Let me start by saying that if you have the time and interest, auction drafts are a great way to play the game. The draft takes about twice as long as a traditional snake draft. And, I have found most people are difficult to persuade to even try this as an alternative. If you can get the crew and time together, you will have a lot of fun. **It can be very cool if you can get someone to be the auctioneer w/o any participation in the league itself.
An auction draft works with each owner receiving an imaginary sum of money...say $100. Owners take turns offering up a player for the group to bid on. Generally, there is benefit to offering up a player that you are NOT interested in obtaining. I also find that it is great to get the highest priced players (again that you are not interested in) off the board first. It encourages other owners to blow their wads early with you still having targeted players available on the board.
Find a website that offers general auction values for each player. One example could be: http://www.fftoolbox.com/football/2012/auction-values.cfm
As a rule of thumb, you don't want to pay more than 75% to 80% of the listed value for any player. What this means is that you are going to watch many stars go off the board early without attaining any of them. Don't be discouraged. It also means that you are going to clean house after other owners have blown half their total money on a single player.
As owners run short on money, they will be limited to purchasing players for a buck or two. You, however, will still have money to take players that they cannot. You can typically scratch players like Rodgers, Foster, and Megatron off the list. You won't be able to afford them with this strategy. But, by the end of the draft, you will have a roster that is both solid in starters and depth. Stick to your guns. Don't panic when you see pick after pick get taken. Be patient. Win your league. For more specifics as to how an auction league works, check any of the several sites available. Good luck!