differently
The price of consignment items will depend the consignment provider’s terms. GalaBid supply items on a no-risk basis i.e. 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 fundraising organisation.
To ensure a great return on your consignment items, think about adding around 20% to the cost price to get your starting bid number. Given your consignment prizes are generally the marquee items, e.g. luxury holidays, this should be enough to attract bidders and secure a generous winning bid.
4. Do You Want To Set A Minimum Bid Increment?
Minimum bid increments are good for keeping the bidding rolling at a reasonable rate. Nobody wants a prize item to get bogged down in tiny increments.
Fix 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.
Want to know more about pricing your live or silent auction items? Get in touch.
GalaBid is CrowdComms’ fundraising software, developed inhouse, which facilitates bidding, donations, purchases, payment for and management of all fundraising activities before and during live fundraising events, galas, golf days etc.MORE ABOUT GALABID