If you’ve studied business concepts you know that finding a customer can be the most expensive part of the sales process. Once you’ve got a customer why not maximize the money you’ve already invested in the effort?

This time honored business concept certainly falls under the category of going the extra mile for a customer. Assuming your product, customer service, packaging and shipping all work together to create a positive feedback posting, here are a few simple ideas companies have been utilizing for years to help them stand out from the crowd and maximize the return on sales dollars:

A personalized thank you

A drop in

A thank you gift

Personalized Thank You

Every package you send to a customer should include a personalized thank you letter. Personalized means there is a salutary greeting such as “Dear Customer Name” and your personalized signature. Why personalized? Ever hear the old sales adage, “Don’t sell the product - sell the person?” It’s taught to sales professionals because it works. A friendly thank you note near the end of a good transaction (more on this later) reminds the buyer they are thought of as a person, not just another sale or number. A personalized touch in today’s impersonal marketplace is very refreshing.

The body copy of the note or letter is certainly up you but should be as specific to the transaction as possible (if you also include a packing slip/invoice the letter can be a little more generic). The goal of the note is to let the customer know they, and the sale, are important to you. Here’s a short example:

Dear (Customer Name):

I just wanted to personally thank you for your winning bid on our (product name), Item #11111111111, enclosed. Our customers are very important to us. We realize you have a choice in selecting who you buy from and we greatly appreciate your business - now and in future.

Sincerely,

(Your Signature)

Drop-ins and gifts

A drop-in or gift provide extra chances to say thank you, create customer loyalty, increase future sales, and maximize your return on the investment of finding your customers. As an example let’s say you’re selling pet supplies. For a few pennies each you can have refrigerator magnets printed like business cards that include your company name, email, eBay store, or website address. They can be as simple or complex as you can afford but only need to include something like:

Acme Pet Supplies (Your company name)

For All Your Pet’s Needs (A marketing line is a good idea)

Your Website Address (Either a link to your website or auctions)

Other inexpensive drop-ins and gifts could be something as simple as a business card, a sales sheet listing all the product types you carry, a gift certificate (to be used on your e-commerce website) for a future purchase, or an offer for your free newsletter. If you’re selling kitchen products you could include your favorite recipe, or if you’re selling poker supplies - a print out of the best starting hands might be nice.

Closing the Sales Cycle

Do you remember my comment earlier when I mentioned “near the end of a good transaction”? If you consider sending the product (with a thank you note, drop-in or gift) the end of the sales process you are missing another great opportunity to increase sales and improve you customer relations. Don’t consider the sales process completed until you send your valued customer one more email. About a week or ten days after shipping the product, send a follow-up email such as:

Dear Customer Name (again, make it as personal as possible):

Just wanted to follow up on our transaction and make sure everything went smoothly for you. We trust everything went well but if you had any problems please let us know. We are always looking for ways to improve our service and your input is very important to us. We will post positive feedback for you and hope you’ll do the same for us. We look forward to doing business with you again in the future.

Thanks again,

Your Name

(Suggestion: To avoid spam filters, in the subject line of your email include the eBay or auction item name and number)

Are the efforts to include a note, a drop-in, a gift, and do follow-ups a little more work and expense? Of course, but with the aid of simple automation packages on your computer the follow-ups can be somewhat automated and the drop-in or gift will help you create a returning customer.

Copyright © Steven Woodward - All Rights Reserved

About the Author:

Steven Woodward is the owner, editor and publisher of the Auction Sellers Network (ASN); a web site for individuals and companies who are serious about utilizing the online auction marketplace for their business. In addition to topical articles, ASN provides an extensive resource center, news feeds, member forums and classified ads. For more information or to become a member visit http://www.AuctionSellersNetwork.com

No permission is needed to reproduce an unedited copy of this article as long the About the Author tag is left intact and included. We do request that we be informed where it is posted and reciprocal links will be considered.

Share This

William Vickrey, highly regarded as the founder of auction theory, was an economics professor at Columbia University when he published two papers outlining his views on auctions:

“Counterspeculation, Auctions, and Competitive Sealed Tenders”, 1961, Journal of Finance

“Auction and Bidding Games”, 1962, Recent Advances in Game Theory

In 1996 he received a Nobel Prize “for fundamental contributions to the economic theory of incentives under asymmetric information.” It’s important to understand that asymmetric information is an essential component of auctions, where potential buyers have varying levels of knowledge about the value of the item.

Although Vickrey considered his work on auctions as “one of my digressions into abstract economics, at best of minor significance in terms of human welfare”, to those of us who work with online auctions, much of what he outlined is useful to understanding our marketplace.

Vickrey identified 4 general types of auctions:

English

Dutch

First-price sealed bid

Second-price sealed bid

English Auctions

The most common type of auction is the English Auction, although it may also be known as an ascending price auction. In ascending price auctions each subsequent bid is higher than the previous one. This is the most popular type of auction for single items.

Although traditional ascending price auctions use a “soft close” format - where bidding continues until a final bid is placed, the majority of today’s on-line auction sites use the “hard close” format - also known as a ‘time interval” auction having a set time limit, regardless of ongoing bidding. It’s important to note that in a “soft close” format, bid snipping, that is bidding during the last few seconds or minutes on an item, is eliminated since the auction stays open as long as bids are being made.

In an attempt to minimize bid snipping and provide more of a “soft close” characteristic to their “hard close” auctions, eBay allows bidders to use “proxy bidding”. In proxy bidding, a bidder enters the highest price they are willing to pay for an item when they first bid. The bid begins at the lowest possible level and increases automatically only if their original lowest bid has been beaten. For more in-depth information on the “proxy bidding capability on eBay go here.

http://pages.ebay.com/help/buy/proxy-bidding.html

Amazon.com currently offers a feature for their auctions called “Going, Going, Gone.” The Going, Going, Gone” feature extends the end of an auction for 10 minutes if a bid is placed effectively creating a “soft close”. For more information on the “Going, Going, Gone” feature on Amazon go here. http://www.amazon.com/exec/obidos/tg/browse/-/1161360/103-1666189-8415007#going-gone

From the buyers standpoint a “hard close” format is preferable since they may be able to make a final bid before others can react, possibly winning the auction at a lower price.

For sellers, a “soft close” format provides an opportunity to realize the maximum price for an item by removing the time restrictions for an auction. As long as bidders are bidding the auction remains open.

Dutch Auctions

As you may have guessed, the concept of the Dutch auction originates in the Netherlands. Unlike English auctions which utilize ascending price methods, Dutch auctions are descending price auctions and are commonly used when multiples of the same items are to be auctioned. In a Dutch auction the bidding starts at a relatively high price which is driven progressively downward by bids.

As an example of a Dutch auction let’s say you had 10 items you wanted to sell for $20 each.

Bidder A bids $18 for 6 items

Bidder B bids $17 for 5 items

The final result is:

Bidder A would receive 6 items for $17 each

Bidder B would receive 4 items for $17 each

Please note that most Dutch auctions allow bidders to refuse an order for a lesser number of items than what they bid on. A “soft” or “hard close” format may be used in Dutch auctions although the most common is the “hard close”.

First-price Sealed Bid Auctions

Sealed bid auctions differ from the English and Dutch in as much as the bids are not announced to other bidders. The individual bid is only know to the bidder and the seller. This type of auction may be either buyer-bid, where the highest bidder wins the item and pays the amount of their bid, or seller-bid, where the lowest bidder sells the item and is paid the amount of the bid. This form of auction is common for construction contracting, military procurement, foreign exchanges, and other types of goods.

Second-price Sealed Bid Auctions

Another common name for second-price sealed bid auctions is Vickrey auctions (named after William Vickrey) There is a slight variation to the first-price auction for Vickery auctions. In a buyer-bid auction the highest bidder buys the item and pays the amount of the second highest bid. Or in a seller-bid auction, the lowest bidder sells the item and is paid the amount of the second lowest bid.

The above descriptions provide a general overview of the most popular auction types in use today. Depending on the auction website these general categories may include a number of variations and options such as reserve pricing, open or closed venue, multiple items, fixed price and lot listings to mention a few. Before entering any particular type of auctions make sure you study and understand the rules for that specific type of auction, as the rules may vary from website to website.

Copyright © Steven Woodward - All Rights Reserved

Steven Woodward is the owner, editor and publisher of the Auction Sellers Network (ASN); a web site for individuals and companies who are serious about utilizing the online auction marketplace for their business. In addition to topical articles, ASN provides an extensive resource center, news feeds and member forums. For more information, or to become a member, please visit us at http://www.AuctionSellersNetwork.com

No permission is needed to reproduce an unedited copy of this article as long the About the Author tag is left in tact and included. We do request that we be informed of where it is posted and reciprocal links will be considered.

Share This

If you sell in small niches as I recommend and are organized enough that you know what you will be listing on eBay 1 to 2 weeks ahead of time, you should give serious thought to previewing your upcoming auctions for your customers. The result can be increased sales and higher final bids.

For two years I used a free hosting service to host a small web site that I used as a pre-auction catalog. Each week this preview site would contain pictures and descriptions of the majority of the items I would be listing on eBay the following week.

When that hosting service eventually dropped it’s free hosting, because of time constraints, I let that part of my business slide. Over the course of the next 3-4 months I saw a significant decrease in the number of bids, the final selling price, and the number of auctions that closed successfully. At the time that was an industry wide trend but I also think it had a great deal to do with the fact I no longer had a preview site on-line.

After a few months I moved the site to a cheap hosting company and saw an immediate increase in bidders, final selling prices, and closing prices. Adding an auction preview site to your business model can have significant benefits to your eBay business.

An auction preview site has several advantages - both to you and to your potential bidders.

Advantages to the bidder include:

1. It gives them additional time to do research on an item if they want.

2. It gives them more time to ask questions about an item.

3. It allows them to plan their purchases. Many bidders budget a specific amount of money each month for on-line purchases. I’ve had several bidders tell me they’d decided not to bid on someone else’s item so they would have the money to bid on what I was listing next week.

Advantage to you the seller include:

1. It gives you a chance to hone your description if needed. If you are receiving a lot of similar questions from several customers about an item it probably means you need more or better pictures or to make your description more detailed.

2. In most cases it will increase selling prices. I’ve found that people tend to bid earlier on auctions that they have been able to preview. This early bidding attracts other bidders to the auction and often drives the final price up.

Your preview site doesn’t have to be anything fancy or expensive. A free hosting service works just fine for what this would be used for. Most of them offer 10-25 megabytes of space, and easy to use page building tools. That’s really all you require.

Another option might be geocities.yahoo.com which gives you 25 MB of web space, 5 GB of data transfer and a helpful web page building utility for only $4.95 a month.

Also most of you will find that your ISP offers 10-25 megabytes of free space. If you have a basic knowledge of FTP and HTML this may be a good route to take.

What should you put on your preview page?

1. The items you will be putting on eBay the following week.

2 Clear pictures of the item.

3. A well written description of the item including any flaws.

4. An easy to find email link so prospective bidders can easily email you with any questions they may have.

Advertise your preview site by including a link on your About Me page. Include it in all winning bidder announcements and other correspondence you have with customers. A link in your signature file is a good idea. If you have a list, send an announcement of your new preview site to your list.

If you try this for a month or two I think you will find the results pleasantly surprising - and well worth the effort involved. And, your customers will love you!

Gary Hendrickson has been making his living selling on eBay for more than six years. He’s the author of two eBay related ebooks, has a blog for eBay sellers, and is the owner of ColdItems.Com.

ColdItems.Com
The Auction Rebel Blog

Share This