Going, Going, Not Sold

"The auctioning process is the means of achieving true price discovery."

For starters, that is a load of absolute crap.

To illustrate my point, I will begin by saying that the quote above is the slogan of an online auctioning website (not eBay). So, first of all, its main purpose it to convince people to participate in online auctioning, specifically at their website. It's no more than something used to attract business, which immediately sets off an alarm in my brain and makes me suspicious of the company. Part of this suspicion arises from the fact that I hate when slogans are designed to sound intelligent to the average customer so that said customer automatically thinks "They sound like they know what they're talking about, so I'll try it." It is a direct manipulation of unsuspecting customers.

Second of all, auctions do not as much encourage 'true price discovery' as they do competition. Notice that live auctioneers say things like 'Are you going to let him have it?' and 'He's a little above you, how much more can you give?', etc. They are trying to encourage the person to win the bid in order to 'beat' the opponent, not to pay what they truly want to. Of course, they can't force people to pay more than they like, but as I have noticed with myself, when it becomes a competition you begin to test the boundaries you have set upon yourself, and even those boundaries that have been set upon you by others. Once the bidding for the item has become a competition, the focus is no longer on the price, but on the achievement of you getting the item instead of 'that other guy'.

Haggling is truer means of 'achieving true price discovery'. In haggling, there is no competition, unless you're trying to compete with the seller. The seller has his set price, and the potential buyer either accepts that set price as lower than his own set price, or negotiates until it is lower than his own set price. The buyer knows what he wants to pay and either pays it or doesn't buy the item at all. The buyer may be tempted to spend a little more than he wants, but unless he is desperate he is NOT going to spend much more than that.

So there, that's my rant for the day.

Leave a comment and let me know if it was interesting or stupid or what. It was the first time I have tried something like that, so I'm interested to see what ya'll think.