This is the second of a two-part series that helps you maximize your revenue by approaching your gala event as if it was a pop-up retail store. This article focuses on the live auction. Part 1 focused on the silent auction. All of this information and more comes from our highly informative webinar, It’s Beginning to Look a Lot Like Auction Profits.
As you plan your gala event, imagine you’re creating a really special, one-night-only retail store for your guests.
Since you only have these folks in your store for one night, you’ll need to be strategic about what you include and the atmosphere you create. What would appeal to your particular audience? What would surprise and delight them?
As we stated in our discussion on silent auctions, you want to create an atmosphere of awe and wonder. This is even more true of the live auction. Not only is the live auction one of your greatest revenue generators, it also provides a good part of the entertainment value that keeps people coming back. You want to procure items that “wow” your audience and get them talking about your event: “Did you see they have incredible tickets to the Cannes Film Festival? I can’t wait! Are you going?”
With high-end unique items and travel packages that people dream about, your live auction becomes the main event of the evening, entertaining people while raising money.
Three Audience Tiers
Think of your audience in three segments. The top tier spenders are the top 15% of your audience; they spend the most per person. The next 25% are the middle spenders; they tend to be active in the silent auction. The remaining 60% are the minimum participants who may not spend much, but probably support your cause in other ways.
When you cater your live auction to your top spenders, you engage them and everyone else. These are people who, when inspired, are willing and able to spend freely. Don’t put $500-$1000 items in your live auction—think bigger. Seek out unique, high-end items that your top tier spenders will love. These tend to be items that everyone else dreams about too. As the live auction takes off, everyone gets into the excitement to see what the outcome will be.
Talk to Your VIPs
The top 15% of your audience is actually a small number of people. If you have 300 guests, that’s 45 individuals and likely that means just 17 couples. Call them up. Find out what they’re looking for. Ask open-ended questions:
- What are your interests?
- What are your vacation plans?
- What have you seen at other events that you liked?
- Which items sold high at other events?
- What do you think other VIPs would like to see?
Ask for advice but don’t pressure them. Most people will be happy to give you tips.
Number of Live Auction Items
The rule of thumb for a live auction is to offer only as many items as you can sell in one hour. If the auction lasts longer than that, people start to lose interest. Some auctioneers are faster than others, but generally you can expect to sell an item every 5 minutes or so. If you offer 10 items, that’s 50 minutes, which gives you time for transitions and a Fund a Need or Special Appeal.
If you are only able to procure 5 or 6 really high quality items, you can fill out your auction with consignment packages. Auction Booster offers unique, high-end travel packages you can reserve at no risk. You can sell each package once or you can sell the same package multiple times. You get to keep all the proceeds above the nonprofit costs. You’ll want to book your packages as soon as you start promoting your event. In fact, having such great travel packages in your offering will actually help you procure other high-end items. People love to be part of something successful. Once donors see you have these awesome travel packages, they’ll want to jump on the bandwagon and offer great items too.
Procure Items of High Perceived Value
While consignment packages are great for filling in gaps in your live auction, your best return still comes from donated items. These need to be items of high perceived value. But this doesn’t always mean they have a high market value. At school auctions, for instance, the VIP parking spot has no fair market value, but it is often a really great revenue generator. Pre-promote all your high-end items and let your guests know in advance what you have to offer.
Create a Retail Store that Rocks
By being strategic about the number and type of items you offer in your live auction, you can create a special one-night “wonderland” experience for your guests that inspires them to have fun while raising money for your cause.