In 2009, eBay CEO John Donahoe decided to close eBay Live Auctions, a live-bidding platform and seemingly successful part of its Marketplaces business. On Thursday, eBay announced it will launch a new live-bidding platform on eBay.com in partnership with Invaluable, formerly called Artfact.
Gene Cook, eBay Marketplaces GM of Emerging Verticals, told EcommerceBytes there won’t be a special name for live auctions, rather, the live auctions will be “deeply integrated” into areas of the eBay site. A search on eBay for a collectible will bring up results for live auctions alongside listings for traditional auction and fixed-price listings.
In addition to “great information and great pictures,” eBay will convey the sense of action and activity that’s going on in the auction room. eBay’s design team is excited to bring the auction experience to life, Cook said, and eBay will put its own spin on it. eBay is still working on the details, and live auctions will launch later this year.
eBay had originally tried buying its way into the traditional auction business in 1999 through its purchases of Butterfield & Butterfield (later sold to Bonhams) and Kruse International (later sold back to the Kruse family). Then it launched eBay Live Auctions, which allowed auction houses to incorporate online bidding with their real-life auctions (similar to phone bidding, only conducted through the Internet).
Donahoe shut down the live auction platform in 2009, a year after he took over as CEO of eBay. It was never certain why he shuttered the platform, but early on he disparaged eBay’s “flea market” image and launched a period of “disruptive innovation.”
Trade paper AntiqueWeek referred to the closing of eBay Live Auction in 2009 a business decision, writing last year, “Although eBay will not comment, speculation is that lawsuits, technical headaches and increasing negative feedback from buyers and sellers, alike, were not worth the trouble.”
One lawsuit was over eBay’s practice of allowing some auction companies to place what the plaintiffs referred to as floor bids on the eBay Live Auctions platform when those auction companies did not hold live, physical auctions. The plaintiffs argued that “floor bids” from those auction companies were shill bids. The case was settled after plaintiffs failed to get certification for a class action.
In announcing the end of the platform in 2008, eBay had said the closure came as it aligned its resources with its priorities as it worked to improve the buying and selling experiences, “including significant investments in Trust & Safety and customer support.” The announcement went on to state, “In the case of Live Auctions, maintaining and improving this platform falls outside our immediate focus, and will, therefore, be retired at the end of the year.”
What’s changed in the 5 years since eBay shuttered live auctions?
eBay’s Cook said the times are very different. The technology has advanced significantly, and eBay is able to provide a world class buyer experience coupled with the unique, higher-end and very special inventory from Invaluable. Customer expectations have also changed, Cook said, and they are more comfortable making transactions remotely.
In speaking to Cook and Invaluable’s CEO Rob Weisberg, one gets the idea that they are counting on mobile bidding playing a major role in the success of the new eBay live auctions.
Cook called live auctions of collectibles and art an $8 billion market – one that eBay has been missing since 2008.
Earlier this week, Christie’s auction house trumpeted its decision to invest $20 million in technological and digital advancement. Christie’s CEO Steven Murphy had told EcommerceBytes that the global audience for art was growing, museum attendance has increased again, and the art market continues to grow. “This is in part driven by the digital accessibility of art and imagery online,” he said.
“Last year, Christie’s had a record $7.1 billion in fine art sales,” said Murphy. “We also saw that 48% of registrations for our auctions happened online with an increasingly global audience. That, coupled with the fact that 45% of buyers in online-only sales were new to Christie’s and our mobile views increased by 42% during the year were clear indicators that there was an audience of buyers online that we needed to better serve.”
Christie’s will use part of the investment to create content around the art and objects that it sells and are passionate and extremely knowledgeable about, saying clients were “ravenous for information.”
We were unable to reach Murphy on Thursday when seeking a comment on eBay’s announcement.
Will Seippel, founder and CEO of Worthpoint, said values of collectibles and fine art have been going up over the past two years. Worthpoint is a “Bloomberg system” that allows collectors to find out about the items (“stocks”) they’re buying and owns the GoAntiques marketplace, a company it acquired that used to publish listings to the eBay Live Auction platform. He called eBay’s reentry into live auctions “great news.”
According to eBay’s press announcement yesterday, “The partnership will offer buyers the opportunity to participate in traditional live auctions through real-time online bidding at auction houses around the world. Invaluable’s software solutions, including their online live bidding technology, will make it easy for Invaluable’s partner auction houses to bring over $4 billion of inventory onto the global eBay platform.”
Invaluable spokesperson Colleen McCormick said it was an exclusive partnership. eBay will launch its own live auction site on the eBay website, and all Invaluable catalogs will launch on eBay as well. “The technology is still being worked out,” she said. Auction houses will continue to set their own buyers premium.
Invaluable’s Weisberg said his company charges listing fees to auction houses and commission fees to buyers, on top of the buyers premium collected by auction houses. Invaluable intends to charge its standard listing fees to its auction houses with no incremental listing fees from eBay.
Neither Weisberg nor Cook would address the revenue share, but both said eBay would make it clear to buyers their total costs. When asked how eBay would present commissions and buyers premiums on the auction listing pages, they said they were still working on the design, and emphasized utmost transparency regarding costs.
How will eBay handle feedback for live auctions? Cook said the individual auction house would be the seller of record, and live auctions would use the same feedback system as the rest of eBay.
AntiqueWeek has an excellent analysis of the market from its February 2013 article in which it reported eBay had begun investigating a reentry into the live-auction business. “Though the likelihood of eBay entering the live auction arena in 2013 is remote, AntiqueWeek has learned that administrative and technical staff from eBay’s vertical markets division are looking into how they can best integrate with auction companies. They could be back in the live auction arena in 2014.”
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