Proxy bidding is a great way to partake in an auction without actually being present or there in person! Set your maximum limit and let the auction holder do the rest. You can head off to the shops, to the office, or bed - and still, you can win the item you’re interested in!
Let’s dive right in, and kick off with understanding what a proxy bid is.
Proxy bidding involves bidders setting a maximum price that they are willing to pay for an item - most often on a computer system. As interested parties place their bids, the system will bid on the item for you in set increments. The bidding increments can be set by the auction holder, or each bidder depending on the auction.
The system will bid for you until your maximum amount is reached or surpassed by another bidder. When this happens, you can choose a new maximum price. Or, you may let go of the item, which would end the proxy bid.
If other bidders give up during the auction, then you will only pay the last amount that you bid, not your maximum.
People use proxy bidding to acquire an item (or multiple items) at the lowest possible price, without needing to attend the actual auction. Proxy bids are usually associated with online auctions and make the auction process easier for bidders. However, some live auctions may also accommodate proxy bidding.
Proxy bidding is often referred to as absentee bidding or automatic bidding. It can take place at an in-person auction, as well as an online auction.
For in-person auctions, bidders would tell the auction house their maximum bid beforehand (usually via phone or email). For online auctions, this information would be given to the hosting site as the auction opens.
For both types of proxy bid auctions, you don’t need to be active unless your maximum bid is reached. In this case, the auction holder will phone or email you with the latest information. At this point, you could decide to change your maximum amount.
Proxy bidding isn’t the only type of bidding - straight bids, as well as telephone bids, are also common. Let’s briefly have a look at these.
While a proxy bid allows the auction holder to increase your bid in increments as the auction moves along, a straight bid is a bit different. A straight bid means that you set the amount you’re willing to bid, and that exact amount is bid on the item of interest.
This amount will become the new leading bid in the auction - unless someone else has set their maximum bid to a higher price. If someone outbids you, you will be notified and can act from there.
With telephone bidding, you need to be more present, although you still don’t need to attend in person. You will have a representative at the in-person event, who will keep you filled in over the phone. They will notify you of all other bids received and will act per your bidding instructions.
Although this is a smart and easy way to attend an in-person auction, be careful of bad phone connections! These could cause you to lose out on the item.
Consider setting a maximum price with your representative beforehand, so that you have a good shot despite any shaky connection.
Proxy bidding is an excellent option for bidders who, for a multitude of reasons, might not be at an in-person auction. Mobility, distance, or time might not allow bidders to attend an auction themselves.
Proxy bidding is useful, accessible, and easy. Because of this, more people may be able and willing to take part in an auction where proxy bidding is an option.
With a proxy bid, you can set your maximum and then go about your day. There’s no need to track the auction to win the item you want - you can go to work, the shops, or even bed! The best part is that you can bid on multiple items, and not worry about tracking them.
Since bidders don’t need to commit to being at the auction in person, or even present online, more people have the opportunity to bid on items. Thus, the final amount for the items may be higher, and auction holders may make bigger profits.
Proxy bidding is convenient, as many people can access the auction without needing to be there in person, or track the items. There are very valid benefits to proxy bidding. However, there are also some potential cons to consider.
If you’re bidding on several items, you may feel more inclined to set lower maximums in case you win more than one item. This is because you might end up needing to pay a whole lot if you do win multiple items. However, this will make your strategy less competitive and you could end up losing out on some items you want.
On the other hand, when you set a maximum amount, it makes it harder to get swept up at the moment. This is a good way to ensure you stick to a budget, instead of simply trying to win the item. To sidestep the possibility of getting carried away, make sure to assess each item’s market value. When you’ve done this, set the maximum value at the price you actually would pay for the item and then leave the auction to unfold.
If you set maximum values that are too low, you may not have time to raise the amount before the auction ends. If you set the maximum too high, you may end up paying a lot more than you were comfortable with.
Proxy bidding is easy and accessible. Not only do you not have to attend the auction yourself - you don’t even need to be present online! Simply set your maximum value, and you’ll be informed of the outcome.
For nonprofits organizations looking to host an auction, offering convenient ways of bidding such as proxy bidding or mobile bidding, is a great way to get more people involved and raise more funds.
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