Someone explain "automatic bidding" to me, please!

Morisa

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Nov 5, 2011
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[I apologize if there is a thread on this already; if so, please point me to it!]

So I'm a TOTAL newb to ebay, and I'm trying to figure out how ebay's proxy/automatic bidding system works. I understand that you set a max amount, and that ebay will automatically bid on your behalf in specified increments.

Some specific questions:
1. Will someone who is an automatic bidder always win over a last-minute bid (assuming that the automatic bidder's max has not been reached)?

2. How often does ebay re-bid on your behalf? Immediately? Once every X hours/days?

3. Can you tell if another bidder is using an automatic bid system? If so, is there a way to determine what the other bidder's max is? (This may relate to question 2)
 

BeenBurned

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[I apologize if there is a thread on this already; if so, please point me to it!]

So I'm a TOTAL newb to ebay, and I'm trying to figure out how ebay's proxy/automatic bidding system works. I understand that you set a max amount, and that ebay will automatically bid on your behalf in specified increments.

Some specific questions:
1. Will someone who is an automatic bidder always win over a last-minute bid (assuming that the automatic bidder's max has not been reached)?

only if the last minute sniper's final bid is lower than the automatic bidder's bid.

2. How often does ebay re-bid on your behalf? Immediately? Once every X hours/days?

There's not an automatic schedule. It happens after another bidder places a bid. If it's lower than the proxy bid that was placed, they'll immediately get a response that they've been outbid and the automatic bid price will go to the next increment above the bid that was just placed.

3. Can you tell if another bidder is using an automatic bid system? If so, is there a way to determine what the other bidder's max is? (This may relate to question 2)

No, you have no way of knowing what someone's bid is unless you keep bidding to try to find it. And in doing so, you might get stuck being on the hook for purchasing an item at a higher price than you really want to pay for it.

Answers in red above.

-----------------

There are a couple of schools of thought on bidding.

1. Some bidders bid their highest price at an early point in an auction and forget about it. If they get outbid, they can either come back later and decide if they want to spend more or they just wait for another "widget" to come along and they try again to get it.
2. Some bidders feel safer with a BIN, they want to know right away that they bought an item and dislike the waiting game to see if they won. They might be afraid that in a bidding war, they could end up paying more than the BIN price so they get the suspense over with early in the fame.
3. Some bidders like to wait until the last few seconds of an auction and place their bid in the last few seconds. They see what the high bid is at that point, decide on a price they're willing to pay (assuming that the high bid may not be the actual bid placed by the current high bidder) and they place a higher bid that they hope will be enough to win.
 

Morisa

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BeenBurned, thank you so much for your responses. A follow up question on number 2:

2. How often does ebay re-bid on your behalf? Immediately? Once every X hours/days?

There's not an automatic schedule. It happens after another bidder places a bid. If it's lower than the proxy bid that was placed, they'll immediately get a response that they've been outbid and the automatic bid price will go to the next increment above the bid that was just placed.
So if another bid has been placed and there has not been a higher bid, one can infer that any automatic bidder's maximum has been exceeded?
 

BeenBurned

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BeenBurned, thank you so much for your responses. A follow up question on number 2:



So if another bid has been placed and there has not been a higher bid, one can infer that any automatic bidder's maximum has been exceeded?
Correct.
 

shopaholism

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FYI, OP--you could also take advantage of a 3rd-party sniping service that does last-second bidding on your behalf (and quicker than your fingers can do it manually). I like JustSnipe, and I also liked Goofbay until their servers started screwing up all the time (they might've fixed that by now)
 

Morisa

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FYI, OP--you could also take advantage of a 3rd-party sniping service that does last-second bidding on your behalf (and quicker than your fingers can do it manually). I like JustSnipe, and I also liked Goofbay until their servers started screwing up all the time (they might've fixed that by now)
Would using a 3rd-party sniping service change the outcome if another bidder's max has not yet been reached? My understanding is that eBay's automatic bidding will always win against a 3rd-party snipe bid, assuming that the snipe bid is less than the automatic bidder's max bid.
 

BeenBurned

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Would using a 3rd-party sniping service change the outcome if another bidder's max has not yet been reached? My understanding is that eBay's automatic bidding will always win against a 3rd-party snipe bid, assuming that the snipe bid is less than the automatic bidder's max bid.
That's true because the highest bidder, proxy or not, wins. But if you don't want to have to worry about being there at the last minute and placing a bid, a sniping service can help. If you aren't willing to pay more than whatever the unknown high bid of another bidder is, you won't win anyway, no matter how the bid is placed.
 

shopaholism

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You're both right--a sniper is only a time-saver, not an override. It has helped me win several items at fabulous deals, though (and was especially helpful when I went a week without a computer while my dead hard drive was being dealt with). In addition, sometimes impulsive fellow buyers might be driven to bid more if they see that an item already has a bid (instead of, for example, only bidding a couple dollars above the starting amount and thinking that will be OK), so saving your bid until the last second can prevent those other buyers from engaging in that kind of behavior.
 

Morisa

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You're both right--a sniper is only a time-saver, not an override. It has helped me win several items at fabulous deals, though (and was especially helpful when I went a week without a computer while my dead hard drive was being dealt with). In addition, sometimes impulsive fellow buyers might be driven to bid more if they see that an item already has a bid (instead of, for example, only bidding a couple dollars above the starting amount and thinking that will be OK), so saving your bid until the last second can prevent those other buyers from engaging in that kind of behavior.
Your last sentence goes to an interesting point about bidding strategy--that is, when is it best to reveal what your max bid is?

For example, take these two situations:

1. A set his max bid at $50; the item's current price is $30. No other bids have been made, but B is watching the item and is ready to jump in. B's max price is $55. Here, if B bids at the last second, either using Ebay's internal system or a 3rd-party sniping service, B would win. (This assumes, of course, that A isn't hanging around his computer and manages to get in another last-second bid.)

2. Assume the same facts as in (1), but B chooses to use Ebay's internal bidding system and bids when there's still a few days/hours left in the auction. A would then receive notification of being outbid, and A would have time to re-bid. B would lose out, because B's max has been reached and exceeded. B could re-bid at a higher price, of course.

These two scenarios aren't perfect, I realize. And I agree with BeenBurned that if you are not willing to pay more than someone else, you will always lose. But I think for a lot of people, if it comes down to a few dollars for a winning bid, they would be OK with increasing their bid. For example, in scenario 1 above, A would probably have been willing to pay $56 for the item, but doesn't get the chance to put that bid in.
 

BeenBurned

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These two scenarios aren't perfect, I realize. And I agree with BeenBurned that if you are not willing to pay more than someone else, you will always lose. But I think for a lot of people, if it comes down to a few dollars for a winning bid, they would be OK with increasing their bid. For example, in scenario 1 above, A would probably have been willing to pay $56 for the item, but doesn't get the chance to put that bid in.
Perhaps A would have paid $56 but he also doesn't know whether B put in a higher bid of $90 (for example). Since the bid just goes to the next higher increment, Bidder A would still have lost out at $56 even if he'd had the time to rebid.
 

northerndancer

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Your last sentence goes to an interesting point about bidding strategy--that is, when is it best to reveal what your max bid is?

For example, take these two situations:

1. A set his max bid at $50; the item's current price is $30. No other bids have been made, but B is watching the item and is ready to jump in. B's max price is $55. Here, if B bids at the last second, either using Ebay's internal system or a 3rd-party sniping service, B would win. (This assumes, of course, that A isn't hanging around his computer and manages to get in another last-second bid.)

2. Assume the same facts as in (1), but B chooses to use Ebay's internal bidding system and bids when there's still a few days/hours left in the auction. A would then receive notification of being outbid, and A would have time to re-bid. B would lose out, because B's max has been reached and exceeded. B could re-bid at a higher price, of course.

These two scenarios aren't perfect, I realize. And I agree with BeenBurned that if you are not willing to pay more than someone else, you will always lose. But I think for a lot of people, if it comes down to a few dollars for a winning bid, they would be OK with increasing their bid. For example, in scenario 1 above, A would probably have been willing to pay $56 for the item, but doesn't get the chance to put that bid in.
Be careful with this thinking. Those few dollar bid increases can really come back to bite you when you realize how much more you paid than you had intended. (I know, its happened to me.)

Determining the max you want to spend ahead of time and sticking to that max is always good advice.
 

Morisa

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skislope15

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Gray text indicates an automatic bid (proxy bid) placed by eBay on behalf of the bidder

Thanks everyone for the answers and feedback. Another related question, based on what was posted in this thread:

Can someone explain the bids here? http://offer.ebay.com/ebaymotors/ws/eBayISAPI.dll?ViewBids&item=250967476570&showauto=true What is the meaning of the bid entries at 18:23:12, where one is greyed out at $5,850 and then you see a bid at $5,917, both by the same person? (The same for the $5,650 and $5,699 bids at 18:19:53 and the two $5,450 and $5,510 bids at 17:27:31)