Penny Auctions

[I. Hustle]

Anyone ever try one of these sites out? Have you won anything? Was it a good deal?
Some guy just won a brand new camaro for a little over 5 bucks on a site that was new and just starting up.
I tried before but only with some free credits I got.

[4>0rings]

I've wondered about these sites. Those insane deals like that Camaro I'm sure are setup. Maybe the site owner put it up for sale, and only he was able to buy it and bought it for $5. Really, who's going to sign over a 40k car for $5?

[I. Hustle]

I've wondered about these sites. Those insane deals like that Camaro I'm sure are setup. Maybe the site owner put it up for sale, and only he was able to buy it and bought it for $5. Really, who's going to sign over a 40k car for $5?

It was on CNN. Turns out they were trying to promote their new site and the guy just happened to win. They said that they won't do that again and that it was a one time deal. I'm not trying to get a car but those sites do have some cool stuff.

[Dex]

The way these sites make money is you have to pay for each bid. I.E. you spend $50 to get 50 bids which you can use for the auctions.

If people bid in the last 15 seconds, the clock resets to 15 seconds, so prices typically get driven up at the last minute, but not by a whole lot. You can still get items for cents on the dollar, but you may have to spend 10-15 bids to do it.

[4>0rings]

So why would anyone put something for sale on that site if they could get more money through ebay/craigslist with a safety net of a reserve?

[cantthinkofanything]

So why would anyone put something for sale on that site if they could get more money through ebay/craigslist with a safety net of a reserve?

ancient Chinese secret

[Dex]

So why would anyone put something for sale on that site if they could get more money through ebay/craigslist with a safety net of a reserve?

The items being bid on aren't being sold by members. I don't know exactly where they get them; a lot of it is gift cards and promotional crap like that.

[robino2001]

Assuming this is in reference to stuff like quibids, etc... the people running these sites are genius - the users are morons (for the most part).

Let's say there's an auction for an ipad... worth what, $600? And each bid raises the price by 1 cent (I know some have different increases, but for the example).... The mentality of the person bidding is "man it'd be awesome to get it for $200" or whatever. So people bid with bids they paid for (often at 10 cents or more per bid).... so each time someone put their name in, they're the high bidder and win the right to buy it at whatever they bid. Once people put in x amount of bids, they're invested into it and will bid over and over because they've already put x amount of money in to win.

So say the iPad finally "sells" at $350 (usually it's like 60-70% of value for the nice things like this). So the winner pays $350. Lets say the bids were $0.10 each @ 0.01 increments - $350 = 35000 bids at $0.10 each = $3500 spent in bidding... add the $350 for the sale price, and the company received ~$3850 for a $600 iPad they likely got at a wholesale price anyway.

I had a coworker really into this stuff for a while trying to find the flaws (like everyone I'm sure). He finally realized where the advantages were at were for like gift cards, etc, and then "bidding" to win more bids. In the end, he invested ~$100 into it and "won" $100 worth of gift cards and said screw it - I'm out.