Two Colosseum coins in auction!

[Tejas]

On 1/18/2024 at 6:00 PM, Ed Snible said:

These are not auctions, but "Buy or Bid".  135 is the "Buy it now price".  This means you can bid half that, $67.50, and likely get it.  You may be able to find it slightly cheaper, but not with a nice printed catalog you can put in your library when anyone asks you to prove its "real".  Only someone who really wants the coin and thinks it is worth more than the Buy It Now price will pay $135 for that Victorinus

Even if this is a Buy or Bid sale (Dutch Auction), I find  this method problematic. Starting with an unrealistically high price to tempt people to overpay is in my view not a serious approach to coin trading. It reminds me of some Ebay sellers like "high-rating-low-price", who offer coins at insanely high prices, on which they offer huge discounts to prices, which are still several times the market value, to tempt less experienced collectors to overspend on coins.

[CPK]

One thing I wish HJB would do differently is update the auction listings when a coin is sold. I had a number of coins on my watchlist on biddr, then happened to go to HJB's own website only to find that a lot of them had apparently already been sold. Yet they were still listed on biddr/Numisbids at starting price. How does that work?

 

[Deinomenid]

2 hours ago, Tejas said:

I find  this method problematic.

There are many ways we can  overpay, and the frenzy of a real (not Dutch) auction has parted many more "fools" from their  money than the HJB auctions! For some, a high starting price is instead a great way  of making them step away having truly assessed what something  is worth to them, rather than being tempted low and then getting caught up in the resulting  bidding war. It's  probably also a good way for HJB to demonstrate to clients who are selling through them whether their  own  views  of  value are too much, but that is mere supposition.

If you  know the nature of the beast, you can do well from HJB sales. Especially the after-sale. And  if your desired coins are sold  by then, there's  no reason to complain, as the market made its decision.

One way of looking at whether it's a terrible way for  buyers (as I assume  you are writing as or worrying  on behalf of a buyer) to buy, as in making them overpay is that IF it were such a good way to fleece  the sheep then many others would do the same. Other auction houses are no less merciless. To me  it's  not hugely different from say many  VCoin sellers who list high  prices for their  wares, and  if  no-one  takes it, are often  perfectly prepared to negotiate down. The nuance seems  mostly in the details.

The biggest curiosity for me is - if the HJB system works well, and they aren't exactly  new to  it - why more  haven't directly copied it.

 

3 minutes ago, CPK said:

update the auction listings when a coin is sold.

Amen!

[Tejas]

28 minutes ago, Deinomenid said:

The biggest curiosity for me is - if the HJB system works well, and they aren't exactly  new to  it - why more  haven't directly copied it.

Because Dutch auctions are less appropriate for the sale of coins and the like. The Dutch auction method is used for selling multiple lots of identical items, where prices drop until the cut-off price at which all lots are allocated. Hence, Dutch auctions are used to sell financial products like Treasury Bills and commercial paper. The traditional (or English) auction method, which all other auction houses is more appropriate for the sale of single items. A Dutch auction that is used for selling single items like coins puts the buyers at a clear disadvantage, as there is no time to react if somebody makes a bid.

[red_spork]

1 hour ago, CPK said:

One thing I wish HJB would do differently is update the auction listings when a coin is sold. I had a number of coins on my watchlist on biddr, then happened to go to HJB's own website only to find that a lot of them had apparently already been sold. Yet they were still listed on biddr/Numisbids at starting price. How does that work?

 

I could be wrong but I suspect the auction houses do not control the listing on those sites when they're not actually auctioning the coins on them directly. I've seen this with a few others as well. I believe it's up to the platform to properly detect that a given coin is sold and what the current bid level is and it doesn't work right with some auction houses.

[Deinomenid]

1 hour ago, Tejas said:

Dutch auctions are used to sell financial products like Treasury Bills

Of course! But I wonder why  HJB persists. Maybe  it works more broadly for them somehow. It's certainly curious.

[Tejas]

Yes, that is what I meant. It puts the auction house at an advantage and the buyer at a disadvantage. This is why HJB uses it and this is also why others don't use it, which is why I said it is problematic.

[Nerosmyfavorite68]

I've picked up a small handful of bargains at HJB over the years, such as a 1990's buy of a not-terrible Pescennius Niger denarius for $200 or 250.

I probably overpaid for my ma-shops Justinian II second reign Ravenna follis (I suspect it was also in the bid-or-buy), but one doesn't see those often and I don't grossly overpay often, so it levels out.  That would have been an add-on to the Constantine IV large follis which I also purchased, but they didn't have in stock, which was a bargain. 

While I don't buy from them often, my experiences are pleasant.  I also know that it won't be like pulling teeth to obtain a refund if something goes wrong.

I'm more of the Allen Berman type of customer. HJB generally isn't going after the $200 coin buyer, although such buyers aren't made to feel unwelcome.

 

[Deinomenid]

1 hour ago, Tejas said:

This is why HJB uses it

That's an assumption (unless you know in which case do  tell!) and it could suggest HJB uses such a  system to put buyers at a greater disadvantage that others won't use it as a result. Though I've seen enough shady dealers around to know that quite a few would leap on any opportunity to shaft a customer.  At risk of  it making  it seem I work there (I don't/didn't/won't!)  I think they are one of the better guys. And I've also  been able to  use their system to get  some great deals. You've just got to  know  how  it works and be comfortable with it. Which absolutely does agree with your  point on less-experienced   buyers, unless they  do their homework on the system.

At the expensive (to me) end of my collection my  2 fairest prices of everything  I have were post auction purchases from them so. My interest here was largely academic in that if there's something  to the system that makes it better to use, on the  working assumption  it's not because they are exploitative or possibly  just hide-bound to something  introduced a good while ago. Guess I'll ask at the next show and report back🙂

[John Conduitt]

I get the impression they thought they could revolutionise the auction system but no-one else was enthused. They remind me of a store here called Argos, where they tried to revolutionise shopping by having nothing on display - you choose what you want from a catalogue, pay for it, and collect it from the adjacent warehouse. Absolutely no-one else followed suit, but they still exist even now Amazon has stolen their thunder.

Harlan persist probably a bit out of stubborn pride, but also because it's a unique selling point, and it likely doesn't matter all that much to their overall earnings. Some people over-pay by buying too early, while other coins sell for less than they would if there'd been a chance of a bidding war. Like any auction, it's the luck of the draw. No-one else does it because it takes far too much explaining.

Edited February 16 by John Conduitt

[Tejas]

I think another reason why nobody is following this Dutch auction mechanism is that it is difficult to implement. All online auction platforms use the standard English method, so even if somebody wanted to adopt this odd (and as I think frustrating) method they would have to have their own platform. 

[Tejas]

On 2/16/2024 at 5:26 PM, Deinomenid said:

That's an assumption (unless you know in which case do  tell!) and it could suggest HJB uses such a  system to put buyers at a greater disadvantage that others won't use it as a result.

True, it is an assumption. I don't have it in writing from HJB that they use the Dutch auction method because it is advantageous for them, but I think this is a good assumption to make. 

If you offer a common coin, like a Victorinus Antoninian at 3 to 5 times average market value, you have: 1. an outside chance that some inexperienced collector jumps on it (I think this is called fishing for rookies) and 2. a higher anchor price. I.e. your unrealistically high starting price serves as a value anchor and falsely signals that you made a bargain if you by the coin at double the average market value.

Auctions are all about psychology. In the Dutch method the buyer has a 100% chance of getting the item only if he pays several times the average market value. At an English floor auction the buyer has a 100% chance of getting the item if he bids one increment above the runner up. (Online auctions have a time element, which complicates matters).

Of course, it can happen that the Dutch auction method puts off many buyers, so that good bargains can be had in from unsold lots. My assumption would be that sought after high quality coins are sold above average market value, while common and lower quality lots are sold at or even below average market value.