The Easiest Way to Price Silent Auction Items in 2024
At a Glance
We know that pricing is crucial to your silent auction's success. But getting that pricing just right can be a challenge.
Too low and you risk losing out on valuable funds—too high and you can bid competitive bidding goodbye.
So how do you get the balance just right??
In this guide, we share the easiest way to price silent auction items in 2024. From determining fair market value to setting the perfect starting bids, we take the guesswork out of the equation.?
No more money left on the table—just proven strategies to maximize your revenue and help you price with confidence.
How to Price Silent Auction Items: Maximize Revenue in 2024
At a Glance
Determining Fair Market Value
The first step to pricing your silent auction items is determining their fair market value. This will be the foundation for all your pricing, so it’s important to take the time to get it right.?
What is Fair Market Value??
Fair market value, or FMV, is the highest amount an item can be sold for in a fair and open market.?
In other words, it’s the price both you and your bidders would agree is fair to pay for an auction item.
Fair market value can be different than an item's cost. Cost is fixed at the time of purchase, while FMV can change over time based on perceived value, demand, and other factors.?
How to Determine Fair Market Value
Calculating fair market value involves several key steps to ensure you're pricing items accurately and competitively:?
?? Research Retail Price
If the item is new, simply search the retail price online or through the manufacturer. This will be your fair market value.?
For items with no clear price such as antiques or memorabilia, consult with experts in the field or browse online marketplaces such as eBay or Facebook.
While experiences such as travel can be harder to price, reputable auction consignment companies will provide you with an FMV and an average bid value.
?? Compare With Other Events
Evaluating the FMV of items across similar nonprofit events can give you valuable insight into your own pricing.?
For the most accurate picture, compare events similar to your own in terms of size, auction items, and attendees.?
? Consider Uniqueness and Appeal
Unique or one-of-a-kind prizes command higher prices at auction, as do trending or high-demand items such as travel experiences or exclusive events.?
When pricing these items, research recent auction results and consider the item's brand, rarity, appeal, and cultural value.?
The more exclusive and memorable the experience, the higher the potential bidding.
Setting Your Starting Bids
At a Glance
Once you've determined the fair market value of each item, it's time to set the starting bids.?
A general rule of thumb is to price items at 30-50% of their fair market value.?
When considering that range, aim to set a starting bid that at least covers the item's cost. This ensures you’ll never suffer a loss even if the item sells at the opening bid.
Let’s break it down further:?
Standard Silent Auction Items
30 to 40 % of FMV
Examples:?
Standard auction items make up the bulk of your silent auction table and should be priced at 30-40% of their FMV.
As these items are easily accessible elsewhere, a lower starting bid can make them more attractive to bidders, driving more competition and ultimately raising more funds.?
High-Value Silent Auction Items
50 % of FMV
Examples:
Due to their exclusivity and appeal, high-value lots should be priced at 50% of their FMV.
A higher price point helps reflect their worth and attract more serious bidders.?
However, be cautious not to set the starting bid too high, as this may discourage participation and limit the potential for competitive bidding.
Buy it Now Price
150 to 200 % of FMV
'Buy-now' or 'Buy it Now' options allow your donors to buy a silent auction item immediately without competing in a bidding war.?
Since the price won’t be driven up by competitive bidding, buy-now options should be priced at 150-200% of the item’s FMV.?
Should You Include a Buy-Now Option?
Buy-now options are a strategic way to capture guaranteed funds from your auction table and can drive a sense of urgency that jumpstarts bidding.
However, buy-now options should always be used in moderation. The last thing you want is to discourage competitive bidding and lose out on valuable funds.?
Avoid a Buy-Now Option for These Items:
? One-of-a-kind experiences
? Items that could “outbid” the buy-now price
? Unique, popular, or emotionally charged items
? Items that have previously started bidding wars
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Setting Your Bidding Increments
At a Glance
Setting the right bid increments is an equally important part of your pricing strategy.?
Bid increments are the minimum amount by which a new bid must exceed the previous bid.?
Fundraising experts recommend a minimum bid increment of 10% of an item’s FMV. This ensures that it's not too high to discourage bidding.
Mark the starting bid and bid increments clearly on your bid sheet to avoid any potential confusion. Amounts should always be converted to a rounded dollar value so bidders understand what they’re pledging at a glance.?
Additional Factors to Consider When Pricing Silent Auction Items
At a Glance
????Know Your Donors
To maximize revenue, tailor item prices to your specific event audience.
Begin by researching donor demographics such as age, income level, and spending power. An item may have a high fair market value, but if your audience is budget-conscious, setting the starting price too high might deter participation.
For a more accurate picture, survey your audience, examine past events, and leverage your CMS for bidders' donation history.?
?? Consider Your Event Theme
Think of your silent auction as an extension of your event. Use the space to create attractive visuals that play up your event theme and draw bidders to the table.?
Aligning silent auction items with your event theme can also drive more revenue to your cause than prizes with no significance.?
For instance, rare vintages, wine retreats, or private winery tours may command higher prices at a wine-tasting fundraiser due to their relevance and audience appeal.?
???????? Leverage Donor Loyalty
Your audience's emotional connection to your organization can impact their generosity and the perceived value of your items.?
Choose items that resonate with your mission to encourage higher bids and more audience participation.?
For example, a conservation organization is more likely to raise funds with a bucket-list safari experience than a golf getaway.
Silent Auction Strategy: Maximize Revenue with Silent Auction Pricing
At a Glance
?? Create a Sense of Urgency
Creating a sense of urgency is a proven way to drive competition and kick bidding into high gear.?
This is where buy-it-now-pricing is particularly powerful. As items get snatched up, donors are more likely to place higher bids for fear of missing out.?
Another simple way to drive urgency is by setting a clear closing time for your auction. Be sure to announce the remaining time regularly throughout the event or use countdown timers and reminders for online silent auctions.?
?Offer Bidding Incentives
Bidding incentives can be a powerful way to encourage participation and increase overall revenue.?
Bonus Items
Consider providing bonus items or experiences for high bidders, such as gift cards, a complimentary dinner, or bottle of wine. This is also a great way to ensure donated items don't crowd your silent auction table.
Raffles
Another idea is to create a raffle or drawing for all participants, regardless of winning bids. This ensures that everyone who takes part in your silent auction feels valued and appreciated, fostering goodwill and encouraging future support.
??? Take Advantage of Auction Consignment
Auction consignment is a simple but powerful way to drive higher bids and attract larger audiences to your event.?
Zero-risk experiences such as auction travel packages allow you to offer high-value prizes at no cost to your organization without the hassle of donation requests.?
Showcasing exclusive and highly appealing showstoppers also helps draw attention to your silent auction table, encouraging more bidding activity.
?? Showcase Items Effectively
Presentation can have a significant impact on bidding and goes beyond creating attractive displays.?
Arrange Strategically
Set up your space to encourage flow between displays and allow bidders to freely browse through the space.?
The order of your items is also key. Fundraising experts recommend arranging silent auction items from lowest to highest value. That way, donors bid on multiple items as they progress through the displays.?
Provide Clear Descriptions
Providing clear and detailed descriptions of each item is also crucial. Include information about the item's value, unique features, and any special stories or significance behind it.?
Use high-quality photos and videos to showcase items online or in digital catalogs, allowing bidders to get a closer look and feel more connected to the items they're interested in.
Limit Your Items
Less is more when it comes to silent auction fundraisers. When curating your collection of prizes, stick to one item per two attendees for the best results.
Too many items and some will be left without bids. Too few and you’ll crowd the bid sheet, leaving many donors with nothing to bid on. ?
Take Action
Planning a fundraiser for your nonprofit? LuxGive offers a wealth of resources to help you plan and execute a successful benefit event.
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