|EcommerceBytes-NewsFlash, Number 1713 - January 25, 2008 - ISSN 1539-5065 2 of 3|
Since 2003, cMarket has enabled organizations engaged in fundraising for non-profit causes to raise funds through online auctions. cMarket has raised over $30 million dollars for their nonprofit clients through their auction portal BiddingForGood (http://www.biddingforgood.com). AuctionBytes sat down with cMarket CEO Jon Carson to learn more about the company which has held over 3,000 online auction events for thousands of nonprofits and charitable organizations. On the day of this interview, there were 1,928 different auction items for sale from 54 different organizations.
AB: Who should use cMarket's auction services?
JC: Any nonprofit or school that wants to expand its reach with donors, parents, or alumni, lessen the logistical workload of a silent auction, and ultimately raise more money to support its meaningful causes should engage cMarket. cMarket's auction services especially benefit nonprofit organizations that want to expand on the success of previous fundraising efforts.
Nonprofits have traditionally spent billions of dollars each year on silent auction events for fundraising, and are finding that online auctions work better. Not only do they expand nonprofits' geographical reach, but they eliminate any number of inefficiencies, such as bidding limitations, heavy logistics requirements, suppressed "competitive arousal," limitations on marketing value for item donors and sponsors, and a lack of any kind of aggregated best practices data. Online auctions address these challenges and put nonprofits in the driver's seat to raise more dollars.
AB: Are there any differences between running an auction for a nonprofit versus a for profit company (with charity initiatives)?
JC: They are very different - a charity auction has a different set of needs. It is more of an event than a transaction. The target audience requires a more expansive feature set that can impact ticket sales, cash donations, sponsorship, item donations - all the things that typically take place with a charity fundraising gala. Nonprofit auctions support causes, and that means structuring them so that they resonate with the people attending and what they value. Logistically, that makes them more complicated.
AB: cMarket's "straight bidding" feature appears to be elegant simplicity in this world of proxy bidding. Is straight bidding's main function to enable bidders the option to pay more for an item?
JC: In a charity auction, distinct from a commercial auction, some bidders are engaged in the auction for purely altruistic reasons: they want to support a meaningful cause. For that reason, the bidder might want his winning bid to be even higher, to not only win an item but to bolster the donation. Straight bidding allows them to do that.
AB: What is cMarket's fee structure?
JC: cMarket clients earn an average of $5 for every $1 they invest in their web auction, resulting in a 400% return on their investment.
We ask for an annual subscription fee of $495, as well as a fee of 9 percent of sales, capped at $100,000. (Tickets, sponsorships, and donated items/cash aren't included.)
AB: Do you offer other services to streamline the auction process such as promoting/advertising the auction and/or determining tax benefits to the original donor and your client (the seller)?
JC: We have a comprehensive, proprietary Intelligent Auction Management program built on data gleaned from more than 3,000 successful auctions that nonprofits use to keep the bidders engaged longer and bid higher.
We also have several tools that help nonprofits prepare for and run their auctions, and evaluate their success.
They include a Library of Resources with tips, item ideas, and tools for planning; cMarket Place, an online consignment store with exclusive items to boost nonprofits' catalogs; SmarterAuction reporting to track progress throughout the life of the auction and help clients reach fundraising objectives; a virtual item acquisition campaign capability; email communications to publicize the auctions and to drive competitive bidding; and online tools to close and evaluate the success of each event.
AB: Can you explain how cMarket's bidding alert system works?
JC: The bidding alert system is a set of proprietary algorithms based on our experience running more than 3,000 online auctions since 2003. We know what messages will stimulate more and higher bidding at different points in the auction cycle, and nonprofits can build them into their emails on a timed basis. Messages might resonate with bidders' competitive or charitable sides, for example.
AB: Does cMarket use Google Checkout for Non-Profits?
JC: Our clients typically process credit cards in one of two ways. They either use Auctionpay, which is specifically tailored to charity auction processing, or they work with their local bank and get the credit cards processed for little to no cost.
AB: When does a client typically opt out of the BiddingForGood.com Portal?
JC: Most don't - over 80% of cMarket's clients have opted in since we introduced the portal just over a year ago. In Q4 last year www.BiddingForGood.com drove on average 21% of the winning bids for our clients. Those organizations that don't opt-in are typically very high end private schools and/or colleges who want to limit bidding to parents and alumni, and prefer a more "exclusive" experience. The beauty of BiddingForGood, of course, is that it eliminates boundaries like geography - expanding nonprofits' pool of constituents, and engaging a new group of individuals with an affinity for a particular cause.
AB: I notice that cMarket is hiring (http://www.cmarket.com/company/careers_ae.htm). What is it like to work at cMarket?
JC: I'm probably the wrong guy to ask since I'm the CEO. But I can tell you what we're striving for, which is a mission-driven environment that rewards hard work, and where people are challenged and at the end of the day can feel that like they made a difference. There is a fair amount of laughter in the hallways, which is usually a good barometer of how folks feel.
AB: What is your most memorable or unique auction item?
JC: Either "a vasectomy for you and your cat," or an unwashed Lance Armstrong jersey that sold for over $110,000. (See http://cmarket.com/sm/creative.htm)
AB: What are cMarket's plans for 2008?
JC: Nonprofit organizations are increasingly replacing or supplementing their silent auctions with online auctions, in recognition that the fundraising world has changed forever with the advent of the Internet. We are currently doubling every twelve months. As a result, we're on a fast-growth track as an increasing number of nonprofits rely on our services, and an increasing number of cause-minded bidders regularly visit BiddingForGood.com, our consumer site that aggregates cMarket's auction clients under one powerful umbrella.
We expect our fundraising events in 2008 to surpass 3,000, and BiddingForGood.com now has almost 60,000 members (50% in the last 90 days). As the excitement about the power of online auctions continues, we'll match this growth with exceptional client service, a hallmark of our company.
About the author:
Brian Cohen has been an active member of the eBay community since May 1998. He currently trades under the member name Bidofthis.com. His first AuctionBytes article was published in May 2002. Brian can be contacted through his website at http://www.bidofthis.com where he always has a "little Bid of This and little Bid of That."
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