Last week hosted the annual Barret-Jackson automobile auction on television. This is one of the most well-known auctions for classic and collector cars in the world and they feature some of the most well-known automobiles and their owners. For example, Clark Gables 1955 Mercedes Benz Gull Wing 300SL and several Shelbys by the late Carroll Shelby.
One by one, cars parade across the auction block as bidders compete to win. Being a car guy, I spend hours watching. And being a pricing consultant, I am continually amazed at the prices that some of these cars command regardless of economic conditions.
But one car this year was very special. This year’s feature car was the Batmobile from the famous television show, Batman. Now, there were actually four of these cars produced for the program. One was used for stunt purposes. And, two were used for shows and displays around the country to promote the Batman brand.
Only one car was actually used in the TV show. This was the car that Batman and Robin used to fight crime. And, this is the car that was up for auction. The owner was George Barris, the original builder of the car. Mr. Barris has built a number of special cars for TV and movies over the years including the car for the TV show, “The Munsters”.
The auctioneer started the bidding at $100,000. Within 20 seconds the bidding rose to $1million. And, it didn’t stop there…
Bidding continued all the way up to the $2.7 million mark and stalled, but, not for long.
Bidders quickly drove the price past $3 million and proceeded to cross $4 million before finally stopping at $4.2 million.
Wow! $4.2 million for the Batmobile!
You can imagine the excitement in the auction hall. You can imagine Mr. Barris’ excitement, too. He was one happy man.
So, what drives the price of a car like this to such an astronomical level?
First, it takes at least two people who want the car very badly and have the funds to throw at it. But, more importantly, the bidders must have a high value perception of the car. The winning bidder said that he grew up watching Batman and had his eye on this car for 20 years just waiting for the chance to buy it. He also said that he “knew” that he would win the car which sounds more like he was committed to buying the car.
This bidding environment is a great way to measure the perceived value of a product. Bidders will tell you with their bids exactly what they are willing to pay at that point in time. And, close the deal on the spot.
The key is to be sure that you clearly communicate the value of the product. The auctioneers took time-out during the bidding to tell people about the cars history. The bidding would temporarily stop while the auctioneers further developed the benefits and mystique behind this vehicle.
The key to an effective pricing strategy
is to fully and clearly communicate the value of the product before establishing the price.