Traditional auction houses have rough transition online

Christie's, Sotheby's and Butterfield & Butterfield are trying to break into the hot Web auction market, but the results have been largely disappointing.

Julia Jucker just wanted to know the size of the ring listed on Sotheby's online auction site. But it wasn't listed, and when she called Sotheby's, they told her they didn't know and couldn't find out the information.

"I can't imagine brushing off a potential customer," said a surprised Jucker, who has been selling jewelry on eBay for about a year. "This is expensive stuff. (It) runs in the thousands. Customer service should be a top priority. That kind of stuff can't sell itself."

Jucker's complaint is one of many that illustrate the rocky transition traditional auction houses have had as they move online to compete with the more nimble and exceedingly consumer-sensitive online auction houses.

In the past year, Christie's, Sotheby's and Butterfield & Butterfield have announced plans to launch Web auction sites to get a piece of the growing online auction business.

But the early returns have been disappointing: Christie's canceled its ambitious plans, and Sotheby's and the recently renamed Butterfields have disappointed some bidders.

The traditional auction houses are trying to break into an area of the Web that is wildly popular and already dominated by well-established Internet companies. eBay, the leading auction site, has some 12.6 million registered users, up from 3.8 million a year ago. The site had more than $1 billion in gross sales the first quarter of this year, up from $541 million during the same quarter last year.

The companies admit it's been rough going online.

Sothebys.com president Craig Moffett said his company had problems answering email and shipping orders placed after it launched its co-branded site with Amazon.com in November. It has since integrated the order systems more fully with Amazon's and the problems have subsided, he said.

"There's no question there were customers that didn't have the experience we would have wanted through the first of this year," he said.

At Butterfields, it was the billing system that caused problems, affecting Butterfields' ability to track and ship orders. Butterfields replaced it and bulked up the back-end infrastructure, spokesman Steve Westley said.

"We are on this like you would not believe," Westley said. "We're really moving heaven and earth to fix this."

Not all problems have been technical. There's evidence of a significant culture clash between the traditional auction houses and bidders used to the freewheeling dot-com world.

In keeping with the "openness" of the Web in general, online auction houses have encouraged dialogue about their sites, inviting increased scrutiny that has yielded both positive and negative reactions. On message boards and via email, people have complained vociferously--and sometimes gotten results. eBay recently made changes to its new automotive site after receiving complaints.

The loud shouts and customer-service demands of the online vox populi stand in marked contrast to the quiet, secretive and closed-door bidding that often goes on at the traditional auction houses.

Unlike e-tail sites, traditional auction houses have tended to ignore most customer concerns, while lavishing attention on sellers and a select few upper-crust bidders, Jupiter Communications digital commerce analyst Mike May said.

"Auctions are simply not a buyer-centric environment," May said. "The model needs tweaking if it's going to resonate with the would-be collectors who either don't have access to, or are intimidated by, the traditional channels."

However, the auction houses are still making a mark in the online auction world.

Butterfields, owned by eBay, reports drawing eBay users into its higher-end auctions and continues to increase its listings. Sothebys.com, which launched in January, had gross merchandise sales of $10 million during its first two months. And Christie's site, which plans to add online bidding in the future, is adding live Webcasts of its offline sales.

But many collectors have complained about their early offerings. Of the feedback messages about Butterfields' eBay sales, 9 percent have been negative and another 9 percent have been neutral--both much higher percentages than most power sellers would consider acceptable. Several noted that while Butterfields accepted payment immediately, the company took weeks and sometimes months to ship their orders.

New Jersey art collector Ron Cavalier, for example, said that he bid on three separate Renoir etchings listed by Butterfields. Although the listing indicated that two of the etchings were framed, Cavalier said the company notified him after he won the bidding that they weren't.

He tried to cancel one order, but Butterfields ended up charging him for both and shipping both to him six to seven weeks after he won the auctions.

"They don't respond to customer service at all," Cavalier said.

That's changing. Butterfields has begun to respond personally to customers who have voiced complaints. In a later email to Cavalier, Butterfields president Patrick Meade apologized for the situation, calling it "inexcusable."

Sotheby's has drawn fire from bidders who claim the items they received were not as advertised or had bad customer-service experiences.

One Sothebys.Amazon bidder who posted an anonymous message on AuctionWatch's message boards said that after winning about 10 auctions for stuffed animals and requesting that they be shipped together, he got them in separate lots, with Sotheby's charging $50 or more for each lot.

The bidder said it got worse: the stuffed animals weren't in the advertised mint condition, and a certificate sent with one limited edition animal didn't go with the animal.

"One of the reasons I felt comfortable in buying from Sothebys was the reputation of their experts," the bidder said. "If I, as a seller on eBay, described items the way Sothebys does, I'd have a ton of negative feedback, angry customers and likely be facing mail-fraud charges."

Unlike eBay and Butterfields, though, Sothebys.Amazon does not allow bidders to post feedback, so bidders have no direct way to complain publicly or relate their experiences to other potential bidders.

Victoria Treyger, general manager of Sothebys.Amazon, said that the site is looking into adding a feedback section. The site didn't include the system when it launched because of time constraints and because it could have meant sacrificing bidders' anonymity.

Neither Sothebys.com nor Sothebys.Amazon lists the names or user identifications of the bidders on auctions. The company says it is done to preserve bidders' anonymity.

The traditional auction houses find that moving online resembles the experience of traditional retailers. From Toys R Us to Wal-Mart, retail giants have struggled with everything from delays in launching their sites to site outages and shipping problems. So far, they have largely lost ground to their e-tail rivals.

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