Bring A Trailer Is Bringing It to the Auction Industry
The online car enthusiast community is talking (incessantly) about Bring a Trailer and the chatter is hardly restricted to the variety of cars on the platform that sold $829 million in car inventory last year, crushing the competition of live-auction houses and increasing their own gain 108% from last year.
To compare, the 2022 Barrett-Jackson recently wrapping up in Scottsdale sold over $200 million vehicles at the auction, which has a history of setting the tone for the rest of the industry world-wide. While it’s no small feat, it is nowhere near the numbers released by BAT in 2021. But it begs the question, is the comparison, well, comparable, considering the undeniable data point that Bring a Trailer’s success in the last two years got a big jumpstart triggered by pandemic-induced closings that, at best, limited most in-person auctions.
Bring a Trailer’s Unique Offering: Simplicity
Understanding the success of Bring a Trailer is multi-faceted. One pathway to BAT’s success in 2021 was largely part due to the pandemic. According to the company, for the first time in auction history, 2022 online auctions surpassed revenue from live auctions, with online platforms selling 20,000 compared to 16,000 vehicles sold live during the same time last year.
Not only are consumers opting for the convenience afforded by purchasing in a digital environment, but they are doing so in abundance, in an economy that has become increasing comfortable buying, selling and trading online. But here’s the thing: BAT wasn’t just in the right place at the right time. BAT was originally launched in 2007 as a blog featuring great cars posted on eBay. The platform was built 100% with the heart of a founder who had the goal of serving-up the best of eBay car auctions to an audience that grew to 415,000 by the time the company sold to Hearst Autos in 2020. (Ah, there is a God.)
Another facet in BAT’s favor is its leveling of the playing field vis-a-vis the anonymity of its users. Buyers and sellers exist online bidding, selling, and buying with a simple username instead of live recognition or live bidding, which tends to lower the tension of a live auction setting when bidding occurs from a screen to a living room. Credentials aren’t needed beyond a credit card and email address, opening up auctions to lower-end vehicles outside of the luxury and vintage categories.
Differences Between BAT and Live Auctions
In the simplest of terms, Bring a Trailer operates like most bidding platforms. eBay, for example, uses similar models for auctioning as BAT. All that’s required is registering for the platform and credit detail to facilitate the bidding. At the end of the auction, the car goes to the highest bidder with a 5% buyer’s fee, which is considerably lower than live auction fees ranging between 10-15%.
But all this convenience doesn’t mean live auctions will disappear anytime soon. Although Bring a Trailer brings an exciting new spin to buying cars online without the spotlight and pressure of an in-person purchase, last month’s 2022 Barrett-Jackson showed fans and skeptics that nothing replaces the in-person events when they can run safely and to capacity, and likely we can expect the same result for auctions to come the rest of the year.
A healthy dose of competition, or is it?
The Barrett-Jackson (outside of charity cars) raked in $1,980,000 for a 2004 Porsche Carrera GT Coup. The highly anticipated Mercedes-Benz 300SL Gullwing Coup finished strong at $1,870,000, and a 2015 Porsche 918 Spyder Roadster sold for $1,815,000. Three insanely high numbers largely fueled by the environment, the hype leading up to the auction, and the inherent competition sparked the largest volume in sales by the auction to date.
In the end, as Bring a trailer leads the revolution in the way consumers are buying their cars, it would be foolish to assume the in-person purchase is a thing of the past.
If we learned one thing from COVID, it’s that nothing replaces the experience of being there.
After all, nothing keeps a good car enthusiast down. Absolutely nothing.
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