DoveBid, Inc., based in Foster City, California, is the world’s largest business auctioneer. Since 1937, DoveBid has conducted auctions of surplus capital assets belonging to corporations, government agencies, and financial institutions worldwide. In 1999, Ross Dove decided to hijack eBay’s model and turn his firm into the first business auctioneer to add online and, eventually, Webcast capability. People can log onto www.dovebid.com and submit their bids for date-certain auctions that are also taking place the old-fashioned way, live on the factory floor. Having worked with DoveBid since its online launch in 1999, Sterling Communications (SCI), www.sterlingpr.com, had already successfully positioned the company as the “clicks & mortar” leader of the business auction market sector, even achieving DoveBid’s inclusion in Forbes magazine’s July 2000 cover story on the dozen “E-Gang” leaders. But as DoveBid’s online business began flourishing in early 2001, and as the dot-com bubble continued to deflate, Sterling realized it had another winning business story on its hands.
Part of DoveBid’s success is a result of current market conditions — economic downturn is good for companies in a counter-cyclical business. As companies tighten their belts, profitability can depend upon the cost-effective procurement and disposition of their in-building assets. As a recognized leader in business auctions, DoveBid already had unparalleled expertise in its field. However, positioning DoveBid as the “silver lining in the clouded dot-com economy” required careful messaging. While it was important to leverage the benefits to DoveBid of the demise of the dot-com icons — an estimated one-third of its 2001 revenue was due to the dissolution of dot-coms — SCI did not want DoveBid to appear to be dancing on their graves.
The spate of dot-com bankruptcies appeared to supply DoveBid with an endless stream of business opportunities in 2001— and SCI with numerous story angles. Realizing that the dot-com story could quickly become old news, it was clear that SCI’s pitching strategy needed to entail multiple angles in order to remain fresh.
SCI had to establish DoveBid as a symbol of success amidst the ruins of the Internet economy — without creating the impression that DoveBid fed on the remains of dying dot-coms. Simply put, SCI needed to make it clear that DoveBid’s business in the auction world does not depend solely on declining markets — many of DoveBid’s customers are merely Fortune 2000 companies divesting of unwanted assets, not companies going out of business. Yet at the same time, SCI wanted to emphasize how DoveBid was able to boost its business during the dot-com meltdown by using the Web.
To keep the dot-com auction story fresh for the press, SCI decided to promote only a select portion of DoveBid’s auctions, based on the size, location and history of the dot-com. For instance, SCI chose not to promote the auction of an Internet company based in Santa Clara, Calif., because SCI had promoted a similar auction of a dot-com in the Silicon Valley less than five weeks prior to the Santa Clara auction.
Once SCI narrowed in on an auction to promote, it identified the following media targets for its pitching strategy: (1) local TV, radio and print media; (2) the print reporters who covered the specific dot-com in the past; and (3) DoveBid’s ongoing contacts, including national media outlets.
SCI compiled an extensive list of targets for each auction. When pitching the local press or press who previously covered the dot-com, SCI emphasized the effect of the company’s demise on the local economy and unemployment rates. In turn, SCI pitched DoveBid’s ongoing and national contacts on the bigger trend of “Darwinism in action” — that is, many auction attendees were themselves from dot-coms, either new start-ups or survivors of the crash. They were looking for great buys for their new companies in an effort not to end up like the companies they were scavenging.
Sterling enlisted DoveBid’s own investors to explain to financial and venture capital media how they directed the bankrupt dot-coms in their investment portfolios to seek DoveBid’s auction services. In the new cost-conscious environment, DoveBid’s auctions also provided a source for companies to pick up good deals on office equipment and furniture, allowing them to husband their limited capital for more important uses, such as R&D.
DoveBid’s auctions of failed dot-coms received extensive coverage (see supporting materials), which drove an ever-increasing number of buyers to participate in-person as well as via the Web. A first round of coverage in one media outlet often resulted in a second round of coverage. Newspaper articles inspired TV coverage, which generated competing coverage on other stations, particularly for multi-day auctions.
The press was receptive to covering the DoveBid/dot-com story, in part because SCI could offer quantifiable proof that DoveBid’s incorporation of Webcast technology, a key element in all the dot-com auctions, was a boon to the business.
In 2001, DoveBid liquidated over 200 failed dot-coms, with as many as 80% of the participants logging their bids via the Internet. The press was eager to cover the final chapter of once high-flying companies being auctioned off by a 64-year-old Old Economy company thriving due to its use of the Internet. The irony was lost on no one.