Online auction business has been very attractive due to its high profitability since the very beginning. No doubt that today the process of selling through an online auction is one of the most simple, comfortable and cost-effective solutions to boost the business. The reasons are simple. On the one hand, it allows actual selling of your products on favorable conditions, on the other – entertaining your customers by adding “gamification” to the whole process. Thus each party receives its own benefits.
So how to start an auction website? Every future auction operator should follow the steps below in order to build a competitive online auction website and lead it to the top.
Step 1. Business plan and project vision.
One of the most essential things on the way to launching your own auction website is to have a comprehensive business plan. One should clearly understand the essence of the online auction business, planned targeted audience, level of competition in the field, most effective communication and marketing channels.
After the project vision is outlined it’s important to find out what type of the auction will be the best to achieve your business goals. Different types of products or assets are best sold at specific types of auctions. For instance, precious stones are best sold at classic auctions, while a penny auction is better for electronic gadgets, etc.
Step 2. Legal issues
The second most important step is the legal matter. The prospective auction operator needs to find out if it’s necessary to get any type of license to build an auction website in this particular region. Sometimes legal bodies require certain paperwork to register the auction as a particular type of business. Apart from that explore all the advantages and disadvantages of starting your own business in this or that legal form, e.g. a limited liability company or a partnership.
Step 3. Find a software provider
Probably the most significant step that will allow you to build an auction website is to find an appropriate software provider for your future project. There are several ways that you can do that. The first one is to find a cheap “script” online but it will definitely cause additional problems leading to quick closure of the business. Another option is to find a reliable software provider that will be able to supply you with the up-to-date system, flexible enough to cover all your requirements and established enough to support a substantial clientele.
Pay attention to all details such as provider past experience in developing online auctions, project portfolio, technical side of the software, whether there is an opportunity for future updates and customization, what the payment policy is. Special attention needs to be paid to provider’s commitments as to technical support after the project launch. The package of full-support will give you the opportunity to get to marketing closer and promote your project quicker. You won’t be too distracted by the technical issues, and will be able to get down to the real business.
Step 4. Payment system
Another important thing helping to build an auction website is finding the most appropriate payment system. Online methods include payments via credit cards directly, payments via online payment systems or aggregators.
Choosing the payment system depends on different factors. The following criteria should be taken into account: the region you are going to work in, languages, commission percent that the system will take on every transaction, cooperation conditions and, again, level of customer support.
Step 5. Marketing and follow-up activities.
The marketing budget has no limits, as there is not any particular marketing budget per month that you can call “optimal”. So it’s very important to plan and think thoroughly about all the communication channels that are better to use precisely for your business.
It’s a good idea to start promoting and advertising your project even before it is launched. This will help you to get traffic at the beginning of project development.
After the launch think of various methods to make your customers feel comfortable. Provide all possible explanations that help your customer to easily take part in the auction. It may vary from “Hot-it-works” pages to special help modules that include detailed instructions and advice on how to use your website. Furthermore, various bonuses, prizes, raffles and other perks can help greatly to attract new and retain loyal customers.
There is no universal answer to the question of how to build an auction site but following the general steps mentioned above will let you escape the most common mistakes on this hard but very fascinating and rewarding endeavour.
Check out online auction software from Merkeleon.