What is the point of listing an item with a reserved price?

[havilah 10]

Hello folks

 

I've been mulling this question: What is the point of listing an item with a Reserved Price?

 

I don't want the obvious answer of "it's the minimum price a seller will accept for the item". I do understand how an auction with a Reserved Price works.

 

But if the seller has a minimum price in mind why don't they just start the auction at that price and be done? Perhaps the question is more: What is the psychology behind listing with a Reserved Price?

 

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[qball 12]

You can list the item with the reserve price as your starting price, that way you are almost guaranteed that if a bid is placed you would have got your price. You simply fill in the start price and omit the reserve price when creating your listing.

 

Kind regards

Cuan

[havilah 10]

Hmm.. thanks, but you haven't answered my question.

 

I'm not a seller asking how to set up an auction without a reserved price. I'm a potential buyer wondering why sellers appear to be coy about the minimum price they're prepared to accept.

 

Anyone?

[Lukeness 10]

Often sellers will set a lower starting price than their reserve to attract buyer interest and get bids going. Many buyers are fishing for bargains so only look at the items with lower starting prices, even if they are prepared to go higher.

[TaLamia 11]

No I don't get the point either. Just about every single one of the reserved price items I've stumbled across the first and often times only bid is the starting bid and it carries on until the listing closes with no winners (unless the seller wants to then give them a personal offer).

 

Pointless in my opinion... I'd rather just start a listing at the minimum price I'd let it go for and at least not waste a buyer's time (because I guarantee you 80% of new buyers have no clue what's going on with the reserved price thing and go into it to bid thinking they're winning the thing at the entry bid which they don't).

[Linka 11]

I also hate a reserve price. I more than once made a bid on such an item and because there were no other bids on the item I could not up my bid and lost the deal.

 

[Southerns 10]

Maybe bob should make it that if the reserve price has not been met yet on an auction when it closes

The highest bid on that auction automatically has the option to accept the reserve price.

(uses the reserve price that was entered on listing the auction so as to stop the seller from sending any price they want)

 

 

The buyer gets an email like the winning bid one,

but it says auction closed without meeting reserve price would you like to accept the reserve price of R ????.???.

It then goes through like a normal auction would.

 

This way seeing as no one else wanted to bid nobody is being done out of a bidding chance, the seller gets their reserve price too.

At least both the seller and the buyer can walk away with a completed auction.

[TaLamia 11]

I also hate a reserve price. I more than once made a bid on such an item and because there were no other bids on the item I could not up my bid and lost the deal.

 

 

That's a very good point, I didn't even think of that part of the downfall.

[Seeds and All 11]

Maybe bidorbuy should make it that if the reserve price has not been met yet on an auction when it closes

The highest bid on that auction automatically has the option to accept the reserve price.

(uses the reserve price that was entered on listing the auction so as to stop the seller from sending any price they want)

 

 

The buyer gets an email like the winning bid one,

but it says auction closed without meeting reserve price would you like to accept the reserve price of R ????.???.

It then goes through like a normal auction would.

 

This way seeing as no one else wanted to bid nobody is being done out of a bidding chance, the seller gets their reserve price too.

At least both the seller and the buyer can walk away with a completed auction.

 

Great idea southerns. Maybe you should post this one in the suggestion box.

[Southerns 10]

Will do it now.

[havilah 10]

Thanks, Lukeness. I hadn't considered that as a factor since I don't use that criterion to browse auction sites.

 

southerns: I agree with Seeds.. great suggestion, makes perfect sense. I hope BoB incorporates your idea.

 

Thanks linkaec, I hadn't realised you're not allowed to improve your bid on a reserved price auction if you're the only bidder. Seems a rather silly rule.

 

I appreciate all the other posts as well. Great feedback. Thanks folks.

[Southerns 10]

Glad to hear the forum helped you

as that's what it is all about as far as I am concerned.

 

Helping each other.

[jamally 10]

LOL - excellent question. I'm a complete newbie, and this puzzled me too.

 

Thanks for the clarification.

[RISadler 10]

Reserve Price = Opening Price X 1.25

 

If you make that your minimum bid, then you "should" win the auction.

[lilythepink 11]

I agree with your calculations, RISadler, but let's hope that one is the only bidder!

[RISadler 10]

let's hope that one is the only bidder!

 

As buyers, that is what we all want.

 

As sellers, that is what we all don't want.

 

................

 

With regards to the "reserve price," the fact that one can work it out makes it very much useless.

 

I see the "reserve price" as something that can and should be used in conjunction with the "personal offer" system. There should be no 20% limit... I should be able to set a reserve of R2000 and start the auction at R1. When the auction closes and the reserve has not been met, then it is my choice whether or not I make a "personal offer" to the highest bidder, i.e. I accept or reject her/his bid.

 

I think that it might even generate more sales, as many people currently put things on auction for waaaaaay too much and then nobody bids. After a while they don't list it anymore, probably thinking nobody want it when in fact they never realise their price was too high. There's also "offers" being made through the QA system, which I have found to be very unfair (I've lost out on a few spectacular deals because of this practise.)

 

So, new seller list his stuff at opening price of R1 and a reserve set at what he/she really wants for it. A few people bid, but the reserve is not met. Seller relist and same happens. Eventually seller realises that price is too high and accepts highest bid. (Well, you get the idea.)