What Is Proxy Bidding And How Does It Help My Auction?
What is a proxy bid and how can it improve your auctions? We've got an answer
Have you ever wondered “What is a proxy bid”? The term proxy bidding may be unfamiliar to you if you haven’t participated in a lot of online auctions. Proxy bidding is quite simple but can have a huge impact on an online auction for both the bidder and the owner of the lot.
Proxy bidding occurs when bidders have the option to set a maximum price that they would be willing to pay for an item and then allow the computer system to bid for them by the bid increment until someone places a higher bid than their maximum.
The bid increment is pre-set by the auction and is the amount that a proxy bid must increase by. The computer will place a new bid following the bid increment every time someone else places a higher bid than you and will continue to do that until the auction is over and you win, or the price goes over your set maximum. Bidders are typically notified if their maximum has been outbid and have the option to set a new maximum to continue participating in the auction.
“Essentially a bidder is telling the computer to let them win the auction at the lowest amount possible without going higher than their maximum.”
For example, say you want to buy a table but you are only willing to spend $75 on it. You would enter $75 as your maximum. If the bid increment for the auction is $5 then the computer will increase your bid by $5 every time someone bids higher than you. So, say someone bids $30, the computer would automatically put in a bid for you at $35. If the auction comes to a close and you are the highest bidder with $55 you have successfully used proxy bidding! You would have been willing to pay $75 but you got the table for less than that!
Proxy bidding allows bidders to win an auction at the lowest price possible. It also maximizes the benefit for the winning bidder because they would have been willing to pay more for the item but they didn’t have to!
So how does it help my auction?
Glad you asked! Proxy bidding is all about taking care of the bidders and allowing the auction process to be as easy as possible for them. If your auction is easy to participate in more people will be inclined to stop over and bid!
The best part about proxy bidding is that after the bidder sets their maximum, they don’t have to watch the auction live. People don’t have to worry about sitting at their computer to track the bidding process, they can be at work or the grocery shopping or asleep in bed and still win! They can bid on multiple things at once and not have to worry about tracking each item they are bidding on. Proxy bidding takes the stress out of the auction.
Because bidders don’t have to commit to being present, more of them will be able to ‘attend’ through proxy bidding. And the more people you have bidding the higher your final price will be! It’s a win-win for both you and your winning bidder!
What Is a Proxy Bid? Conclusion
We hope this has helped to answer your questions ‘what is a proxy bid’ and that you feel confident to use proxy bidding the next time you participate in an auction! If you have further questions about proxy bidding please contact us!
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