The role of Internet auctions in the expansion of B2B markets

In the wake of the advent of the World Wide Web, businesses are scrambling to take advantage of changes in their markets. While the consumer side of the Web explosion has been much touted, it is the business-to-business (B2B) market that has quietly surpassed expectations. An important business model that is responsible for this new market expansion is the Internet or Web auction. Businesses are adapting traditional auctions to the instantaneous "real-time" advantage of the Net to reach new markets that were previously cost-prohibitive by reducing transaction costs. Advantages such as the size and scope of the audience are giving Internet auctions a major role in the emerging global economy. This article examines the enormous impact of Internet auctions on B2B markets. We look at the kinds of auctions being conducted and their relevance to emerging business paradigms. We examine the circumstances under which you choose to conduct Web auctions and their impact on pricing mechanisms, information asymmetries, and channel relationships. (C) 2001 Elsevier Science Inc. All rights reserved.