Is no reserve really the truth?

Thank you Sedond for clarifing. This will be helpful for future auctions I participate in. Best regards, Paul

if reserve price isn't met, the hi-bidder is *not* required to buy...

on ebay, i've seen some bidders cast artificially high bids yust to see what the reserve was, then cancel them, saying they mistyped their bids...

I just had to chime in even though this is not exactly related to "no reserve being the truth" My concern is with auctions that have a reserve price that is too high. This would mostly be the case with dealers rather than individuals. I have noticed several items in auctions in which the reserve price reflected a 20% or less discount from retail. So in effect it's not really an auction but a dealer trying to sell their wares at almost full retail. This seems unfair and a waste of bidders time. It's a lot of work to watch an auction for an especially hot product that even bid after bid after bid (one I counted 72 bids), the reserve price was never met. It is the dealers way of getting you all excited and thinking you will get a good deal when actually to win the item you would just as well pay retail. Most brick and mortar dealers can give you 10% off of items over 1k retail. Why go to the trouble of participating in this kind of Auction. It is frustrating to say the least. A suggestion is that for dealers to participate in an auction the reserve price must be say at least a 30% discount from retail. Otherwise they should just post a demo or classified add. It's no fun to spend all that time watching, bidding, and winning only to find out there is no way in hell you are going to get the item because the reserve was way too high! Also a question for you bidders: If the reserve price is not met, is the winning bidder still obligated to buy? If yes than that is interesting because it means the seller holds all the cards. I guess if I were a dealer I would auction everything with a high reserve and then see where things fall. Hmmmmm

Sdcambell & Audiogon staff- I had a similar experience. I was high bidder (admittedly at a low price) on a pair of monoblock amps, listed with no reserve. When I checked back a day later, found that a reserve had been added in (above my bid). Since there have been at least three instances reported on this thread, there seems to be problem here.

My thanks to the Audiogon staff for responding as well. Your interest and support are what allow this site to remain the premiere audio market on the Internet and it is appreciated. OTOH, I agree with Sdcampbell that hidden reserves serve no positive purpose. I do not buy from Ebay because there's too much opportunity for manipulation and deceit. Full disclosure of the particulars of a business deal is always better for everyone involved. With holding information (i.e., secret reserves) benefit no one but those looking for angles to work. Thanks for advising sellers of their downside. It's certainly a step in the right direction.

Audiogon staff: Thank you very much for taking the time to respond to this thread. I sincerely mean that. On the whole I have been very pleased with my experiences, both as a seller and a buyer, on Audiogon. I have been a long-time audiophile, and have also sold high-end gear, so my opinions have been shaped through a lot of experience. I understand very well what "high bidder" and "reserve price" means. In the example I listed above, there was no notice of a reserve price, or "reserve not met", following my bid of $300 the TEAC mini-system auction. A day later, there was a "reserve not met" notice on the auction page next to my bid. I'm not accusing anyone of dishonesty, but it did seem odd.........A final point: I dislike the reserve price approach because it's too gamey. High-end audio used to be a hobby and avocation for many of us, and there was a shared sense of honesty and comaraderie. I find it very distasteful to go through the marginally honest and misleading process of bidding that characterizes the whole notion of "reserve price". If sellers want to play that game, let them do their business on E-Bay. I would hate to see Audiogon become just another cheesy auction site. Thank goodness for the classifieds you have!!!

It appears there two are different issues being discussed here:
1. The terminology and notification system used on the site for reserve price auctions.
2. The acceptance of reserve price auctions in general, or the lack thereof.

1. In regards to the notification system, it sounds like Sdcampbell understands the term "high bidder" to mean something different than what we think it means. Our definition of a High Bidder is independent of the reserve price, period. If you have the highest bid in place, then you are the high bidder, regardless of whether there is a reserve price, and if so, whether the reserve has been met. Each listing will always indicate whether there is a reserve, and if so, whether it has been met. One possible source of confusion may the fact that listings do indicate "no reserve" in a very similar manner to "reserve not met". As in, they are both blue colored links, as opposed to one of them being red perhaps. Thus, upon first glance, this indicator may not be as clear as a multi-colored one. Another possible source of confusion may be that Dutch Auctions do not indicate anything about a reserve, since by definition a Dutch Auction here can not have a reserve. Perhaps we will start indicating "no reserve" on all Dutch Auctions, to make it more consistent. However, we are quite sure that every single-item auction indicates the reserve status all of the time, barring some bizarre page layout or browser incompatibility issue.

2. In regards to reserve price auctions in general, we consider them a necessary option for auctioneers. It is understandable how some bidders may not like reserve price auctions, and we do inform sellers that reserve prices will turn away some bidders. Thus, if the seller still chooses to list with a reserve price, that is his/her choice. Likewise, bidders are of course free to choose which auctions in which they will participate. In general, we do feel that reserve price auctions are a good way to gauge the demand for an item. Reserve price auctions are really NOT that different from a classified ad, where a seller would set an "asking price", and then receive offers. In this analogy, the reserve price auction would have a hidden asking price, but the offers would be public. On the other hand, a classified ad would have a public asking price, and the offers would be hidden. Thus, we might argue that reserve price auctions are actually better for the buyer, than a classified. For example, let's say Joe had a reserve of $2500 on something, hidden of course, but the highest bid only reached $1500. Now, the bidders have a strong bargaining point with the seller, something like "You can see that $1500 is about the market value, let me offer you $1700...". On the other hand, if Joe had listed the same item in the classifieds with a $2500 asking price, then who knows what the highest offer might have been? In this case, the buyers are making "blind" offers, trusting Joe if he said "Well, the best offer so far is $2000". One last scenario is the classified with a $2500 asking price, where buyers become offensive in their comments or in their offers. Like "You're a XXXXXX if you think you can get $2500", or "I'll give you $500". Instead, at a reserve price auction, the second commenter could have bid $500 without offending anyone, and the first commenter would have no reason to comment. So in conclusion, Audiogon.com does not encourage reserve price auctions, but we think they are NOT deceptive, and if anything, they are a good bargaining tool. They are certainly a little more fun than a boring classified. :)

Hi, Fpeel: I share your thoughts. The reserve price method is a ploy, in my opinion. If one is not going to accept a bid below a certain point, then establish that point as the opening bid requirement. You may not get a lot of the early bidders, but you also eliminate the "looky lou's". With regard to the "bait and switch" technique I think I experienced with the reserve price suddenly appearing after I was declared high bidder, I'd be very interested to see Audiogon respond the points in this thread.

Interesting observation, sdcampbell, as I am confident that happened to me at least once before. Unfortunately, I didn't keep a copy of the Web page, so am unable to substantiate it. As it turned out, lucky for me someone else won the auction in question because the dealer that placed it turned out to be a jerk whom, based on our correspedance, would not have appreciated my business. Thanks for the heads up; I'll be watching more closely. As for reserves, minimums, etc. my belief is they should all be disclosed. Like agendas they serve no good purpose when hidden except to deceive.

Interesting timing on this question, because I have just had an experience here on Audiogon that made me inquire (to the Audiogon staff) if a seller could post a reserve price AFTER the auction began. I bid on a TEAC mini-system and the auction page stated that I was the high bidder (admittedly at a very low price). There was no reserve price posted, and I have the printout of the page to prove my point. A day later, when I checked the progress of the auction, there was a reserve price posted that had not been met. I sent an E-mail to Audiogon for a clarification, and they said that there was NO WAY that could happen, since sellers are not allowed to post a reserve price once an auction begins. However, the E-mail I received from Audigon DID say there was a chance of a glitch in the software. Hmmm, now that leaves me feeling really reassured! I guess the main point here is that one must study the terms of selling by auction, and exercise some caution even on Audiogon.

I erred. This auction did start at $1. Please excuse my ignorance of the various practices and procedures involved in an auction.

Dtwomey, you've been mistaken, I checked out that auction of Wadia 850 and the opening bid was $1.00 So far, there were many bidders and the price is up to $2930. Therefore ,the minimum now is $2960. If you were the first person to place a bid, you could have placed it at $1.00. I hope my explaination is of help to you.

Dtwomey- There is a difference between reserve and minimum bid. Reserve is hidden, minimum bid puts it out there to see so you don't have to waste your time. However, if the listing your taking about says starting at $1 and then there is a minimum on the detailed page then that is false advertising. I ran into this also on an auction here and was pretty upset. This is deceptive and is one real problem I have encountered on this site. Site sponsors should be informed and look into it. Posting the name would be a last resort; such postings are starting to deteriorate some of the threads into name calling or he said-she said affairs that are a real drag and add no useful information to help out the hobbiests who want to learn.