Online vs traditional auctions: What’s the difference?

Please forgive me, as I will be showing my age here. But hands up if you remember life before the Internet? Who can remember back to the days when we didn’t have the constant stream of consciousness access to all the information we need (or don’t) in the world, where we had limited options, and basically, if we didn’t use our imaginations for things then we were up the Swaney, and without the proverbial paddle to boot. Ah, yes, it was a simpler time indeed, but before you go off into a hazy glow of rose-coloured glasses and how things were better in my day, hold on for a minute. Was life pre-internet better? Of course, it wasn’t. I mean, would you go back to life pre-electricity or running water? No, thought not.

How eBay revolutionised online auctions

To eBay and beyond. Like it or not, the internet revolutionised our way of acting, thinking and, above all, spending. I remember when auction sites like eBay became a thing. While we approached with trepidation, no one really trusted them at first; there is no doubt that eBay revolutionised online auctions by introducing a new platform for buying and selling goods in an auction format. Suddenly, the world got much, much bigger – and you could as easily be in a bidding war with someone on the other side of the globe as with someone from next door. Personally, I loved eBay when it arrived; it opened up a new realm of possibilities for buyers and sellers alike. I remember setting my alarm in the middle of the night as I wanted to be the final bid on a pair of shoes that I had spied and had become obsessed with. Thanks to eBay, online auctions became accessible to everyone with ADSL (as it was back then) and changed how people shop online.

Are online auctions or traditional auctions better?

Fast forward the 20 or so years that have passed and we find ourselves asking the question. With the success of online platforms such as eBay is there, have actual auctions become obsolete? How has the success of e-auctions and trading apps such as  affected specific industries?

Traditional auctions are the age-old, conservative approach to procurement that relies on manual functions, heavy paperwork, and phone calls, not to mention physical displacement (in most cases). They have been around for centuries, and in the case of fine wine auctions, over time, they have become a way for wine enthusiasts to buy and sell rare and expensive wines. However, with the digital revolution, manual procurement became seen as a handicap more than anything:  financial success relied on time-consuming and tedious, repetitive tasks that either failed to generate significant savings or profit, or these latter were cancelled out by heavy third-party fees. In an increasingly volatile and digitalized world, the traditional procurement system just doesn’t seem to have a place anymore.

Online auctions vs traditional auctions: Advantages

E-procurement represents a more strategic and digitalised approach, and the benefits of virtual auctions are obvious. Firstly, online auctions provide convenience to buyers and sellers. They can be accessed from anywhere in the world, and there is no need to physically attend the auction, saving on both time and travel costs. Online auctions are usually open for a longer period of time than traditional auctions, allowing potential buyers to take their time and bid at their leisure. In addition, online auctions provide anonymity for both buyers and sellers, a very attractive attribute to those who prefer to fly under the radar. 

Another advantage of online auctions is that they have a much larger reach. This means that there are more potential buyers and, therefore, a higher chance of achieving a higher price for the item being auctioned. Traditional auctions are usually attended by a smaller group of people, which can limit the number of bids and, as a result, the final price. With online auctions, bidders from all over the world can participate, and the auction house can reach a much larger audience.

Do online auctions provide better transparency compared to traditional auctions?

Online auctions also provide transparency in terms of the prices achieved for wines. Buyers and sellers can view all of the bids and see the final price achieved for the wine. This transparency is not always present in traditional auctions, where buyers may not know who they are bidding against, and the final price may not be disclosed to the public. In addition, online auctions provide detailed information about the wine being auctioned, including its provenance and condition, which can help buyers make informed decisions.

While the transparency of provenance and global reach are undoubtedly seductive qualities for anyone interested in buying or selling, surely the key benefit of online auctions for fine wine is the ability to access rare and collectable wines. With so many fine wines difficult to find, traditional auctions stumbling block is that they only offer a limited selection. With online auctions, buyers can access a much wider selection of wines, including rare and collectable bottles unavailable elsewhere. In addition, online auctions often offer more up-to-date information on the wines being auctioned, including tasting notes and reviews, which can help buyers make informed decisions. And, as we all know, informed decisions at buying level usually promise greater returns in the long run.

Another advantage of online auctions for fine wine is the ability to buy wines in smaller quantities. Traditional auctions usually require bidders to buy entire cases of wine, which can be costly and impractical. With online auctions, buyers can bid on individual bottles, allowing them to purchase the exact amount of wine they want without having to buy a full case.

Anonymous bidding a benefit

Online auctions can also offer a more competitive bidding environment. Traditional auctions can be intimidating, and buyers may not want to bid against experienced collectors. With online auctions, the playing field is level, and buyers can bid against each other in a more relaxed environment. This can result in higher prices achieved for the wine being auctioned.

The benefits of online auctions, particularly when it comes to fine wine, are so many. They provide convenience, anonymity, a larger reach, transparency, access to rare and collectable wines, smaller quantities, and a more competitive bidding environment. As a result, online auctions have become an important part of the wine auction market and are likely to continue to grow in popularity in the years to come.

Not all auction websites are to be trusted!

We do have just one word of warning, however, before you fire up If something is too good to be true, it usually is. Always use a reputable site (even traditional players such as Sotheby’s and Christie’s have an e-auction site) where you know that your product has been thoroughly vetted. We do not need to mention the huge wine fraud business surrounding the buying and selling of fine wine, nor do we need to mention that without proper storage (this means professional and traceable), your wine is good for the table but not the portfolio. It really is a case of Wolff’s Law; either use a reputable company or risk losing your wine forever. 

All wines on offer guaranteed provenance and are sourced directly from the chateau, producer or negotiant. Download today!

Leave a comment

Your email address will not be published. Required fields are marked *