Penny Auction Sites Could Cost a Chunk of Change

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Ever wonder how those "penny auction" sites work? Well, this article explains it very well and, let me tell you, they have a hell of a racket going.

So how can the sites afford to give such steep discounts? Consider an item that sells for $100. Bidding starts at $0, so users would need to have placed 10,000 bids to drive up the price by a penny at a time. If a bid costs $1, the site would have raked in $10,000 on the sale. That's not including the $100 the winner has to pay for the item.
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I admit, I play penny auctions. Play is the operative word here. You're gambling, and not shopping.

I've also done very well with them. (Last month, I spent about $40 for $300 in Walmart gift cards and $100 in gas cards).

The key is to focus on saving money on items you'll use/need, and not items you want. Study and learn how the game is played, and don't let your emotions take the better of you. Go only for items that you will use, and don't see it as a way to turn a quick profit on EBay. Think small, and focus on them. Forget the big ticket items. Those target gamblers who have no idea at what they're doing, and will only end up losing money in the long run.
 
yeah its no surprise on how they work. I seem to remember an article a while back that stated every time there is a bid time goes back on the auction timer, so no last minute sniping of items.
 
I have no respect for websites which accept advertisements from those scum.

:confused:
 
I must admit, whoever came up with the penny auction idea is fucking brilliant.
 
sfsuphysics said:
yeah its no surprise on how they work. I seem to remember an article a while back that stated every time there is a bid time goes back on the auction timer, so no last minute sniping of items.
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That's the controversial part about it. 10 seconds gets added after every bid, so auctions can go on and on and on. The question is whether other bidders are actually continuing the auction, or is it employees of the company that are artificially increasing the bids.

I do hope all these penny auction sites get shut down soon. It is illegal gambling.
 
snowcat said:
That's the controversial part about it. 10 seconds gets added after every bid, so auctions can go on and on and on. The question is whether other bidders are actually continuing the auction, or is it employees of the company that are artificially increasing the bids.

I do hope all these penny auction sites get shut down soon. It is illegal gambling.
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I do think they need to be reclassified, since most of the money is from people who don't win anything, which seems that it shouldn't fall under the legal umbrella of "auction".

If anything, even though this should be obvious, all the commercials I see for beezid.com need to be scrutinized since they're being quite deceptive about the true cost that some of these high priced items are
 
It's a form of gambling that doesn't look like gambling. I agree, the creator is a genius.
 
The first time I saw a commercial for Quibids I laughed my ass off as soon as they said "And receive 10 free bids!" And THERE is the rub.

Kudos to the brilliant people that will make millions off these sites before they get shutdown. LOL at those same folks that might find their butts in jail.
 
I have never used one of these sights, but I do not see a problem. As a consumer, it is MY responsibility to investigate into any purchases that I make, or attempt to make. I am sure some sights are scams, but there are plenty of "retail" sites that are just scams and are there just to take your money.
 
cocheese256 said:
I have never used one of these sights, but I do not see a problem. As a consumer, it is MY responsibility to investigate into any purchases that I make, or attempt to make. I am sure some sights are scams, but there are plenty of "retail" sites that are just scams and are there just to take your money.
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agreed, if i'm too stupid to pay attention to how i spend my money that is my fault.
 
cocheese256 said:
I have never used one of these sights, but I do not see a problem. As a consumer, it is MY responsibility to investigate into any purchases that I make, or attempt to make. I am sure some sights are scams, but there are plenty of "retail" sites that are just scams and are there just to take your money.
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Wait...what? Are you actually advocating personal responsibility? Are you fucking out of your mind? That's what we have the gubment for....They will bail us out ;)
 
Wait, there are sites that makes you pay for bids you don't win? Who the hell would do this?
 
Serpent said:
Wait, there are sites that makes you pay for bids you don't win? Who the hell would do this?
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Yeah. Say a bid costs $0.70 and I buy 100 bids. I have 70 bids to use on the "items" for sale. If I bid on an item that's $4.25, it increases its price to $4.26, and I lose by bid. But If I win the auction and no one else bids on it, I only used one, $0.70 bid for my $4.26 product (probably something like an iPhone or the like). But if I get outbid, I lose that bid forever.

Multiply that times 100, being outbid that is, and I just paid the auction company $70 for letting me "play" on their site.

Genius.
 
snowcat said:
That's the controversial part about it. 10 seconds gets added after every bid, so auctions can go on and on and on. The question is whether other bidders are actually continuing the auction, or is it employees of the company that are artificially increasing the bids.
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I can guarantee that is exactly what they are doing. First time I saw beezid.com advertised on TV about a year ago, I decided to check it out myself. On the front page was several big ticket items such as TV's, stereos, washer and dryers, and even a car. They all had clocks on them counting down. I watched several items reach 1 minute left exactly, then suddenly the price increased by a penny and there was more time on the clock. Each item had only one bidder listed underneath the countdown clock. Why would anyone in there right mind keep artificially raising the bid if they were the only one bidding? They wouldn't, it was an employee or some software bot doing it for them. Of course you can't prove this behavior now since the site is popular enough to have more than one person bidding on the items at a time, but I guarantee it still happens.
 
TheWeazmeister said:
Wait...what? Are you actually advocating personal responsibility? Are you fucking out of your mind? That's what we have the gubment for....They will bail us out ;)
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Pretty much hit the nail on the head. Our society has turned from personal responsibility to asking for handouts. Watching the news makes me want to barf when I see things of that nature.
 
CaptNumbNutz said:
I can guarantee that is exactly what they are doing. First time I saw beezid.com advertised on TV about a year ago, I decided to check it out myself. On the front page was several big ticket items such as TV's, stereos, washer and dryers, and even a car. They all had clocks on them counting down. I watched several items reach 1 minute left exactly, then suddenly the price increased by a penny and there was more time on the clock. Each item had only one bidder listed underneath the countdown clock. Why would anyone in there right mind keep artificially raising the bid if they were the only one bidding? They wouldn't, it was an employee or some software bot doing it for them. Of course you can't prove this behavior now since the site is popular enough to have more than one person bidding on the items at a time, but I guarantee it still happens.
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I went to beezid and spent $50 for "bids" even though I knew how it worked and knew it was a total scam. The system CAN work for your favor but its worst then your odd's in VEGAS. A poster said previously the smaller ticket items that are usable are the bigger items to go for. I did this after spending 20 bids trying to get an iPad. I ended up getting a $70 homedepot card and a $50 SEARS card. for shits and giggles I went back to see how much higher the iPad and TV got that I attempted on, wow ... they got super high and continued for hours. For sure something fishy going on there.

I won't be trying again, theres too many people trying to make it big on these sites and theres way way way too many plants on forums defending these sites too. ONE week after beezid.com came online some guy was on the c|net comments saying how he already got a car, 3 tv's, 2 laptops a few camers etc. etc. etc. with zero proof or linkage of any winnings.
 
Sucker born every minute... goodluck to those who create these sites... and LOL at the morons who use em to shop... welcome to the internet dumbass
 
I've come up with two good ideas in my life that could have made me loaded:

1) An in-site instant messenger system. I even designed one, but the users on my site thought it was a worthless idea due to AOL popularity, and I scrapped working on it after nobody liked/used it. Facebook brought theirs about four years later.

2) An auction site where we listed an item at $X and users paid $.20 for each bid. Sadly, I didn't think the concept would drive in as much users as these sites do. Damn, was I wrong.

And I'm still poor.
 
The main thing to remember is that these are not actually auction sites. They are auction lotteries in that many people pay to bid but only one succeeds. Most people do not realize it is a lottery, and besides most people fail at lottery statistics anyway.
 
There are many with huge negative ratings by the BBB for not shipping winner items. Beezid and some of the more retarded site names are most cuprits
And then theres the bots , crap loads..
 
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