eBay Auction Bidding Strategies--Overcoming the most Frustrating Situation on eBay

Home
>
Online Auction
>
eBay Auction Bidding Strategies--Overcoming the most Frustrating Situation on eBay

eBay Auction Bidding Strategies--Overcoming the most Frustrating Situation on eBay

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.

© 2004 NetBrainer LLC. An eBay Power Seller and rabid eBay shopper, Carolyn Schweitzer is the owner and editor of "NetBrainer", a site dedicated to improving the performance of buyers and sellers on eBay. (You can learn more about sniping programs at NetBrainer.com ). Carolyn also provides weekly recorded tips on eBay for "Third Mind USA Small-Biz radio".

In The News:

Yahoo! News: Top Stories

Obama taps spending watchdog, eyes Social Security (AP)

AP - Pointing with concern to "red ink as far as the eye can see," President-elect Barack Obama pledged Wednesday to tackle out-of-control Social Security and Medicare spending and named a special watchdog to clamp down on other federal programs Â— even as he campaigned anew to spend the largest pile of taxpayer money in history to revive the sinking economy.

Gaza fighting rages despite cease-fire proposal (AP)

AP - Israel resumed its Gaza offensive Wednesday, bombing heavily around suspected smuggling tunnels near the border with Egypt after a three-hour lull to allow in humanitarian aid. Hamas responded with a rocket barrage.

Burris expects to join Senate 'very shortly' (AP)

AP - Roland Burris said Wednesday he should be able to join the Senate "very shortly," after talking to newly supportive Democratic leaders and working on lingering legal obstacles. Talking to reporters on the second day of a Washington power odyssey that would intimidate many, the 71-year-old Burris declared himself happy and said he was pleased with his meeting with Sens. Harry Reid and Dick Durbin.

Obama hails 'extraordinary' moment with presidents (AP)

AP - Confronting a grim economy and a Middle East on fire, Barack Obama turned Wednesday to perhaps the only people on the planet who understand what he's in for: the four living members of the U.S. presidents' club.

Richardson adviser worked for firm feds probing (AP)

AP - One of Gov. Bill Richardson's close friends and advisers worked as a consultant for the California firm at the center of a federal pay-to-play probe that derailed the governor's appointment as commerce secretary.

End to Minn. Senate race pushed even further out (AP)

AP - Minnesota's grueling U.S. Senate race, already dragging on two months past Election Day, has now moved even further from the voters Â— and into the hands of lawyers.

How big Jurassic flying reptiles got off ground (AP)

AP - The Jurassic version of jumbo jets Â— huge flying creatures weighing hundreds of pounds Â— is a mystery of dinosaur-era flight: How did something so big get off the ground? A Johns Hopkins University biologist thinks he has figured out the answer.

C-sections best for baby when close to due date (AP)

AP - Babies do better after a scheduled Caesarean section if they're born no sooner than seven days before their due date, a new large study of U.S. births shows. Those delivered earlier had more complications, including breathing problems, even though they were full term, the researchers reported in Thursday's New England Journal of Medicine. Even just a few days made a difference, they said.

Pa. man opens neighbor's door with chain saw (AP)

AP - An eastern Pennsylvania man may face up to 37 years in prison for tearing open a neighbor's door with a chain saw. Police say 34-year-old Robert Kane began sawing through the front door of Jamie Zaleski's apartment in Scranton while Zaleski and several friends ran out the back.

AP source: Browns to hire Eric Mangini as coach (AP)

AP - The Cleveland Browns will hire Eric Mangini as their next head coach, a person with knowledge of the negotiations told The Associated Press. Mangini, fired last week by the New York Jets, will be introduced at a Thursday news conference at the team's headquarters in Berea, said the person, who spoke on condition of anonymity because Mangini's contract has not been finalized. Mangini reached an agreement with the club Wednesday, the person said.

Israel pounds Gaza again (Reuters)

Reuters - Israeli aircraft and tanks pounded the Gaza Strip on Wednesday and troops battled Palestinian guerrillas on the ground as U.S. backing for a proposed truce raised expectations of an end to the 12-day-old offensive.

Budget deficit to hit $1.2 trillion in fiscal 2009 (Reuters)

Reuters - The U.S. budget deficit will swell to a record $1.186 trillion in fiscal 2009, congressional forecasters said on Wednesday, the result of an economic recession that has cut tax receipts and caused massive government bailouts of banks and automakers.

Union gears up for negotiations with GM and Chrysler (Reuters)

Reuters - United Auto Workers bargaining teams are arriving this week in Detroit as the union gears up for negotiations with General Motors Corp and Chrysler LLC, which are mandated to cut labor costs under a $17.4 billion federal bailout.

Senate Democrats move to seat Burris (Reuters)

Reuters - In an abrupt switch, Democratic leaders began talks on Wednesday to swear in Roland Burris, appointed by embattled Illinois Gov. Rod Blagojevich to replace President-elect Barack Obama in the U.S. Senate.

Salmonella outbreak sickens 388 across U.S.: health officials (Reuters)

Reuters - An outbreak of salmonella food poisoning has made 388 people sick across 42 states, sending 18 percent of them to the hospital, U.S. health officials said on Wednesday.

Private job losses mount, ominous for payrolls (Reuters)

Reuters - Job losses and plans to lay off workers hammered the struggling U.S. economy in the final month of 2008, according to private reports that could foreshadow surprisingly grim labor market data from the government on Friday.

Gates says Afghan surge may cost $5.5 billion in fiscal 09 (Reuters)

Reuters - Defense Secretary Robert Gates has told Congress that a planned buildup of U.S. forces in Afghanistan could add $5.5 billion to U.S. war costs in the current federal fiscal year, officials said on Wednesday.

U.S. presses to jail Madoff on diamonds, watches mail (Reuters)

Reuters - Accused swindler Bernard Madoff mailed $1 million worth of diamonds, watches and other jewelry violating a court order, U.S. prosecutors said on Wednesday while demanding the disgraced investment adviser be jailed.

Israel approves tougher war on Hamas (AFP)

AFP - Israel on Wednesday approved an even tougher war on Hamas, warning residents to flee southern Gaza ahead of planned bombing of cross-border tunnels, as the Palestinian death toll passed 700.

Kremlin lays down terms as gas crisis engulfs Europe (AFP)

AFP - Russian President Dmitry Medvedev on Wednesday laid down terms for a resumption of Russian gas shipments via Ukraine to Europe as tens of thousands of Europeans suffered heating cuts amid freezing weather.

eBay Auction Bidding Strategies--Overcoming the most Frustrating Situation on eBay

Online Auction Online Auction