The Penny Auction

In this post on how to run your own Penny Auction, we will be looking at why all the systems use bid packs - and how they can be used to make your penny auction website the best it can be and increase its revenue to a maximum.

By using bid packs on your website, you have now gained two advantages - compared to if you didn’t use them. Firstly, there is not guesswork about what your cash income will be, and therefore a greatly reduced risk concerning the amount you can spend on prizes. This is because in affect, the bids have already used by the bidder! They are now merely ‘allocating’ their bids on which ever item they would like. Whereby the number they allocate will increase the likelyhood that they will win the item being auctioned off. Although timing, bidding ‘personalities’, time and the current price of the item are all part of the equation as well. Which brings us onto another penny auctions strategy. Never bid on items already under progress. In fact, the first time you use these types of websites, it may be advisable to not bid at all. Instead, just sit, watch and take not. In many respects, Penny Auctions are simmilar to Poker in many respects. Whilst poker may intially seem very much like a game of pure chance, in reality it is not. There is a great deal of skill involved in becoming a good player. In many respects, you are playing the people not the cards. Online is the same. Sit, wait and look at how people place their bids. Do they wait till 0 seconds left? Do they bid straight after you? How agressive are they? It is alll about getting inside their head and looking at the penny auction from their perspective. How badly do they want the item, what are they willing to do to get the item on the penny auction website?

Once you begin to understand your opponents, you will begin to understand how to maximise your efficiency and use tactics to win the products that you desire from the penny auction website.

written by admin \\ tags: bid packs, penny auction, strategy, win

Contrary to popular belief, it is most likely that each auction is not a ‘gamble’ for the website. Whilst they may ‘lose money’ on some, this is not actually where most of their profit is made. Instead of examining the number of bids placed on a single item, people should instead examine the way bids are pre-sold on penny auction websites.

Thats right, penny auctions already have your money. However, it must be noted that this is assuming that most are bought before hand rather than placed one at a time. This pre-buying of bids is much more widespread due to a number of factors. A) On some sites, it is the only way to get bids - for example in a minimum pack of 10. B) Buying bids for use in auctions in this way allows for bulk discounts and so makes it ‘cheaper’ for most users on the site. With each bid now potentially costing around 75p instead of £1.50 or there abouts.

Therefore, the penny auction websites already know how much money they have; that vast majority of bids have already been placed as such before an item is actually bid on. In many ways it can just be seen as users apportioning their ‘points’ onto different auctions as they see fit. To this end, the penny auction website operators should always be able to keep afloat as they already know how much money they have, the average ‘extra’ that will be spent by single bidders at the maximum rate without buying a bid pack (if the website allows it) and therefore the % they need to spend on products to make their site look glamourous with desirable high end goods, and still retain a healthy profit margin and bottom line.

We hope this has helped people to understand how these sites actually make money, rather than thinking that these sites ‘gamble’ on a having a few good auctions! Keep reading for more great information and further posts about how to beat the competition on penny auctions and actually get some good deals online!

written by admin \\ tags: bid packs, gamble, penny auctions