Hospitals see cash in online auctions

A need for creative fund raising has facilities turning to the Internet.

By Katherine Vogt, amednews staff. Feb. 2, 2004.

Like others in the nonprofit world, hospitals are cashing in on a relatively new way to raise charitable donations by using online auctions as fund-raising events.

Though items have been auctioned over the Internet for years, experts say a surge in the popularity of online auction houses, such as eBay, and growing computer savvy among the general public has helped fuel hospitals' increased use of the technology. Observers say hospitals also are being forced to be more creative in finding new sources of donations.

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Phil McCarty, senior director of corporate marketing for St. Jude Children's Research Hospital in Memphis, Tenn., said St. Jude has been using online auctions for about four years and engages in two or three large online auctions each year. He said the most successful ones involve celebrity autographs or a chance to meet someone famous.

Miami Children's Hospital used an online auction for the first time in November 2003, offering nearly 80 items, such as vacations, jewelry and art, said Ivette Diaz, director of marketing and community relations for the hospital's foundation. The online auction raised more than $32,000.

Diaz said online auctions seem to be a natural fit. "The entire philanthropic community is constantly looking for new avenues through which to raise funds. And our constituency has become very computer adept. I think it's a natural move to that. It also expands your ability to reach more of the community."

Tom Saturley, director of the Overland Park, Kan.-based National Auctioneers Assn., said online auctions could provide a less expensive format for raising money than live auctions. "[But] I think to a certain extent the attraction to the online is being able to generate more money because they've been able to speak to a larger audience, whether that's geographically or by numbers," he said.

Businesses also are cashing in on the trend. Cambridge, Mass.-based cMarket was launched in March 2003 offering an Internet-based auction platform for nonprofit fund raising. It helped put on 17 auctions last year that raised $292,000, said Jon Carson, cMarket's chief executive.