The Problem...
It's happened to the best of us.
You've been watching the auction all week, and finally
you're about to claim your prize--a rare bronze statue
from the Qing Dynasty. Or something just as tantalizing.
You log on a few minutes before the auction closes, and
confirm that you're still the top bidder -- no one has
challenged you in several days. You're already picturing
"your" statue prominently displayed on the
living room mantelpiece, your friends green with envy as
you tell them about the great deal you got on eBay. You
refresh the page a few times, to make sure you're still
number 1. You even up your bid a little just to make sure
no body tries to outbid you at the last minute.
50 seconds to go...30...10...the auction has ended and the
statue is yours!! You refresh the page for the last time
so you can see your eBay ID announced as the winning
bidder. And that's when your heart drops to your toes.
It's not your eBay ID at all, but some joker who calls
themselves "SpeedyFingers123".
How could this have happened?
You were the winning bidder with only 10 seconds to go!!
Speedy or not, it just doesn't seem humanly possible.
Well, you're right. No one is that fast. SpeedyFingers123
(I made that one up, so if it's your actual eBay ID,
please don't sue me!) won the auction in the final 4
seconds. It isn't humanly possible because
"speedy" didn't actually place the bid. The bid
was place on his or her behalf, from a remote server,
using something called Bidding Software.
You've Been Sniped!
The act of placing a bid during the final seconds of an
online auction is called "Sniping" and it's
perfectly legal on eBay. Bidding wars and sniping are an
eBay sellers dream and a buyer's nightmare. Why, you're
asking yourself, don't these people just use eBay's trusty
proxy bidding process? Why not just discreetly enter the
maximum they're willing to pay at the beginning of the
auction, then let the cards fall where they may? Well, for
a couple of reasons. First, it's not human nature. If all
you have to do is outbid the next guy by fifty cents or
even five dollars to win, wouldn't you?
Second, it doesn't make economic or strategic sense to
place a bid anytime before the last five minutes of an
auction.
Think about it. eBay encourages bidders to use the proxy
system and place bids early. What this means is that an
inexperienced bidder who wants an item will want to be the
highest bidder right away, and will keep upping their bid
to hold that winning position. They'll only stop when the
bidding exceeds their budget. Then the next guy comes
along and continues the process. If this starts at the
beginning of a seven or ten day auction, and ends with a
bidding war in the last 10 minutes, the final price for
the item can spiral out of control. Many items sell for
far more than fair market value because people get caught
up in "bidding fever" -- all they want is to
WIN, they're not even thinking about whether the price is
realistic.
What to Do?
A better strategy would be for everyone to
"watch" the auction until the very end. Again,
there's two good reasons. One, the price doesn't spiral up
as just illustrated. Two, the auction has zero bids, so it
attracts fewer bidders-- less competition. It's a fact
that once an auction has at least 1 bid, it becomes a
magnet for additional bidders. Shoppers scanning an
auction page tend to jump to the ones with bids, figuring
there must be something that attracted other bidders. The
more bids, the more interesting the item looks.
Wouldn't it be great if a seller started a two carat
diamond ring at $0.99 and no one bid until the last five
minutes, and they all bid in fifty cent increments?
Someone might win the ring for just a few bucks!! Of
course, that never happens, but it would be the ideal
situation for a buyer-- and it would put eBay out of
business in a hurry. eBay encourages early bidding and
smiles upon the snipers of the world. eBay makes their
profits on listing fees and "final value" fees.
The more the item sells for the higher the "final
value". This makes eBay very happy. That's why you'll
never find any tutorials anywhere on eBay telling you to
wait until the end of an auction to bid.
The Solution...
OK, so now that we understand the benefits of sniping,
lets get back to our friend "SpeedyFingers123".
Speedy probably started out in life just like I did. She
learned everything she knew about eBay from eBay and never
realized there was such a thing as bidding software. Never
knew a computer could do your sniping automatically, bid
on your behalf in the last 2 to 8 seconds of an auction,
and do it while you're asleep. With sniping software, you
tell the software program which auctions you're interested
in and how much you're willing to pay. eBay never knows
you've seen the auction until your friendly sniping
service swoops in and places your bid with only seconds to
spare. Neither does your competition. They never see you
coming. The only way you can lose is if someone else uses
the same program sets their maximum bid higher than yours.
(Yes, my friend, you can still lose. There's no guarantee
of winning an auction no matter what system you use, if
someone else is willing to pay more. If you set your
maximum bid at a million dollars for a hunk of Elvis'
belly button lint and some nut is willing to pay a million
ten, you're still going to lose!)
"Bidding Fever" Cured
Let's face it, there IS a positive side to losing an
auction. It's the satisfaction of knowing that you didn't
lose your head and spend more than you could afford!!
Trust me, I've been there, done that, and come to regret
it. With sniping programs, you can "set it and forget
it" and walk away knowing that if you don't win, you
couldn't have afforded it anyway.
What's that I hear you saying? "But I could have had
it if I'd just upped my bid by another fifty cents!"
Hey, did you listen to anything I just said? Do you want
to drive yourself nuts? It's only stuff, after all. You
can't take it with you, and there will always be more. The
beauty of eBay is that there will probably be another just
like it, or at least something just as fabulous.
You're in Control
There's another big advantage to using bidding software.
Two things, actually. First, sniping programs allow you to
do something called "contingency bidding".
Suppose you're interested in several very similar items
and you want to win at least one of them but not all.
Provided they're not all ending at the same time, you can
create a contingency plan telling the bidding software to
cancel your bids on the other items as soon as you win one
of them.
Second, you can change your mind about an item you're
bidding on at any time (except in approximately the last
15 minutes). On eBay, it's a huge "no-no" to
retract a bid. You can only do this under the most dire of
circumstances. Do it too many times you'll be politely
asked to leave. Permanently. But, because eBay doesn't
register your bid until the Sniping program enters it for
you, (at the very end of the auction) you can cancel your
"snipe" with no penalty. You're canceling what
you've programmed into the sniping software, not an actual
bid on eBay. Isn't that nice? No more "watching"
an auction you're unsure about, and then forgetting to bid
on it. No more babysitting your computer so you can be
there for the final moments of the auction. No more
finding out you've read the description wrong and you're
bidding on an item you don't want. Or finding something
you like better after you've already committed yourself to
another item, and having to pass on it. (Or worse,
spending way too much on both!) And, finally, you have the
satisfaction of knowing that winning doesn't depend on the
speed of your fingers or your internet connection.
Believe me, the first time you snatch an item away from
SpeedyFingers123-- or anyone else for that matter-- you'll
be hooked.
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