How not to host an Auction

Published on the 27th of December, 2007

Recently looking at sitepoint we have come across 2 prime examples of how not to host an auction when selling your website. What makes this interesting is that a recent reader of this site emailed me saying that in part they disagree with what I said in my article, Selling - How To Sell Your Website, yet these two clearly show that in part my article was correct

Don’t mention a price

The reader raised an objection to me saying that it is better if you do not mention a price you are willing to sell your website for. I am a firm believer in this and will remain so.

In an auction for myspaceantics.com the seller posted a buy it now price of $2000. The seller received a considerable amount of interest given that the website was making over $700 a month and had quite good traffic.

A day later the seller increased the BIN to $5000 and the following was said;

Raising the BIN from 2k to 5k doesn´t sit well with me just as you had a lot of interest. I have NEVER known this to happen on a Sitepoint sale before and I will be reporting the thread."

"I agree [sic]. SP should not allow this. What is the point of a BIN of the seller will not honor it? It is dishonest."

As you can see by the two comments the potential buyers were not happy, sure they would have been in for a bargain at 2k but the biggest potential sales killer is the second comment. What is the point of a BIN if the seller will not honor it? It is dishonest. Here we go back to a point that we mentioned earlier. Trust! The seller has revaluated the value of their website, which under the terms of Sitepoint auctions is fully within the seller’s right to do, yet the seller has lowered the trust level with his potential buyers.

What happened with the sale? We have contacted the seller and as yet have not had a reply. The auction closed a day latter with two bids at the $5000 BIN. Had the seller not have mentioned a buy it now price he may have exceeded the $5000.

Get your financials in order

In an auction for a warez forum the seller says

Site has over 70 Donated/VIP members that have paid for this. It also has ads that get $100+ everyday, as i charge $60/Month for a 468 banner.

* $100+/Month from Banners
* $20-100/Month for Subscriptions

Now leave out the fact that there is a mistake in the first sentence the seller claims here to be making $100 + ($20-$100) yet in monthly revenue says the site makes $300 so far all he has shown is $120 - $200 worth of revenue. There is $100 unaccounted for so the site in reality makes $150-$300 per month. The sellers are left a little confused on what the site is making and add to that the seller posts a useless screen capture of his paypal account that says there have been 45 transactions earning $955. No mention of time period or where the income was sourced (ads/subscription?)

A far better method of displaying income potential would have been listing the last 3 months such as

December
Advertising: $120
Subscriptions: $280
Total: $400

November
Advertising: $100
Subscriptions: $100
Total: $200

October
Advertising: $120
Subscriptions: $180
Total: $300

Here the income says the same thing yet the sellers are a little clearer on where the income is coming from and how much of it is coming from a particular source.

Whilst this was sorted out and made clear in the discussion the fact remains that the information you are using to sell your website needs to be clear, error free and detailed!

Seen an auction go wrong? Let us know..