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3/20/2008
03:36 PM
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Online Bidding Site To Silence Silent Auctions

E-commerce site cMarket expects to host more than 3,000 online fund-raising events for the likes of the United Way and the Muscular Dystrophy Association this year.

But running an online auction doesn't mean giving up on real-world events entirely. Miriam May, executive director of the Massachusetts affiliate of Susan G. Komen for the Cure, said her organization began using cMarket as a way to diversify its sources of income. Through Bidding for Good, which accounted for 40% of the bids, her organization raised an additional $22,000. (May is on the cMarket board of advisers.)

"This was not something we were doing," said May. "We didn't have this and then we had it."

May said she appreciates the auction data cMarket provided, which helped her organization identify popular items and the best times for bidding. She also gave high marks to the technology for being easy to use. "I think that's very important in the nonprofit world," she said. Many small organizations "don't have a full-time techie."

CMarket's services aren't free. It charges a $495 annual fee and a 9% performance fee for the first $100,000 raised. Carson says the benefits of running an online auction amount to $5 back for every $1 of fees.

Marie Lehman, a parent at the Menlo School in Atherton, Calif., said her school began using cMarket four years ago to raise scholarship funds. "We decided we didn't want to do the physical silent auction anymore," she said.

One problem, she said, was that people would send decoys to bid on items because bidders in the affluent community were sensitive about being seen spending large sums. Online, she said, "you can buy whatever you want and no one knows who you are."

Now, in addition to an annual live auction of eight to 10 items, in conjunction with an 800-person dinner and a fashion show, Lehman said the Menlo School favors cMarket's online system because it brings in significantly more than the school's old silent auctions.

There may be a reason for that. "The environment at a silent auction does not stimulate what behavioral folks call competitive arousal," said Carson. Online, he said, is different, more competitive. He said he has the research to back that up.

"The punch line for us is taking these auctions and turning them from art to science," said Carson.

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