Slashdot Mirror
How to Win on Ebay: Snipe
grammar fascist writes "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.'"
The acutal paper is from 2000. This has been tought for the past 3 years in an undergraduate eCommerce course.
The paper has an interesting comparison between eBay and Amazon, for two distinct cases: common value and private value.
Make even shorter URLs - 8LN.org
That's what I've always thought too. The people who come in and snipe at the last minute always end up paying more than I would have for the item because I set my one bid to what I'm willing to pay and then leave the auction alone. While this means I don't get as many items as the snipers, it also means that I don't end up paying more than retail for an item like far too many ebay users I've seen. Unless you're bidding on an game system on the day it's released or something crazy like that, I'd prefer to wait until a good deal rolls around instead of overpaying for my item just to make sure I get it.
I read the internet for the articles.
It sounds like one of the basic assumptions of this article is that the object of ebay is to win. That's an incorrect assumption: the object of eBay is to get what you want at the lowest price you're willing to spend. If you're only willing to spend $25 on an iPod, put in a bid of $25. eBay's proxy bidding will handle the pissant bidders trying to nickel and dime their way up. Eventually one of two things will happen: A) you'll be the high bidder and get the item you want for a price less than or equal to the amount you wanted to pay, or B) someone will outbid you and you won't get the item at the price you want, at which point you can either let it go or re-evaluate the amount you're willing to spend.
People get caught up in the "game" of bidding on eBay which is how you see digital cameras that retail for $299, and sell on Amazon for $240, sell on eBay for $320 -- that's an example I've seen with my own eyes. People are stupid and so sniping is effective.
rooooar
Every buyer with any brains at all figures out sniping is the way to go. I have been a seller for over 5 years, and I make more money on my auctions when I have them end on a Sunday afternoon. More people are home, near their computers, and ready to snipe at that time. I don't ship internationally (too much fraud), so time zones aren't really an issue.
I often get no bids at all up until the last 30 minutes of an auction, when 10 or 20 can suddenly come in.
"The advanced societies of the future will be driven by competing systems of psychopathology." -JG Ballard
Not so. Snipers are perfectly logical. YOU might set your max-price-you're-willing-to-pay but there are hordes of ebayers out there who bid incrementally. Snipers just bid the max-price-they're-willing-to-pay for the item, just like you, but they do it as late as possible so as not to give the nonlogical incremental bidders the chance to outbid them. This means they've got more chance of getting the item and they're likely to get the item for less.
It's got nothing to do with 'beating the other guy' or 'resorting to sniping' or 'winning is the only goal' or any nonsense like that. It's just the optimal strategy for maximising the chance of winning and minimising the price paid for the item.
That is called a Vickrey auction. It has some theoretical advantages but for various reasons never caught quite on.
(has some theoretical diasadvantages as well, such as the possibility of stable bidder cartels iirc)
You're stating that sniping is worse for you than using eBay's proxy bidding (when you place your max bid up front and let eBay dispense the increases as necessary)? I can't think of a single possible scenario (assuming no outages, early endings, etc..) where placing a bid earlier (and thusly, announcing your intentions to all possible competitors) is better than placing a bid as late in the game as possible.
And that's not even considering the fact that the majority of snipers use automated sniping sites (www.esnipe.com and www.auctionsniper.com for example), that allow you to set up your bid ahead of time, JUST LIKE EBAY, except you're not locked into it. You can go back and review it, edit it or cancel it up to 5 minutes before the end of the auction. You can't do that with eBay proxy bidding. Once you've placed your eBay proxy bid, you're locked in (except for retracting your bid which is a no-no).
Better yet, the two aforementioned sniping sites allow you to group a collection of bids together in 'bid groups' so that you can try sniping multiple similar auctions and once one of them wins, the other bids will automatically be cancelled.
Here's an excellent resource for sniping information which will be of benefit to anyone looking for logical arguments and reasons for sniping and not illogical, flawed reasons not to.