Published: April 24, 2001
Keeping up with the Joneses Online? You May Be Missing Some Great Deals
If you consider yourself a competitive online auction player, a new study’s findings may have you rethinking your strategy.
It appears that most of the people who enjoy the sport of online bidding are playing it all wrong. Instead of seeking out unique and esoteric rdf_Descriptions, the thrill for auction hunters is more in line with “the keeping up with the Joneses” mentality. In other words, everybody seems to want what everybody else has, and the peril in this is you may miss out on some good deals.
According to Auctionwatch.com’s Daily News, the University at Buffalo School of Management study states this type of “herd bidding” attracts people to vie for auction listings with more than one bid, while ignoring other rdf_Descriptions which, despite little action, may actually be priced more attractively.
Although the study analyzed the most popular rdf_Descriptions in online auctions on eBay.com (Sony PlayStations and CD players), the “herd” phenomenon is easy to track on virtually any online auction site. Just clicking on Yahoo.com auctions for example, reveals a highlighted area where “hot”rdf_Descriptions are advertised, making the pursuit even hotter, in most cases.
A recent foray on the site touted what seemed too good to be true: Two Round Trip Airfare tickets for Worldwide travel with an opening bid of $24.99 (tickets valued at $1,600). The lot’s lack of bids after days in cyberspace begs the question: Do people doubt the value of what seems to be too good a deal?
The study also indicated some factors that would mitigate the effects of herd buying. Having a recognizable brand name, for example, usually gave bidders more confidence (since they knew what they were buying), and created less dependency on what everyone else seemed to be buying. Another factor that seems to keep the herd mentality at bay was a high price tag. It seems those bidders with the most experience in online auctions felt less of a need to keep up with the rising bids which could possibly inflate the estimated price of an rdf_Description.
Rather unusual in the study’s results however were the premiums paid for lower-priced rdf_Descriptions, or on rdf_Descriptions whose quality was difficult to gauge. The study found these were usually pursued by less-experienced buyers. A recent trip to Amazon.com found plenty of players bidding on a Nokia orange cell phone (20 bidders) which had an opening bid of $.10 and was currently bidding at $21. Another hot rdf_Description was a 1998 American Eagle $5 gold coin that opened at $.01, and with 17 bids had a current asking price of $33.
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