The Live Auction by April Brown Auctioneer

The Live Charity Auction

A live auction is competitive buying and selling process whereby an auctioneer cries out monetary increments asking buyers to commit to paying that amount with the raise of a numbered bid paddle or card. The live charity auction model can be as relaxed and informal as a picnic and as elaborate and entertaining as a Broadway show or as intimidating and intense as a Sotheby’s or Christie’s auction. Most fundraising auctions fall somewhere in between. All are productions that involve many players, hundreds of details with dozens of procedures and can be easily managed to profitability and fun.

It is important to keep a very tight timeline and control every activity that will be presented from the stage. Your guests will make decisions about what to buy from looking through the catalog either before the auction or as they follow along in real time. One of the best ways to keep both donors and bidders engaged is to dole out plenty of recognition for both groups of players. The setup of the stage and layout of the live auction arena is arranged to showcase items and facilitate sales activity. 

The Time-line

A time-line is a production tool for setting expectations for volunteers, vendors and venue personnel. As the auction nears, you need to put the timeline in writing along with the names of the people, their title and tasks they will be performing during that time-line. This includes any script that needs to be read, slides and videos that need to be played, special gifts or presentations, literally all the details. This is the expanded version of the live auction time-lime. Create a cover sheet with a shortened version for reference purposes. Timelines tend to get lost during the event and more copies are always requested so print at least six extra sets. If any changes take place on the master, they must be copied or hand written on all copies, and it’s almost impossible to run around and find every copy. I suggest buying a lightweight inexpensive printer/copier and plug it in near the production area, away from the clerking and check in for this purpose. It is a good idea to keep all these documents on a cd and bring a laptop as well to expedite changes to the copy. 

Time-line Tips

·               Limit videos to 3 minutes
·               Serve dessert after the Paddle Raise
·               Wait 30 minutes after the auction before clearing tables

The Live Auction Item Lineup

Bidding activity is generated by the attributes of the items being sold. If you are selling what your audience desires the bids will go as high as the buying power of that audience. There have to be at least two buyers competing until they reach the projected profit point. If one bidder drops out early and another doesn’t jump in to bid, the competition for that item is over. Knowing what your audience will buy can be a bit baffling and if this is your first auction, and the seats are not sold out, how can you possible know what will sell?

I created a simple system for rating and sorting items for the live auction.

Rating the Donations

Evaluate the donations as they begin rolling in. This rating data assists in establishing the projected  auction proceeds at any given time. As the auction nears, those donations will be sorted to one of the silent sections, the raffles, and giveaways, saving the highest rated items of the highest value for the live auction.

Evaluate and categorize donations by these attributes:  

·               The Audience Demographic – Does the item fit the demographic of your audience?
·               Item Value – Does the value of the item match the buying power of the audience?             

    Use this litmus test and assign a rating to the donation. Keep in mind that items of high retail value may receive a low rating and items with a low value may receive a high rating. As an example, local concert tickets to see Paul McCartney on a date certain six months after the auction would be rated higher than tickets on a date certain two weeks post auction that required air fare to another city. Read the chapter on Procurement for more information on retail value vs. auction value.

    With the above attributes in mind rate the items by the number of people likely to engage in the bidding for that item. Do not consider value at this time.

    1 = 1 person might bid

    2 = 2 people might bid

    3 = 3 people might bid

    4 = 4 people might bid

    5 = 5 people might bid

    Now sort the items by the rating and organize the items by value in ascending order. Value rises with each item until about two thirds of the way through the auction with the most valuable items sold before the Paddle Raise. Sell lower value items after the Paddle Raise.

    This is the typical lineup of a live auction selling 50 lots with a rating of 4 and 5.

    Catalog Numbers     1 – 3                Lowest value 4’s and 5=s.  

    Catalog Numbers     4 – 18 Value increases      

    Catalog Numbers     19 – 30            Value increases and sell most expensive items sell

    The Paddle Raise

    Catalog Numbers     31 – 50            Sell the balance descending in value

    Now you are ready to print the catalog.

    After the auction, just for fun, compare the sold amounts with the item ratings and see if the ratings matched the results. Knowing what appeals to your buying audience is information that will influence the procurement strategy for future auctions.

    Print Opening Bids in Catalog

    Opening bids send a message to the buying audience that any serious offer, including the Opening Bid will be considered. Low opening bids stimulate bidding activity and high opening bids can create resistance. Of course, a seasoned auctioneer will open much higher than printed catalog bids after the buyers have warmed up and he or she detects greater buying power. 

    List the Value in Catalog

    Listing the item value sets an expectation with bidders and can be a useful bidding tool. Listing items as “Priceless” should only done on items that are truly priceless, meaning not available anywhere at any price. Remember, a tax deduction can only be taken for the amount the buyer pays over fair market value. If a high value is placed on an item, less deduction is afforded to that winning bidder. Be realistic and honest about values.

    Accepting Last Minute Additions Before and During the Live Auction

    Last minute donations can create inventory management and marketing issues and you may not want to accept them. Personally, I think last minute donations are a good thing. You might as well put some procedures in place for accepting late donations before the auction and on auction night and then graciously accept everything. People will get inspired to donate as they walk through the silent auction. Nearly every auction has a donor in the live auction that spikes their package as it is being sold. Appoint one volunteer on the night of the auction to accept last minute additions and prepare the auction clerk to write in the changes and additions. Then make sure that information is given to data entry personnel for entry into the computer in the auction data base.

    I once sold a package donated by the world famous Wolfgang Puck. Wolfgang actually catered the dinner and attended the auction. Many of his friends were at the auction, some from his native country of Austria. Wolfgang’s donation was a private culinary feast at Spago’s in Los Angeles and included a stay at the Beverly Wilshire and limousine service. As I was selling this amazing donation, one friend added a box of cigars a private smoke with Arnold Schwarzenegger at the Havana Club.  One can only surmise that this package was pretty tricky to redeem. Spontaneous add-ons can be a real hassle to verify and arrange. The bid recorder must listen and record the add-ons and the auction chair will need to record and relay the contacts for further clarification before those add-ons can be redeemed.

    Staging and Layout of the Live Arena

    The live auction arena is cross between retail selling and a theater production. Every activity and person in the live auction arena has the ability to influence a bidder and the overall feeling of the auction. Few have greater influence than the auctioneer. Discuss the arena very carefully with the auctioneer and any other performers that will be sharing that space. The staging must be simple and safe and facilitate the sale of items and recognize donors and advertisers and relay the organization’s mission.  It is up to the auction organizers to identify the venue’s limitations and compensate with sound, displays, lighting, signage and safe pathways to and from the action. Take charge and create a schematic with written instructions for the venue personnel.

    How Long is Too Long?

    The typical live auction lasts anywhere from 45 minutes to 2 hours. Many live auctions can last as long as 3 hours. Time on the auction block is money in the bank. My rule is this: the auction needs to run as long as it takes to sell enough items to reach the auction goal. Since guests aren’t chained to their seats, they can leave and it’s okay if they do. Guests that stay are playing the auction game and engaged in the social aspects of the event. Focus the energy on the people that are present not the people that are leaving.

    Long boring auctions are not fun for anyone, but if your auction happens to go in that direction, don’t give in to shortening the auction for the sake of the audience. I met an auctioneer that told me a story of calling an auction and in the middle of selling an item the auction chair walked on stage and told her to stop selling and ended the auction. The auctioneer still had 3 items to sell. They reasoned that the auction was running long and the audience would rather hear the celebrity they had scheduled to speak. It makes little sense to spend hundreds of hours putting a fundraising event together and let 30 minutes and a few yawns rob the revenue.

    I conducted exit surveys a few years back and asked guests these 3 questions. 

    1. May I ask why you are leaving early?
    2. Is there anything in the live auction you wanted to bid on ? 
    3. Would you like to leave a bid?

    These were the answers: 

    ·               The babysitter had to be home by 10:00
    ·               They had to work, play, or go to church the next day
    ·               The were tired or sick
    ·               They spent all their money
    ·               They planned to leave early all along
    ·               The couldn’t hear the auctioneer
    ·               The sound was too loud
    ·               Too building was too hot

      The responses were as I expected. Few of the reasons people left had anything to do with the auction itself. People leave and people stay. Play to the people that stay.

      Recognize the Winning Bidder

      Bidder recognition is accomplished a couple of ways. First the name of the winning bidder is announced to the audience after the auctioneer cries “Sold!”. To further reinforce and honor the winner, a brag gift is presented to them at their table. We often give a simple novelty to be worn round the neck or on a lapel. Gifts that are worn on the body offer more visibility and travel with the bidder as they move about the venue. Leis, medallions, and blinking lights are some of my favorites. 

      Bidder Incentives Advance the Bid

      A Bidder Incentive is an enticement for getting hesitant buyers to bid higher.  The incentive is a gift that is awarded to a winning bidder when the final bid is at or over a pre-determined dollar amount. Often the bidder incentive is a bottle of better champagne delivered to the table after the item sells. The incentive comes into play after the bidding advances beyond a predetermined amount, like $500 or $1000 and up.

      Powerhouse Tip

      If possible, sell all items if the donor is in attendance before the paddle raise.

      Powerhouse Tip

      Any item of low appeal that must be in the live auction should be placed after the paddle raise.

      Powerhouse Tip

      Promote donations in advance, especially if the donor will be present.

      Powerhouse Tip

      Live auction items should be a complete as sold and easy to redeem.

      Powerhouse Tip

      Do not overvalue donations. Buyer’s are savvy.

      Powerhouse Tip

      Do not embellish or make empty promises. The auction is not over until the donation has been successfully redeemed leaving the winning bidder with a positive experience. 

      Powerhouse Tip

      Uncomplicated packages sell faster and for more money.

      Powerhouse Tip

      Don’t place valuable items last. The audience bank may be overdrawn and less money is available for bidding at the end of the auction.

      Powerhouse Tip

      Sell as many items as it takes to reach the auction goal.

      Powerhouse Tip

      Total up the items sold after the Paddle Raise. The odds are that another 10 to 20 percent of the gross proceeds were earned in the last hour.

      Powerhouse Tip

      PowerPoint is the perfect tool for making items come alive on a big screen. Use at least one slide for every live auction item.

      Powerhouse Tip

      Friendly and attractive models attract attention and draw the audience back to the action on stage.

      Powerhouse Tip

      Its okay if the audience starts to leave as the inventory reduces and opportunities to give are over. People who came to give and buy will find a way to do both.

      Powerhouse Tip

      It only takes 1 to give and 2 to compete.

       

       

      The Live Auction