REA increasing their BP and making other changes

[Exhibitman]

Originally Posted by bandrus1

Can somebody explain to me the reasoning behind adding a BP vs taking a total amount of a final hammer price?

Is there a known psychology that people will bid higher with BP's vs total price

Since the commission and the buyer’s premium both are paid to the auctioneer from the proceeds of the sale, they are functionally the same, so why split them? If you’ve read my Substack for a while you know my answer: to manipulate people. It is a jazz hands misdirect. Labeling 1/3 of the AH take as a “commission” and the other 2/3 as a “buyer’s premium” tends to suggest that they are somehow different and that the consignor only pays the “commission” because the buyer pays the “buyer’s premium”. It's salesmanship: "I tell you what: I am going to make you a special deal and completely waive the commission on your consignment." Nevermind the 20%, er 23%, Biuyer's Premium. That’s a bullshit framing, but a significant percentage of the public (especially the novices or hon-collectors) falls for it when consigning. They don't have the knowledge or the stomach to ask for a piece of the BP.

Something I am going to cover in more detail in another column is the follow-on effect of the confusion that the split causes to some percentage of bidders.

[jsfriedm]

I get that the idea is that the higher the BP, the more of it you can offer back to consignors. However, consignors also realize that getting back 5% or 10% of 23% is not the same as 20%. If one auction house offers you 10% of 20 and the other offers 10% of 23, you go with the first, all things being equal. So now you have to offer 12% or 13% to be competitive. How does this help in the end?

[Aquarian Sports Cards]

Originally Posted by Exhibitman

Since the commission and the buyer’s premium both are paid to the auctioneer from the proceeds of the sale, they are functionally the same, so why split them? If you’ve read my Substack for a while you know my answer: to manipulate people. It is a jazz hands misdirect. Labeling 1/3 of the AH take as a “commission” and the other 2/3 as a “buyer’s premium” tends to suggest that they are somehow different and that the consignor only pays the “commission” because the buyer pays the “buyer’s premium”. It's salesmanship: "I tell you what: I am going to make you a special deal and completely waive the commission on your consignment." Nevermind the 20%, er 23%, Biuyer's Premium. That’s a bullshit framing, but a significant percentage of the public (especially the novices or hon-collectors) falls for it when consigning. They don't have the knowledge or the stomach to ask for a piece of the BP.

Something I am going to cover in more detail in another column is the follow-on effect of the confusion that the split causes to some percentage of bidders.

I explained the origins and the reasons it still works in detail earlier in the thread.

[Snapolit1]

Originally Posted by Aquarian Sports Cards

I explained the origins and the reasons it still works in detail earlier in the thread.

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