The National Auctioneers Association (NAA) recently surveyed their membership and found that 70.4% of members use a third-party vendor to manage auction bidder, sales, or seller information. Yet, only 55.4% of these members understand how that third-party handles that information.
As a result, the NAA published a position paper dedicating to better educate and promote the use of exclusive data ownership by auction entrepreneurs. Below is a summary from this position paper:
The National Auctioneers Association shall recommend exclusive data ownership by auction entrepreneurs in order to promote their own brand, drive traffic to their own websites and create their own online marketplaces. The National Auctioneers Association is promoting the accepted best practice of enabling and empowering auction entrepreneurs for success and long-term viability in the auction industry. The National Auctioneers Association will promote and educate auction entrepreneurs on the reasons for this best practice and how to implement and market this practice. What follows is the continuation of the conversation encouraged by this motion.” Auction Marketplaces, Auction Data, and The Impact — NAA, July 2021
It seems to us auctioneers have to make a decision. On the one hand, an auction marketplace essentially does the marketing for the auctioneer, at the cost of data retention and related fees. On the other hand, auctioneers can create and maintain their own data (marketplaces) but then have to market their auction themselves.
We have held that some auctioneers are not very skilled at marketing, and thus an auction marketplace may be a better solution for their needs: https://mikebrandlyauctioneer.wordpress.com/2020/10/05/youre-not-marketing-your-auction/. Even for those auctioneers who are competent at marketing, they will have to decide if it’s more economical to advertise their auctions themselves or use an auction marketplace.
Further, one must wonder if a bidder would prefer to look at a few auction marketplace platforms — or would rather check countless other websites and/or hope to be “found” by the auctioneers’ own marketing? Does the exclusive use of auctioneer-specific marketplaces make it even more difficult for bidders to participate? It seems likely.
Additionally, what does your current seller think? Would he or she rather you used an auction marketplace platform costing $2,000 or spend $4,500 to advertise their auction but protect “your” data? How does an auctioneer explain to sellers that it’s better for them to not utilize the auction marketplace platform?
We were early skeptics of the true intentions of large auction marketplace platforms — in that it seemed clear they intended to eventually compete with the very auctioneers who provided them all that data. More recently, however, we’ve noted it’s probably too late to do anything about this: https://mikebrandlyauctioneer.wordpress.com/2021/02/27/auctioneers-is-it-too-late-does-it-matter/.
Nevertheless, I am 100% in favor of NAA members being educated on this issue, including how to create and maintain their own marketplaces if they so choose. This education will need to include an emphasis on auctioneers’ agency duties including obedience, loyalty, and disclosure. We have to do what’s best for the sellers and bidders and necessarily not do what’s only better for ourselves.
Lastly, many auctioneers who are arguing to protect their own data are part of networks that do the exact opposite. As always, be careful where you secure your advice, as this is anything but a simple issue to manage. Data ownership is a topic around the world and the auction industry is no exception. The best solution would be a large popular auction marketplace platform that confirms they will not compete against auctioneers … however unlikely.
Mike Brandly, Auctioneer, CAI, CAS, AARE has been an auctioneer and certified appraiser for over 30 years. His company’s auctions are located at: Mike Brandly, Auctioneer, RES Auction Services, and Goodwill Columbus Car Auction. He serves as Distinguished Faculty at Hondros College, Executive Director of The Ohio Auction School, and an Instructor at the National Auctioneers Association’s Designation Academy and Western College of Auctioneering. He is faculty at the Certified Auctioneers Institute held at Indiana University and is approved by The Supreme Court of Ohio for attorney education.
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