Method and system for conducting electronic auctions with aggregate lotting for transformation bidding

• US 20020032621A1
• Filed: 09/06/2001
• Published: 03/14/2002
• Est. Priority Date: 03/31/1999
• Status: Active Grant

• Current Assignee: Ariba Incorporated (SAP SE)
• Original Assignee: Ariba Incorporated (SAP SE)
• Inventors: Rupp, William D., Smith, Christopher J., Bernard, Anthony F.
• Granted Patent: US 7,346,574 B2
• Time in Patent Office: Days
• US Class Current: 705/27
• CPC Class Codes: G06Q 30/02 Marketing; Price estimation or determination; Fundraising
• CPC Class Codes: G06Q 30/0234 Rebates after completed purchase
• CPC Class Codes: G06Q 30/0235 constrained by time limit or expiration date
• CPC Class Codes: G06Q 30/0601 Electronic shopping [e-shopping]
• CPC Class Codes: G06Q 30/08 Auctions
• CPC Class Codes: G06Q 40/04 Trading; Exchange, e.g. stocks, commodities, derivatives or currency exchange
• CPC Class Codes: G06Q 40/06 Asset management; Financial planning or analysis

Abstract

An auction methodology wherein individual demands are bid in lots and an aggregation of several lots is then run as an individual lot to determine if the buyer can attract a lower price offering from bidders by selecting to award the total volume of all of the individual lots to one bidder. A bidder-specific transformation factor for the aggregate lot is computed by combining selected transformed values (one for each lot) that take into account that bidder'"'"'s price offerings for individual lots and the buyer-specified transformation factors for that bidder. Each bidder is then invited to bid a discount percentage for the aggregate lot. This discount percentage is then used along with the bidder-specific transformation factor to generate that bidder'"'"'s transformed value for the aggregate lot. The bidder with the lowest transformed value for the aggregate lot may be selected as the winning bidder. The combination of bid transformation and lot aggregation results in obtaining an optimum bid for the buyer because it allows the buyer to accurately evaluate the bids received for the aggregate lot.

Claims

1. A method of conducting an auction, wherein each of a first bidder and a second bidder is competing for a first lot and a second lot to be auctioned by an auction requester, said method comprising:

receiving at least one bid for each of said first and said second lots from each of said first and said second bidders;

waiting until bidding for each of said first and said second lots is closed;

inviting said first and said second bidders to offer a first price and a second price respectively for an aggregate lot after said bidding for each of said first and said second lots is closed, wherein said aggregate lot is created by combining said first and said second lots;

for said first bidder, computing a first transformed price for said aggregate lot from said first price and from one or more bids received from said first bidder for said first and said second lots; and

for said second bidder, computing a second transformed price for said aggregate lot from said second price and from one or more bids received from said second bidder for said first and said second lots.

2. The method of claim 1, further comprises performing the following prior to inviting said first and said second bidders to offer said first and said second prices respectively:

generating a first set of transformed values for said first bidder, wherein said first set of transformed values is generated by applying a corresponding one of a first set of transformation factors to each bid received from said first bidder; and

generating a second set of transformed values for said second bidder, wherein said second set of transformed values is generated by applying a corresponding one of a second set of transformation factors to each bid received from said second bidder.

3. The method of claim 1, further comprising:

comparing said first transformed price with said second transformed price to determine a winning bidder for said aggregate lot from said first and said second bidders.

4. The method of claim 1, wherein inviting said first and said second bidders to offer said first and said second prices respectively includes:

asking said first bidder to offer said first price as a first discount percentage; and

asking said second bidder to offer said second price as a second discount percentage.

5. The method of claim 2, wherein computing said first transformed price for said aggregate lot includes:

selecting a first group of transformed values from said first set of transformed values, and

combining said first price with said first group of transformed values to compute said first transformed price; and

wherein computing said second transformed price for said aggregate lot includes;

selecting a second group of transformed values from said second set of transformed values, and

combining said second price with said second group of transformed values to compute said second transformed price.

6. The method of claim 5, wherein combining said first price with said first group of transformed values includes multiplying said first price with a first summation generated by adding all transformed values in said first group of transformed values, and wherein combining said second price with said second group of transformed values includes multiplying said second price with a second summation generated by adding all transformed values in said second group of transformed values.

7. The method of claim 5, wherein selecting said first group of transformed values includes selecting a corresponding lot-specific transformed value for each of said first and said second lots from said first set of transformed values, and wherein selecting said second group of transformed values includes selecting a corresponding lot-specific transformed value for each of said first and said second lots from said second set of transformed values.

8. The method of claim 5, wherein said first group of transformed values includes:

a first transformed value from said first set of transformed values, wherein said first transformed value is the lowest transformed value for said first bidder associated with said first lot, and

a second transformed value from said first set of transformed values, wherein said second transformed value is the lowest transformed value for said first bidder associated with said second lot;

and wherein said second group of transformed values includes;

a third transformed value from said second set of transformed values, wherein said third transformed value is the lowest transformed value for said second bidder associated with said first lot, and

a fourth transformed value from said second set of transformed values, wherein said fourth transformed value is the lowest transformed value for said second bidder associated with said second lot.

9. The method of claim 5, further comprising:

reporting to said first bidder each bid received therefrom that corresponds to one of said first group of transformed values; and

reporting to said second bidder each bid received therefrom that corresponds to one of said second group of transformed values.

10. The method of claim 2, further comprising:

allowing said auction requester to specify said first and said second sets of transformation factors.

11. The method of claim 1, further comprising at least one of the following:

providing a first feedback to said first bidder asking said first bidder to offer a reduced value for said first price to stay competitive in said auction; and

providing a second feedback to said second bidder asking said second bidder to offer a reduced value for said second price to stay competitive in said auction.

13. The method of claim 12, wherein computing said first transformed price and said second transformed price for said aggregate lot includes performing the following electronically:

for said first bidder, selecting a corresponding lot-specific transformed value for each of said first and said second lots from said first set of transformed values;

for said second bidder, selecting a corresponding lot-specific transformed value for each of said first and said second lots from said second set of transformed values;

computing a first bidder-specific factor from said lot-specific transformed values for said first bidder and a second bidder-specific factor from said lot-specific transformed values for said second bidder; and

multiplying said first price with said first bidder-specific factor to compute said first transformed price and said second price with said second bidder-specific factor to compute said second transformed price.

14. The method of claim 13, further comprising:

electronically comparing said first transformed price with said second transformed price to determine a winning bidder for said aggregate lot from said first and said second bidders.

15. The method of claim 13, further comprising performing the following electronically:

providing a first feedback to said first bidder asking said first bidder to offer a reduced value for said first price to stay competitive in said auction; and

providing a second feedback to said second bidder asking said second bidder to offer a reduced value for said second price to stay competitive in said auction.

17. The system of claim 16, further comprising:

means for comparing said first bidder-specific transformed price with said second bidder-specific transformed price to determine a winning bidder for said aggregate lot from said first and said second bidders.

18. The system of claim 16, wherein said means for computing said first bidder-specific transformed price for said aggregate lot includes:

means for generating a set of transformed values for said first bidder by applying a corresponding one of a set of transformation factors specified by said auction requester to each bid received from said first bidder;

means for selecting a group of transformed values from said set of transformed values;

means for computing a bidder-specific factor for said first bidder from said group of transformed values; and

means for multiplying said first price with said bidder-specific factor to compute said first bidder-specific transformed price.

19. The system of claim 16, wherein said means for computing said second bidder-specific transformed price for said aggregate lot includes:

means for generating a set of transformed values for said second bidder, wherein said set of transformed values is generated by applying a corresponding one of a set of transformation factors specified by said auction requester to each bid received from said second bidder;

means for selecting a group of transformed values from said set of transformed values;

means for computing a bidder-specific factor for said second bidder from said group of transformed values; and

means for multiplying said second price with said bidder-specific factor to compute said second bidder-specific transformed price.

12. A method of conducting an online auction, wherein each of a first bidder and a second bidder is competing for a first lot and a second lot to be auctioned by an auction requester, said method comprising performing the following electronically:

receiving at least one bid for each of said first and said second lots from each of said first and said second bidders;

generating a first set of transformed values for said first bidder, wherein said first set of transformed values is generated by applying a corresponding one of a first set of transformation factors specified by said auction requester to each bid received from said first bidder;

generating a second set of transformed values for said second bidder, wherein said second set of transformed values is generated by applying a corresponding one of a second set of transformation factors specified by said auction requester to each bid received from said second bidder;

determining when bidding for each of said first and said second lots is closed;

inviting said first and said second bidders to offer a first price and a second price respectively for an aggregate lot after said bidding for each of said first and said second lots is closed, wherein said aggregate lot is created by combining said first and said second lots;

for said first bidder, computing a first transformed price for said aggregate lot from said first price and from one or more bids received from said first bidder for said first and said second lots; and

for said second bidder, computing a second transformed price for said aggregate lot from said second price and from one or more bids received from said second bidder for said first and said second lots.

16. A system for conducting an online auction, wherein each of a first bidder and a second bidder is competing for a first lot and a second lot to be auctioned by an auction requester, said system comprising:

means for receiving at least one bid for each of said first and said second lots from each of said first and said second bidders;

means for determining when bidding for each of said first and said second lots is closed;

means for creating an aggregate lot by combining said first and said second lots;

means for inviting said first and said second bidders to offer a first price and a second price respectively for said aggregate lot after said bidding for each of said first and said second lots is closed;

means for computing said first bidder-specific transformed price for said aggregate lot from said first price and from one or more bids received from said first bidder for said first and said second lots; and

means for computing said second bidder-specific transformed price for said aggregate lot from said second price and from one or more bids received from said second bidder for said first and said second lots.

20. A computer-readable storage medium having stored thereon instructions for conducting an electronic auction, wherein each of a first bidder and a second bidder is competing for a first lot and a second lot to be auctioned by an auction requester, wherein said instructions, when executed by a processor, cause said processor to perform the following:

receive at least one bid for each of said first and said second lots from each of said first and said second bidders;

determine when bidding for each of said first and said second lots is closed;

invite said first and said second bidders to offer a first price and a second price respectively for an aggregate lot after said bidding for each of said first and said second lots is closed, wherein said aggregate lot is created by combining said first and said second lots;

for said first bidder, compute a first transformed price for said aggregate lot from said first price and from one or more bids received from said first bidder for said first and said second lots; and

for said second bidder, compute a second transformed price for said aggregate lot from said second price and from one or more bids received from said second bidder for said first and said second lots.

21. The computer readable storage medium of claim 20 having stored thereon said instructions, which, when executed by said processor, cause said processor to further perform the following:

compare said first transformed price with said second transformed price to determine a winning bidder for said aggregate lot from said first and said second bidders.