Auction mentality

Ever go to a charity auction and think, “Hey, this is a lot like eBay — why don’t they just put it all online?”

Because odds are it wouldn’t work nearly as well or raise as much money for the cause. It’s a matter of individual and group psychology.

This past spring, as a favor to a colleague, I dipped back into the world of charity auction emceeing for a night at Villa Academy in Seattle. In 2003 and 2004 I regularly emceed charity auctions as a feel-good sideline through Stokes Auction Group (which provides auctioneers and auction services exclusively for charities). This gave me insight into auctions for organizations including the American Heart Association, YouthCare, Boys and Girls Clubs, Young Life, Skiforall, and the Cystic Fibrosis Foundation, which does the delightfully named “Tennis Ball.” I gave it up when my travel schedule and new position made committing to an auction schedule impossible.

There’s a lot of planning and psychology that goes into a charity auction, from the smallest private school to the largest non-profit. (I’ve been at private school auctions that have dramatically outdrawn the most heart-rending charity; never underestimate the giving power of a dedicated parent or alumnus.)

Seven items in my catalog of behind-the-scenes observations:

Tickets aren’t donations. If you think you’re giving the charity a donation by buying a ticket, you’re not. Tickets are designed to cover the cost of food and the venue. Sometimes, they don’t charge enough to do even that. But a ticket purchase serves a purpose: It gets you financially and psychologically invested in the event.

Minimum bids help cover costs. A few big-ticket items (from vacation trips to motorized scooters) may have been purchased by the charity with the hope that, in the frenzy of live bidding, they’ll go for much more than the discounted purchase price. That’s why an item may be withdrawn if it can’t get the minimum bid. But a few good big-ticket items can help raise the entire image of an auction to spur attendance and overall giving.

More isn’t always better. More items don’t necessarily make a better live auction. Some of the most successful events use a “gala” format with a few as three, to no more than a dozen, items. The brevity and perceived scarcity makes the items all the more desirable; you can’t hold your bidding dollars for later. Conversely, auctions with more than, say, 40 items can drag on to a point where there’s bidder fatigue and returns drop. (We had an informal rule that the auction staff couldn’t drink while working, unless the auction went into its second day.)

Seeding the live auction helps. Most auctions have a portion called “raise the paddle,” “fund a need,” or “fund an item,” during which bidders help pay for a specific charity cause (at schools, it might be arts programs or scholarships, for example). Bidding starts at the highest dollar level and works down in increments, perhaps starting with a $5,000 ask, then $2,500, then $1,000, eventually down to those donors willing to raise their paddle to give $100. Usually, a charity has already arranged to have a donor ready at the highest level to avoid deadly silence when the first amount is called out.

Pacing is critical. This isn’t just an auction; it’s a performance that has to entertain. The rule of thumb is two minutes per item. Testimonials can help vary the pace so the whole event isn’t at a dead run, but if you have too many speakers or if they go on too long, the entire event can bog down, people have a chance to get restless — and may leave early.

Always say thank you. Bidder lists sorted by bid number are given to the auctioneer and emcee just before the auction starts so the winning bidders can be thanked by name. Call it human nature: We like to be recognized for doing good, especially among our peers. (Volunteers rarely get all the credit they deserve, unfortunately.)

Pay is based on performance. Auctioneers and their firms are generally compensated based on a percentage of what they raise for the charity, with limits. If the charity doesn’t do well, they don’t.

As the professionals I used to work with frequently state, a charity auction is a fundraiser masquerading as a social event. Feeling good tends to want to make us do good. And that’s all good.

(This essay originally appeared on Frank Catalano’s blog.)