AC Dickson: eBay Power Seller

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Bidding on eBay, revealed at last
by acdickson

AC checking in. Landed in and loving Los Angeles. Lots of work to be done down here, thrift stores to be scoped out, post offices to be tested for average wait time and worker friendliness, DSL issues to be resolved with Earthlink. But for the first few days, I'm just going to enjoy the new digs. I expect to take a journey up to Griffith Observatory manana. (That Spanish for tomorrow, eBay is my expertise, but I don't like to restrict my teachings).

But that doesn't mean I can't impart a little eBay knowledge in the time being.

Weeks ago, Adam asked me to articulate how bidding on eBay works. He understands it, but like most of us found it difficult to explain it to someone else. Adam, I feel you, so difficult is such an explanation that I neglect to cover that in my seminar. But I'm going to give it a shot.

When an eBay item hasn't been bid on yet, lets imagine it's an obscure but rare 7" record from the band Primal Horde –– you have two options. Either you bid the minimum, let's say $5. Or you bid what you're willing to pay. If you really want it, you might bid $25. Either way, the high bid of that item is now $5. Even if you bid $25, your bid is only $5. And what's more, you likely won't pay that amount exactly. Huh? How's that? Follow along.

Now someone else wants to bid. They see that they have to bid at least $5.25. Let's say they bid $6. If you only bid $5, they now have the high bid at $5.25. You get an email saying you've been outbid. But if you put in that $25 bid, they will get an message saying that they've been outbid by you for $6.25. You're still high bid. This other person really wants the record, so they bid again. This time, they get sneaky. They bid $10.01. Sorry Charlie, you (my dear reader) still have the high bid at $10.26. Now this person is really angry. They're pissed, this record was meant to be theirs and since Mommy and Daddy are subsidizing their bohemian existence, they bid $500. Yeah, 500 freaking dollars.

Now Mr. Trust Fund has the high bid at $25.25. You'll now get a email saying you've been outbid. The only way for you to get this record from the spoiled brat in question is to bid over $500. But you don't know this. You'll just have to keep upping your bid, hoping you get the high bid. Maybe you try $30. Nope, they've got the high bid for $30.25. Then you try $55. Still no dice, they have the high bid for $55.50. At this point you give up.

Assuming no one else bids, the record sells for $55.50. But let's say that at the last minute, the lead singer of the Horde, destitute with no money to his name, but with internet access and false illusions that if this record sells for an obscene amount of money his old band will get invited to play a reunion tour... this guy puts in a bid of $10,000 for the record. Well, now the high bid is $501. The only way for the singer to artificially bid up the record is to have a friend bid $11,000. At that point the high bid would be about $10,005.

As a seller, you never know how much a high bidder was willing to pay. That's what makes a candle auction like eBay different from a English or live auction. There is no going once, going twice, sold. If someone puts in a huge bid (as dealers and rich folks often do), and you smartly wait until the closing minutes to put you bid in (if you bid early, you've put your cards on the table and the chances of snaking something for cheap at the last minute diminishes) you likely will only a few shots to bid. In the last minute you might put a bid of $30 for that record, then $55, then $100 as the last second ticks, you're out of luck. Maybe you're running auction fever and are willing to pay $150 now that you know you'll never again find and possess this rare record, but you're out of luck. It's over.

What's even more likely is that you'll have the high bid of $5 until the closing seconds and the rich kid will put his $500 bid in and win it from you for $25.25. And you won't even have a chance to counter bid. You've been snipped. As far as sellers are concerned, a live auction is going to make you more money. You want that back and forth bidding until one person just can't spend any more money. But unless you've got a world class art auction that Sotheby's covets, eBay's 125 million users is you're best shot selling.

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