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Five Truths about Running an Online Auction

Submitted by: Peter Dudley

Posted: Feb 24, 2016 – 06:00 AM EST

Tags: workplace giving, employee engagement, csr


Not only did I fail to kill our workplace giving campaign’s online auction last year, this year my team is working harder than ever to improve it. I’m still not sure where I went wrong.

I have hated our online auction since we expanded it to the enterprise several years ago. It’s fraught with risks, it’s a customer service nightmare, it’s used by only a small portion of our 260,000 employees, and it accounts for just 0.29% of our $70 million campaign. Also, I’m personally not an auction shopper. I’ve sold my books and I’ve offered my time on our auction site (there’s nothing sadder than seeing your “shadow me for a day” item going for less than a plush pony), but auctions hold no appeal for me.

Apparently, I’m in the minority on that. But, as with chemistry class back in high school, if I’m required to do it I might as well learn from it. If you’re thinking of running an online auction in your workplace giving campaign, maybe you can learn from my experience.

1. Auctions are a terrible way to raise money

Last year, our auction raised $200,000, which might seem like a lot until you look at our entire campaign.

Payroll contributions accounted for about 70% of our campaign, and credit card donations made up another 7%. Considering the cost of building, maintaining, and supporting the site, you’re better off investing in almost any other scheme, no matter how hair-brained, to increase your campaign totals. Auctions are great for the whole “one man’s trash is another man’s treasure” thing, but for raising money? Not so much.

2. People don’t always make good choices

One morning a few years back, I opened an email that started, “Someone is auctioning their cat.” I should have quit right there, but inexplicably I read the next sentence: “I think this is okay as long as they don’t send it through interoffice mail.”

That was the day we wrote down the rule that if it eats, breathes, or swims, you cannot auction it. We’ve since had to broaden those terms, establish a process to review all items when they’re posted, and build administrator tools so my team can delete items as necessary. We’ve also had to put in parameters to stop people from bidding a billion dollars and to make people agree to our “workplace appropriateness” language before posting photos with their items. It turns out not everyone inherently shares a common view of what is safe for work.

3. Milliseconds can ruin lives

Some people seem to think that my auction site can sense the precise instant their brain tells their finger to click the “bid” button. I wish I had their IT department because apparently they live in a magical world where computers never fail and the network is never slow. In the real world, however, network lag exists. If you click a millisecond before the auction ends, your click might not be the winning bid. It might not get registered at all, or it might even be beaten by someone across the country who has a more precise clock. Seriously, people, your life is not ruined just because someone else won Tessie’s homemade granola for eight dollars. Back away from the keyboard and take a deep breath.

4. Commitment is on a sliding scale

I think a prankster must show fake terms and conditions to some of our auction bidders. Our real terms state clearly that a bid is a commitment to pay, but the fake ones must say something different. Either that, or some people think that “commitment” means “I’ll think about it, if I still want to later.”

I have to point out that the vast majority of our auctions close out as completed transactions, resulting in a happy seller, a happy buyer, and a happy nonprofit. Still, every year we get a handful of people who claim they didn’t mean to bid, or they never expected to win the auction. This is why I only provide the auction site, not the auction. The actual transaction is by agreement between the buyer and the seller, with the money going directly to the nonprofit.

If you’re planning on setting up your own online auction, take this advice: your role is to facilitate that agreement, not to facilitate the payment or fulfilment. Believe me, you’ll be much happier if you keep yourself and your company out of the middle. (This is where I encourage you to talk to your legal department.)

5. What really sells?

Although our auction site has its share of collectible hand knitted portraits of Elvis, two things sell better than anything else. First, parking. As a train commuter, I didn’t really understand why parking spots close to the front door were such a big deal until I visited one of our Minneapolis campuses in the winter. Now, I totally get it.

The other big seller is face time. Executives and even middle managers put themselves up for auction—work a day with Peter, have lunch with Pam, golf with Steve. In a company our size, a lot of executives don’t have time to do all the informational interviews they wish they could, and this gives them a way to raise money for charity while setting aside time. The great thing about this is there’s no possible way that these could sell for less than their original purchase price. Though my “shadow Peter for a day” auctions sometimes come close.

In the end, the online auction is not really about the money it raises or the redistribution of things. Among the workgroups that use it every year, it creates excitement and buzz about the campaign and gets people excited. In fact, auction participants were twice as likely in 2015 to make a personal pledge in the campaign, and those personal pledges were on average 42% higher than people who didn’t participate in the auction. So there may be some good in it after all. Maybe I’ll let it stick around a little longer.

I hope you’ll join me and other CSR professionals for the Charities@Work conference in March in New York for more peer-to-peer sharing and networking. Click here to register today.

The opinions, beliefs and viewpoints expressed by CSRwire contributors do not necessarily reflect the opinions, beliefs and viewpoints of CSRwire.

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