NAA®: Online Auctions: Not Your Father's Classifieds

Online Auctions: Not Your Father's Classifieds

by Christopher J. Feola

It starts out just like any other classified: 25 cents for the listing; 25 cents extra for bold; 25 cents for italic...

But then there's this sentence: "An administration fee of 2.5 percent of the final sales price will be assessed on all successful, closed auctions."

Welcome to Auction Universe, the Mark McGwire of online classifieds. Claiming 28 media partners, Auction Universe is a subsidiary of Times Mirror Co., which got into the online-auction business last year as part of its evolving Internet strategy, according to Lou Golden, deputy publisher and vice president of external affairs at the Hartford Courant.

"We were looking for a different way to make revenue on the Internet, and we'd been involved with banner advertising and putting our classifieds up," Golden says.

"But we thought that there might be something more, something that takes advantage of the technology of the Internet a little bit better."

Online auctions represent "tremendous opportunities" for newspapers for several reasons, Golden argues.

Online Auctions

They're highly interactive. "The price increases as bidders come on and keep outbidding," he says. "It's a series of e-mails that go out that say, 'You are now the high bidder,' and five minutes later you get one saying, 'You have now been outbid.'"

They're highly entertaining. "It goes beyond the area of commerce and gets into the whole area of entertainment and excitement," Golden says. "Anyone who has been in any kind of auction knows what happens to the adrenaline levels." Indeed, the entertainment aspect is paying off for Auction Universe. Golden says its users average 58 minutes per session—and two sessions a day. Compare that to daily newspaper readership times, which hover in the 20-minute range.

They're transaction-based. "Instead of just selling real estate based on impressions and CPMs, we now are involved in the transaction. We take a percentage," says Golden. "And in doing so, that makes us a partner with our customers. And we think that really is the wave of the future on the Web."

Auction Universe backs that future vision with present-day revenues. That 2.5 percent fee may not sound like much—until you consider that recent auctions have seen Beanie Babies going for $3,000-to-$4,000 each.

Even better, everyone is having a good time. Sellers are confident they have gotten the best price. Buyers are having fun. And Times Mirror is enjoying its 2.5 percent cut.

Golden says that Auction Universe is working to develop categories into communities. The site's popular Beanie Baby area, for example, has news, price reports and other content besides the ongoing auctions.

Along with Times Mirror Co. newspapers, recent affiliates include The Orlando Sentinel and Sun-Sentinel of Fort Lauderdale, Fla., says Larry Schwartz, Auction Universe's president and chief executive officer.

With an online redesign scheduled to launch Sept. 16, Times Mirror continues exploring ways to link the auctions to print products, Golden says.

Christopher J. Feola is director of the Media Center at the American Press Institute. E-mail, feola@apireston.org; phone, (703) 715-3333.

Online Auctions: Not Your Father's Classifieds

by Christopher J. Feola

TechNews Volume 4, Number 5: September/October 1998

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