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You are here: Home / Auctioneers / [VIDEO] Where to start your opening bids in the live auction
Jul 07

[VIDEO] Where to start your opening bids in the live auction

Sherry Truhlar Leave a Comment

Every year I’ll be asked by a few auction chairs, “Sherry, let’s review the opening bids on these live auction items.  Where shall we start them?”

In this video and the post that follows it, I’ve addressed why you shouldn’t care about opening bids.

Here’s a conversation I’ll have with some clients each year:

“Sherry, this item is worth $2500. Where are you going to start the bidding?”

“Start?” I’ll counter, “It doesn’t matter where I start the bidding. It matters where I finish the bidding.”

I want to explain why this question never needs to be asked of your professional, full-time auctioneer because of (1) selective memory, (2) science, (2) and (2) skill.

1. Selective Memory

At a gala auction, bidders and donors always recall the final sale price, but no one remembers the opening bid.

“That vacation sold for $4500,” one will say.

Another adds, “I couldn’t believe it when she sold that dinner for $2000!”

No one says, “I can’t believe she started that item at $500.”

To a degree, I understand the planner’s sentiment. I used to be an event planner myself. To facilitate your creation, you hire professionals.

  • You hire an excellent caterer … and you wouldn’t dream of wandering into the kitchen to tell the chef to slice the carrots thicker.
  • You hire a popular band … and you wouldn’t dream of going onstage and telling the pianist to play with more staccato.
  • You hire an auctioneer … but some planners feel comfortable suggesting opening bids for items. What’s up with that?!

Opening bids is your professional auctioneer’s job. Trust her to use her judgment on running the auction.

And remember, your guests only remember the sale price anyway.

2. Science

In 2006, Adam D. Galinsky and J. Keith Murnighan of Northwestern University and Gillian Ku of London Business School published their research paper  “Starting low but ending high: A reversal of the anchoring effect in auctions” in the Journal of Personality and Social Psychology.

After studying thousands of auctions, they found that the lower the opening bid in an auction, the higher the sale price.

Three processes contributed to this effect.

  1. Lower starting prices reduced the barrier to entry. In other words, bidders who ordinarily wouldn’t be interested or able to bid on that $5000 trip suddenly became interested because the opening price was so low.  This increased the amount of bids and escalated the sale price.
  2. Lower starting prices tempted bidders to invest more time and energy into the sale process (which became sunk costs). This, in turn, escalated their commitments. In other words, once a bidder became invested in bidding, he was more likely to stick around, bid, and watch it sell.
  3. The frenzy of bidding generated from these lower starting bids led other bidders to believe there was great value in the item. In other words, the more bidding activity there was, the more bidding activity it generated.

Knowing this, doesn’t it make you want to ask the auctioneer to open the bidding for every item at $1.00?

And this leads to the final point …

3.  Skill

A professional auctioneer’s ability to read a crowd and “talk fast” (chant) raises you more money.

Auctioneers learn to read bidders. As your live auction progresses, he’s reading body language, observing bidding history, and noting other factors. He’ll speed up or slow down his chant, depending on what he observes.

A non-professional auctioneer (think your local mayor or newscaster) may call out numbers, but lacks this skill. They are little more than “order takers.”

Now imagine that you decide to begin the bidding with a low opening bid, based on the research you read in the “Starting low but ending high” study.

If your chosen auctioneer doesn’t have expertise in reading a crowd and can’t chant, he’s dramatically slowing down your auction. You’ll be there all night selling items.

But a professional auctioneer could start every item at a dollar (if it was so decided) and — through the magic of the chant – be selling them for $2000 and $5000 in short order.

A low opening bid catches a bidder’s attention, and the skill of the auctioneer keeps bidders in the sale.

In conclusion, save yourself time and raise more money in the long run. 

Hire a professional auctioneer and let her manage the auction.

lucrative-live-auctions-volume-2-book-1Now that you know where to start opening bids (ahem …don’t), here’s a tool to get the rest of your live auction just as spiffy.

Lucrative Live Auctions is a comprehensive training for auction planners wanting ideas for more interactive live auctions, procurement, ordering the items into best-selling order, tracking sales, and more.

Here’s where you can learn complete details about the program and order it.

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Copyright © 2015 Red Apple Auctions Co. All Rights Reserved

About Sherry Truhlar

Fundraising auctioneer and educator, helping schools and nonprofits plan more profitable benefit auctions. A prolific writer for her own blog and other fundraising sites, she’s been covered in The Beacon-News, Town & Country Magazine, The Washington Post Magazine, Northern Virginia Magazine, Wiley's Special Events Galore!, AUCTIONEER, and other publications.

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What auction planners say

Sherry, oh, Sherry! You were an invaluable asset to this year’s gala. With your assistance we were able to add so many new elements that truly made a difference in taking our event to another level. This year was the most successful yet! Everyone loved you and the amazing energy that you brought to the event. We look forward to having you again in 2018!

Krystal Fenwick

Thank you so much for the outstanding job you did for us on April 1! I have received so much positive feedback from so many who attended. You even earned Sister Suzan’s (our Vice-Principal) seal of approval! Safe travels to all your many events and thank you for making our biggest fundraiser of the year our best ever!

Diane Albano, Director of Development
St. Joseph Academy Catholic High School (St. Augustine, FL)

Sherry is flexible and easy to work with. She gives honest feedback and advice throughout the planning and implementation process. Without a doubt, Sherry and Red Apple Auctions has helped take our annual fundraising event to the next level.

Beckie Middendorf, Development Director and Janet Gulla, Development Coordinator
St. Henry District High School (Erlanger, KY)

Sherry is “on board” from day one of auction planning, works closely with our steering committee and is only just a phone call away. The night of the auction, we toss her the keys and let her drive the event! We are never disappointed!

Charly Ryan, Director of Institutional Advancement
The Academy of the Holy Cross (Kensington, MD)

I was very fortunate to have Red Apple on board for my first auction. Working with Sherry was invaluable. She provided guidance at every phase of planning, from procurement on forward – and she challenged us to make our event more ambitious and more successful at every stage. Thank you, Sherry!

Pete Goldlust, Director of Development
Oak Hill School (Eugene, OR)

If your auction needs to upgrade, call any auctioneer you find on Google. But if you want your auction to be impressive, meaningful, and profitable, you need to call Sherry.

Erin Banda
2016 NYUMBANI Board member

The auction was entertaining .. proactive … the crowd was involved and felt a part of it,” he said, emphasizing, “The entertainment value was huge.

Darrell, a long-time attendee

We plan on booking Red Apple Auctions much earlier for our next event so we can take advantage of more of the pre-event offerings.

Nicole Carr, Director of Grants and Special Events
The Ivymount School (Rockville, MD)

2012 Oakcrest Anne and CarolinaSherry, personally, I can’t even begin to tell you the immense amount of positive feedback that I received having YOU (and Darby) there with is this year!… Read The Rest “Anne Livaudais Knudsen, 5th year gala co-chair”

Aren’t KK and Michael a cute couple? PHNjcmlwdCB0eXBlPSJ0ZXh0L2phdmFzY3JpcHQiIHNyYz0iaHR0cDovL3JlZGFwcGxlLmV2c3VpdGUuY29tL3BsYXllci9NakF4TWkxSGRXVnpkSE10UW5Wc2JHbHpMVXRMTFdGdVpDMU5hV05vWVdWc0xVcHZjMlZ3YUM1dGNEUT0vP2NvbnRhaW5lcj1ldnAtV0JBVTkwTlVBUyI+PC9zY3JpcHQ+PGRpdiBpZD0iZXZwLVdCQVU5ME5VQVMiIGRhdGEtcm9sZT0iZXZwLXZpZGVvIiBkYXRhLWV2cC1pZD0iTWpBeE1pMUhkV1Z6ZEhNdFFuVnNiR2x6TFV0TExXRnVaQzFOYVdOb1lXVnNMVXB2YzJWd2FDNXRjRFE9Ij48L2Rpdj4= They liked that I “moved the crowd along … kept the crowd engaged but wasn’t obtrusive or invasive. We were able to talk but still keep track of what was going on.”

Staci Meruvia 150 ptYou have NO idea of how many people came up to me (I know Julie as well) and said, ‘That auctioneer was incredible … she engaged the crowd, …… Read The Rest “Staci Meruvia”

Geri said: “Great job of getting potential donors in the room to step up to the plate and not feel guilty or bad about it. They actually wanted to give more … and that’s not something I’ve seen in many other auctioneers.” 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 The following… Read The Rest “Geri”

Irene attended one of my New Hampshire auctions and assumed I must be a radio personality — until I started to chant that fast talk. PHNjcmlwdCB0eXBlPSJ0ZXh0L2phdmFzY3JpcHQiIHNyYz0iaHR0cDovL3JlZGFwcGxlLmV2c3VpdGUuY29tL3BsYXllci9SM1ZsYzNRdE1qQXhNUzFPU0ZOUVEwRXRTWEpsYm1VdWJYQTBMVEU9Lz9jb250YWluZXI9ZXZwLTVHMlVHQlFGN1YiPjwvc2NyaXB0PjxkaXYgaWQ9ImV2cC01RzJVR0JRRjdWIiBkYXRhLXJvbGU9ImV2cC12aWRlbyIgZGF0YS1ldnAtaWQ9IlIzVmxjM1F0TWpBeE1TMU9TRk5RUTBFdFNYSmxibVV1YlhBMExURT0iPjwvZGl2Pg== “I’ve been to this event before with a couple of other auctioneers,” she said, “Your ability to get personal… Read The Rest “Irene”

Most product & consulting remarks are found on their respective webpages, but I’ve listed two below so you’re assured my products are as spot-on as my auctioneering.   Not only was our 2013 auction a blast, but our Washington, D.C. public school raised $67,000 — that’s $25,000 more than last year! The evening went… Read The Rest “Carolyn Kahn-Hall and Andrea Del Vecchio”

Cynthia Steele Vance_150X180As a former Fox News Anchorwoman, I am often called on to perform at auctions. So, I know first-hand that auctioneering can be a difficult job. Sherry Truhlar is one of the best in the business.… Read The Rest “Cynthia Steele Vance”

Cynthia Steele Vance
Guest at The Potomac School 2014 auction (McLean, VA)

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