Kinds of auctions

There are different kinds of auctions, about which it is important for the buyer and seller to know. The typical auction is the nice straightforward kind of winner-takes-all.
However, there are special auctions, and one kind in particular is critical for
any seller who wants to reach the top pinnacle in the auction business.
Here are of the few different kinds...

1) Reserve Auction
I have already explained this kind of transaction in my previous post. Reserve auctions are a very small minority and are usually reserved for higher-priced items.

2) Dutch Auctions
Dutch auctions are vitally important. They are the key to substantial
income generation! A Dutch auction is one in which the seller offers more than one of the items she is selling. For example, if you have 25 pens to sell, you can create 25 different listings, or you can put them all in a Dutch auction.
Sometimes it is appropriate to create single listings. Other times, Dutch
auctions are the way to go. There are different strategies for either approach...
i) Rules -- On most sites, brand new traders cannot participate in a Dutch
auction. This restriction isn’t to pick on the “new kids.” It’s
because it takes some skill and practice to manage them.
There can be no reserve price in a Dutch auction. There is no proxy bidding,
either. The winners in a Dutch auction purchase the item at the lowest
successful bid.
Take the following example:
Let’s say that X is auctioning 10 pairs of socks, with an
opening bid of Rs.5. If 10 people (or less) bid Rs.5, no problem. They all get a set of socks. But what if 16 people bid on those 10 sets of socks. We can have the following scenario:
Buyer A - Rs.13.50
Buyer B - Rs.12.75
Buyer C - Rs.12.25
Buyer D - Rs.11.80
Buyer E - Rs.11.00
Buyer F - Rs.10.43
Buyer G - Rs.9.10
Buyer H - Rs.7.50
Buyer J - Rs.5.00
Buyer K - Rs.5.00
Buyer L - Rs.5.00
Buyer M - Rs.5.00
Buyer N - Rs.5.00
Buyer O - Rs.5.00
Buyer P - Rs.5.00
Buyer Q - Rs.5.00
Buyers A to K get the socks. J and K got the socks, and
buyers L to Q did not get them, when they bid as much as J and K. It all has to do with the chronological sequence. The first buyers who bid a winning
price are the lucky ones.
Now for the tough question. What does everybody pay for these socks?
The price is based on the lowest successful bid which in this case was Rs.5.
Therefore, everybody pays Rs.5. Yes, you read it correctly. Everybody! Even though Buyer A bid Rs.13.50, she only has to pay Rs.5. For now, just be aware that Dutch auctions are something you want to master. They are the source of super profits.


3) Reverse Dutch Auctions
Reverse Dutch auctions are sometimes found at specialty sites, but they are
not very popular. In a reverse auction, the price begins dropping at specified
intervals. The buyer’s job is to figure out when the price is acceptably low.
Wait too long and someone else will buy the widget.
It is similar to a Dutch auction, however, in that everybody will buy at the lowest price. However, you had better be willing to pay whatever you have bid. Be sure of your bid -- don’t hope or expect the price to drop because it may not.
So far, this doesn’t seem to be an especially popular format. I have yet to talk to anyone who has participated in such an auction.

4) Restricted Auctions
Restricted auctions are usually for “adult” auctions. To even look at the items in restricted auctions, the site requires credit card information which means the browser must be 18 years old.

5) Private Auctions
In a regular auction, the identity of the bidders is available for all to know. In a
private auction, this isn’t the case. There are usually two reasons for a private
auction...
1) If the item is very expensive, the bidders may not want the world to know
that they can afford a Van Gogh.
2) In the case of adult auctions, the bidders may not want anyone to know they
are bidding on a particular item.

But Dutch auctions cannot be private.