Online travel auction
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An online travel auction is a system of buying and selling travel products and services online by proffering them up for bid and then awarding the item to the highest bidder.
As with a standard (offline) auction, the bidders, having made a judgment on how much a particular product is worth to them, place their bid over a set period of time. At the end of this period of time, the highest bidder ‘wins’ the product at whatever price is finally reached.
Like a number of other travel websites, travel auction sites pull their stock inventory in from a wide variety of suppliers. The range of products may include cruises, package holidays, hotels and flights.
Types of Travel Auction
As well as the most familiar English auction (or open ascending price auction) model, where the participant places a bid higher than the last, a handful of operators run no-reserve auctions or absolute auctions.
Some sites also operate a system of mystery auctions, whereby the bidder is unaware of the product they are bidding on. Another variation on the theme is proxy bidding which involves the bidder stating their maximum bid for a particular product, and the auction site placing the bids for them automatically.
References
- Krishna, Vijay (2002). Auction Theory. San Diego, USA: Academic Press. ISBN 0-12-426297-X.
- Milgrom, Paul (2004). Putting Auction Theory to Work. Cambridge, United Kingdom: Cambridge University Press. ISBN 0-521-55184-6.