How to price an experience nobody has sold before

Somebody offers your auction a day on a fishing boat, or a private tour of a factory, or a lesson from a chef in their own kitchen. There is no market for it. You cannot look it up. And you have to write a starting number next to it by Friday.

This is the most common pricing problem in a small auction, and there is a way through it that does not involve guessing twice and hoping.

Separate three numbers before you start

Committees get stuck because they are trying to settle one number when there are actually three, and they do different jobs.

• What it costs the donor to say yes. Usually their time rather than their money.
• What you tell the room it is worth. This is the value line in the description.
• What you open the bidding at. This is the only one that touches the night directly.

The third is the one people agonise over and, provided you set it low, the one that matters least. The second is the one that actually moves the price, and almost nobody spends any time on it.

Find the three nearest neighbours

Nothing is genuinely without comparison. A day on a boat with a skipper who knows where the fish are is not a listed product, but a chartered day out is, a guided fishing trip is, and a good dinner for four is. Find three things a guest would mentally compare it to, write down what each costs at retail, and you have a range instead of a blank space.

Do this out loud with two other people. What you are looking for is not the right answer but the sentence a guest will say to themselves: this is a bit like that, and that costs about two hundred. That sentence is what they will bid against, so you may as well know what it is.

Where an experience beats its neighbours is in the parts nobody can buy. Access, a particular person, a story to tell afterwards. Which is why the description ends up doing more work than the number.

If you state a value, state one you can defend. Inflating it does not raise bids; it lowers them, because the room notices and stops trusting the rest of your list. A guest who thinks you have doubled the value on one lot will assume you did the same on all of them, and will bid down accordingly.

Where a fair value genuinely cannot be established, say so plainly and say why. Priceless is a marketing word and does nothing at all. "No comparable trip is sold to the public" is a fact, and does quite a lot.

Open at roughly a quarter of your guess

Whatever number you have landed on, open the bidding well underneath it. A quarter is a reasonable habit. The purpose of the opening bid is not to protect the lot's value; it is to get the first bid placed, because a lot with one bid on it is a contest and a lot with none is furniture.

Then think about increments. Too small and a lot needs forty bids to reach a serious number. Too large and a bidder who was willing to go up by twenty is asked for a hundred and stops. Something in the region of five to ten per cent of where you expect the lot to end is a workable rule of thumb, and there is nothing wrong with the step growing as the price climbs. The guide goes through opening bids and increments with worked examples.

Ask whether more than one person can win

This is the question that changes totals, and it belongs specifically to experiences.

A painting has one winner. A tour of a factory might comfortably take six people, in which case you are not selling one lot at an uncertain price. You are selling six places at a price you can set, or three separate lots on three separate dates. A chef's lesson might be offered twice without the chef minding.

Ask the donor how many times they would be willing to do it. Many say two or three without hesitating, because the effort of the first one was what they were weighing when they offered. Two lots at four hundred beats one at six hundred, and the room gets two winners instead of one, which matters more than it sounds. Organisations that run the same evening every year usually discover this in year two; how a repeating lot list gets built is covered on the page for clubs and associations.

Describe the day, not the thing

The largest single lever on the price of an experience is the description, and it costs nothing but an hour.

Write what the winner will actually do, in order, in plain sentences. Not "a day out on the water" but: you meet at the harbour at seven, the skipper takes you out for six hours, coffee and rolls are on board, you keep what you catch, and it happens on a Saturday between April and September that you agree with him. Name the donor. Say when it expires.

Every unanswered question in a description is a reason to bid lower. How many people can come? Is it transferable? Does it have to be this year? Who pays for the meal? A guest forced to guess will guess in whichever direction protects them, and that direction is down.

Corporate guests respond particularly well to specifics, because they are often working out whether the lot functions as a client outing or a team afternoon rather than a personal treat. There is more on that on the page for companies.

Give an unusual lot time to be understood

An unfamiliar lot needs longer in front of people than a familiar one. A case of wine explains itself in three seconds. A morning shadowing a vet does not.

So open it early rather than late, let it run while people are still arriving and reading, and if there is a moment at the microphone spend fifteen seconds on it with the donor standing up. The lots that need explaining are usually the ones with the most room above your guess. They are also the ones most likely to close at the opening bid if the room never really registered what they were.

When the number turns out to be wrong

Sometimes you find out on the night. Two situations, two responses.

If a lot has no bids at all with time still on the clock, the problem is almost never the price. It is that nobody has understood what it is. Say it again out loud in one sentence and name a person: Marieke is giving this, it is her boat, she does this properly. That usually produces the first bid, and the first bid usually produces the second.

If a lot runs away far above what anyone expected, do nothing except notice it and write it down. Next year that lot is your anchor and you can build three more like it. A committee that keeps a short note after each evening, listing what sold, what stalled and what surprised everyone, prices better in year two than any formula will.

You can build the whole list, put your guesses on it and rehearse the evening before committing to anything. The getting started walk-through takes it in order, and nothing is charged until real bidding opens.