First things first: I am NOT suggesting an auction house, or any other type of global, automated trade system.

I realise that, via WoW, the name 'auction house' has come to mean any type of game-wide trading system, even when it has nothing to do with actual auctions (like GW2's trading post, which is often called the auction house by ex-WoW players). But that's not what I'm suggesting here.

What I am suggesting is that, in guild stores, we should be able to choose to sell items by auction instead of direct sale.

The current system - we have two ways of selling to other players:

1. Guild Stores - The seller lists an item for sale for a fixed price, and the buyer either pays exactly that price and gets the item or decides they don't like the price and goes looking elsewhere.
2. Direct trade - The seller advertises an item for sale in chat, with or without a price. Buyers express their interest and those two individuals agree on a price before trading. (Or they don't agree and the sale doesn't go ahead.)

There are pros and cons to both of these. Guild stores make it easier because the actual trade is automated, and it means the buyer and seller don't have to be in the same location, or even online at the same time. But it also means there's far less room for negotiation. You could message the person selling an item to ask if they'd consider a lower price, or a trade, but it's not ideal, especially because they'll have already paid their listing fee. In most cases you pay what's asked or you go elsewhere.

Direct trading allows much more discussion and therefore flexibility on price (or trading goods in return instead of gold), but it's restricted to people who happen to be in the same location at the same time as the seller. And any discussions are likely to be just between those two individuals.

How are auctions different?

I'm sure everyone is familiar with how an auction works, but basically the idea is the seller offers an item for sale with a starting price, usually much lower than they expect it to sell for, then buyers offer what they would be willing to pay and whoever has bid the most after a fixed period of time gets the item.

How is this better?

• It can be much simpler for sellers because they don't need to know what an item is worth to sell it. For example, I found a dwemer motif the other day. I've never had one before and none of my guilds currently have one for sale. Under the current system I'd have to either ask around for a price check and trust it's accurate or try to guess exactly what it's worth. If I could sell it at auction however I could give it a starting bid of, say, 1,000 gold and let buyers decide the actual price.
• It also opens up the market to people who want to sell an item rather than delete it because they know there is a demand for it, but aren't too worried about the actual price. Sure at the moment they could simply list the item for much less than it's worth, but this way they could end up getting a decent price for it which is a much greater incentive.
• As a result of the above it could lead to many more items entering the market. Particularly crafting materials. I've got far more than I'm going to use, but it's just not worth my time to try and work out what they're worth so I don't sell them. If I could auction them I could just start each one off at 1g and let the market decide the price.
• Prices can be much more variable than using direct sales, which means sellers may end up getting more gold than they would normally have asked for and buyers may end up getting a bargin if not many people bid on an item.

What are the downsides?

• Prices can be much more variable. Same as the above, but the other way around. Sellers may end up getting less than they wanted, or buyers may end up paying more. (Although see below for common tools that can mitigate this.)
• I'm not sure how it would affect price check mods and the people who use them. I don't know enough about the API to even try to understand it. I'm sure someone could sort it out eventually but it may be a problem for a while.
• It can take longer. If someone lists an item for auction and a buyer sees it immediately and puts in a maximum bid the seller would be completely happy with they both still have to wait until the auction ends to complete the trade.

What would be the mechanics of the system?

It'd be mostly identical to the current guild trader system - the seller pays a listing fee and adds their item, buyers search for it and bid and when the auction ends the gold (minus a sale fee) is mailed to the seller and the item is mailed to the buyer. But there are a couple of extra features that I think would be useful:

• Optional reserve price - When a seller lists an item instead of just putting in a price they put in a starting price - the lowest possible amount buyers can bid. But they could also add an optional reserve price, the actual minimum they want it to sell for, and if the highest bid at the end of the auction isn't above this the item doesn't sell. I think this is a marketing tool - buyers are more likely to bid if the starting price is lower. But it's a standard feature of both real life auctions and online sites like ebay.
• Maximum bid - Obviously one of the advantages of this system are that it's automated so neither buyers or sellers need to hang around for the full duration of the auction. But that means buyers have a high risk of being outbid if they can't be online all the time. To get around this they could put in both a starting bid - slightly higher than the current highest bid - and a maximum and if someone outbids them the system will automatically raise their bid, until it reaches their maximum. If that's higher than everyone else's they are the highest bidder, if not then they've lost but can submit a new bid up until the auction ends.
• Variable duration - It would be nice if sellers could choose how long the auction should run for. Maybe have a few different points like 1 day, 5 days, 7 days, 14 days etc.

So, what do you think?