Summary

We have discussed different aspects of online auctions. Of course this is a broad subject however, we focused on the most important factors regarding this subject.

Six different versions of auctions were discussed;

1. Public outcry also known as English Auction

2. Dutch auction

3. Sealed Bid Frist Price auction  

4. Sealed Bid Second Price auction also known as “Victory auction”

5. Chinese auction also known as “Tricky Tray” or “Pick-a-Price”

6. All Pay auction

Additionally, we have reviewed different bidding types;

1.     Penny Auction

2.     Beginner Auction

3.     Peak Auction

4.     Cash Back Bidding Auction

5.     Seat Auction Bidding

6.     Scratch Auction Bidding

Matching auctions with bidding types will result in a vast array of options. Although, very different all auctions have the same outcome.

Further, we have discussed the typical key websites (Quibids, Beezid, Ebay, Amazon, etc) and discussed the various types of auctions these websites utilize and the advantages and disadvantages of each.  Advantages of using online auctions include being able to add additional sales outside of a business’s traditional sales model, controlling prices through minimum bids to help cover cost, a cutting down of distribution costs overall, as well as open up to new international markets a business would otherwise find themselves not included in. These advantages to using online auctions also come with their share of disadvantages however, including; buying and selling fees, lack of autonomy and customization of goods, and online fraud.

Lastly, con artists are finding new ways to con people. An example of fraud it overpayment fraud in which a buyer gives a seller an counterfeit check of an amount higher than the value of the item and then asks for the amount difference to be returned to them with the order. This attacks the seller and not the buyer. An example of fraud that affects the buyer is a wire transfer scheme. This is where an item is sold and the buyer is taken to a wire transfer site and never hears from the seller again. Second chance schemes target losers of the bids and give them a similar product with a discount but once the person has paid they also never hear from the seller again. The only way to prevent these acts of fraud for the bidder to check on the seller and vice versa as well as using a secure payment method such as PayPal. Companies prevent fraud by using a firewall and an SSL which checks to make sure the site is trusted.

Online auctions are a great example of businesses adapting to an expanding international market. It’s not only allowed smaller businesses to expand their distribution pool but has also allowed for domestic goods to be easily assessable on a global market. Online Auctions allow for a typical online user to instantly have access to either buy or sell goods on a rapidly expanding market and while fraud may be the information systems number one threat, education can allow for safe navigation through this new market offering massive potential. Through using secure accounts, prepaid card and remembering to stay safe, online auctions could prove to be a great asset to your marketing needs. Happy bidding!