eBay Sniping: A Slashdot Article

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(click here link to the original Slashdot article, reproduced here for summary purposes)

"A study by South Korean physicists confirms what some of us have taken for granted for a long time: a single bid at end of auction nets the most wins. From the article: 'Plugging all those data into the model and testing the outcome in terms of how the auctions turned out, the team found that the probability of submitting a winning bid on an item indeed drops with each bid. "Our analysis explicitly shows that the winning strategy is to bid at the last moment as the first attempt rather than incremental bidding from the start." The study appears in the current Physical Review E journal.'"

Sniping is a pain in the butt to buyers who just bid normally and constantly get beat up with 10 seconds to go, but is a real blessing to sellers who can watch their items jump continuously in the same time frame. I know of a couple of sellers that often list the item for 3 days instead of 7 days as they claim (with some justification) that all the bids happen in the last day anyway. Nearly all the articles about sniping attempt to justify buying one program over another, but a buyer does need to bid high enough to win the auction. It is sort of fun to watch 7 bids come in with 20 seconds to go. The ebay proxy bid system is much less effective.

Rick

When I first started to buy notes on E Bay, I tried bidding normally and consistently. If my bid was beat, I would go back and win it again. Unfortunately I found that in most cases I would lose the item in the end if I didn't babysit it. I found that sometimes I'd lose by less than a $1. As a result, I started snipping usually with less than 30 sec, sometimes I wait until 10 or less if there is interest and price movement in the last minute. I bid my max at the end, and usually win. I'm fortunate as I work with computers all the time, so I can be watching. I also use the watch feature quite a bit as well, lets me know what an item I'm interested in buying or selling trends for over a given period of time. My rule of thumb for E Bay is there will always be another one and if you are patient, you can usually get what you're looking for at an off time for less. They likely wouldn't hold true for rarer higher end notes, but there are lots of RADAR note on E Bay.

 [smiley=beer.gif]

Rachel's what is "shill bidding?"

I confess I'm no good at sniping.  I've tried it but my connection is "dial up" and far too slow for it to work.  There was only one instance in which I just kept hammering away (upping my bid) and that had to do with a nice VF $10 BEL I won (for what I thought was a fortune at the time).  Six months earlier, I bid on a BEL and lost an EF by only a few dollars, and it turned out to be about $25 cheaper than the VF version I won later! (Although this seems like a costly mistake-- I'm sure I could get more for it than what I paid for).  Just goes to show that it often pays to be a bit more extravagant rather than cheap when it comes to certain "Sure Bet" notes to bid on.  I now kick myself for not bidding on many notes I've seen go through the roof.

In times like these (fairly good market conditions) I don't think you can go wrong with bidding on just about any rare note on eBay.  The winning prices tend to be less than what I've seen at most shows/most dealers shops or tables.  I have traded countless notes that I won on eBay (and we all know we're only getting 70%) to dealers -- for upgrades, and still have made a small gain (because the note was so cheap on eBay).

On occassion: I will even bid fairly HIGH on an item I really would like to win in hopes that the "snipers" out there will fall short.  Its actually worked.  It especially works on the notes that already have a higher starting bid (because that seems to attract less of the "Cheapies")

When I sell items on eBay -- I'm always surprised how little I make (when you deduct all the fees).  Unless the note is truly a "hot" item wanted by many-- the margin is slim (or if I originally got if for a "Song").   I really have gotten the impression that everyone who uses eBAy is CHEAP  and totally into sniping, or doing whatever it takes to get a great note for next to nothing.  

I can be CHEAP too.  I'm not criticizing anyone out there... its just my impression!

Walktothewather, shill bidding is the disallowed practice of using an alternate ID to bid on one's own items to drive up the price or to set a minimum price in an auction.

In my experience, I find the only reason that sniping actually is successful is due the "cheap" psychology of bidders which leads them to grossly underestimate the maximum they would be willing to pay for an item. I don't think most bidders realize that placing a low (maximum) bid does not in any way increase their chance of winning their item at a low price. It simply increases the chance they will be outbid. Faulty human psychology and auction "fever" take over, which is precicely what snippers are trying to get around. That is, by bidding late, you are taking advantage of the fact that other bidders have underestimated the maximum that they themselves would pay.

Here is an idea ebay should think about:
What if, every time a bid is received, the auction is increased in length by a certain increment (say, 2 minutes)? This would give all of us bidding without specialized "bidware" and ultrafast connections the opportunity to reconcider our bids and allow the auction to continue until truly the highest bid is received! It would be just like a live auction... going once, twice.. SOLD! I'm sure e-bay would be happy to even charge an extra fee for such a feature..  

happy_philosopher, I think your on to something.

As both an active buyer and seller on ebay I think many could benefit from such a feature. Especially the folks with a slower connection. It's always a little frustrating to see your bid being loss by only a couple bucks in the last 5 seconds. Even with high speed you cant respond fast enough.