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Internet auctions have become increasingly popular over the years for a number of reasons, from their broad geographical reach to their absence of time limits. If you are contemplating moving into this area of selling there are a wide variety of attractive benefits to consider, but also some negative aspects to take account of. Here is an outline of some of both the pros and cons:

Cost-effective

Auctions can be one of the most cost-effective ways of selling goods online. There’s a plethora of cost saving measures sellers and auctioneers can take. It is considerably cheaper to organise an online auction than an offline auction event – with an offline auction money needs to be spent on a venue, a professional auctioneer, item storage and various other necessities. There are comparatively few expenses to worry about online… Auctions can also be an excellent way of liquidating old or excess stock. Selling these items by auction tends to bring in significantly higher profit margins than selling them off at a fixed discounted rate. Marketing is another area in which Internet auctions can save on costs. Marketing materials in the offline world can be costly and time-consuming to produce and distribute. Online marketing is relatively cheap, and has numerous other advantages.

High profits

Online auctions are open 24 hours a day, 7 days a week. They can go on for weeks (or even months). This is in contrast to physical auctions, which typically last for no longer than a few hours. This lack of time constraints is a great asset. It means that bidding can carry on for longer and thus lots are likely to sell at a higher price. Bidders find the competitive environment of auctions exciting and exhilarating. This is true of Internet auctions just as it is of auctions in general. This atmosphere can encourage participants to bid for items at significantly higher prices than they would in other situations. It is not surprising that online auctions have often been compared to gambling. As in gambling, participants can become caught up in the excitement of the event and become increasingly reckless with their money. This can lead to prices being driven well above and beyond market value.

Wide reach

Whereas in the offline world auction attendance is limited to those who can manage to physically be present at the event, auctions on the Internet can potentially be accessed by a vast and diverse audience of people from every corner of the globe. Items can be sold to people sellers would never have had access to previously. The larger the number of participants in an auction, the higher the prices that items are likely to sell for. There can also be a larger number of products up for auction. The increased reach of online auctions can allow sellers and auctioneers to create new specialist markets within their sector. Online auctions provide an astonishing degree of access to unusual or niche items that rarely turn up for sale in normal circumstances. For example, in the offline world machinery tools may become available for sale only occasionally and go for a high price when the do come up for sale. There is a wide geographic market for these items online. If marketing is targeted effectively, you can make lucrative sales.

Efficient marketing

Trading online offers the opportunity to market products in an exceptionally efficient and effective way. Data from your website can be used to identify customers’ and visitors’ buying and viewing habits. This means you can make highly informed decisions based on your customers’ interests and tendencies, and target your marketing activities more accurately. Social networking and blogging are very useful tools for anyone with an online business. Social networking can provide a steady stream of contacts and sales leads, as well as allowing you to publicise your auction site in a general way. If you frequently take part in online discussions relevant to the goods you sell you can offer your advice and expertise in the area and encourage people to put their confidence in you as an auctioneer or business partner. Writing a blog can also provide excellent publicity and customer interaction, as well as another route to your site for search engines.

Downsides

However, Internet auctions can also have their downsides…

• All websites are vulnerable to technical glitches. Technical glitches could cost you significant amounts of money, and customers who encounter a glitch when using your site may be permanently put off from buying from you.

• Criminal activities are something else to which e-commerce websites can be susceptible. If customers pay for items through your own site it is important that you scan the server for any potential security risks and comply with PCI DSS requirements.

• It shouldn’t be forgotten that there is still a significant number of people (particularly older people) who are not adept at, or not enthusiastic about, using the Internet to buy goods. Basing all commercial activity online may cause companies to lose these customers.

• Online auctions tend to lack the bustling, highly-charged, highly competitive atmosphere of auctions in the real world. This could lead to less competitive bidding and thus lower prices. Online auctions tend to see a dramatic surge in bidding activity towards the end of the auction, rather than sustained competitive bidding throughout the auction.

• Some bidders engage in a practice known as “sniping” – not placing any bids until the very last moment of an auction (when it is impossible for other participants to place competing bids) so as to avoid a bidding war that will drive the price higher. Naturally, this is not very beneficial for sellers and can result in lots selling for well below market value when in a physical auction they would have sold for a higher price.

Overall, the benefits of online auctions tend to outweigh the risks and downsides. However, it is important to research and consider all aspects of online auctioning before making the decision to move into this area of commerce.

As a student of human nature, as well as a long-time forum member and owner, I am in a good position to offer some general thoughts (call it a rant if you like!) and guidelines regarding ‘net based forums. I guess I am as qualified as any to comment from the user’s side of the equation. Currently, I read or post to a least a dozen forums per day, some revolving around my line of work and others related to my hobbies and interests: fitness, health, bodybuilding, longevity, weight loss, audio-video, military, law enforcement, firearms-to name a few.

I can also comment from the owner’s side, as my two forums-Fat Loss Revealed and Bodybuilding Revealed-have over 10,000 active members. Not the largest forums on the ‘net for sure, but not small time either.

This article is not about how to market a forum to “drive” traffic or anything like that. Rather, this article is concerned with the culture of a forum, which directly impacts its long-term success. These comments are based on what I have seen and experienced, as both a long time forum user and owner, about the major downfalls and mistakes that ultimately lead to unhappy members.

Forum Culture

Every forum has its own culture. That culture always starts with the owner of the forum. It’s a direct reflection of what the owner does, or does not do, with their forums, such as the moderators (mods) they choose, how much power the mods are given, how much personal control the owner maintains, how active he is, and so on. The forum reflects the personality, values, goals, etc. of its owner. The “buck stops” with the owner of the forums, as he is literally the captain of the ship. As an owner, if you wish to run a successful forum long term, you should be on the look out for the following problems.

The Member Cabal

The member cabal is inevitable on any forum, but it’s not inherently a negative. All it means is that a group of long term “regulars” have formed their own clique. It can be a helpful, productive group that’s supportive of new people coming into the forum, or it can be highly damaging. It’s up to the owner of the forum and the mods to keep an eye out, and keep firm control over the member cabals that form. The type of cabal will be a direct reflection of the forum’s culture, which reflects on, as mentioned above, the owner of that forum.

“Beating up the new kid”

This is a logical transition from the above, because it usually, but not always, involves the member cabal. Many forums have a culture where every new person is “initiated” or generally hassled, simply due to the fact they are new to the forum. I recall one forum I visited regularly, which had a guy with an avatar that said something like “I sh&% on the new guy.” Mods, as representatives of the owner, should not tolerate this behavior, as-if not cut off early-it will only grow.

It’s the perfect way to assure a small group of people run the forum, and if it’s not prevented early on, the owner can literally lose control. New members looking to join won’t when they see the abuse, or else it will turn into one of those forums with a few active members and a bunch of lurkers, as few will actively participate due to the abusive member cabal. On the other hand, a friendly member cabal welcomes and accepts new people, and helps the forum grow.

On my forums, for example, my “regulars” are one and all friendly, helpful, and welcoming people. That’s because I have great mods, and make sure the forums are always going in the direction I feel they should, based on my overall guiding philosophy and principles.

The Moderator Cabal

Similar to the member cabal, but potentially much more damaging to a forum, is the moderator cabal. Again, it’s pretty much inevitable such a cabal will form when you have people working together, even if it’s a virtual work space. And again, there is nothing inherently wrong with it, but the owner of the forum needs to keep a very close eye on the moderators. Pecking orders, cliques, etc. will form, and unless the owner of the forum keeps a tight handle on his forum, it can quickly get out of control. I have seen forums where there was more drama behind the scenes with the mods than could be found on the forum! Like any office space-virtual or otherwise-the culture starts from the top down, so the owner must put time into the back end of the forum, as well as the front.

I know too many forum owners who have let their mod cabal essentially take over their forums, chase off members they don’t like, chase off, or generally harass, other mods they don’t like, and so on. The owner of any forum who takes a “hands off” approach will have a mess on his hands sooner then later. I spend at least a few hours per day on my own forums making sure they’re all running smoothly, supporting members and mods equally, and assuring the ship is heading in the direction it needs to, as reflected in the mission statement of the forums.

To finish my point, and continue with the ship analogy: big ships develop a great deal of momentum, so setting the course early, and making small adjustments, takes less energy and time than attempting to alter course once that ship has gotten it’s full momentum up.

“Mod as God” syndrome

As the member cabal section transitioned perfectly into the “beating up the new kid” section, the mod cabal transitions into this section. The “Mod as God” syndrome is, without a doubt, my personal peeve. It can be all the members of a mod cabal, or an individual, and it’s very destructive to any forum. This syndrome appears to start when a mod decides the section they mod, or the forum itself is their personal fiefdom. These mods often set different standards for themselves than for the members. Like the member cabal, they may insult, belittle, or generally hassle a member they have taken a dislike to, and if that member attempts to defend themselves or respond, the mods will ban them or use other penalties at their discretion.

This double standard is damaging to the morale of any forum and unacceptable behavior by the mod(s) in question. It’s also a very common problem on many forums where a mod has decided he or she has additional rights above that of the members, and their word is law, even if they are often responsible for the problems.

A similar issue is favoritism, where one member can say or “get away with” far more than others. Mods should be objective and fair; once they decide their word is law, they are no longer able to objectively carry out their jobs. Again, this comes about due to the owner of the forum not being the true overall guiding influence on the forum. The only word that is law on a forum is the owner’s-period. However, if the owner is not an active participant, and/or allows mods to abuse members, then sides with the mod (even when it’s obvious that mod is way out of line), he loses authority and credibility with the members.

The forum ultimately suffers. Productive members of the forum will leave, the cabals will stay and grow stronger, and the forum will cease to be relevant within its intended niche.

Now in the spirit of full disclosure, I have been banned from forums. A few times temporarily (though I will generally not return to that forum anyway), and a few times permanently. I’m not proud of that fact, but I am also not the least bit ashamed of it either. Whenever it’s happened, it was for one of the reasons I mentioned above.

Personally, I simply will not tolerate the “mod as God” syndrome as either a member of a forum or as the owner of that forum, and when a mod attacks me-or is clearly being biased or playing favorites-I will let them know it. I will not tolerate it on my own forums, and if I feel a member is right and the mod is wrong, I will side with the member. That has never happened on my forums, however, and that’s because I’ve stepped in long before it ever got to that point. I don’t put my mods in a position where they have to defend themselves, and they know I will deal with it well before that.

The members of my forums know I always take a fair and objective approach to the issue or dispute. It’s part of my mission statement, and is an essential component of a healthy, successful forum.

The Missing Mod Syndrome

There are also forums where you know there are mods somewhere, but you can’t figure where, or even who, they are. They don’t seem to do any actual moderating, don’t keep the forum running smoothly, and may show up to lock a thread after some flame war has been taking place for days or longer. These “hands off” mods and owners tend to end up with a ‘free for all’ type forum. There’s nothing inherently wrong with that if that’s what the owner wants and the members enjoy, and such forums have their own niche, but they are not for me and not what I recommend owners strive for. They are generally a big mess of flame wars, member cabals, and a waste of time for those people who actually want to talk about and read about relevant topics that such a forum pretends to offer.

Conclusion

One or more of the above pitfalls can produce what I call “Toxic Forum Syndrome.” The forum is sick and is in need of fixing. Obviously, prevention is always better than treatment, so it’s best to be proactive and “hands on” as the owner of a forum, rather than reactive. Members of forums will probably recognize the above categories from forums they visit regularly, which should help them decide whether to move on, or attempt to be part of the cure vs. the problem. I identified these problems over many years as a member and user of forums, so when I decided to start my own forums,* I was fully aware and prepared to avoid them. So far so good…

* = Access to my Fat Loss Revealed and Bodybuilding Revealed forums comes with the purchase of my ebooks under the same name.

Author Bio

Will Brink is an author, columnist and expert in the supplement, fitness, bodybuilding, and weight loss industry and has been extensively published. Will graduated from Harvard University with a concentration in the natural sciences.

His often ground breaking articles can be found in publications such as Lets Live, Muscle Media , MuscleMag International, The Life Extension Magazine, Muscle n Fitness, Exercise For Men Only, and numerous others.