Types of online auctions

There are a number of online auctions available for use however, six will be discussed. First on the list is the Chinese auction. Other names known for the auction are "Tricky Tray" and "Pick-A-Price." During this auction bidders purchase tickets. After final bid the party with the most tickets is the winner. This auction is usually held at fund raising or charity events.

Outcry auction also known as English auction is the most common auction. Prior to bidding a reserved price is set. During the auction each bidder raise the price in a ascending manner until there is one bidder remaining or time runs out. The remaining bidder or person with the highest bid is awarded the item. However, if reserved price is not met the owner of the item has the right to decline the offer. A Dutch auction is very similar to a english auction wIth the exception of price. Instead of price increasing price descends. 

During Sealed-bid first price auction all parties bid simultaneously. Once the competitor have made their Bid on the good other parties involved can rapidly decide on whether or not to keep bidding. The party with the highest bid wins. Sealed-bid second price auction also known as Victory auction is similar to bid first price. The only difference between the two is the winner doesn’t pay the highest price instead bidder pays the second highest price. All-pay auction requires bidders to pay the set amount regardless if party won or not. 

Beyond the many different types of online auctions in use today, you can also take into account a vast array of different bidding types available to users ranging from penny by penny bids to cash-back bids.

Bidding types include:

• Penny Auction – A very common bidding type made popular by sites such as Quidbids and Beezid. In this bidding type users buy a package with a preset number of bids. The user can then use these bids to raise the price of an auction penny by penny. Typically each bid will reset the timer on the auction. The auction will then expire when no more bids are place and the timer reaches zero.

• Beginner – When a beginner bidding option is offered, new users can enjoy lower bids at a lower account amount. Typically these offers will last for only a set period of time and sometimes expire after the first auction is won by the user.

• Peak Auction – In a peak auction, bidding is only allowed during hours predetermined by an administrator most often during the peak times of online traffic.

• Cash back bidding – In Cash back bidding the winner of the auction will get back 100% of the money he/she has used to place their bids. The second bidder then gets back 50%, while the third receives 25% cash back.

• Seat Auction Bidding – In seat auction bidding, a user pays for a “seat” in the auction rather than a package of bids. After purchasing a seat for a predetermined amount set by an administrator, once bidding opens a user will be allowed to make unlimited bids at no further charge until the auction closes.

• Scratch Bidding – In scratch bidding users do not make bids but rather “scratch” at the set price to reduce it by certain increments. The auction will not display the ending time and the last person to have scratched by the end of the auction will be set as the winner.

Sources

 http://www.unieauction.com/how_itworks/bidding-types.html

http://www.referenceforbusiness.com/small/Mail-Op/Online-Auctions.html

Online auctions and Perks

Online auctions is a very broad topic because it does not focus on a particular item. Online auctions have grown to produce large corporations such as eBay, Yahoo, and Quibids. This blog will cover the types as well as logistics of online auctions. Online auction is a very profitable way to sell and obtain goods at a competitive price. It is much more convenient than leasing office space. Additionally, online auctions expose the product or service to a global marketplace instead of being confined to a local market. To increase profit, sellers could potentially get involved in fraudulent activity. Such activities include receiving money from buyers and not sending product or sending a less desirable item. To combat this issue software has been implemented by organizations to identify users practicing collusion. Taken this into account corporations have introduced an advanced system to prevent crimes e.g. shill bidding. Shill bidding is a seller that has someone bid on their item to increase price.

How does an online auction work?

An online auction begins when a seller lists an item and sets a specific amount of time the item must be sold. Next, a buyer may submit a reasonable price for the item. After time runs out the buyer with the highest bid wins the auction and is required to submit payment to the seller. When payment is received the seller sends the item.

Some questions that will be answered in future blogs are the types of auctions that are available to the consumer. The pros and cons businesses encounter through online auction sites. How corporations use software to manage the different processes of the establishment as well as prevent fraudulent activity. If there are any more questions that needs to be addressed feel free to post them in the comment section of the blog.