15 November, 2014

General online auction "sniping" tips for ALLBIDS

 Image Credit: Lars Hammar on Flickr
This is just a quick article about the specifics on "sniping" online auctions (That is: bidding late to try and catch other bidders unawares). Specifically I will cover the differences between "traditional" sniping on the worldwide eBay site and the Canberra-specific ALLBIDS.

The differences between online and "meat space" auctions

"Meat space" (That is "real-world" or "actual") auctions are typically several people gathered together in the same place with an auctioneer arbitrating competing bids. When a bidder places a bid, they're promising "This much and no more" until they're outbid, at which time they can bid higher.
On the other hand, online auctions are ultimately arbitrated by a computer that can compare and rank bids in fractions of a second. The speed at which computers can process bids is so fast, the vagaries of network communication (long-latency and congestion and the HTTP protocol design in general) can get in the way of "traditional" style competitive bidding. So online auctions are usually implemented using automatic proxy bidding: If I want to bid up-to some limit, I can tell the auction site the limit and it will automatically bid-over any competing bids up-to my limit. However problems arise when some people still try to bid along the "traditional" lines and will bid multiple time throughout the life of an auction, this can be troublesome to people who've taken the time and effort to properly evaluate an auction and place a reasonable proxy-bid, so the concept of "sniping" auctions arose.

What is "auction sniping"?

"Sniping" an online auction is simply the act of placing a proxy-bid as late as is practical to try and circumvent "traditional" repeat-bidders disturbing the proxy-bidding process. Ideally on eBay, this can be done in the last few seconds before the auction closes. Unfortunately many traditional bidders initially consider sniping to be "cheating", but this simply isn't the case - traditional bidding just gets in the way of people who've done their research.
There are software packages you can download to automate the sniping procedure locally and there are even online services that can perform with lower latency, but they're out of the scope of this document (And honestly you get pretty-good results just doing it manually through the web interface anyway)

ALLBIDS versus eBay

Allbids started-out as Dominion On-Line Auctions (DOLA), the online arm of a traditional auction house, typically disposing of a lot of ex-government I.T. equipment. It rapidly rose in popularity as a much more convenient place to buy government disposals. Given that it arose from a traditional auction house (in comparison, eBay was originally an online "collectibles" exchange site), they try to maintain the traditional bidding model. To this end, their auctions have a "last call" period where they will automatically extend if there is any bidding activity in the last 5 minutes of an auction. You can still "snipe" these auctions in a way though, you just need to place your single proxy bid just before the last call period begins. Then ignore the auction until its over (i.e. don't get suckered-into a bidding war: Your proxy-bid should have been your highest acceptable price).

tl;dr - Bullet list of things to do:

  • Look at the recently-sold prices of the category you're after to see what the typical closing price might be.
  • Based on this information, choose the maximum price you're willing to pay. Higher means you will probably win an auction quicker, lower means you might have you roll the dice a few more times.
  • Bid as close as practical before the start of the 5-minute "last call" period (This is not that critical with the auto-extension).
  • Bid once only!
  • Use a proxy-bid of your maximum price.
  • Look for when the next auction for the class of item you're interested closes and be ready to be online then if you can (Otherwise you'll just have to post an earlier bid and hope you make it). Allbids tends to start pools of items in the evenings and has auctions ending every 20mins or so thereafter.
  • Check the first auction you bid on after the close. If you've won: Good! Otherwise move-on to the next one of the same item type. Don't be tempted to get caught in a bidding war if the auction has been extended - just move on to the next item of the same type.

Conclusion

Hopefully with the tips above, you should be able to close purchases sooner at fair market-prices, without having to have your time wasted by low-balling chancers.

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