Estimated reading time: 6 minutes, 1 second

ImageAuctions have long been a crucial, and lucrative, element of nonprofit fundraising campaigns, and their popularity has grown in recent years. According to the National Auctioneers Association, more than $16.2 billion was raised in charity auctions in 2007. While the raw dollar figures suggest that auctions are lucrative, dollar returns are not the only indicators of an auction's success. And according to the leaders of two major online auction companies that cater specifically to nonprofits, if your organization is only conducting offline, "event" auctions, and not utilizing online auction resources, it's likely you're passing up many opportunities.


For example, online auctions can open up a pipeline to a lot of potential revenue-generating items. Jon Carson, the chairman and CEO of cMarket Networks, which hosts online auctions only for nonprofits, says that his company actively seeks valuable items to assist clients, and that "most of our clients get anywhere from $2,000 to $6,000 of free stuff" to sell.

The key to a successful auction? Simple, says Carson. "It boils down to two things: supply and demand. On supply, it's about having a good catalog. The only way to get more money is to get more items and more bidders." And by "items," he doesn't mean just anything. "People don't buy crap," he says. "And you can quote me on that."

What people do buy, says Sean Milliken of Mission Fish, which partners with eBay in producing the eBay Giving Works program, are "things that are one of a kind, many of them experiences. These are things that nonprofits often have access to, but the general public may not."

For example, said Milliken, on Giving Works "you'll find everything from lunches with Eli Manning and a tour through the locker room to playing golf with Justin Timberlake." These items can fetch top dollar, and offer the added bonus, adds Milliken, of producing very little administrative burden for the organization.

How cMarket and Mission Fish Work
Mission Fish partners with eBay's Giving Works, serving, says Milliken, as "an interface for nonprofits to get certified for participation in the program." Nonprofits can use Giving Works to set up one time "event" auctions, to create ongoing auctions, and to sell items directly via an eBay storefront.

"We see ourselves as the advocate for the nonprofits. We make sure that the technology is as easy as possible for sellers, and that nonprofits' needs are taken care of. We're a resource for nonprofits to get involved and maximize use of Giving Works."

Both Milliken and Carson stress that good promotion and marketing are critical to successful auctioneering. To that end, Mission Fish enables organizations to set up "About My Nonprofit" pages on eBay; these pages can be branded with the organization's logo, provide information about its cause, and also feature items listed directly by the organization

CMarket, unlike Mission Fish, has created its own online auction platform, BiddingForGood. Carson says that about 100,000 users have registered at the auction site, and that one of the advantages of BiddingForGood over other auction platforms is that "it's a one of a kind ecommerce site" that sells lots of unique items.

For example, some visit BiddingForGood seeking hard-to-get sports tickets, says Carson "We know of some professional sports teams that that will take away your season-ticket pass if you're a season-ticket holder and you sell tickets on eBay. But they are okay with it if it's for charity. So you'll get more Patriots tickets on our site than you will at [eBay or] Stubhub."

Carson is talking about Patriots tickets to emphasize that auctions are primarily about consumers wanting to get good stuff. This makes his formula for a successful nonprofit auction a simple one. "It boils down to two things," Carson says. "It's supply and demand. It's about having a good catalogue."

CMarket has positioned itself to help nonprofits build that good catalogue. To attract good items it's crucial that organizations provide donors with a measurable marketing impact.

Online Auctions as Marketing Platforms
Carson says a key to the success of online auctions is that impact is automatically measured. CMarket's auction management software enables you to see page impressions and click through rates, and to tally how many visitors access a sponsor's site by clicking on their logo.

Providing sponsors with this type of feedback is difficult, if not impossible, to accomplish in an offline auction. "Most of our [donor] clients have bought into the idea that charity auctions are a great way to get your brand in front of a mass affluent audience," says Carson. "Our [nonprofit] clients want more money, and the only to get more money to get more items, and then you get more bidders."

So cMarket acts as a go-between. "We can talk the language to both sides, and facilitate the exchange of value between [for-profit and nonprofit] organizations. Times are tough, but they'll pony up the stuff if they'll get good marketing." cMarket's easily accessible data enables companies to see that their donation will have -- or has had -- a measurable marketing result.

In addition, cMarket's platform is designed around templates designed to make the process as easy as possible for nonprofits.

Milliken stresses visibility -- the nonprofit's ability to get the word out that it has fundraising mechanisms in place on eBay Giving Works. An organization can be most successful with online auctions, says Milliken, if they begin "with an event that has lots of one-of-a-kind, higher-value items that can create a lot of excitement" around the initial Giving Works foray, he says. "From there you can start to offer more consistent items. [Consistently selling items on eBay is] a great strategy for producing a source of unrestricted funding, but launching that initiative with a one-time event is a smart strategy."

The Takeaway
While it's certainly possible for nonprofits, especially those with auction experience and adequate staff, to run their own online auctions using off-the-shelf software solutions, most nonprofits will benefit from the established reputations, relatively large donor and bidding bases, and turnkey solutions provided by cMarket Networks and Mission Fish (which is virtually synonymous with eBay Giving Works).

Both cMarket, a for-profit organization, and Giving Fish, a nonprofit, take a small percentage of your proceeds (generally less than 10 percent). While each provides plenty of services, nonprofits who choose to use either one must still do the work -- and be smart -- about how they go about fundraising online.

The major keys to putting on successful fundraising auctions include:
  • Publicizing the auction to as wide an audience as possible, using the organization's Web site, Facebook or MySpace pages, email blasts, and other tools;
  • Selling unique and valuable items;
  • Soliciting, and making available, the items that get the best results in auctions: event tickets, travel, one-of-a-kind experiences, etc.
  • Publicizing individual items properly, with well-written descriptions sharp photos;
  • Providing a long enough time frame to allow for publicity (and the listing of additional donations) during the auction;
  • Carefully considering the timing of your "event" auction (for example, Carson has suggested, auctions can be built around holiday themes). This also means ending the auction at the right time. For example, many suggest Sunday is the best day to end auctions, as this is a day when people have plenty of time to be online for personal reasons.
Last modified on Sunday, 19 May 2013
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