Learn me ebay sniping

After losing some recent auctions at the last possible second, I'm convinced I need to start sniping auctions.

Given that, how do I go about doing so?

hammersnipe.com

bidnip.com

If those don't work, http://www.jbidwatcher.com/

Call me old fashioned, but I do it myself:

An auction ends at 9:32:17. First, determine what the item is worth to you, that is, what is your maximum bid and if it was $1 more, berkeley it, you don't want it. Let's say that's $27.50. About 9:20, open a browser window and go to the auction. Enter $27.50 in the bid and click away until you get to the "click this button and you have bid." Leave that browser window alone. Open another browser window and go to the auction. Hit the refresh. It will say how long until the auction ends. Syncronize your clock or watch with this or note when the auction's end time is. So, if it ends at 9:32:17 and you hit refresh and it will say Ends in 10 minutes 32 seconds. Figure out when you have to hit refresh to have it say Ends in x minutes 5 seconds and practice pushing refresh at that point in the second hand sweep of your clock/watch. When it is coming down to 0 minutes 5 seconds, in the other browser window, hit your bid submit button and you will either win the bid or be outbid by someone that want's it more that you, fair enough. Note that if you have a flakey internet connection, that can cause problems.

http://www.moxieproxy.com/

There are only two REAL reasons to snipe:

1 - You are worried the seller will try to up the bid (shill bid) if it is too low for them (should be very rare).

2 - You have no idea what the max amount you want to spend for the item is or have no idea what it is really worth (in which case you probably shouldn't be bidding).

I cannot think of any other reasons. I tend not to bid real early, a little because of #1, but more so because I don't want to lock myself in on the chance a similar but cheaper item shows up. Waiting until the last seconds though is just silly and a waste of effort.

I don't get it. You enter the max you want to bid, and Ebay automatically bids up to that value. Or does it stop doing that near the end of the auction?

Why? because if interest is shown, someone else is likely to bid.

most stuff I've sold gets bid on in the 2 seconds. by multiple people

There's another reason for "sniping."

To help you get a price you're willing to pay without giving folks who are willing to pay too much a chance to outbid you.

All I can say is that sometimes it just works. I haven't done any last minute bidding for a long time.

I WILL tell you that MANY things I've SOLD on ebay end up going for much more than I expected and at least 50% of the bidding (by volume) happens in the last few minutes of the auction. Period.

I start all my auctions at a nominal amount ($.01 or $1.00) because in my experience, however limited, the earlier you get folks bidding, the higher the final bid will be. Some folks just have to be the highest bidder before they log off their browser session.

Clem

I've always wondered why eBay doesn't do something to discourage this. Don't close the auction until 15 minutes after the most recent bid, for example. It means that split-second reflexes won't matter, you'll always have at least 15 minutes to respond to a higher bid. That's long enough to get an email, log in and bid again instead of clicking "refresh" every half-second. Seems to me this would benefit the seller, unless you're depending on the auction ending at a very specific time.

I guess you could add a third reason then:

3 - Because other people are willing to pay too much and like to snipe (kind of a "it is" because "it is" sort of thing).

aircooled wrote: There are only two REAL reasons to snipe: 1 - You are worried the seller will try to up the bid (shill bid) if it is too low for them (should be very rare). 2 - You have no idea what the max amount you want to spend for the item is or have no idea what it is really worth (in which case you probably shouldn't be bidding). I cannot think of any other reasons. I tend not to bid real early, a little because of #1, but more so because I don't want to lock myself in on the chance a similar but cheaper item shows up. Waiting until the last seconds though is just silly and a waste of effort.

I would say there are other reasons to snipe:

1 - Auctions end at strange times and I may not be awake at 3 am PST when it does 2 - Early bidding brings out competition in others who may be willing to spend more than an item is worth 3 - I want to pay as little as possible for the items I am interested in buying

This is an interesting, academic article on the topic from USAToday:

Thank goodness for science. How else would we know the best way to nab those barely-used weed whackers, dumbbells or duck-shape salt shakers on eBay? In a study that gives the lie to the notion that eggheads don't like to eyeball online auctions like normal folks, a study by South Korean physicists confirms via some elaborate mathematical modeling that "sniping" — waiting for the very last second to submit your bid on that Elvis-shape throw rug — is indeed "a rational and effective strategy to win in an eBay auction."

Founded in 1995, eBay is the king of online auction sites. Sellers put up items for sale and buyers bid up the price. Thanks to the Internet's lack of state sales tax and the public's thirst for other people's garage sale items, the company has grown into a firm that amassed $4.55 billion in revenue last year. The service sets a deadline on bids for items, which has given rise to the practice of "sniping," bidding at the last minute to deny other bidders time to outbid you.

Savvy buyers have taken to the practice in swarms. Some companies even exist to snipe for you. Sellers, however, have grumbled that the practice keeps winning bid prices lower than they would be in a more open-ended auction, in which prices may be driven up by competition between buyers. If nobody bids until the last second, it's inevitably just a (relatively) low-bidding person who puts in the highest-price bid and walks away with the item.

To test whether sniping is a smart way to do things or just truncates normal bidding, the South Korean team at Seoul National University produced a "master equation" for how bidding proceeds (it's nk(t+1) — nk(t) = w(k-1)(t)n(k-1)(t) — wk(t)nk(t) + sigma(k,1)*u(t), if you really want to know), and then tested it against a massive number of auction records, some 264,073 items sold in one day on eBay and another 287,018 items sold in one year by eBay's Korean partner.

Plugging all those data into the model and testing the outcome in terms of how the auctions turned out, the team found that the probability of submitting a winning bid on an item indeed drops with each bid. "Our analysis explicitly shows that the winning strategy is to bid at the last moment as the first attempt rather than incremental bidding from the start." The study appears in the current Physical Review E journal.

The finding is no surprise to Harvard economist Alvin Roth, who has studied sniping from an economics viewpoint since 2002 with colleague Axel Ockenfels of Germany's University of Cologne. They came to similar conclusions. "I think you might do the most good if you advise bidders to form an opinion of how much they are willing to pay for an item, so that they don't get caught up in a bidding war and pay more than they will be happy with," says Roth, by e-mail. "But, that being said, if they know what proxy bid they want to submit, it won't hurt them to submit it very near the end (but neither will it help them much, or often ...) So, sniping is a good strategy, for those with the time to do it," he adds.

A statement on the eBay site says: Sniping is part of the eBay experience, and all bids placed before a listing ends are valid — even if they're placed one second before the listing ends.

BONUS MATERIAL: Dan Vergano's Q&A with Alvin Roth and Axel Ockenfels

1. Do you view sniping as a problem? Some eBay sellers have complained that sniping works to artificially lower auction prices. What is your view?

Ockenfels: Sniping can help bidders to get better prices on eBay. But sellers too can profit from sniping, because the possibility of sniping may attract more bidders. For instance, sniping can lead to more bidding from experts, because by bidding late, experts can avoid giving information to others through their own early bids. Sniping can also increase the excitement and entertainment value of bidding, which again attracts more bidders.

Roth: Sniping is a feature of the auction that eBay bought into when it chose to have a hard close. They must think it adds enough to the auction, in entertainment value, in allowing experts to protect their information, etc. to make up in increased bidders what it loses in lost bids and bidding wars.

1. If your work and this South Korean paper show that sniping is rational and effective, why doesn't everyone use the strategy?

Ockenfels: On eBay, not the last bid but the highest bid wins. Furthermore, last-minute bids sometimes come in too late, after the close of the auction. So, it can be a perfectly sensible strategy to submit a bid early. In fact, depending on the situation, game theory supports both early and late bidding strategies. However, we are also seeing a lot of non-rational, naive behaviors on markets such as eBay. There is no reason to suppose that everybody always behaves in a rational and effective way. This is especially true for eBay, where many experienced and sophisticated traders interact with many unexperienced, naive bidders.

Roth: EBay isn't an English auction, it is a second price auction with proxy bids. If you're a busy guy, you might find it better to put in an early proxy bid, high enough to have a chance of winning. The winning bidder isn't the last bidder, it's the bidder with the highest proxy bid (and the earlier bidder in case of ties). So sniped bids only get lower prices when other bidders would have been willing to raise their proxy bids, but don't have the chance. That happens often enough so that sniping is a good strategy for those with the time ....

1. How does this new study's approach strike you compared to the one you published in 2002? My understanding was that it rested on game theory, so I'm just trying to see how you see things.

Ockenfels: We closely intertwine game theoretical, laboratory and field analyses. Taken together, our studies help in understanding how the market microstructure qualitatively influence participants' strategies and overall market performance. The new study looks at bidding phenomena from a very different perspective and thus takes a very different approach. It quantitatively analyzes statistical properties of dynamic bidding patterns on eBay — without addressing institutional complexities or equilibrium aspects of behavior.

Roth: We take a lot of approaches, empirical, theoretical, experimental. And so we are able to look into the multiple causes of sniping, and how they are influenced by the auction rules (and why, therefore, there's so much less late bidding on other kinds of auctions, for example.) But the big divide between physics and economics is that physicists tend to study processes that don't have any human volition in them. Molecules do what they do without forming opinions about what other molecules do. Sometimes this physics approach can also yield some insights into large markets, where each player is small enough to be inconsequential. And eBay must have looked that way to the authors of this article, since they report that in one day they have data from 264,073 auctions involving 384,058 distinct bidders. On the other hand, when I look at those numbers, what strikes me is that there were fewer than 2 bidders per auction in their data. To put it another way, a lot of auctions in their dataset had only a single bidder. Obviously conclusions about sniping are going to be different in such auctions (and in our analyses we normally exclude them).

1. Do you see a better auction strategy for online auction?

Ockenfels: What is a good bidding or selling strategy in online auctions depends on the context, such as the degree of competition and the available information about the value of the object. However, there is a fast-growing applied literature in economics on auction/market design and bidding strategies. (See Roth: http://kuznets.fas.harvard.edu/~aroth/papers/engineer.pdf.)

Roth: I think you might do the most good if you advise bidders to form an opinion of how much they are willing to pay for an item, so that they don't get caught up in a bidding war and pay more than they will be happy with. But, that being said, if they know what proxy bid they want to submit, it won't hurt them to submit it very near the end (but neither will it help them much, or often…) So, sniping is a good strategy, for those with the time to do it. (You can also pay a fee to third party sniping software on the web, like esnipe.com or others ....)

1. What do you see as the key point(s) to make to readers about a study like this one? How do the results apply to other auctions?

One of the general lessons that comes out of our research in "economic engineering" is: details matter! For instance, our studies demonstrate that replacing eBay's hard close by a soft close, which allows bidders to always respond to late bids, would remove the strategic incentives to snipe and thus substantially affect bidding behavior. Bidders respond to incentives, and incentives can be strongly affected by the details of the auction rules and algorithms. This is true for all auctions, including, for instance, spectrum, electricity and procurement auctions.

The last time I bid on something on e-bay, it helped me "snipe". I entered a bid and was waiting, and it gave me a little countdown clock, and a self-refreshing look at the current price and I could easily increase my bid with a little button-thingy. (sorry for all of the technical jargon) I think they know people wait until the last minute and are supporting it.

That said, I love putting a bid in on something when it first goes up for auction and forgetting about it, and learning a week later that I won the auction for 45-cents! So awesome!

I still say the only reason sniping is at all effective is because others do it (another might not time his bid right) and bidders don't bother to set a limit for themselves (which is a bad idea).

If bidder A and bidder B both want an item and bidder A does not want to pay more than $25 while bidder B does not want to pay more than $24.99.

• Bidder A puts in a $25 bid 6 days before the item closes (shows as $.99).

• Bidder B puts in a $24.99 bid .00000000000000000001 second before the item closes.

Who wins?

An alternate scenario would be bidder A does not want to pay more than $35 while bidder B does not want to pay more than $25.

• Bidder A puts in a $35 bid 6 days before the item closes (shows as $.99).

• Bidder B put in a $24.99 bid .0001 seconds before the item closes, since he is not winning he puts in a $40 bid .000001 seconds before the item closes to make sure he gets it.

Who just paid $10 more for an item than he thought it was worth?

Either way, it doesn't really matter to me, I just bid the max I want to pay... no problems.

Aircooled-Scenario 2 is EXACTLY what sniping is for. If you were bidder A and you sniped the auction with your $35 bid, you would have won. The whole point is that by bidding in the last few seconds you avoid the people who get caught up in the bidding and bid higher than they intended at the last minute.

I have been sniped in the past and chose to submit my absolute top price about 20 seconds before it closes. I typically will submit a bid earlier to show that I am interested. I will not put the price I am willing to spend in at that time because it is possible that someone will want it worse than me. Also, if I snipe, I must be on the computer, If I forget, oh well

Opus wrote: I have been sniped in the past and chose to submit my absolute top price about 20 seconds before it closes. I typically will submit a bid earlier to show that I am interested. I will not put the price I am willing to spend in at that time because it is possible that someone will want it worse than me. Also, if I snipe, I must be on the computer, If I forget, oh well

this. i place a nominal bid amount just a little above whatever the current auction price is when i first come across the auction to demonstrate interest to the seller. i decide what i'm absolutely willing to bid then put it in "watched items" so i don't forget it. go back and submit my bid with about 4 seconds left. i know lots of people do the bid sniping thing and i know that whatever i've bid is exactly the most i'll pay so if someone out-bid-snipes me, that's fair. it also means that i usually pay around 2/3'rds what my max value for the item is. just another way to save money on challenge car parts

MrJoshua wrote: Aircooled-Scenario 2 is EXACTLY what sniping is for...

I am not sure that is a good example, buyer B over paid. I can see where there is some usefulness though, but realistically that would only be because other buyers are using poor buying practices. In the case where one buyer would otherwise overbid what they wanted to pay it could work out. Of course you also could screw yourself if more than one (or a few) are all sniping.

I do wonder what happens when you have 3 or 4 people all using a sniping program, it seems like at least one of them will not even get a bid in.

I don't trust giving my PW to any internet connected program. Too many opportunities for the loss of my PW. IE is bad enough. My personal bidding philosophy goes exactly like Opus'. I will occasionally bid early on something with a max price that it is worth to me and let if fly. I rarely win those. Like a Harley throttle body or something. I'm always outbid by someone sniping it. Whatever, they paid more than it was worth to me. But if I am really interested, I snipe it.

I haven't taken the time to analyze this, but I'm convinced that some form of shill bidding is frequently at work.

There are too many times I have been outbid by $1, or my bid has been run up to exactly my limit.

Everyone would like a bargain. If I am willing to pay $100 for an item, but can get it for $25, it makes me very happy. It also works well for Challenge builders.

If I put in my max bid of $100 yet the current bid is $25, it is common for my current high bid of $25 to sit for a long time. Then, in a flurry of activity at the very end, either I win it for $100, or someone else wins it for $101.

It's pretty hard to convince me that there is not foul play involved.

Looks to me like it is common for people to shill, then back out their high bid to force me to pay my maximum.

This is not a legit auction. It is fraud.

While I may be willing to pay the $100, it certainly makes me unhappy to know I had to pay that much due to a fradulent bidding process, and that I can expect it to go that way with regularity.

Additionally, when I am the seller, I see no such similar activity. I don't think sniping it is necessarily normal, just doesn't happen because I don't shill.

I used to really like E-bay. Now I almost never use it.

So what happens if more than one person uses bid sniping software bidding on the same item?

Whoever bids higher wins. Or if the same price whoever bids first.

SVreX wrote: I used to really like E-bay. Now I almost never use it.

Same... I use craigslist more & more.

I keep trying to use CL more, but I am 3 hours away from a real metropolitan center which has a good sized CL site.