Ashley is 25 years old. She works nearly 60 hours a week at both a personal fitness company and a nearby medical office.
She is also enrolled in night classes working towards her masters degree in finance.
Her mother’s birthday is coming up and Ashley is hoping to buy her a 14K gold necklace to replace the one her mother lost last year.
Ashley is finding some necklaces she likes at some local stores and has searched online with equal success. She is also looking at some live and online auctions where it appears she might get a “better deal.”
She has narrowed her choices to the following:
A local jewelry store with a 14K gold necklace for $1,100.
An online auction with two different 14K gold necklaces with opening bids of around $500.
A live auction coming up Saturday with over 100 lots of jewelry selling absolute including five 14K gold necklaces.
A few eBay listings of 14K gold necklaces both buy-it-now and auction-style with prices ranging from $700 – $900.
It appears to Ashley that she might get a deal at the live auction, the online auction, or eBay as contrasted with the local jewelry store. Further, the eBay buy-it-now would save her about $150 for sure.
We’ve written about the prospect of a deal being a primal driver of people to an auction. Ashley is absolutely considering an auction in order to possibly pay less.
But Ashley is busy. She wants to get this purchase behind her so she can focus on her work and classes. It isn’t that she doesn’t have time to bid online, or even attend the live auction Saturday. The time she’s trying to minimize is the time from this very moment until she has that necklace in her hand.
As Ashley evaluates her choices, it seems the quickest time from now to having secured the necklace is not an auction. Rather, she can have that necklace in about 30 minutes by purchasing it at the local jewelry store.
Her other choices …
The eBay buy-it-now listing she looked at would have required three days for shipping. (Approximately 3 days)
The live auction she saw would have required a three days until the auction, and one more day to attend the auction. (Approximately 4 days)
The ebay auction-style listing she found would have required five more days plus three days for shipping. (Approximately 8 days)
The online auction she looked at would have required maybe seven days or so, considering the length of the auction, and the shipping time. (Approximately 11 days)
This brings us to the critical question: Do people in Ashley’s age group want the best deal? Are they willing to wait 4, 8, 11 days for that possible deal?
Ashley certainly wants a deal, but she also wants to minimize time. Both time spent looking for the necklace and time waiting for the necklace.
If she wasn’t working 60 hours a week, and attending classes, she might be willing to invest more of her time to secure the best deal. But her time is worth money to her, and the $1,100 necklace in the jewelry store allows her to save time.
For Ashley, the online auction (eBay-style or otherwise) required the most time — time waiting for the necklace. As well, auctions intrinsically don’t guarantee anything … she may bid but not be the high bidder.
Let’s look at eBay.com. In 2003 about 90% of all listing were auction-style. By 2013, that number had dropped to 10%, with about 90% setup as “buy-it-now’s” In other words, an online store with price tags is apparently preferred to buying at auction.
Does anyone think eBay would have all but abandoned the auction-style listings if selling at auction was preferred by sellers? Or, would eBay sellers abandon the auction-style listings if they were preferred by bidders?
I’ve heard hundreds of times that Ashley and people her age prefer online auctions over live auctions due to the quickness and ease; I’m not sure an online auction fixes that issue. What is even quicker and easier is buying (it-now) and/or the retail market. Yes, Ashley likes quickness and ease, and for her maybe the prospect of a deal isn’t as motivating as the prospect of saving time?
Mike Brandly, Auctioneer, CAI, AARE has been an auctioneer and certified appraiser for over 30 years. His company’s auctions are located at: Mike Brandly, Auctioneer, Keller Williams Auctions and Goodwill Columbus Car Auction. He serves as Adjunct Faculty at Hondros College of Business, Executive Director of The Ohio Auction School and Faculty at the Certified Auctioneers Institute held at Indiana University.
Comments