Gone in 60 seconds: eBlock hosts first online auction
All of the fast-paced, real-time, instant gratification of buying a car at auction – with none of the expense of transporting yourself or your vehicles to auction – all crammed into your desktop or mobile device’s screen. And no listing fees.
Sound good to you? Michael Ryan O’Connor, eBlock’s president and chief executive officer, sure hopes so. And after a successful first auction on Tuesday afternoon, it appears as though at least a few dealer buyers and sellers are on track to possibly make eBlock part of their daily routine.
If you’re saying, “Did I just see ‘daily’ and ‘auction’ in the same sentence?” to yourself, don’t worry, you read that correctly. eBlock currently plans to operate one Canada-wide online auction, for every province, at 3:30 p.m. EST every day. And just like the physical auction – each vehicle is sold, or not sold, in roughly a minute.
If the name O’Connor is ringing a bell, that’s because he’s also the president and CEO of Carmigo.com and the president and co-founder of eDealer, as well as a member of our 2015 class of “Remarketing’s 40 Under 40.”
O’Connor invited Auto Remarketing Canada to take part in eBlock’s first auction on Tuesday. And with over 700 dealers, mostly in Ontario, having signed up for the service over the previous five weeks, it was looking to be a success.
Limited to a 125-unit run list for Ontario and Quebec for its first day, eBlock sold 53 units, which were comprised mostly of late model vehicles and quite a few trucks and SUVs, resulting in just over $1 million in sales. The auction sold another 35 units during Wednesday's sale, bringing eBlock's two-day total sales to roughly $1.6 million.
Not too shabby considering each auction only takes about an hour to complete.
And although the majority of the dealers currently signed up for eBlock’s services are currently in the Ontario area, O’Connor says that the company now has two representatives in British Columbia and two in Quebec, and expects that eBlock will be operating nationwide within the next six months.
And with a brand slogan of “it’s about time,” eBlock really has set its focus on selling vehicles as conveniently and expediently as possible. With each province’s lane running four vehicles at a time, each vehicle starts with 45 seconds on the “block,” but the timer won’t stop until the vehicle has gone 15 seconds without a bid. The application updates the current bid in real time, visually showing the name of the current high bidder and time remaining for transparency.
Like a traditional auction, eBlock even has “if bids” in case the required minimum reserve isn’t met – a nifty feature if you consider the fact that 25 percent of Tuesday’s sales closed in the “if bid” stage. The “if bids” remain open until noon the day after the sale. If an agreement can’t be made, the dealer can always relist it for free in the next day’s sale.
“Used cars are not a commodity anymore,” O’Connor said. “So remarketing them should not be an expense. And that’s our angle.”
To get an idea of the application’s aesthetics, which is quite reminiscent of a Tinder app for auto auctions, check out eBlock’s YouTube video above or here. For more information on its functionality, check out its site.
Full of anticipation the evening prior to eBlock’s first sale, O’Connor sat down with Auto Remarketing Canada to discuss why his company has decided to throw its hat into the crowded online auction space.
Interestingly enough, eDealer was working on a trade appraisal tool when TradeRev launched. The company decided to park the project – and O’Connor says that’s when he felt the large potential to grab market share on the online auction side of the industry.
“Most dealers are pricing their own trades. They do their best to take it in right and maximize profit when selling,” he said. “So when a dealer owns that car we are saying, ‘Hey, throw it up on eBlock and see what happens. Zero cost.’ Because of the set auction times and buyer experience, we believe we will be able to get more eyes on cars and hopefully better results for the seller. If it doesn't sell they can always run it at the block or use other platforms.”
Again, the key point that O’Connor reiterates behind the eBlock system is its focus on saving dealers’ time. And for the average dealer, O’Connor says eBlock may save a lot more than just time. Putting himself in their shoes, he proposed a hypothetical situation to demonstrate his thought process.
“Forget this product,” he said. “Say I’m the dealer and the closest auction is an hour and a half away. I’ve either got to get drivers together or transport my cars to the auction. So I’ve got that expense. So let’s say I took that car in on a trade on a Saturday and I call the auction, which (has its sale) on a Wednesday, and I get a relatively (bad) run number. I end up no-selling it to run it the following week. I’ve now sat on that car for almost two weeks. And guess what, I’m never bringing that car home. Eventually I end up cutting. And I’ve got seller’s fees, and my transportation fees, and my money’s been out for 10 or 11 days. This tool allows the seller to list it on Monday. Have the car sold. And if it doesn’t sell on Monday, he can run it again on Tuesday.”
While the eBlock system doesn't have seller's fees to list vehicles, it does have buyer's fees that are taken out of the vehicle's selling price. Check out those rates below.
|Selling Price||Buyer Fees|
|$0 – $499||$50|
|$500 – $999||$90|
|$1,000 – $2,499||$125|
|$2,500 – $4,999||$150|
|$5,000 – $7,499||$200|
|$7,500 – $9,999||$225|
|$10,000 – $14,999||$250|
|$15,000 – $19,999||$275|
|$20,000 – $29,999||$300|
|$30,000 – $39,999||$350|
|$40,000+||1% of sell price|