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Bidding sites allow auctions for goods, but work through proxy bidding. Bidders indicate a maximum amount they are willing to pay, but may get caught up in “bidding wars”. There are two contracts with the site: one between the seller and the site, and one for the sale of goods between the buyer and seller. Bidders may use techniques such as bidding a cent above a round number. Looking for misspelled terms can lead to cheaper prices.
Bidding sites are websites that allow people to run an auction for their goods. They have the benefit of bringing together more buyers and more sellers than a real-world auction which is limited to people in a specific location. However, there are some important differences to remember about how such sites work compared to traditional auctions.
Many people don’t understand, or forget, that bidding sites usually work through proxy bidding. This means that a bidder will indicate a maximum amount they are willing to pay, but the site will initially only count their bid as the lowest amount needed to make them the highest bidder. If someone else bids a higher amount, the original person’s bid is automatically raised to beat just that amount, up to the stated maximum.
In theory this means that buyers on bidding sites always have to place a single bid, specifically the highest amount they are willing to pay. By this logic, there shouldn’t be a need to rebid if the price breaches their high as, at this point, the price will be too high for them. In reality, human emotions often take over and a “bidding war” can make some people change their minds and become willing to pay more just to “win” the auction. These people will often try to bid at the last possible moment before the end of the auction, either manually or using automated software.
It is important to remember that there are two separate contracts with the bidding sites. One is between the seller and the site itself and concerns the fees that the seller pays, which usually consist of a flat rate for listing the item and then a percentage of the final sale price. However, the contract for the sale of the goods exists between the buyer and the seller.
Some sites may have policies that prevent people who do not pay for the goods or supply them to the seller from using the site. However, this is separate from the legal situation; this means that the winner of an auction is automatically in a contract to exchange the winning bid price for the item listed. If one party falls short of this, the other party has the right to take legal action to compel it to do so.
Some bidders use the technique of always betting a cent above a round number, such as ten dollars and a cent rather than just ten dollars. This is because most people bid a maximum of a round number. In this example, although both bidders are actually willing to pay the same general amount, the one who bid the extra penny will receive the item.
A helpful tip when looking for bargains on deal sites is to look for misspelled terms in the titles. Since such items do not appear in search results for the correctly spelled term, they generally have fewer bidders and are more likely to target cheaper prices. There are some specialized websites that take the user’s chosen phrase and automatically search the major bidding sites for a wide variety of possible spelling errors.
