Auctions are those events where properties or goods are sold to the highest bidder. Auctions are mostly public events, where bidders make a series of bids and purchase a particular item for a high price. During auctions, bidders decide the price of an item rather than the seller. It depends on bidders to decide the amount they would want to pay for a specific item. During an auction, a bid is a proof of a legal binding. Bidders agree to pay the amount that they have bid. In a high profile auction, bidders may have to pay a deposit in escrow accounts or give a proof that they can pay for those items.

Types of Auctions:

Different types of auctions take place around the world. Below mentioned are some types of auctions:

1. English auction:
This is a basic type of auction. In this type, people can see the item and then start bidding. Bidders slowly raise the value of their bid until everyone gives up. The highest bidder is the winner. An auctioneer manages an auction, keeps records of the on going bid and decides the winner. Sometimes, the seller will quote a minimum amount for an item to the auctioneer, below which the auctioneer cannot sell that item.

2. Dutch auction:
In this type, the auctioneer sets a particular price and then gradually lowers the price. People in public will start bidding and later decide which prices are suitable for the item. A seller may use this type of auction to sell large quantities of same products to the public. For instance, a seller may want to sell a large amount of hay and will thus, decide to sell this hay to people for the same amount, once a reasonable price is decided.

3. Silent auction:
In this type, the bidders in public will present their bids in a sealed format. These sealed bids open at the same time and bidder with the highest bid wins. There could be a modification in this type of auction. The bidders are allotted a specific period to bid. They can roam in a room displaying the items, and write their bids on an associated sheet of paper. The bidders are allowed to see bids of other bidders and can choose a higher price for an item. At the end of the allotted time, bidder with the highest bid is the winner.

Examples of Auctions:

Auctions can be of two types either public or private. Sellers may trade any kind of items in both types of auctions. Some areas where auctions take place are:

1. Antique auction: An antique auction consists of a trade opportunity as well as provides entertainment.

2. Collectable auction: In a collectable auction, the seller may put up collectables like coins, vintage cars, luxury, stamps, real estate, and luxury for sale.

3. Wine auction: In wine auction, bidders can bid for rare wine, which may not be available in retail wine shops.

4. Horse auction: Bidders can bid for young horses of the best breed.

5. Livestock auction: In livestock auction, bidders can buy pigs, sheep, cattle, and other livestock.

The other examples of auctions may not be public. These auctions are for bidders from corporate levels. Some examples of private auctions are:

1. Timber auction
2. Spectrum auction
3. Electricity auction
4. Debit auction
5. Environmental auction
6. Auto auction
7. Electronic market auction
8. Sales of business auction

Bidders in an auction need to examine the items displayed and decide an appropriate price for an item. Thus, auctions help buyers in getting the best deals and in gaining better profits for sellers.

WHAT IS A PENNY AUCTION?

Penny auctions have exploded in popularity with the massive growth of the internet. However, few people know the true origins of penny auctions.Beginnings actually stretch back to the Great Depression. Those were hard times for everyone, but even harder for farmers. Farmers struggled to bring in steady income because of droughts and crops not selling as well as they had previously. As a result, the banks would foreclose on the farmers who couldn’t keep up with their mortgage payments.

The banks weren’t satisfied with just repossessing the house, they wanted to raise as much capital as possible, so they resorted to selling off the possessions of the owners of the repossessed houses. There was not much the farmers could do about it so they began bidding ridiculously low prices, pennies, on the items while threatening others who dared to bid higher than a few pennies.

The auctions of today hardly resemble their tremulous beginnings. Being part of a penny auction today is exhilarating, fun, and addictive. It combines the selling format of auctioning with a little bit of chance factored in.Auctions are a game of strategy but also a game of luck.

The premise behind penny auctions is giving people the chance to win an item at a drastically reduced price.Auctions make that possible by spreading out the cost of the product among multiple bidders. In order for a person to take part in an auction, they must pay a set price for each bid. For example, if a person wanted to bid on a fifty dollar Amazon gift card then he would spend a dollar for each time a bid placed. If he ended up winning the gift card, then he would only have spent a few dollars for a fifty dollar gift card. Usually penny auctions sell bids in packages.

HOW PENNY AUCTIONS WORK!

The main foundation of penny auctions is the pay-per-bid format. It is the key that allows bidders to win items at the fraction of their retail value and allows the auction owners to keep their site profitable. Most y auction sites run on the same premise: people pay a set amount for each bid, whenever a person places a bid within the closing seconds of the auction time will be added, the last person left with a unique bid after the clocks runs out will win the item. There are a large variety of items that can be won, but they tend to be popular electronics or gift cards to popular stores.

There are two types of auctions: lowest unique bid auction and highest unique bid auction. Lowest unique auction sounds confusing but it is actually quite simple. A unique bid is when only one person has a bid at a certain price. Bids usually start at one penny, a bidder can then place a bid at two pennies. Until another bidder places a higher bid, the most recent bidder will be the lowest unique bid because that was the only bid at two cents and nobody bid higher. However, penny auctions generally don’t stop at one penny. It is not uncommon to find auctions that end up at a couple hundred dollars based on the popularity of the item being auctioned. However, the same principles apply for those auctions. Highest unique bid auctions follow the more traditional auction format such as eBay. The person with the highest bid at the end of the auction wins the item.

Auction site owners turn a profit by selling bids. Say twenty people are bidding on a ten dollar gift card at one dollar per bid, at the end of the auction if there were twenty bids placed in total then the site owner would have made twenty dollars with a ten dollar profit.Auctions do seem like a win-win situation:The site owner makes money while the bidder gets an item for dirt cheap. However, not everyone wins in penny auctions. The people who paid one dollar each bid but left with nothing to show for their investments will not be so happy.

HOW TO WIN!

Penny auction has a lot of chance mixed into it, but one can incorporate strategy that will help raise the chances of winning. Playing smart can make all the difference between gambling and auctioning.

The first crucial tip to winning penny auctions is to know how to manage your bids. Your goal should be to win as much as possible without spending a ton of money buying bids. Managing your bids means that you should already know how much you are willing to risk in order to win an item. The amount of capital you are willing to risk will determine how many bids you can use. Once you know how many bids you have to spend on an item, then you will be better able to manage how and when you place a bid. That will keep you from blowing away all of your bids in the first few seconds of the auction.

The next tip is to practice time management. When fighting in the trenches of penny auctions, you have two enemies: other bidders and time. Knowing when to bid is a must if you want to have success. Placing a bid when there is a lot of time left on the clock is never a good idea. You have to remember that the key to winning a penny auction is being the last one standing when the clock runs out and that each bid increases the amount of time left. It would be a good practice to wait until the last few minutes of the auction before you begin to bid.

The final tip for successful auctioning is to keep your emotions under control.Auctions have a lot of similarities to gambling, and just like gambling, your spending can get out of control. If you keep your emotions level, it will keep you from making rash decisions and blowing loads of cash. Keep your mind clear so that you can gage the behavior of the other bidders and outsmart them.

HOW TO AVOID SCAM SITES!

Penny auctions are a great addition to the web whether you want to win an item that otherwise you wouldn’t be able to afford or if you simply enjoy the thrill that comes with bidding in auctions. Unfortunately, scam sites have tarnished the reputation of the legitimate penny auction sites. However, there are ways that you can protect yourself from scamers and enjoy your auctioning without having to worry about losing your money due to dishonesty.

Checking the reputation of the auction site before you start spending your hard earned money is always a good idea. Chances are other people have tried the site before you and some of them have left reviews. The reviews are your way to gage whether a auction site is trustworthy or not. If a site is getting overwhelmingly negative reviews, then that is a clear indication that you should steer your business elsewhere.

Another tool you can use to protect yourself is checking the Alexia ranks of the auction sites. Alexia rank will give a solid view of how much traffic the auction is getting. If you see a huge difference in the amount of traffic Alexia is projecting and the amount of active bidders on the site, then warning signals should be ringing in your head. Some auction sites have been known to set up robots that automatically bid on projects in order to keep the auction going and inflate the price. That is known as shill bidding. You can sniff out those sites by comparing the traffic the site should be getting to the amount of users using this site.

CONCLUSION!

New legislation may come out later down the road that will officially make penny auctions gambling, but until then, it is a fun, exciting auction that allows one to win the item they’ve always wanted but couldn’t afford.Auctions are also quite lucrative for the site owners because of the pay-per-bid strategy they’ve incorporated. Penny auctions had humble beginnings with farmers who just wanted to get back at the banks who kicked them out of their house. More recently, auctions have enjoyed an explosion in popularity with the rise of the internet.

There are two main formats fora auctions, lowest and highest unique auction, however they both run on the same premise where the last unique bid wins the item. Winning a penny auction will require a certain amount of mental tactic and a bit of luck. However, you can increase your odds of winning by practicing certain techniques such as managing your bids wisely, learning how to work with the time, and keeping a level head and your emotions under control. When you combine those three strategies to your bidding plan, you will find that you win a lot more often.

It is important that you do your due diligence to protect yourself when participating in auctions. Not every auction is run by honest and trustworthy people. There are people out there who just want to take your money. You can protect yourself by ensuring that you only bid on sites that already have a very positive reputation from real users.

What Are Citizens Getting From Public Agencies?
All too often we hear of government programs that cause inefficient and wasteful allocation of goods and resources. Consider the example of the Australian government’s home insulation program (HIP), which was designed to prop up business in the wake of the global financial crisis, providing rebates to insulate the ceilings of 2.2 million houses at a cost of (AUS) $2.7 billion. As well as claiming that the scheme would create jobs, the government sought to boost its “green” credentials, insisting that home energy bills would be cut dramatically. Countless problems plagued the HIP; houses caught fire, thousands of cases of fraud were claimed, numerous installation companies went bankrupt, and a number of deaths and injuries occurred (despite multiple safety warnings from regulatory agencies). A lack of effectiveness in the program design, administration, and delivery arrangements and a poor management structure for dealing with the risks associated with a rapid program rollout (along with making the program instantly available to millions of household owners and suppliers without first piloting the offering) were cited by an independent review as the main contributors to the failure of the HIP program. After sustained media pressure, and in an effort to exercise damage control, the program was scrapped in early 2010.

With dwindling budgets and mounting expectations on government agencies to act in the best interests of their customers (the public), a new view about how to best develop and implement such ambitious government programs must be undertaken.

Learning From the Private Sector
Most citizens expect government agencies to develop and run programs that are relevant, efficient, effective, sustainable, and impactful to theirs and the nation’s welfare. With their activities under increasing scrutiny by the public, governments need to adopt practices and proven methods that facilitate the successful implementation of public programs. One solution is to adopt the best practice marketing tools that are routinely deployed within the private sector.

When a government department develops a “product” – be it a physical product such as running water in a poor village, an idea such as “don’t drink and drive”, or the provision of a service such as the upkeep of a national park for visitors – and then prices, distributes, and promotes it to a targeted audience to promote an exchange, marketing is taking place. By providing focus, marketing helps avoid the “knee-jerk reactions” that usually result in wasted time and resources.

Philip Kotler is one of the world’s foremost experts on the strategic practice of marketing. In his book, Marketing in the Public Sector, Kotler claims that marketing has been most overlooked and misunderstood by the public sector.

When applying a marketing mindset, Kotler and others would stress that there are obvious differences between public and private sector organizations. They typically have different mandates (citizen interests vs. maximization of shareholder wealth), competitive environments (monopolies vs. competitive markets), and focus (usage levels and cost savings vs. sales and profits).

Moreover, many of the perceptions and behavior changes that government marketing tries to address are long term projects. Monitoring the outcomes of a national smoking cessation program, for example, would typically require a 10 to 20 year perspective. While this may be a reasonable time horizon, some stakeholders, such as those within health authorities, may expect to see results a lot sooner: this can make government marketing a lot more complex than in the private sector.

Persuading people to break an ingrained habit or do something they find difficult, can be a significant challenge. This compares to the private sector where consumers are persuaded into choosing one brand over another – the results are far more tangible.

Despite substantial challenges, governments are still held accountable for tangible performance improvements. Whether a public agency wishes to maximize revenue, increase service utilization or product purchase, ensure compliance with laws, health, and public safety or to increase customer satisfaction, their functional mandates must be met.

And it should be highlighted that government has certain features that can be used to their advantage. For example, they tend to have more information on their customers then most private organizations would ever dream of.

Using the Marketing Mindset in the Public Sector
In order for programs to succeed, a disciplined approach to conducting a situation analysis, setting goals, segmenting the market, conducting market research, positioning, choosing a strategic blend of marketing tools, evaluating results, preparing budgets, and formulating an implementation plan is required. Adopting this strategic approach towards program or service delivery forces an organization to focus its efforts on priorities, rather than applying a “bandage” to a wide range of never-ending issues.

Publicly-driven organizations and professional associations need to adopt a marketing mindset in order to thrive. Kotler’s five principles of a successful marketing mindset are:

Adopting a customer-centered focus
Segmenting and targeting the market
Identifying the competition
Utilizing all four P’s in the marketing mix
Monitoring efforts and making adjustments
Adopting a Customer-Centered Focus

Too often, public or member-driven organizations plan and implement programs without consulting their clients and are left wondering why these initiatives are not getting the anticipated take-up. Effective organizations ask their clients what they want first – and then plan accordingly.

Starting with something as simple as a survey can be a powerful tool to figure out what your market – the public – needs, and how you can best position your product or service.

Segmenting and Targeting the Market

By developing a better understanding of the customer, the high-performing government agency can then begin to ‘categorize’ similar wants and needs into distinct groups that may require different products and services. With this in place, services can be far better targeted with the appropriate marketing strategies, satisfying the different preferences of each chosen segment, and optimizing the use of resources.

Identifying the Competition

One of the tricks in marketing is to describe offerings in short, simple terms. Schools are in place to provide education. With this same goal in mind, public schools compete with private schools, just as they do with home schooling. Government-run post offices compete for business with privately-run courier services, libraries compete with bookstores, and so on.

Offerings provided by the government are not necessarily the best answer to the benefits sought, and therefore public sector agencies must continue to look at what it is they offer, who their competitors are, and how their offerings match up.

The Marketing Mix (Product, Place, Price, Promotion): An Egyptian Public Sector Success Story.

With customer needs analyzed, the market segmented and understood, and the competition identified, all the elements required to shape the offering are in place.

To better explain effective use of the marketing mix, consider the ambitious (and successful) example of Cairo’s taxi scrapping and recycling project, which has delivered a multitude of direct and indirect benefits for citizens and project stakeholders. It was launched to support the enforcement of a 2008 traffic law that announced the end to the renewal of licenses for taxis older than 20 years, which made up the majority on the clogged and polluted streets of Cairo. The goal was to improve air quality and reduce greenhouse gases associated with Egypt’s aging fleet of taxis and other public vehicles. The project also tackled a variety of other issues such as safety (accidents due to mechanical breakdowns), economic losses (commute time due to increased traffic congestion) and the weak image the filthy, ancient cabs provided tourists.

Product

The taxi replacement and recycling program was launched on a voluntary basis, where private taxi owners received financial and other incentives to surrender their old vehicles for new, more fuel-efficient models, while the old vehicles were scrapped and recycled.

A range of models were available to choose from as part of the scheme, each one locally manufactured. Given the financial challenges to tax drivers that the purchase might present, the government introduced a variety of subsidies and discounts through collaborative efforts between the finance, interior, and environment ministries, several private sector participants (commercial banks, insurance companies, auto dealers, advertising firms), and other program stakeholders (taxi owners, the recycling and scrapping operator, and the World Bank Carbon Finance Unit).

Price

To maximize collaborative efforts, The Ministry of Finance (MoF), that spearheaded the project, structured it as a Public Private Partnership (PPP), with different government and commercial organizations contributing financial incentives. These included a low-interest loan offered by participating banks and sticker price discounts offered by automobile dealers. The MoF provided payment for the surrendered vehicle along with sales tax and customs fees exemptions for the replacement. Taxi owners were also offered an option to participate in an advertising scheme, where a portion of advertising revenue was directly paid by an agency to the lending bank toward vehicle owners’ debt service payments. The owners also received a reduced cost for maintenance and spare parts along with insurance for all new taxi vehicles against all standard casualties (theft, fire, accidents, etc.). With the combined incentive assistance, vehicle owners could expect to pay back the car loan in less than six years.

Place

Land, in the form of a project site, was provided by the Ministry of Interior (MoI) to complete all replacement activities, ranging from vehicle inspection and surrender, to financing and incentives and the purchase of new vehicles. The use of this one-stop-shop for the taxi exchanges made it convenient and helped achieve a high program participation rate.

The auto dealers, advertising agencies, insurance firms, and banks were also available to vehicle owners at the project site. Additionally, on-site personalized help was made available, where candidates were given an orientation on project details and provided resource material illustrating eligibility and participation procedures.

Promotion

To maximize participation, the MoF conducted a public awareness campaign prior to the project launch, which included announcements of the program through advertisements in newspapers, radio, television, and other public media. The campaign outlined the program objectives, eligibility and participation criteria, and financial incentives available to vehicle owners who volunteered to participate. The Ministry also established a telephone hotline to address all project enquires.

Monitoring Efforts and Making Adjustments

Key to the program’s success was careful planning and close monitoring. This included several stakeholder meetings prior to launch to ensure coordination between project partners, detailed record keeping (project vehicle and scrapped vehicle databases), and periodic random surveys of project participants to estimate emissions reductions. The program has also maintained a degree of flexibility, allowing for periodic procedural changes to be made based on feedback from the vehicle owner surveys and interviews.

With 20,000 vehicles replaced in the first year, and plans for the rollout to include all public transport vehicles, including microbuses, trucks, and buses, the program has made significant early progress. And the Egyptian government’s estimate of reducing 1.3 million tons of CO2e emissions between 2009 and 2018 is an example of the scale and reach that government programs can have, and the breathtaking effects their successful implementation can provide.

Conclusion
With mounting pressure on governments around the world to address citizen complaints, alter public perceptions, and improve performance, effective implementation of public programs is critical. In order to perform services that are in line with the public’s interest, governments need to introduce the marketing planning platform that has long been utilized by their private-sector counterparts. Those public sector organizations that adopt this approach, as we have seen from the example demonstrated by the Egyptian government, will have the right focus to deliver maximum value to society.