Skip to main content

34 replies

Why keep the reserve a secret??

Replies sorted oldest to newest

B bjtMember
Hi BDS

You know, that's a good question, I often run into the sellers that don't like to reveal their reserves (in my case it is usually 95% don't reveal - 5% do Smile)

The reason they state is so that the auction is fair to all bidders.
I don't see what is unfair about stating your reserve.
Perhaps the seller is hoping that by not revealing the reserve, it will encourage "nibblers" to continue to bid in order to reach the reserve - perhaps they feel that if the nibbler knew what the reserve was up front, they might not bid at all (?)

These are just my off the cuff theories. I would be interested to hear from some other people on the forum about this.

-bjt
D dagnabitgrabitMember
Q. Do you tell people your reserve price?
A. How often do you get the email "What is your reserve?". If you ever use the reserve price format, then you probably get them quite often.

Should you spill the beans or not? I can't really give a definitive Yes/No on this one. Let me explain...

Here is how I view it. Why did you use a reserve in the first place? Was it so you wouldn't get ripped off and have to sell the item for a painfully low price?

When you set your reserve, do you set it at your cost, OR at the minimum profit level that you want for the item?

For example, you are selling a widget that cost you $50. You will be happy to get $70 (40% markup) for the item. Would you set your reserve at $50 or $70? If my reserve is at $70, then yes I would tell them the reserve. If they buy it, I made my profit.

If my reserve is set at my cost of $50, then I might tell them (Stick with me here :-) If I have only one of these, I probably would NOT. Especially if it a collectable item that has it's value determined by the buyer.

Do you know what I mean?

Here is an example: Recently we listed an original Elvis Presley t-shirt from 1956. It was worn with holes in the armpits, but the logo was in very good shape. (It could be mounted in a frame and look very nice). My wife and I had no idea how much it would sell for. There was no eBay history on this type of item. We knew the value would be determined by how badly a buyer wanted it. We set a $25 reserve on it. We wouldn't tell anyone the reserve. Why? Because we were afraid the first bid would be for $25 to meet reserve, and then it would get sniped last minute for $25.50. (BTW, the shirt sold for $283.16 including S/H. It was amazing. A bidding war occurred between SERIOUS Elvis fans. Their eBay IDs made clear their devotion. You can view the auction action by clicking here) The first bid was for $65 blowing way past our miniscule $25 reserve.

On the other hand, if I set my reserve at my cost, and I have multiples of the item, then I probably would reveal the reserve to someone who asks. The reason being that even if it sells for my cost or close to it, I am still making $$$ on the S/H, and I can average my profit out with the other ones that I have to sell.

So, in a nutshell....

If your reserve includes the minimum profit you are willing to accept, then yes tell them what it is.
If you have a collector's item then I would NOT share the reserve.
If your reserve is set at your cost and you have more than one, then yes tell them your reserve price.
If your reserve is set at your cost and you have only one, then no, keep them guessing.

diva (aka Dag)
B bigsteveMember
Hello -- !!

Interesting thoughts to be sure, but to my way of thinking waaaaay off base. Anyone who thinks this way is obviously an idiot. (Pardon me for being blunt)

With this way of thinking, the seller is only concerned with himself (MY profit, MY markup, etc) when it makes better business sense to be concerned with his customers. The most successful business all seem to do the same thing, namely figuring out what buyers want and then catering to that need. As a buyer, if I see something I'm interested in buying the first thought is almost without exception "how much is it??" If the answer is something vague like "tell me how much you are willing to pay for it and then I'll tell you if you can buy it"... I'm out of there fast.

With ebay I want to know up front if there is a possibility of buying the thing. My funds are not unlimited so I don't tolerate earmarking X amount of money for a week and finding out after the fact I had no chance to buy at my high bid. Too bad more sellers don't understand this.

The real genius sellers (imho) are the ones who list their reserve price in the item description. Whenever I see this I send them an email and thank them. Big Grin

Thank you and best wishes,
BDS
D dagnabitgrabitMember
Being both a seller & buyer I can see two sides of this issue. As a buyer, I don't like the mystery of reserve auctions, but still bite when I see something I really want. I've seen people (me included, once upon a newbie time) nibble away trying to find out what that damn reserve is... always certain it's just another $1.00 away! But I KNOW that 99% of reserve auctions are NOT going to be bargains, and part of the thrill of buying on eBay is that elusive bargain hunt! What a GREAT feeling to win an auction for a paltry sum and preen about it (picture me sitting at my puter rubbing my greedy little hands together and giggling "hehehehe")! It's like finding a designer coat on the triple discount rack and standing there in dismay wondering how you could BE so lucky and WOW it fits and DOUBLE-WOW there isn't a darn thing wrong with it! Did someone make a HUGE mistake? QUICK go buy it now before someone figures it out!!

When I first started selling, I never listed reserve auctions - I disliked them as a buyer and dog-gone-it I wasn't going to use them as a seller! Oh, but soon we learn! People won't bid on an item if the start price is "too high" because we are all looking for a bargain right?? I mean, we ALL know that a first edition of Stephen King's Gunslinger isn't going to sell for under $300, but we can always hope dammit! Maybe the person selling it doesn't know it's true worth and didn't do their homework! I'm not about to bite on an auction that starts at $300, but I will snipe on a reserve putting in my absolute max and hope for the best! Hey you will NEVER win the lottery if you never buy a ticket, right?

If you avoid listing your item with a reserve and start with a low attractive start bid, you risk the chance that your item will sell for less than it's worth, and what you need to make a profit. If you've ever put a first edition blah blah blah in a box and shipped it off with that horrible sinking icky crappy I-Want-To-Cry feeling in your gut because you sold the darn thing for $2.99, you'd know what I mean! And next week you see the same thing selling for $20.00 or more! waaaaaaaa!

So it's a Catch-22. List it low with no reserve and pray it will sell for a good price? List it high with no reserve and pray someone out there realizes the inherent value of the item and takes the high bid? Or list a low start bid with a reserve and hopefully reel in some bidders who will get hung up on getting YOUR item and chip away until they reach that darn reserve!? Sometimes the bidding will STOP once it is reached, which is ALSO a pain, but it is a WHOLE lot better than selling an item for 1/2 the price you needed.

An interesting observation, that ties into this. My sister and I attended a live auction last weekend. The barker would start all bidding at a "reasonable" price (let's say $50 for an example) and RARELY did people jump in at the start. Almost EVERY time he would have to get all the way down to $5.00 or $10.00 and then the bidding war would start. And 9 times out of 10 it would fly right PAST the bid he'd started with! My sister and I commented on it often - shaking our heads in dismay and laughing.

It's the same mentally in eBay. If you are a seller you have got to start that bidding low! So the only way to do that and hope to get the item's worth is to have a reserve. Now if you go telling everyone what the reserve is up front, then they are very likely to go looking elsewhere for a better bargain, when those same people might have instead nibbled away at your auction until they reached the reserve anyway.

(Keep in mind I'm talking about one-of-a-kind type items. I don't have multiple copies of collectibles, so I only have one chance to sell most the stuff I have. Rare exceptions are those few items I've learned are "hot" and snatch up whenever I can to resell - I MIGHT have one or two of them on hand at a time. To be honest, if I had a LOT of one item to sell, then it is likely an item whose market value isn't a mystery - so I see no point in a reserve in that case, personally.)

Anyway, it's psychological, it's marketing, it might even be insulting to those of us who are intelligent or savvy enough to know better. But we are marketing to the majority out there folks. Just turn on the TV and you will understand what I mean.

Fortunately I've never had anyone ask me my reserve... and I don't run many reserve auctions. I don't know what I'd do if someone asked. I don't see the point of having a reserve if you are going to tell. But I'm also an honest person. Hmmmmm food for thought.

And lastly, to me (no flame wars please) I don't see the point of having a reserve auction and then telling everyone the reserve price in your item details. If someone could explain the point of that to me, I'd appreciate it. My logic is, if you are going to advertise it, why not just start your bidding at that price and forget about having a reserve auction? I thought the "point" of having a reserve auction is to keep the price secret, allow you to start the bidding at an "attractive" price, and to assure you don't sell an item for more than you want. Maybe I'm missing the boat here... wouldn't be the first time, and I'm sure it won't be the last!

Disclaimer: The above meanderings are not intended as a direct rebuttal to anyone's statements or comments in this forum thread. This is all stuff I've been chewing on for some time now, and someone (whomever started this thread) just gave me an opportunity to put some of it down on virtual paper! THANKS whomever you are (can't remember and it doesn't show the originator's name in this area.)!

And a request... please remember that some of us are both buyers and sellers, and it is not always easy to balance those two things and be "right" all the time. Buyers and sellers will always be somewhat at odds with each other because one wants a bargain and quality and the other wants "quantity" (in dollars) for their quality.
Many many many good business arrangements have been made between the two, but to make both people happy BOTH have to walk away feeling like that got what they wanted.

The best buyers are those that realize that the seller NEEDS to make a profit and who VALUE other qualities like good communication, fast shipping, great packaging, honest and detailed descriptions, and some flexibility. AND the best sellers are those that realize that the buyer just spent their hard-earned cash on YOUR product (and may very well have spent more than they wanted to), who are willing to make concessions (when they can), who behave as if you (the buyer) are their most important priority at this moment in time, provide excellent communication AND follow-up, ship fast, package with loving care, and offer to bend over backwards to resolve problems. I'm sure I'm missing something, but you get the gist.

Wow, who passed ME the soapbox this early morning? Whomever you are, HERE! Take it back! Ok... back to the grind and then to bed. Night all!

diva (aka Dag)
C chatterMember
Well, said, Dag, thanks. I also appreciated the comments you posted yesterday, in interview format, that gave additional insights. Some others may not agree with the comments listed, but clearly this is an issue about which not all will agree. I disagree with the poster who claimed that anyone who subscribed to the notions expressed in the interview is an "idiot."

Having never sold anything on eBay, I can offer few insights! Cool
K kevMember
quote:
Originally posted by big steve:

With ebay I want to know up front if there is a possibility of buying the thing. My funds are not unlimited so I don't tolerate earmarking X amount of money for a week and finding out after the fact I had no chance to buy at my high bid. Too bad more sellers don't understand this.



Hi all, new lurker here...
Big Steve, Not really. Unless I've got it all wrong, if you bid your max on item A which has a reserve price and you don't make that reserve the page shows up with your bid marked with a "reserve not met" line. This way you know right away that you either need to bid more or your free to use that set aside money or something else. Likewise if you hit the reserve price the line reads "reserve met" and you know you're in the running.

quote:

The real genius sellers (imho) are the ones who list their reserve price in the item description. Whenever I see this I send them an email and thank them. Big Grin

Thank you and best wishes,
BDS


While I've only sold a few things (and never used a reserve)I would say about half the time I've ended up with Dags feeling that I'm "giving" something away because my starting price was too low and I didn't have a reserve.
But hey thats just my 2 cents...

Kev
mrsmmrsmMember
What I try to do is start out my small items (under $100.00) at my cost, including listing. This way, at the worst, I am only trading dollars if it goes "nowhere". On very large items, I usually start at the least I will take..not my happy point, but not at a losing point. I cannot say that I have ever been in a losing situation by following this. This is not much different than what I followed for years in my sucessful business. I am one happy Ebay seller! Big Grin

rsmiller40
Last edited {1}
mrsmmrsmMember
Big Steve, I do understand where you are coming from, but please keep in mind, these are auctions,sales conducted by bidding, not stores. There are risks for the buyer and the seller. If I were to use a reserve, which I do not, I would not reveal my reserve. I think putting on a reserve and revealing it is pointless. Why not start it at that point? If you say that it would start it too high, then the reserve is probably too high.

rsmiller40
D dagnabitgrabitMember
Whew! Thanks for not jumping all over my post guys. This topic seems somewhat controversial and potential "flame" fodder, so I was a bit worried I was going to push too many buttons and get people upset with me.

As far as the piece I cut-n-pasted from that newsletter, the guy that wrote it is a very, very successful power-seller on eBay. A lot of his stuff is hype to get you to by his e-books so you can get insider tips, but he does dole out some useful tips in his free newsletter. Apparently he was also a very popular speaker at one of e-Bay's big conferences.

I often don't like his tone or his attitude. He seems too cut-throat at times... all for the seller getting as much out of the poop unsuspecting buyer as the market will bear. But when you are selling 1000s of items a month I guess you lose that personal touch - which is something I've also been struggling with.

How do I sell more and still keep that personal, friendly mom-n-pop feel that I think gives my buyers that warm fuzzy feeling they like and deserve? No one likes to be treated like a number and get the same response to their problem as the next guy. We all feel we are unique and numero uno when we are having a problem. And I know I don't appreciate it when I email in a complaint and get a stock form-letter type reply. I will give you a recent example that really fried my azz!

I bid on this auction of 5 paperbacks. The ONLY reason I was going for this particular auction was for 1 paperback I have a buyer for - he has asked me to watch out for certain books. When I find them for a low price that I can mark up a bit, then I buy them and sell them to him. The other 4 paperbacks have very little resell value because they are mass market books and the market is saturated with copies for sale. I knew I wouldn't be able to unload them for more than 75 cents, and that's if I'm lucky - so I was counting on making up for that with the sale of that one book!

So, I placed a very very low snipe bid and won the auction. Course I was obviously having a brain-fart day and failed to inquire about shipping costs, which wasn't posted. I got an automated invoice with shipping listed for $2, which was less than expected, but I wasn't complaining. I paid quickly via PayPal as I always do.

FOUR days later I got an email from the seller thanking me for my payment, but ooops his automatic invoice system was designed for his baseball cards not for shipping books, and oooops he undercharged me, and would I please send another $5.50 for S/H! Ok... $2 was cheap, but $7.50 is outrageous! So after counting to 10, I wrote him back and managed to avoid saying all the nasty things I wanted to about poor customer service and such, etc. (The NERVE of this guy ignoring me for 4 days, never sending a personal thanks or anything, and THEN jotting me off a letter saying I owed him more $ for S/H! And this guy is a BIG seller, not just little guy selling his collection from home.) Ok... so I replied to his email and acknowledged that $2 seemed low, but that $7.50 seemed too high. Could we reach a compromise? Would he consider shipping via Media Mail instead of his usual method of Priority Mail and I'd send him the additional money for that?

He came back with a big fat NOPE. My choices were get a refund for the auction or pay up. And he went out of his way to point out I'd gotten a BIG BARGAIN on these books which were worth $35! YEAH RIGHT! I wasn't born yesterday! I sell books for Pete's Sake.

(BTW, telling a buyer that they got a REALLY GREAT DEAL as an excuse for not dealing with a problem is VERY VERY poor Customer Service. It will only make the most reasonable buyers angry and unreasonable... like it did me. Hey buddy, this widget I bought from you has a big huge stain on the front! Yeah but you GOT A REALLY GREAT DEAL! See how THAT flies folks!)

So after counting to 10 again, I wrote back that it was unfortunate he was willing to lose a sale rather than reach a compromise and told him I'd take the refund. I resisted the need to point out to him that I'd be lucky to get 75 cents for 4 of his BIG BARGAINS! (I'm always professional even when I don't wanna be!) At this point my only hope is that he doesn't leave me negative feedback... sigh.

Anyway, I've picked up a few tips from that power-seller's newsletters. I let go of some guilt over certain things that initially just seemed "wrong." Just like sniping grates on peoples' sense of right and wrong, there are other issues that do too... like charging more for shipping/handling than your cost, so you make a little money there too. I could never WAY overcharge like he seems to do, but I have gotten a little more comfy adding another 50 cents here and there... and WOW, the occasional extra $1.00!!

When you think about it, too many people are making this "business" of running auctions into a moral debate! Yes, we need ethics in business, but to argue that sniping is morally wrong is ridiculous! waaaaa it's not fair they all whine! Well it's not fair I have a cable modem and you don't, or that I might have a faster PC than you, or that I can type faster than you, or maybe have more $ to bid on an item than you, or that last week my widget only sold for $2.99 and this week the same widget listed by someone else sold for $29.99, or any number of things that might give me an advantage over someone else... or someone else an advantage over me.

Hello! Life ain't fair! And auctions certainly aren't. They are a form of gambling, that is why they are so addicting! If you want fair, read all the newspaper marketing ads, and go buy your widget from XYZ company that offers rebates if you can find that same widget anywhere else for less. But be assured you are NOT even close to getting a REAL bargain, not like you MIGHT be able to get on eBay. But then again, the risks are higher. It's a tradeoff and a crapshoot!

Ok... that soapbox keeps landing at my feet. Will someone PLEEZZE take it away? lol And... the usual disclaimers apply. This again, was just the normal (abnormal?) rantings of a less-than-sane woman! Big Grin

Bubbye!

diva (aka Dag)
B bigsteveMember
Hello -- !!

So RSM, if "putting on a reserve and revealing it is pointless" what exactly is the point of putting a reserve and NOT revealing it?? Confused

You put the reserve so you don't take a loss (or a bath) as financial "insurance" but keeping the reserve amount a secret you gain... what??

If anything, the secret reserve (or any reserve for that matter) will cost you in the long run because it will drive away traffic, and you want lots of traffic in hopes a war will break out. The secret reserve just makes matters worse.

Yes, there is a difference between an auction and a store, but every potential buyer (anywhere) wants to know the answers to the quesstions "is it worth it?" and "can I afford it?"

Sell the way you want to, and be happy !! Big Grin Big Grin Big Grin

Thank you and best wishes,
B CoolD WinkS
mrsmmrsmMember
I personally don't like reserves. I don't use them and as a rule don't bid where there is one. I just think either use it or don't. To put one on and say this is the amount, to me is going nowhere. Why not start it at that amount in the first place? The bids don't count until they get there anyway. And as far as the statement I made about it not being a store, what I meant was in an auction it just is not that way. It is chance and control, I guess. I mean you can go to an auction and stand all day long to bid on an item, only to see it go for twice what you thought. That is an auction. And knowing what you think it is worth and sticking to your guns is control.

rsmiller40
C chatterMember
I think Big Steve makes the assumption that undisclosed reserves drive buyers away, since it apparently drives him away. That is all well and good, but I can say that they do not drive me away, and there evidently of plenty of other bidders who are not driven away, so this one would seem to be a matter of personal preference, rather than an indicator of one's intelligence.
Roll Eyes
rickrickMember
quote:
Originally posted by big steve:
Rick, it seems like a reserve price auction DOES require two people to determine value, namely the seller who sets the reserve and a buyer who agrees with her.

Yes. I was afraid someone would discover the weakness in my argument. But better sooner then later, and better you then someone else. Big Grin

Don't answer if you don't want to: BDS? Big D Steve?
rickrickMember
BDS,

One more idea: One might say, in a reserve auction, that the seller is actually helping the buyer to determine what the value of the item is. This would clearly be a service to the buyer, since without the seller's help the buyer might think it was worth less, which would mean the buyer wouldn't be as happy with the item, since the cost of something often relates to the enjoyment.

(I sometimes get like this - sorry). Big Grin
Last edited {1}
mrsmmrsmMember
quote:
Originally posted by big steve:
Hello -- !!

Rick, sellers can decide anything they want but remember that its only worth what someone else will pay for it. It takes two to tango..

Thank you and best wishes,
Big Damn Stevie Cool
ACCEPT NO SUBSTITUTES - anything less is just BS
Big Grin Big Grin

-anything less is just BS (big Steve?) Big Grin

rsmiller40

Add Reply

Post

Membership Required

We're sorry. You must be signed in to continue. Sign In or Register
×
Are you sure you want to remove from your Block List?
×
Loading...
×
When you block a person, they can no longer invite you to a private message or post to your profile wall. Replies and comments they make will be collapsed/hidden by default. Finally, you'll never receive email notifications about content they create or likes they designate for your content.
Note: if you proceed, you will no longer be following .
×
Link copied to your clipboard.
×