An auction is the buying and selling of property by placing and accepting bids. This transfer of ownership through auctions occurs in many area including agricultural commodities, real estate, used goods and the stock market.
There are primarily five types of auctions utilized for on-line auction sites. They are as follows:
- 1. Regular Auction
- The seller starts the auction with a minimum bid. Bidding occurs and the highest bidder wins the item. Contact between seller and buyer occurs via e-mail.
2. Reserve Priced Auction
- The seller sets a reserve price for the auction. This price is the lowest price the seller is willing to sell a particular item. This price is not revealed to bidders until the reserve price is met during the bidding.
3. Dutch Auction
- This type of auction is not available on all auction sites. The seller has more than one of the same item up for sale. The seller determines the starting bid for all items and indicates how many are for sale. Buyers can bid that price or higher. For example, if a seller had three photos for sale the first three highest bidders would each win one photo.
4. Private Auction
- Not used very often. Used when seller feel that the bidder would like to remain anonymous. One example might involve the sale of adult material. At the end of the auction only the seller and buyer are notified. The results of the auction are not made public (Hix, 1999).
5. Restricted-Access Auction
- This makes it easy to find or avoid adult-only items. Sellers and buyers must have a credit card number on file with the auction site before participating in this type of auction. Items listed as restricted access auctions are not accessible through title searches (ebay 2, 2000).