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New Online Auctions for Nonprofits



Updated July 12, 2007
A look at a different online auction concept.

A recent email from the National PTA alerted folks (and me) to their first online fund-raising auction. This was an online auction, but with a twist. It wasn't on eBay!

It didn't take long to do a little research on the National PTA auction and, as a result, finding another world of online auctions out there. And like other online auctions, just about everything was for sale. Collectibles, household items, trips, sports equipment, tickets, name it and it was for sale!

cMarket was founded in 2001 by Gregory McHale with the concept of helping non-profit organizations conduct online auctions on their own terms. Organizations have their own home page complete with sponsors and information links, hot auction items, etc. Organizations can also keep would-be bidders in the loop with easy-to-do html newsletters and announcements.

McHale said the idea started fermenting back in '95 or '96 when he attended a live auction for the Jimmy Fund. His thought was how highly inefficient the event was for raising money for the organization. Although The Jimmy Fund was an organization that people cared deeply about, not all of them could participate at the live auction. He also noted there were items for auction, e.g. Red Sox memorabilia, that would appeal to numerous other folks who were also not in attendance. This created a very limited bidding pool at The Jimmy Fund event, thus raising less money for the worthy organization.

McHale sort of tucked that idea way and finally came back to it several years later, bringing together a group of people to help build a tool that would allow a non-profit to put an auction online. But also still be personal enough that members of the organization would be involved in both donating and bidding.

McHale also mentioned that he feels eBay is one of the greatest business models ever invented, but non-profits needed something a little different. And it's that something different that cMarket has fine-tuned.

In his research many non-profits said they tried eBay, but since it's so big, it was easy for their members to get lost. The good news was the non-profits sold almost everything put on eBay, but the bad news was -- almost nothing to their own members, the ones they most wanted to reach or be sure had a chance to bid.

For example, McHale suggested that schools might auction off a lunch with a favorite teacher -- which would have great appeal to the school patrons, but not to the general public. He also mentioned a very successful auction for a vacation home rental held via cMarket. The church holding the online auction had the stipulation that only a member of the parish could win that particular auction. These type of auctions can raise a lot of money if they are available to the right pools of bidders -- constituents of the organizations.

McHale said "The more I talked to people, the more I became convinced, so we went out and built this tool. It allows a non-profit to create a homepage for their auction and have a link off their web site. The beauty of the tool is they fill in forms and the article is created for them, it creates a catalog and manages all the bidding."

He also said there are three places the tools can really work for the group.

  1. It enables more and better bidding to their whole constituency.
  2. Sponsors can be included on the home page and in emailed newsletters, complete with links to the sponsor's web site.
  3. Each item can also have up to four links and logos, e.g. link to the hotel that donated the rooms or the company that donated the items.

When a group decides to use the auction format, cMarket has a training session with as many "students" as desired or necessary, a preformatted home page and support -- both live telephone and through email.

McHale also noted "The interesting thing is we have a greater than 100% renewal rate, groups are not only doing the same event -- they've come up with additional events to use with the auction tool."

Success Stories

  • The Pan-Mass Challenge auctioned off a Lance Armstrong event-worn jersey for $39,000.
  • Miami Children's Hospital's online auction raised 75% of their goal before the accompanying gala even started.
  • Volunteer Center of Rhode Island achieved 50% of their goal before the live auction portion began.
Fees for the Non-Profit
From cMarket:"There is a yearly hosting fee plus a percentage of the net online auction proceeds. For a single $295 fee, plus 9% of online auction proceeds up to $75,000, you get hosting, setup and expert cMarket support for as many auctions or events as you wish—for a whole year. It's that simple."

Check out the cMarket web site, there might be an organization that would be perfect for you to support with a donation or a bid!

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