The Attraction of Online Auction Sites
The rise of online auctions began with eBay in 1995. Online auction sites have been becoming increasingly popular ever since. Millions of items are auctioned off every day.
There are all kinds of online auctions – starting from the ones where you can buy almost anything, e.g. eBay, to the narrow niche auction sites, e.g. gemrockauctions, specializing in gemstones and minerals.
Their diversity and popularity come as no surprise for you can find all kinds of deals from the comfort of your couch. Plus, the thrill of bidding as many of the auctions start at $1 with no reserve prices. And you can hunt down real treasures. This is what attracts millions of online auction bidders. As a matter of fact, all the best bargains I have ever had were on auction websites. If you know what to look for, online auctions are probably the best resources for finding cheap prices.
Indeed, great deals can be found through online auctions. It is especially true if you are after something unique or collectible. When it comes to antiques, collectibles, unique pieces of jewelry, watches or art, online auctions, without a doubt, are your best option. Many online auction sites offer unique pieces that can be found neither in brick and mortar stores nor online stores.
However, you have to be a conscientious shopper, you have to be a smart shopper. Otherwise, you are seriously risking to fall for fakes, misleading item descriptions, and severe overpricing.
Smart Shopper vs an Online Auction
First of all, let’s clarify: what is a smart shopper? In essence, a smart shopper is a shopper who is capable of buying the right item at the right price. According to my experience, only 3 out of 10 online auction buyers succeed in that. 7 out of 10 online bidders purchase a fake, fall for inaccurate and misleading item descriptions, or get overcharged severely.
Overcharging is a huge issue in itself. And by severe overcharging, I do not mean 50% or 100%. I mean tens of times. Many businesses are based solely on that model of pricing. I mean, there is no added value for the consumer whatsoever. It’s just that the business owner knows where to buy cheap and where to sell expensive. I have been running a business like that for more than 15 years.
According to some researches, 53% of shoppers say they always do research before they buy to ensure they are making the best possible choice. The more expensive the item, the more likely consumers are to research costs online. So, what’s the problem then? Apparently, the vast majority of shoppers lack the necessary, specific knowledge to conduct quality research.
Some may think it is enough to compare a few prices of alike items to be a smart shopper. Well, in most cases it is not. When it comes to antiques, collectibles, art, design, jewelry, gemstones, etc., you need quite some in-depth knowledge to do real quality research because every slightest detail can turn out to be a game-changer.
Let’s have a closer look at these three online auction problems: fakes, misleading descriptions, and severe overpricing.
Online Auction Sites & Problems With Fake Items
As a matter of fact, everything gets forged. From medieval swords to antique coins, from artworks to jewelry, from high-end handbags and wristwatches to baseball cards. Needless to say, if you buy a fake item, it’s a total waste of money. Unfortunately, it happens way too often.
Even to the ones considering themselves smart shoppers. Many online auction sites substantially contribute to that by claiming they are expert-curated and they check the items offered for sale thoroughly. Shoppers seem to take their word for it. In reality, they shouldn’t.
Some auction sites say they themselves are experts (e.g. liveauctioneers, invaluable). Some claim they hire the necessary experts (e.g. catawiki). Others even go so far as to claim they physically inspect the items offered for sale (e.g. auctionet).
In reality, these claims have no positive impact on the number of fake items sold on online auction sites. I mean, they can claim whatever they want, but their own profits are what matters the most to them. And if selling you some fakes is needed to secure these profits, it will constitute no moral dilemma for most of the online auction sites.
If you don’t make the effort to be a smart shopper, this is what happens (see the examples below):
This pendant with fracture-filled and dyed quartz was sold as a piece of emerald jewelry for EUR 1000 + 9% auction fee. Its true market value is EUR 20 – 30. Read more about fake emeralds here.
A rhetorical question – how likely is it that the owner would be willing to sell it for a small fraction of its price estimate if that was an original painting by William Verdult?
Here a shameless fraudster is trying to sell this low-quality fake “17th – 18th-century” bowl for a whopping £30,105.97
Online Auction Sites & Misleading Item Descriptions
Misleading item descriptions are probably the most popular form of deception on auction websites. The main difference, when compared to buying a fake, is that you do not lose all the money paid. Nevertheless, you still lose a lot on most occasions. The line between the two can get blurred because in both cases you end up buying an item that is not really what you expected to buy.
Inaccuracies in item descriptions occur both intentionally as well as due to a lack of knowledge (seller unprofessionalism). Whatever the cause, such inaccuracies have a direct negative effect on the price you pay.
There is nothing wrong with presenting your item in a favorable light. Unfortunately, many online auction sellers seem to be unable to draw the line between a favorable light and deceptive practices.
In the example above, the seller intentionally describes light green beryl as an emerald. It is done despite the fact that the GIA certificate clearly classifies this gemstone as green beryl, not an emerald.
In essence, there is nothing wrong with green beryl. It is a beautiful gemstone. Its value, however, is tens of times lower than that of an emerald. Read more about the difference between the two here.
This is another excellent example of an intentionally misleading description. The seller has done two things here. First of all, he is not entirely honest about these rubies. He does not state clearly that these are lead glass-filled or so-called composite rubies. Instead, he claims these are “natural rubies”. That is not true. In order to describe their treatment, he uses evasive terminology: “high temperature heat treatment, with glass & flux additives”. This is not exactly lies, but it is not exactly the truth either.
Secondly, he states a severely inflated appraised value to catch your attention and to convince you that this is the deal of a lifetime. Nothing could be further from the truth. It is even somewhat incorrect to say this appraised value ($22,245) is inflated. It is totally ridiculous! Sterling silver necklaces like this with lead glass-filled rubies can be bought online at an average price of $100 – $150.
Antique items are comparatively rare. They attract more attention. They are more expensive. The seller here decided to take advantage of this fact. In reality, this is a contemporary piece of Thai-made jewelry worth $20 or less. Read more about dishonest online auction sellers selling contemporary items as antique or vintage here.
Misleading descriptions is one of the main tactics to lure you into an unfavorable transaction. They can take various forms – from concealing crucial information to shameless lies. Heavily photoshopped item images is another member of that gang.
Natural black diamonds never have such a perfect, spotless appearance. The distribution of color is somewhat uneven, there are lighter color spots and lines, oftentimes nicks and cracks in natural black diamonds. Thus, either these are not natural black diamonds or the images have been photoshopped severely. There are a lot of photoshopped images on Liveauctioneers auction site. Therefore, I rather tend to think the latter is true.
As you can see, misleading item descriptions hide diverse traps, and you have a pretty good chance to fall into one of them unless you are a smart shopper.
Right Item, Wrong Price
Last but not least, you can buy the right item but pay the wrong price for it. There are literally millions of examples where online auction buyers end up paying tens of times more than what the item is worth. Item’s description is perfectly correct. No essential information is missing. Images are ideally honest. Still, buyers lose immense amounts of money. Inflated auction site price estimates (valuations) substantially contribute to that.
The buyer paid staggering EUR 6119 + a 9% auction fee for this opaque, low-quality diamond. Its true market value is around $200. A purchase that is almost as bad as if he bought a fake.
Pretty nice bracelet, no question about that. Its description is flawless and the images are honest. The only problem is that it is not worth $5,505, as claimed. It is not worth $500, either. Bracelets like this are readily available for $100 – $150.
Exactly the same is true about this bracelet above. There is nothing wrong with it, except the price. Bracelets like this can be bought for $20 – $25.
If you pay an excessive price, you have no one to blame but yourself.
Conclusion: Are You a Smart Shopper?
Apparently, being a smart shopper pays off. Always. No one wants to buy a fake. No one wants to buy something that looks different or is less valuable than the desired item. No one wants to pay an excessive price.
As I said before, online auction sites are an amazing place to hunt for treasures, but you better be armed with some knowledge.
Remember, age and condition play a key role in all collectibles, antiques, and art. In the case of jewelry and gemstones, every slightest detail, such as color, clarity, quality of cut and polish, etc., affects the value immensely.
It’s hard to know all the minor details affecting an item’s value or all the tricks that online auction sellers use to dupe and overcharge us. However, it doesn’t mean you cannot be a smart shopper. If you are not sure of something, ask the community.
For dishonest sellers, the best buyer is the one who asks no questions. Don’t be the best buyer for them. Instead, be the best buyer for yourself!
P.S. If you want to know how to bid to win on eBay (and pay less), read this post.