But Exceet thought that pay per bid auctions sites still were not offering customers what they really wanted…namely real variety and fairness.  The variety issue is that most pay per bid sites offer only one pay per bid auction style to their customers.  All of us usually have a favorite food, but we don’t want to eat it everyday.  We like variety.

However fairness is where all the pay per bid auction sites really come unstuck.  You see they all list the products that are being auctioned.  This is a huge conflict of interest.  What this means is that the profitability of the auction site is directly dependent on their customers losing money on their auctions.  A massive problem and one they’ve been receiving a huge amount of criticism for. All these pay per bid sites are busy advertising how you can win at product for up to say 90% off, while at the same time are built on the very fact that their customers need to lose for them to make money.  You can only con people for so long…

So what do these sites do?  Simple.  To ensure they make money they stack the odds against bidding clients (you and me) to ensure that on average they lose.   And to make matters worse many small sites that are short of cash and have only a limited customer base have given into the temptation of resorting to bots and shill bidding to fraudulently increase the sale price of their products and stop genuine bidders from winning products, which would cost the site money.

So how can people who like the style of pay per bid auctions know which site to go to?

Just answer one simple question…

Does the site list the products they auction or do they have independent sellers?

The only pay per bid site in the world that offers pay per bid auctions where independent third party people are the sellers is Exceet.  They realised how fantastic pay per bid auctions were, but how poorly the current sites were treating customers, so they decided to take these auctions to the next level.

But they didn’t just replicate the current model and give you independent sellers.  No way.  They decided to make it far more interesting for bidders by offering you four different pay per bid auction types on one site.  Another world first.  So you can play penny auctions, lowest unique price, reveal the price and zero price auctions all on the one site.  But there’s more…

Exceet also offers a free daily cash auction.  That’s right, they give away cash everyday…free.  No catches.  You can’t even buy bids in this auction so there is no secret intention.  It simply represents a portion of their marketing strategy and budget.  Hey, I’ll visit a site that’s going to give me the chance to win free money!   Again their the only pay per bid auction site offering free cash.

So if you are the winner you gain hugely…but at the expense of all the other bidders.  So is this fair?  Well that’s where a lot of the controversy starts.  Many (certainly the most vocal) people argue it’s totally unfair…even a con or a scam.  At a minimum it is very cleaver marketing.  I mean who wouldn’t want to pick up a $1,000 Apple computer for $20?  Heck, I would!     But this is maybe where I go against those vocal advocates.  I think it is a valid auction model on two conditions:

1. It has to be transparent – what I mean here is people need to not only know that they are paying to bid but that there is only one winner and loads of peple who will be disappointed in each auction
2. The rules/model has to be fair – and this is where I think all pay per bid auction sites have failed to date and deserve critcism.  Since the sites are the ones listing the items and they design the model, they set the model to ensure they win on average…and the clients (you and me) loose.

Until they change there business practices they will continue to get a huge amount of criticism.

Just a final note.  Exceet was set up for this very reason.  We applied the eBay fairness to the pay per bid auctions.  The terms are designed to be fair and Exceet earns it’s income by charging a portion of the auction selling price.  That means we want auctions to end (not run on and on like traditional pay per bid auction sites) and we win when users win.  So that means that users (you and me) can enjoy the thrill of pay per bid auctions and maybe snap up a bargain AND do it on 100% fair terms.

Until next time…

The three things that new visitors should do to ensure this doesn’t happen…

Understand the auction model and site

Pay per bid auctions are not like eBay.  Some have timers some don’t.  Some have reset timers, like the going, going…gone style of normal auctions, some don’t.  Some are countdown while others are reverse style.  But all these pay per bid auctions have one thing in common:  they ALL charge you to make a bid.  Begginers need to understand that the massive discounts being offered are the result of each bidder contributing a small amount to the auction pot, while there is only one winner.

Manage your expectations

Too many new visitors think that they can join an auction site for the first time and with the minimum amount of bids, win a great product on their first auction for a fraction of it’s price.  While this does happen it’s pretty rare.   Every pay per bid auction involves skill and has a unique strategies that help bidders win.  The more prepared and experienced the more success you’ll tend to have.  It’s like anything that involves skill…the more you practise the better you get.

Jumping straight in

Pay per bid auctions are very simple and it is tempting to want to get right in and bid straight away.  But although they are simple to understand they take practice to master.  Beginners will have to compete against experienced bidders with tried and tested strategies.  Do you know what the item your bidding on generally sells for on the auction style your bidding?  The best thing you can do is watch your first few auctions and maybe paper bid.  In other words, bid in your mind or on paper to see how you would’ve done.  We have provided a few Tips and Tactics for you to get you stated in the F&Q.

Conclusion

At Exceet we want our customers to have a great time…and of course be big winners.  This can only happen when you understand what our auctions and site is all about, you have realistic expectations and you take your time to learn before bidding.   We want to keep you as a customer, coming back again and again…and that can only happen when you’re happy.  So we’ll do everything in our power to make sure you are aware of everything you need to be to have a great auction experience.

Competition

The future of online auctions is bound to be one filled with competition.  Their popularity is only going to grow in the coming years and more people bidding means fiercer bidding competitions.  But the competitive spirit will not end there.

As the demand for online auctions grows so too will the number of online auction sites.  This means that even as bidders bid against each other, online auction sites will be vying for bidders.  The sites with the best formats, the lowest prices, and essentially the greatest popularity will attract more bidders with others coming up behind or falling to the wayside.  With all the money to be saved and to be made in the world of online auctions, competition will be a constant theme.

Evolution

The future of online auctions will show the evolution of this form of buying and selling.  The types of auctions may grow in number and change in form.  Already normal auctions, penny auctions, and lowest unique bid auctions are among the many types offered and more are sure to sprout up to entice more bidders to join the bidding frenzy.

These sites may become more regulated.  As they grow and develop, the genuine sites will continue to be separated from those with lesser credibility.  This expansion and progression of online auctions is bound to turn online auctions into a worldwide phenomenon.

Once, the internet was only for some people.  Now it is a tool that keeps droves of individuals connected.  As online auctions continue to develop, it will be similarly difficult to find someone who does not participate in these auctions that have already gained a popularity that few could have foreseen.

The concept of regulation raises so many questions such as who would regulate?  How would they regulate global auctions? What should be regulated?  Where does regulation stop?  Who will pay for it?  And so on.  All incredibly difficult and for the most part impossible to get right.  As with any regulation there are also unexpected consequences.  Would regulation simply stifle innovation or competition due to higher costs?

Of most concern is that the introduction of regulation will encourage users to become less discerning about their actions.  If users think someone is regulated they tend to act less cautiously, trusting a site to act the way they should rather than treading carefully.  It also encourages the blame culture, such that when things go wrong (as some will always flaunt the law) they look to blame the government rather than the site and taking proper responsibility.  Regulation always has unintended consequences, but are these consequences outweighed by the benefits of regulation?  Or is it better for the market to simply name and shame?

Theft

One concern with auction sites is that items could be stolen in the real world and sold through these sites.  In theory, shoplifters could create a new form of organized crime where merchandise was regularly stolen and then sold online.  Unregulated auction sites could result in a new wave of crime with these auction sites just being a new, easy way for criminals to unload stolen merchandise.

Fraud

Some argue that auction sites should be regulated because the sites themselves may not be on the up and up.  Some sites have been known to drive the prices up on their auctions by having their own bidders place bids to keep auctions going.  Sometimes the bidding on an auction stops at a relatively low price and results in loses or only small profits for the auction site.  Recognizing this, some auction sites employ fake bidders to drive the price of items up and to increase their own profits.  Regulation might prevent this type of fraud.

Can unregulated Auction Sites just Do Anything?

Unregulated auction sites could be selling inferior merchandise that is not as it was advertised.  They may not send the auction items to the winners at all or win their own auctions.  Is (proper) regulation the most effective answer or can the markets simply ferret out those unlawful few that give the majority of honest auctions a bad name?  Will regulations really stop this kind of behaviour?  And at what cost?

While it is easy for online auction sites to take advantage of bidders and criminals to take advantage of online auction sites, it will be incredibly difficult and expensive to stop this behaviour through regulations.

The market should be given a chance to name and shame dishonest sites and the law should then intervene to punish those concerned.  Regulation will only cost money and prevent innovation, which at the end of the day brings the greatest value to us all.  Regulation will also increase the costs of doing business and reduce competition and lead to higher costs…costs that will likely far exceed the cost of any fraud that might be prevented.  I for one would like to let markets name and shame…(and a great place where dodgy sites are exposed is Penny Auction Watch’s Hall of Shame and Legit or Not) and only if markets fail at this task move to a more rigid regulated model.

The Positive Aspects Of Paying With PayPal

PayPal is a household name.  It is known for safety, security, and for being an easy way to pay for things online.  The true beauty of PayPal, however, lies in what is does not do with your personal information.

PayPal does not send your personal information out when you pay for auction wins.  Rather, it acts as an intermediary so that your information does not need to go beyond the PayPal site when you make payments.  You can rely on PayPal to keep your personal information safe while you participate in online auctions and pay for your winnings.

The Negative Aspects Of Paying With PayPal

Not everyone is singing PayPal’s praises, however.  Many of PayPal’s customers have reported that they have been treated poorly by this online payment business.  Some say that this bad customer service has been overlooked because of the site’s overwhelming popularity.  Also, PayPal’s high fees have been questioned.  After all, why would you pay high fees when you could just pay for your auction wins directly?

The biggest point to consider is that PayPal is owned by Ebay.  If you try to use PayPal with other auction sites, will you have problems?  Or is this tie-in a way to restrict anyone with a PayPal account to using Ebay as their primary online auction site?

PayPal could be called the best online auction payment method because of how well it protects your personal information.  It could also be placed among the worst for its poor customer service, high fees, and strong ties to one particular auction site.  PayPal allows you to bid and win as much as you want without worrying that your personal information is being sent out into the great unknown each time.  But at what cost?

What is Pay Per Bid?

Pay Per Bid auction sites simply charge users to make a bid or take some sort of action.  The best known pay per bid auction models are penny auctions (countdown auctions), reveal the price and lowest unique bid auctions.  All these auction types allow the winner to win the auctioning product for a fraction of its retail value…even 100% off.  The tiny auction value is essentially paid for by the value of the bids sold.  But if there are not enough bids sold then the seller risks losing a bundle…which is where part of the issue arises.

What are bots and shill bidding?

Bots are simple programs that place fake bidders into an auction if a certain criteria is not met.  For example, in a penny auction a bot might place fake bids if the bidding price has failed to reach a predetermined level.  To genuine bidders it looks like the auction has far more interest than it really does and they end up having to pay much more than the actual selling price if the fake bidders were removed.  But worst of all it stops genuine bidders winning when they should.

Shill bidding is just as wrong but is more of a manual bidding practice.  In this case the auction seller or their friends etc bid on the item to increase the price.  This behaviour has been a problem even on sites like eBay.  But where bots and shilling become a really big problem is when sellers also own the auction site…

The real issue…

The real issue is when the auction seller also owns the auction platform.  This is for two main reasons:

1. The platform is no longer impartial and is biased to the seller (as they are the seller) and so are not incentivised to protect the bidders
2. They can easily create bots or give themselves (or their friends) free bids to bid on their own products.

All businesses at the end of the day need to make money or they go out of businesses, and new start-ups usually have limited funds to keep running and need to generate a profit quickly.  If they have only a limited database of interested bidders then they can quickly lose a small fortune on their auctions completing (selling) at low prices.  The solution?  Fake bidding!

Some tips

I would suggest:

• Most importantly check out reviews and forums on any pay per bid site you were thinking of joining.  Scammers are usually named and shamed pretty quickly. PennyAuctionWatch.com is always a good source of information.
• Watch out for new and unpopular sites as these are under more pressure to try desperate measures to stay in business
• Watch out for sites that are selling expensive items but are not popular (low Alexa ranking)
• No site should ask you to take part in a continuity program (i.e. regular monthly direct debits from your account)
• Finally, (sorry for the home plug) check out Exceet.com.  We are creating the first site to really solve this problem by allowing users to sell the items and Exceet operates the platform, much like eBay, but on pay per bid auctions.  So Exceet is impartial.  Exceet will earn its income from charging sellers a percentage of their sale price, so we will want auctions to end (not keep them going like auction sites that sell their products).

Plus we will have four different auction styles running all on one site to make it really exciting.  You can register your interest on our home page and we’ll email you when we’re ready to go.