Sealed-bid auction (B2B
e-procurement—Ariba
Sourcing; Elance)
Sealed-bid auction, RFQs. Winner is chosen from lowest
bidders at acceptable quality levels.
Buyer bias: Multiple vendors competing
against one another
Vickrey auction (private
auction)
Sealed-bid auction, single unit; highest bidder wins at the
second-highest bid price.
Seller bias: Single seller and multiple
buyers competing against one another
English auction (eBay) Public ascending price, single unit; highest bidder wins at
a price just above the second-highest bid. Buyers can skip
bidding at each price, but return at higher prices.
Seller bias: Single seller and multiple
buyers competing against one another
Traditional Dutch (Dutch
flower market)
Public descending-price auction, single unit; seller lowers
price until a buyer takes the product.
Seller bias: Single seller and multiple
buyers competing against one another
Dutch Internet (eBay
Dutch auction)
Public ascending price, multiple units. Buyers bid on
quantity and price. Final per-unit price is lowest successful
bid, which sets a uniform price for all higher bidders as
well (uniform price rule).
Seller bias: Small number of sellers and
many buyers
Japanese auction (private
auction)
Public ascending price, single unit; highest bidder wins at
a price just above second-highest bid (reservation price)
and buyers must bid at each price to stay in auction.
Seller bias: Single seller and many
buyers
Yankee Internet auction
(variation on Dutch
Internet auction)
Public ascending price, multiple units. Buyers bid on
quantity and price per unit. Bidders ranked on price per
unit, units, and time. Winners pay their actual bid prices
(discriminatory rule).
Seller bias: Single seller and multiple
buyers competing against one another
Reverse auction Public reverse English auction, descending prices, single
unit. Sellers bid on price to provide products or services;
winning bid is the lowest-price provider. Similar to sealedbid markets.
Buyer bias: Multiple sellers competing
against one another
Group buying (demand
aggregators)
Public reverse auction, descending prices, multiple units.
Buyers bid on price per unit and units. Groups of sellers
bid on price; winning bid is lowest-price provider.
Buyer bias: Multiple sellers competing
against one another
Name Your Own Price
(Priceline)
Similar to a reverse auction except the price the consumer
is willing to pay is fixed and the price offered is
nonpublic. Requires a commitment to purchase at the first
offered price.
Buyer bias: Multiple sellers competing
against one another for an individual’s
business
Double auction (Nasdaq
and stock markets)
Public bid-ask negotiation; sellers ask, buyers bid. Sale
consummated when participants agree on price and
quantity.
Neutral: Multiple buyers and sellers
competing against one another. Market
bias: trading specialists (matchmakers)