Reverse Auctions

Sandy D. Jap

Description of the Research Agenda

In many industrial markets, buying organizations are turning to the use of online, reverse auctions to gain procurement efficiencies. In this research, I am trying to understand the role of online, reverse auctions in the broader organizational sourcing context. To this end, the work in this area is developing along two streams.

How online, reverse auctions impact the buying organization's relationships with suppliers
How the conditions under which auctions are used and the structure of these auctions impact key financial, process, and relational outcomes.

This research identifies the tradeoffs between short-term savings and intangible supplier attitudes (e.g., opportunism suspicions, satisfaction, etc.), and considers how these aspects vary as a function of the specific characteristics of the auction.

This work has benefited from a variety of financial sponsors including the Goizueta Business School, the Center for eBusiness@MIT(now called the MIT Center for Digital Business), the MIT Leaders for Manufacturing program, and the MIT-Ford Alliance. Data support has been provided by B2e Markets and the Center for Advanced Purchasing Studies as well as a host of other corporations who prefer to remain anonymous.

In recent years, Professor Jap has been a highly sought expert on this area. To date, she has given over 60 talks on this work to academic and managerial audiences around the world.

Relevant Papers

Sandy D. Jap and Prasad Naik (2008), “BidAnalyzer: A Method for Estimation and Selection of Dynamic Bidding Models,” Marketing Science, 27(6), 949-60.
* Lead article

Sandy D. Jap and Eric Overby (2008), "Electronic and Physical Market Channels: A Multi-Year Investiga-tion in a Market for Products of Uncertain Quality" forthcoming at Management Science.

Sandy D. Jap and Ernan Haruvy (2008), “Interorganizational Relationships and Bidding Behavior in Industrial Online Reverse Auctions,” Journal of Marketing Research, 45(5), 550-6.

Ernan Haruvy, Peter T. L. Popkowski Leszczyc, Octavian Carare, James C. Cox, Eric A. Greenleaf, Sandy D. Jap, Wolfgang Jank, Young-Hoon Park, and Michael H. Rothkopf (2008), “Competition Between Auctions,” Special Issue: 7th Triennial Invitational Choice Symposium, Marketing Letters, 19(5), 431-448.

Jap, Sandy D. (2007), "The Impact of Online Reverse Auction Design on Buyer-Supplier Relationships," Journal of Marketing, 71(1), 146-50

Steckel, Joel, Russ Winer, Randy Bucklin, Benedict Dellaert, Xavier Drèze, Gerald Häubl, Sandy Jap, John Little, Tom Meyvis, Alan Montgomery, and Arvind Rangaswamy (2005), "Choice in Interactive Environments," Special Issue: Sixth Invitational Choice Symposium, Marketing Letters,16(3-4), 309-20.

Jap, Sandy D. (2003), "An Exploratory Study of the Introduction of Online Reverse Auctions," Journal of Marketing, 67(3), 96-107.

Beall, Stewart, Craig Carter, Phillip L. Carter, Thomas Germer, Thomas Hendrick, Sandy Jap, Lutz Kaufmann, Debbie Maciejewski, Robert Monczka, Ken Petersen (2003), “The Role of Reverse Auctions in Strategic Sourcing,” Center for Advanced Purchasing Studies (CAPS), research paper.

Jap, Sandy D. and Jakki Mohr (2002), "Leveraging Internet Technologies in B2B Relationships," California Management Review, 44(4), 24-38.

Jap, Sandy D. (2002), "Online Reverse Auctions: Issues, Themes, and Prospects for the Future", invited article for The Marketing Science Institute-Journal of the Academy of Marketing Science Special Issue on Marketing to and Serving Customers Through the Internet: Conceptual Frameworks, Practical Insights and Research Directions, Parsu Parasuraman and George Zinkhan, eds., 30(4), 506-25.

Jap, Sandy D. (2000), "Going, Going, Gone" Harvard Business Review, Nov-Dec, p. 30 "Going, going, gone".