The best Silent Auction Bid System is a very simple yet effective way to get the highest possible revenue from your silent auction. In order to put the system in perspective, let’s first discuss the “traditional” silent auction form.
The Traditional System
In the traditional system, a bid sheet is placed on the silent auction table in front of the item to be sold. On the bid sheet, there is a description of the item, a value, a starting bid, and a “minimum raise” requirement. Generally, there are 20 to 30 or more spots (lines) on the form for bidders to enter their bid.
To bid, the bidder first must read the description of the item, look at the value, understand the minimum raise amount, and read the amount already bid by the previous bidder.
After reviewing the information, the bidder, if wanting to enter a bid for the item must add the minimum raise amount to the previous bid amount, then must write in the new bid amount and then write his or her bid number or name. All of this takes time, is subject to a variety of mistakes such as improper bid raises, failure to write the new value clearly so the next bidder can interpret the previous bids, and other potential problems.
In addition, human nature dictates that if an item has a “minimum raise” of $10.00 as an example, we tend to do exactly as told, and will raise the bid by exactly $10.00. Rarely will people routinely “over raise”, that is, raise a bid by $20, $30, or more if the minimum raise is $10.00.
Finally, because there is an open ended bidding process, with no way to take an item out of the bidding before the close of the silent auction, the “hot” items will draw all the attention of the bidders, often at the expense of the bidding on the other items.
The Best Silent Auction System
The bidding process should be kept as simple as possible. You want your guests to be able to bid on as many items as possible as quickly as possible.
The amounts on the silent auction forms should be pre-filled before the auction, the bidder need only review the form, pick an amount to bid, and then write their bid number next to the pre-filled bid amount. This greatly increases bid activity for several reasons:
· No mental “math” for the bidder to deal with
· Only 14 steps keep activity on a “hot” item to a reasonable level. The very hot items are purchased using the “Own it Now” step. The balance of the silent auction items will receive more attention once the “hot” items have been purchased.
· The bid activity is spread over a wider selection of items since it takes less time to bid using this system.
· Bidders routinely skip bids on the forms and go directly to the level they wish to pay for the item. That is, if there was an item worth $100, the opening bid would be $20.00 and each of the remaining 13 bids would be filled in to a “Own it Now” amount of $150.00. Bidders will often skip increments and go directly to the $60 or $70 slot.
We recommend you use a form that has only 14-steps available to it, is a half-sheet in size and has pre-printed areas to list the bid increments. The normal opening bid is 20% of the estimated fair market value of the item, and each of the 13 remaining increments are set at 10% of the fair market value of the item. Since there are 14 steps total, this makes the final bid on the form worth 150% of the estimated fair marked value of the item. The 14th step is called “Own it Now” or “Guaranteed Purchase” which means a bid number entered there is an “instant winner” of that item.
The silent bid form should also be a 3-part carbonless form. The white and yellow copies should be removed at silent bidding closing and taken to the cashier for data entry and filing. The pink copy should remain on the table in front of the item so your bidders can check back to see if they were the successful bidder. The winning bid amount and bid number should be circled at the conclusion of the bidding.
Your organization will see at least a 10% to 20% increase in silent auction revenue compared to the traditional system. It is any easy system to use and will make your organization more money. The conventional wisdom is that with fewer places to enter bids, some items might sell too cheaply. Actually, on a single basis, that may be correct. However, when you look at what your overall yield is for the silent auction, your bottom line is what you deposit in the bank, and you will earn 10% to 20% more revenue from this system.