|
In the News
"Big Bidding" London -- If there's one thing three executives from auction-related B2B companies wanted to express about their companies at Line56Live! London, it's that they're not B2B versions of eBay. The domain expertise involved in conducting online auctions in the B2B space is exponentially more complicated that just dusting something off from Grandma's attic and putting it on the block. Furthermore, as the auction business continues its online assault, it's evolving. "An ideal auction solution is one that gives you the highest return and has the highest liquidity. But that takes a lot of work," says Scott Randall, chairman of Fairmarket, which provides auction software and services. Most importantly, there needs to be a great deal of profiling and personalization. Participants need to be able to find the equipment they want before the auction, and afterwards, the sellers may want to "up-sell" losing bidders, Randall says. Daphne Li, vice-president of corporate strategy for used capital asset auction house DoveBid, adds that auction vendors bring domain expertise, such as pricing knowledge. "Unless you're in the marketplace every day, you're unlikely to know how much equipment should cost." Several facets of auctions are changing, executives note, especially given the international nature of the Web. DoveBid combines onsite auctions with real-time webcasts, and recently handled an auction in Osaka, Japan that netted $2 million. In Japan, Li says, there is a social stigma attached to buying used equipment because it connotes failure. By conducting the auction over the Web, Dovebid was able to attract bidders from the U.S. and provide a better outcome for the seller. The convenience of online auctions also provides logistical advantages and anonymity to bidders on a much smaller scale. Li says Dovebid has hosted auctions in the Silicon Valley attended by online bidders in the very next city. Aggregating like assets is another way to attract bidders to online auctions. When a factory closes, PCs, office equipment, and assembly-line equipment may all be for sale. But the most valuable asset, say a steel milling machine, might be of interest to only a few companies in the world. Li says the ease of online bidding now makes it cost-effective to sell assets one at a time to targeted buyers. In the overall corporate structure, executives are paying more attention to purchasing, noted Daniel Wilson, COO and vice-president for FreeMarkets Europe, and that's increased the importance of auctions. Though most CEOs come from sales, he said, executives "have renewed their focus on the cost side of the business. You're seeing new corporate structures aligned and balanced to support both the buy and sell side of the business." During its offline auctions, Li said, DoveBid attracts an average of 250 attendees, but that number goes up 50 percent with the Web. "That means more competition and higher prices." Pretty good, she notes, for an industry whose last innovation was the microphone used to reach the buyers in the back of the room. |