The auction site BidRivals is pure genius … if you’re the owner.
The site works like this: they have a number of products that they sell on timed auctions, to be able to bid on an action you need to buy “bids”, every time you or anyone else add a bid (raises the price with 0.10 Skr – approx 1.5 cent) the remaining time for the auction is increased with a predetermined number of seconds.
So when you see that the timer comes close to 0 seconds you press the button, raise the price with 0.10 Skr and the remaining time is increased with for example 15 seconds. Got it.
To avoid that people would miss their chance to bid (and for the owners to lose money) there is a “Bid Agent” that automatically bids on item for you (the Bid Agents seem to take a round robin turn of bidding).
This is pure genius, those involved in the bidding pays 5kr for each bid and there is no upper limit on how long an auction can continue. If you somehow manage to win an auction you’re very very happy because the final bids are quite low – you can get good stuff very cheaply – but I guess that the owners of the site are even happier!!
Let’s make a calculation based on an actual item, an iPod Touch 32 GB which costs, according to the site, 2995 Skr. It was sold for 80.70 … so if you managed to win the auction you’re very happy!!
But wait!! This means that there was 806 bids each costing 5 Skr (assuming that none of the bids were automatic to raise the price) which means that the owners of the site got 4030 Skr for selling that Touch. That’s 1035 Skr over the recommended price !!!
So instead of selling the Touch in a shop for 2995 Skr they actually sold it for 4030 Skr. Not bad !!! If I read the information on the site correctly the buyer for this made 221 bids which means that he/she spent 1105 + 80.70 = 1185.70 to get it. So I assume the buyer is happy.
And those who lost probably think that the whole thing was exciting and that they will win the next time. So everybody is happy … it’s such a good idea to get money (if you’re the owner of the site).
Another example, a Canon EOS 50 with a 18-200 lens sold for 651.90 SKr. That means 6518 bids, each costing 5 Skr. That means that the auction gave the owners 32590 Skr. The listed “recommened price”?? 13 799 SKr (this auction took 17 hours to complete)
Pure genius