How Does An Online Auction Platform Work

Before attempting to understand the working of an online auction platform, a quick look at how traditional physical auctions function will help in this regard.

In the older form of auctions, a venue and auctioneer were hired and the items for sale were displayed on tables inside the hall. People crammed into the space shouting out the bids until one was declared the winner. Payment was made and the item was carted off by the new owner. Now with Covid-19 related lockdowns and social distancing norms in place, all that has gone for a toss. Welcome to the new world of the online auction platform.

An online auction website uses specialized software to conduct the proceedings. The photos of the items are uploaded on the site and potential participants can evaluate them before placing the bids. The services offered include registration of the participants, displaying the items, conducting the bidding, declaring the winners, and even providing gateways for payments. The charges are very nominal, generally limited to administrative fees, resulting in higher profits for the fundraisers.

The bidding process for an online auction platform is unique. After registration, the participants can place their bid from any Internet-enabled device such as a smartphone, tablet, or laptop. On the day of the auction, after a bid is placed, a participant need not continually follow the proceedings and can go on with the usual work. After the bid is crossed, a notification is sent to the participant who is offered the option of either placing a higher bid or dropping out.

It is because of this convenience that an online auction platform draws more bidders and higher prices than the traditional auctions.