Home / Solutions / Why Expert Auctions Are Superior to Reverse Auctions

"Making Markets Work For You" Optimal Auctions is the only reverse auction provider that does not port common procurement errors from RFPs or negotiations into auction software. Rather than utilizing the opportunities presented by information technology to eliminate procurement errors, other vendors either replicate or compound the errors. Typically, when software vendors provide users with a friendly and intuitive tool it meets the customers needs. This is not the case with auctions. The correct microeconomic principles necessary to lower prices can be undermined by features not developed with a thorough understanding of the economic issues attendant to an auction. Optimal Auctions combines information technology with expert economic advice in order to fulfill the potential of online auctions. A summary of differences appears below: Expert Auctions Reverse Auctions Expert masking Partial Masking Single-click bidding for fast, competitive auctions Users type in bids that slow the auction and enable bidder signaling Bidders are only told what they need to bid to stay in the auction Bidders see bids coming in and can use the timing to send signals True anonymity for optimal competition Codes/icons that enable collusion Expert rules Informal bidding Formal activity rules to insure fast auctions that always reach the competitive price at the conclusion Ad hoc activity so auctions can stall at high prices until the auction ends Formal bid increments for auctions that start fast and end slow for optimal tradeoff between auction speed and low prices Ad hoc increments for auctions that are either too long or do not achieve the lowest price or both Activity-based stopping rules that encourage early bidding and guarantee optimal results Fixed time auction end that discourages early bidding, then cuts off bidding prematurely Expert bundling Fixed bundling Allow local and national suppliers to both compete the best product combinations every time Hurt local or national suppliers or both by sub-optimal bundling leading to higher prices Allow suppliers with broad and narrow product lines to compete by picking their own best product combinations Hurt suppliers with broad or narrow product lines or both by sub-optimal bundling leading to higher prices