The power of the auction

The traditional broker listing and selling method of real estate isn’t going away soon or ever. For the majority of buyers and sellers, it’s the only way they know.  For the most part, having someone to represent and negotiate on your behalf takes the pressure off of you.  

So you find a broker, decide an asking price, and because the market in heating up; you set the price a bit higher than you really expect to get offered and you wait. The reality is, you’re not really that motivated to sell.

But what if you didn’t have the luxury of time on your side? What if you had a court order to sell, or you had inherited a house from a distant relative? In these situations, your motivation to sell increases dramatically.

Bill Sheridan is a successful auctioneer and broker who conducts the majority of his real estate sales through the regular old broker process. He talked about the one out of ten transactions where an auction becomes the strongest sales tool.  He refers to them as one of the Five Ds that motivates these sellers.  

The Five Ds that magnify the power of the real estate auction are Death, Disease, Divorce, Distress and Default.

I know as you read this, you’re thinking, "Those are actually the things I’m trying to avoid in my life." And you’re right, we all hope those Five D’s won’t happen to us but unfortunately most of us will be for many of us one or all of them may affect us someday.

These five situations are also the key factors in creating an extremely motivated seller. Most motivated sellers are also much more realistic in terms of what the real estate is really worth. Overpricing isn’t an option. Plus the terms of sales are clearly spelled out before the auction starts. In most cases; the real estate must be sold and must be done so within a specific time frame, along with a specific closing date.

 The wait and see approach is not an option. So instead of setting the price high and working it down to a negotiated sale, it’s the opposite. The auction is always working the price up. Plus buyers come ready to buy, and ready to be the winning bidder. 

Re-ignite the fire

Have you been watching as the attendance to your annual benefit drops year after year? Are you resorting to comping tickets just to put bums in chairs? Does anyone laugh at your MC's jokes anymore? Is the crowd tired of listening to the live auction drag on and on?

Maybe your event is suffering from BAS, the boring auction syndrome. Typically, the first call to action is to get rid of the MC and the auctioneer you've been using forever and replace them with professionals who have proven results. You will notice the difference immediately on the stage, in your event revenues, and even on your invoice from your auctioneer. As they say, "You get what you pay for." Someone who can turn your event around or grow your fundraising revenues year after year is worth his weight in gold. I've been on both ends of the stick and typically; if you've done your homework, you'll notice improvements in your event right away, whether big or small. Though if the core components of your benefit remain unchanged, so will your results. Auction prizes are typically the same at most fundraising events: art, wine, trips, special dinner and hotel packages or maybe even a one-on-one meeting with a B-list celebrity. While auction prizes make up some of the building blocks of your benefit, they are never going to be the components that bring your special event to that next level.

So how do you make the leap? While not a new concept, it's the people who make the event. Whether it's the tireless dynamos who sit on your fundraising board, or the generous patrons in the audience, or even the best audio-visual techs in town; it all comes down to the people. Brainstorming, event-planning, ticket-selling - every component it takes to put together a successful event, requires the person who best fits the job! Have you ever been successful at putting a square peg into a round hole? Shaking things up on your planning committee and on your stage may be just the changes your event needs. Heck, move the stage and change the venue while you're at it! This may be just what it takes to get your auction rocking again. Ask the members of your board, the loyal guests people who have been coming to your event year in and year out, maybe even some of your event volunteers. A cross-group brainstorming session may reveal the answer or answers you need to reconnect with your audience or to re-energize your planning committee. There is no end to the resources or ideas that can re-ignite your auction's fire. Give one or all of these ideas a try as you begin planning for your next benefit auction.

Fundraising season is underway

The school auction season is officially underway starting in February and running through to May. Then it starts up again in the Fall after summer break. This year all indicators point to another fantastic year for supporting and giving to our local area schools. Successful fundraising auctions allow your kids' school to continue to hire those much-needed extra teachers, to replace tired, worn-out sports equipment, or to take that special field trip. Throw in a few instruments for the music department and some building supplies for a new playground; that there is where all of that hard-earned money from your fundraising efforts go. . Remember your support does really make a difference. Maybe you can't give financially, but volunteering the night of the auction or donating an item to be auctioned can be just as valuable to the school or organization, than your money. It's been my experience that the same group of loyal parents are always the ones who end up year after year at most, if not all, of the school auctions! So, promise your kids and yourself, to make a point of involving yourself in your local community by reaching out to the auction chair at your school. Then find out what you can do to help out this year!

My first fundraiser of the year is tomorrow night and I'm excited to get back into the swing of things. Hope to see you in the crowd with your bid car high in the air!

Beware of the man in the tuxedo

I'm always curious to know more when I hear or read about someone who says he 'specializes as a fundraising auctioneer'.

Why have I not heard his or her name before? Who is this person? Is he or she professionally trained? What kind of auction experience did he or she have before becoming a benefit specialist or expert?

Fundraisers are a collaborative event. A professional auctioneer will make sure that all the behind the scenes work is properly and completely done. This is the first of many important steps that it takes to produce an evening of giving that is both seamless and successful.   

I have been an auctioneer working in the Pacific Northwest for over twenty-five years. I have auctioned off date nights with Hollywood stars. children's art, school teachers' homemade baking, tens of thousands of wholesale and collector cars, as well as California real estate. I have worked with hundreds of other auctioneers. Among the lot of us, we have a few thousand years of experience combined and have easily seen hundreds of billions of dollars change hands. Boy, that makes me sound old!

Like any other profession, it takes years of learning and doing to master one's craft. A proficient auctioneer is not as easy to find as it seems. What you can expect of him or her when you find one is this:

A great auctioneer connects with your audience.
He or she establishes the tone and momentum of the auction.
An auctioneer never misses a guest with his bid card in the air.
He communicates and carries on with everyone with ease and finesse.
After he sells the crowd every single live auction lot, he is still able to draw more money out of your guests during the special appeal!

It's true that we all have to start somewhere. The question is, do you want an auctioneer who's wet behind the ears to use your event as his guinea pig? Before you hire someone; ask for his or her credentials, have a look at his portfolio, watch her in action. Best to see it before you believe it. You know what they say, “If it sounds too good to be true..."

Happy new year!

Happy new year!

The holidays are behind us. The kids are back to school. The auction business is back in full swing.

In the month of January, there are no less than five auction houses, which will sell over $200million worth of classic cars in the matter of a week. If you happen to be in the vicinity of Scottsdale Arizona between January 10th through till the 18th, that's where the first big auction events of 2015 will take place.

If you are a fan of vintage motorcycles, Las Vegas Nevada is the place to be. With Bonhams and Mid-American offering up close to a thousand bikes starting January 8th and ending on the 11th. I'll be at Bonhams checking out some of the rare bikes that will be crossing the auction block into the garage of some lucky collectors.

Then by February, fundraising season starts up again. Most not-for-profits have their spring events booked. Now is the time when autumn fundraising committees are securing their dates for venues, entertainers and caterers.

Grey Bowl? Super Cup?

 
 

Did you catch the Civil War Game between the Ducks and the Beavers?

I was just sitting down to deep fried spicy squid and a cold Canadian beer in a Downtown Vancouver restaurant. Low and behold, what's on the television screen in front of me? Halftime at the University of Oregon Ducks versus the Oregon State Beavers football game. Funny thing since I happened to be in town during Grey Cup weekend, the Canadian Football League's version of the Superbowl. We came across the parade procession on a walk through the city after a bit of breakfast at a popular Italian cafe.

I love Vancouver, but especially on clear sunny days like today. After we caught a glimpse of the actual Grey Cup trophy, the Royal Canadian Mounted Police bagpipe band, and two dozen plus Blues Brothers; we found ourselves in a French pastry shop to have a warm beverage and an apple tarte. Then swung by the Tesla showroom followed by a walk in a big loop of downtown on the sunny side of the street. Ended up on the beautiful bustling seawall, across from Granville Island and underneath the Burrard and Granville Street bridges. Finally back to where the story began, in a Yaletown resto.

Quack quack!

Reinvent and resize

In my last blog post, I talked about rethinking how to go about planning your next fundraising auction. One of the main points I covered was the size of the event. It really comes down to the ROI, return on investment. What if I told you that in the following year, you should only invite half the people AND double your ticket price? Your first thought would probably be an emphatic NO. I'll let you in on a not-so-secret secret. As with most other sales transactions, the 80/20 rule applies. This is true for most things in the world of business, auctions included. What is the 80/20 rule? Also known as the Pareto Principle, it is the rule of thumb that 80% of your output is determined by 20% of your input. For example, in business it works out that 20% of your customers represent 80% of your sales. Or in our case, 20% of your event's patrons are bidding for your auction items 80% of the time. That means, in a crowd of 300, there are really only 30 actual serious bidders!

Let's do the math: starting with 300 people, divide that by 2 because most people come as part of a couple, apply the Pareto Principle by calculating 20% of 150, you are then left with only 30 true bidders in the room. What if, instead of trying to accommodate a lukewarm crowd of 300 at $250 a head, you double the ticket price and halve the number of guests? That translates into $75,000 in ticket sales right off the bat! Plus your fundraiser is left with only your most committed of patrons. Isn't it likely that the guy/gal who already spent $1,000 to attend your fundraiser with his wife/her husband, be the same guy/gal who takes home the grand auction prize?

Do your own little study at your next fundraising event and then give me a call.

Size doesn't matter. Really

We live in a world where if it's bigger, it must be better.

In the fundraising world, that axiom is not always true. Sure, it's exciting to be in a room filled with hundreds of other well-dressed and like-minded people thrown together to raise money for a shared cause, while also being entertained by the theatrics of the auctioneer. But the reality of large fundraising events is that only a small portion of those in attendance are actually active participants in the live auction. In my experience, I would venture to guess that only about 20% of the room is doing 80% of the bidding and buying. Yes, it does seem that more people tend to join in on the bidding for a special appeal. Though often, that may be the single occasion of the evening when that specific bid card saw any action.

So my question to event planners out there is, "How much thought and effort do you put into the process of guest selection?" Like most not-for-profit organizations, do you simply send out invites to the masses hoping to fill the huge ballroom that you have rented for the night? Or do you pick and choose those patrons who have potential in their pocketbooks and the ones with proven buying power to contribute to your night's cause? What if you could cut the cost of producing your event in half and at the same time, double your audience participation? Wouldn't you be interested in knowing how? Stay tuned for some hints in my next blog. 

Location, location

I found a great website recently that I want to share with you. It lists all the favorite event spaces here in the Portland area. Go to www.eventective.com, to find a location for your upcoming auction. I've worked in many different spaces, from traditional ballrooms to tents and rough open urban warehouses. I really like working in rooms where the organizer, thought a bit out of the box. Every room has its challenges - sound, lighting, seating, as well as food and beverage services. Use your imagination to create a unique space for your next auction.  

Estate sales

How would you like someone, anyone to take off your hands, a dearly departed family member's house filled to the rafters with stuff? In return, you've saved a ton of time and still end up with money in the bank.

A real estate auctioneer can do that for you.

Instead of you and your siblings having to coordinate a time to meet, in order to sort through an entire household of remnants from the past and take carloads of used clothing to goodwill. Then empty, clean, stage and list that old house in wait of the right buyer to make an offer acceptable to you. Why not hand that task over to a licensed broker slash auctioneer to liquidate your shared family home and its entire contents? Even that old car that hasn't been started for years, collecting dust in the garage, can be taken care of in one fell swoop.

I happen to be one of a very few professionally-trained auctioneers in Portland, who is also a licensed real estate broker in the state of Oregon. If an estate sale auction peaks your interest or sounds like it might work well for you and your family, ask away. I will try to answer any questions you might have or be able to point you in the right direction.

Like father, like son

My son Spencer has worked by my side for many years now. He helps me out a great deal, mainly at fundraisers, and my auction team loves having him around. It's great that he'll put on a suit and hang out with his dad! I have watched him mature and learn a bit about the business world, sharpen his social and life skills, as well as build his confidence. It's hard for me to believe that he'll be graduating from high school next year. Where does the time go?

I'm lucky that we have the chance to work together and that he actually enjoys it. It gives us an opportunity to spend more time together since fundraising events are often on weekends. That way, we don't feel like we're missing out too much on our family time. We probably have as much fun as the guests at these fundraising auctions. The energetic and exciting atmosphere of an auction can't be beat. Especially if the alternative is having my son sit in front of a television or computer screen for the night. Plus it's extra rewarding to be able to feel like you're contributing to a worthy cause; whether it be for bettering the greater good of the community, improving a kid's educational experience or raising funds and awareness towards battling a life-altering disease.

Thanks Spence! I'm so proud of you.

School fundraisers

School fundraising auctions are some of my favorites amongst the variety of events that I do. They give parents and teachers an opportunity to socialize outside of the school environment. You have a highly motivated captive audience. Everyone in attendance has a student who benefits from the proceeds of the evening. It's a winning combination.

With smaller budgets and fewer subsidies, more and more schools are required to do their own fundraising - from kindergarten to high school, private and public school. Academic institutions are raising money for sports fields and equipment, international exchange trips, scholarships. The list goes on.

I'm a part of the fundraising team at a local private school's annual gala. For the past few years, a table of desserts made with love by the school's teachers goes to auction after the dinner portion of the night. The parents get pretty competitive. Little Lisa wants to hear how her dad made the highest bid for everyone's favorite teacher's triple-layered chocolate cake. I've seen bids go as high as $1,000 for a homemade cake. This year, the dessert auction raised $7,500 for the school's foundation!

Something to think about as yet another school year comes to a close. Have a fun and safe summer out there.

Auctioneers: There is a difference

Auctioneering is one of those jobs where it's not unusual for someone in the crowd to think, "How hard could it be to do that? It looks pretty easy. If that guy on stage can do it, why couldn't I?" If you have been part of an audience during a fundraising event, you can tell the difference between a professionally trained auctioneer with experience and someone who is just trying to wing it. There is nothing worse than to watch someone struggling on stage. It's like the feeling you get when you're at an amateur comedy show where nobody is laughing. It is painful to watch and can be incredibly embarrassing for the person on stage.

Once the audience's interest or the bidding momentum is lost, it's game over. What do you do then? Not much you can do, except to wait till next year to do it better.