[sdiy] ebay internal shill bidding?

[Ben Lincoln]

On Wed, January 5, 2011 1:41 pm, Bob Weigel wrote:

> "Best" has a lot of definitions I guess.  lol.  The reason we've never
> heard of this site, is that many people..including myself..wouldn't go
> there because the policy pretty much deletes the possibility of finding
> a good deal there.    The reason ebay is HUGE is because of the auction
> format largely.

I have to agree. Even if it weren't for the potential shill-bidding by the
seller, I still wouldn't use an online auction site that extended the
bidding window as described. People get too attached to the stuff being
auctioned, and the price balloons way past reasonable levels when they
have time to start thinking of a higher bid not in terms of the absolute
value, but in terms of it only being a small percentage more than their
previous limit. This is exactly what I did with that SQ-80 I mentioned.

I've seen the same thing happen at real-world auctions. I went to the
University of Washington's surplus auction once, and it was a huge waste
of time. Virtually everything was bid up so high that in many cases it
would have been cheaper to go out and buy the same thing new, instead of
having been through 5-20 years of abuse by students and staff. That's
great for the seller, but not for encouraging repeat business from the
buyers.

I know there's a whole argument here that the inflated value is actually
the "fair market value" because at least one person was willing to pay it,
but I think that's a narrow perspective that doesn't take things like
repeat business or encouraging new customers into account. To return to my
UW example, there is essentially no chance that I will ever go to one of
their auctions again. If I'm the only one who took away that impression,
then the future financial impact is minimal or nonexistent. But if enough
people are discouraged, that *will* impact their profits, because
competition at future auctions will be lower (or there may be no
competition/bids at all for some items).

eBay's model has its problems, but I like the balance it strikes. If
someone is willing (with a clear mind, not in the last minute of the
auction) to spend $400 on something that is currently only sitting at $15,
and I try to snipe it in the last ten seconds for $250, they'll still end
up winning. Most likely, I won't even have a chance to revise my snipe
attempt, because the auction will have ended. The seller still ends up
getting a fair price, even if they don't extract the maximum theoretical
value from the auction.