Earlier this month on Twitter, I caught a link to the Chicago Business Journal. Shia Kapos wrote on this very subject. “Chef dinners on the charity auction block: a behind-the-scenes look” visits with some local chefs about their popular donations and the redemption process.

Most interesting to me was that the article confirmed one of my own observations:  Many of an auction’s winning top bidders never redeem the item.

One of the chef’s in the article estimated that more than 50% of his donations are never used.  Did you catch that?  More than half of his donated dinners are never consumed.

I’ve noticed this with other items, too.  As I work with clients, inevitably we’ll talk about the top-selling items from the previous year.  “How did that couple enjoy the trip to Mexico?” I’ll ask.

“They never took it,” my contact will reply, “They became too consumed with the planning of their daughter’s wedding.”

I hear this more often than you might think.  A wine tasting excursion in Napa never used because work gets in the way of a couple’s vacation.  The Mediterranean cruise – for which a couple fought fiercely in the auction – is never taken.  Gift cards which are misplaced.  Dinners which are never scheduled due to any number of personal conflicts.

I can’t blame the winning bidders.  I myself have been close to pulling similar stunts.  More than one gift card has been forgotten in my wallet, only to be found months later while searching for my insurance card.  An Ethiopian dinner which I purchased at a silent auction was redeemed days … nay, HOURS … before it expired.  And I won’t even write about the clothes in my closet which might still have a price tag hanging from the sleeve.

The auction method encourages bidding and buying, but it doesn’t force you to consume (i.e. take the trip, eat the dinner, wear the clothes).

Although I don’t advocate it as an acquisition strategy and wouldn’t suggest mentioning during your procurement pitch, it is tempting to mention to a prospective donor that, “in addition to all these great reasons as to why you should make this donation, there’s a good chance your outstanding gift of service will never be used.”

That becomes a triple win for the donor:  1) Feel good about making a donation.  2) Enjoy a tax deduction.  3) Never be troubled with someone wanting to fulfill on your promise!

I wonder what percentage of items in a charity auction are never redeemed?

Individual donors of items (like our chef above) would know their individual record, but it’s unlikely that even the charity would know this figure because their involvement ends once the certificate or item has been delivered to the winning bidder.

So, bid high, take it home, and just fuhgeddaboutit.

(c) 2005-2010 Red Apple Auctions LLC

P.S. Like this article?  If so, you’ll enjoy my FREE e-zine, Benefit Auction Ideas. Subscribe here.

Have a display explaining the need for your cash appeal, as was done at this hospital gala.

Many auction ideas can help you raise cash, but no other singular activity during your auction fundraiser will have more financial impact than the cash appeal.  It can be such a cash cow that one of my clients has no live auction and only conducts an appeal.

The appeal goes by various names:  gift from the heart … cash call … raise the paddle / paddle raiser … community gift … fund a need … or even — as one of my client’s says tongue-in-cheek — “the shakedown.”   Whatever you call it, there is a strict protocol to follow if you want to be successful.

Here are seven pointers.

* Select a single item or cause to fund.

You will confuse your audience if you have a laundry list of activities or items.  I saw an appeal flop at one school because they insisted on raising money for three items.  Some members of the (tipsy) audience became confused and thought they could choose which item they got to fund.  Ugh!  Keep it simple by keeping it singular.

* Advertise the appeal.

Just as you would advertise a silent auction item or live auction item, you should advertise the appeal.  Talk it up prior to the gala… put it in your catalog … highlight it in your program … ensure it has its own display table in the silent auction (see photo).  Showcase it.

* Describe the need.

This can be conveyed in a heart-wrenching video, a heart-warming live testimonial, or via a short plea from someone close to the need who can succinctly describe its impact.  Guests need to understand where the money is going, and how it will help the cause.

* Offer several different pledge levels so everyone can participate.

The appeal is the “group gift” of the gala, but not everyone is going to be able to give at the same level.  By offering four to six different levels of pledges, you ensure everyone in your crowd can give and feels good about it.

* Begin by asking for the most amount of money (your highest giving level), and end by asking for the least amount of money (your lowest giving level).

This is simple psychology.  Asking a guest to pledge $100 seems a modest request after they have just witnessed other guests pledging $1000.

* Ask auction guests to raise their bid card to make their pledge public.

With few exceptions, public pledging will raise more money than silent pledging.  Pledges written on notecards and collected by volunteers just isn’t as effective.  When a guest watches a neighbor raise his bid card, there is subtle pressure to do the same.

* Announce the total of what was raised.

Guests are always curious about the total, and my experience has been that even when the money raised hasn’t been as spectacular as privately had been hoped, guests don’t know it.  “Wow, we raised $25,000! ” a guest will tell me (even though we hoped for $35,000…), “That’s wonderful!”  Announcing the total inspires guests; they feel good about their participation.  You’ll likely even collect a few more donations as guests check-out.

© 2009 Red Apple Auctions LLC