Bidding foolishly early on Ebay ...WHY ?

[DimitriP]

Why ...oh why ...would you bid early and raise the price from 24.95 to $74 with almost 6  days left to go?   

Time left  5 days 18 hours 24 mins
   
Member Id: MoneyToBurn4   US $74.00   Apr-20-16 10:57:36 PDT
Member Id: MoneyToBurn3  US $73.00   Apr-21-16 15:03:05 PDT
Member Id: MoneyToBurn2  US $67.00   Apr-20-16 12:46:52 PDT
Member Id: MoneyToBurn1   US $65.00   Apr-20-16 11:08:26 PDT
Starting Price      US $24.95   Apr-20-16 10:38:01 PDT

[jpanhalt]

It used to be that a seller could delete/change an offering until bids had been placed.  During that time, there was a benefit in freezing a seller's offer.  I have not read the current TOS, which I sense may have evolved more to favor sellers with respect to changing and deleting offerings.  So, that earlier reason may not still be valid.

Another reason is the psychology of an auction.  The opening price of often not met, so it gets lowered.   Once there is a bid, the bidding often quickly surpasses the original opening price.

Another reason is shill bidders trying to get a higher price.

And finally, since eBay went to anonymous bidders instead of usernames, I will sometimes bid early just to get a feel for how the other bidders at that time are bidding. (With usernames, it was reasonably easy to get a feel for familiar names, since the items I typically bid on have a narrow appeal.).  That is, some bidders always bid just a few dollars over the minimum, some (foolishly) bid closer to the items real worth early on.

John

[PTR_1275]

If it is something I don't want to miss, I bid so I get more warnings / alerts pop up if I get outbid. Less likely to forget about it then. I have missed out on some really good gear because I forgot

[Halcyon]

I will sometimes put in an early initial bid so that I can see how many watchers are on a particular item using www.watchcount.com. It'll give me a better idea on the competition later on during the auction process.

If you enter the item number in the above website it'll display the number of watchers (normally hidden on the ebay page), but it needs at least 1 bid for it to work.

[digsys]

IIRC, experience from th epast, so not sure if it applies as much today. If you start with a low or no reserve, you get a much cheaper advt cost, so you then
simply use shill bidding to get it to where you wanted it in the first place. There's all sorts of "tricks" used, but I do admit, this guy seems pretty open about what
he's doing.

[station240]

I've also seen the other problem where people bidsnipe at the last minute, with a really high bid to beat others.
Goes like this:
Member Id: BidSniper2      US $75.00         Apr-21-16 10:03:36 PDT
Member Id: BidSniper1      US $71.63      Apr-21-16 10:03:34 PDT
Member Id: NormalBidder  US $15.20      Apr-20-16 12:46:52 PDT <- what the item is actually worth
starting price $5.00

The two bid snipers pretend to be dead, so the seller relists the item and contacts the remaining bidder.
Item sells for $10, as there is less competition.

[Brumby]

For legitimate bidding, it's this:

Another reason is the psychology of an auction.  The opening price of often not met, so it gets lowered.   Once there is a bid, the bidding often quickly surpasses the original opening price.

'Auction fever' can kick in and the psychology of 'missing out' jumps all over the sensible approach.  It is worse when attending a live auction with inexperienced bidders.


For non-legitimate bidding, there are a number of reasons.

[Delta]

Maybe because some people think using sniping software is rather ungentlemanly, and prefer to simply stick their max bid in whenever and let the system do its thang...?

I wish eBay would do something about sniping software - a simple way would be to have auctions end randomly up to X amount of minutes either side of the planned end time.  Without knowing the exact second the listing ends, the snipers would be useless.

[DimitriP]

Maybe because some people think using sniping software is rather ungentlemanly, and prefer to simply stick their max bid in whenever and let the system do its thang...?

I wish eBay would do something about sniping software - a simple way would be to have auctions end randomly up to X amount of minutes either side of the planned end time.  Without knowing the exact second the listing ends, the snipers would be useless.

I used to snipe manually sitting in front of two computer with three windows open. One to watch, one with the "last bid" and one...juuust in case with the "desparate" bid. At least once I ended up outbidding myself. Back then, it was a skill
 
I prefer sensible "Buy it now" or "Make Offer" so I don't have to wait 5+ days to "win".

[station240]

I've used bid sniping software for one important use, it's when the item is hard to get, and I plan to reverse engineer it to make more.
Even still, it's hard to justify buying some items, as $150 for something I could build for $50 just isn't right.

But yeah, some people got nuts when they must have an item, more likely if the item is rare (or simply they think it is).

[Brumby]

Maybe because some people think using sniping software is rather ungentlemanly, and prefer to simply stick their max bid in whenever and let the system do its thang...?

I wish eBay would do something about sniping software - a simple way would be to have auctions end randomly up to X amount of minutes either side of the planned end time.  Without knowing the exact second the listing ends, the snipers would be useless.

There are a number of ways to defeat sniping - one of which is to extend the auction by, say, 5 minutes when a bid placed after the scheduled finishing time.

As far as sniping is concerned, that is simply a tactic to make use of the system so that a bidder doesn't pay any more than they need to.  Change the system and the tactic will no longer work.

Also, please consider, that the final price is NOT dependent on the winning bidder - but on the underbidder.  Ebay's proxy bidding system will only apply as much of a bidder's entered amount as is necessary to beat the underbidder.

If the underbidder just does 'nibble' bidding, the sniper is likely to get a bargain since the underbidder will either have no time to react or insufficient time to push the sniper up by any significant amount.  This is the mentaility of bidding for a bargain and hoping for a win.  I believe it is based in either not understanding or not trusting the proxy bidding mechanism.  A sniper, however, will bid for a win and hope for a bargain.

However, if the underbidder is another sniper, then the price is going to rocket in the final moments - something I have experienced on more than one occasion.

[TerraHertz]

I don't see anything wrong with bid sniping, and I _always_ use it for any ebay auction item I actually want.
The reason is it lets you place a bid that is the maximum you are prepared to pay for the item, place it long before the end of auction, then just go on with your life. No emotional churn during the auction, no bidding wars that can make you lose objectivity, etc. You just get an email or site status afterwards that you won, or lost.

Much more sensible than getting involved in real time bidding, imo.
Everyone who gets their nose out of joint by being outbid by a sniper, just isn't thinking their bidding strategy and limits through rationally. What exactly are you upset about? That someone was willing to pay more? Or that you weren't game to actually front up with a bid that was truly what you would have paid?

There's even precedent in the live auctions world - closed envelope bids, and auction by public tender.

[Brumby]

@terrahertz- your opening sentence seems at odds with the rest of your post.

If you are sniping manually then that is true, but not if he uses a sniping service.

The advantage of a service is you get all the benefit of sniping without having to tie yourself down at the last moments of an auction - which sounds just like the sort of thing he likes.

[nidlaX]

This Cornell blog post links to good papers and also explains concisely some of the factors at play: http://blogs.cornell.edu/info2040/2014/10/28/the-dominant-strategy-for-ebay-auction-bidding/

Note that the optimal bidding strategy is dependent upon your information about the value of the item at hand. The more precise (and independent) your valuation of the item, the more "rational" it is for you to bid late and bid once at your maximum (true) valuation. Auction designs that "defeat" sniping by extending bidding times are likely trying to maximize revenue by taking advantage of behavioral features that increase the risk for someone to overbid. This method, taken to the extreme, is implemented as penny auctions (see the discussion of penny auction vs. gambling, "entertainment auctions", Swoopo, etc.).

[miguelvp]

That's odd, I believe ebay itself allows you to put a bid and a max bid at any time so it does the sniping for you. If someone bids more than your 1st bid and your maximum bid is higher, ebay will make the bid for you automatically for a dollar more or something like that, until your max bid is not enough to cover the current higher bid.

It only shows the end back and forth so it looks like if the bidders involved overbid, but you can find the details of the automatic bidding which by default don't show.

But it's been a while so maybe things have changed.

[Brumby]

What you are describing is eBay's Proxy Bidding process.  It will continue to apply ever increasing amounts under your maximum bid to keep you ahead of other bidding.  This means that your maximum bid can be chipped away at over time, pushing up the price.

Sniping is placing a similar bid at the last possible moment, preventing someone else from seeing your bid and then trying to beat it.

[DimitriP]

That's odd, I believe ebay itself allows you to put a bid and a max bid at any time so it does the sniping for you. If someone bids more than your 1st bid and your maximum bid is higher, ebay will make the bid for you automatically for a dollar more or something like that, until your max bid is not enough to cover the current higher bid.

Well.... do it and you will lose. Unless your max bis is some overpriced amount,  or the item is a used pair of shoes of two different sizes.

[DimitriP]

What you are describing is eBay's Proxy Bidding process.  It will continue to apply ever increasing amounts under your maximum bid to keep you ahead of other bidding.  This means that your maximum bid can be chipped away at over time, pushing up the price.

Sniping is placing a similar bid at the last possible moment, preventing someone else from seeing your bid and then trying to beat it.

Yes! That!! Thank you

[miguelvp]

I guess it will depend when you place the bid with the max bid, of course I don't do it days in advance, five seconds before it ends has worked for me in the past, also doing some crafty cents on the max bid helps a lot

[Halcyon]

also doing some crafty cents on the max bid helps a lot

+1 on that. Most people will place bids to the nearest dollar. I usually make my final bid some obscure amount, but not before placing a few "dummy bids" in small increments so that hopefully the other person(s) assume that I'm only going to continue making only small increases. Then finally, I jam in my highest bid plus some random cents in the last final seconds and hope my browser doesn't timeout ;-)

Just long enough to get my bid in, but not long enough for others to receive updated bidding amounts, put in their bid and click submit.

Some call it nasty, but whatever gets the job done.

[Brumby]

also doing some crafty cents on the max bid helps a lot

+1 on that. Most people will place bids to the nearest dollar.

I've had that work for me on more than one occasion.

Some years ago, I sniped $162.67 for a 21" colour monitor.  The bidding hadn't cracked $100 when I placed my snipe - but there were four of us who jumped in within the last 5 seconds.  When my screen refreshed with my maximum bid amount still showing, I panicked wondering why it hadn't gone in.  After checking the bid history, I found that, not only had it gone in, but that I had won - beating the underbidder by 67 cents.

This was an example where snipe bidding proved beneficial to the seller.  In fact, you only need two people who have submitted serious bids, such as two snipers, for that to happen.

[Halcyon]

also doing some crafty cents on the max bid helps a lot

+1 on that. Most people will place bids to the nearest dollar.

After checking the bid history, I found that, not only had it gone in, but that I had won - beating the underbidder by 67 cents.

Winner winner, chicken dinner.

[Brumby]

One more example - it was a bit cheeky, but fun.

Again, this was some time ago before eBay anonymised User Ids.  You could see how your competitors bid on other auctions.

I came across an item that was a "Will I or won't I" sort of purchase.  So I checked the other bidding and found there was only one other bidder to worry about.  When I looked up some of their previous bidding, I noticed they were a fan of multiples of $5.  Since the bidding of this item was just over $5 and considering its true value, I guessed the other bidder had put in a $10 maximum bid.  So I sniped with a $10.01 bid .... and won it by 1 cent.

[Kilrah]

The simplest way would be to not end the auction until the bidding stops for 10 minutes.

+1. The "local" eBay equivalent where I used to live worked that way, any bid within the last 5 minutes of an auction resets the counter to 5 minutes. No sniping possible, and an auction can end up lasting a couple of hours more depending on the players.
I've participated in a few memorable ones, with much playing with odd bids in the cents range.

[Halcyon]

The simplest way would be to not end the auction until the bidding stops for 10 minutes.

+1. The "local" eBay equivalent where I used to live worked that way, any bid within the last 5 minutes of an auction resets the counter to 5 minutes. No sniping possible, and an auction can end up lasting a couple of hours more depending on the players.
I've participated in a few memorable ones, with much playing with odd bids in the cents range.

That's actually not a bad idea. I wonder why eBay haven't looked at this as an option for listings? They would be set to make more money out of it with their insane fees.