Can anybody explain how this Buds Penny Auction works. I got an e-mail yesterday about one opened it up and looked at what they were offering. Saw a Berreta 22 so I said to myself what the heck I'll throw in a bid. I went to the Auto Bid Section and put in a $10.00 bid just for kicks and giggles. It had five hours left on the auction. I looked at it today and someone got it for a few dollars much less than my top bid. Did I do something wrong or is this just a come on?
Buds Penny Auction Question
- Thread starter gilfo
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243winxb
Member
The autobidder will stop bidding if your account has a bid balance of zero.
http://pa.egunner.com/Index/Howitworks
Looks interesting. Never seen or used it.
http://pa.egunner.com/Index/Howitworks
Looks interesting. Never seen or used it.
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Acera
Member
They are a great way for a seller to realize many times the price they paid for an item.
For example, take a look at this closed auction.
http://pa.egunner.com/index/detail?auction_id=5087
The final price of the gun was $40.73
The winning bidder used 273 bids for $177.45, paid $40.73+$15 shipping. That persons total cost for the $700 gun was $233.18, a pretty good deal.
Now lets look at what the seller made, to keep it simple we will use the cheapest bid (bought in large bulk purchases to save bidders money) of $0.65.
It took 4072 bids for someone to win. 4072 x $0.65 = $2,646.80.
Add that to the purchase price, $2,646.80 + $40.73 = $2,687.53
(Not going to worry about the shipping costs.)
So at the end of the day, seller made about $2,687.53 on a $700 gun (not even considering that they do not pay MSRP for their guns, so profit margin even greater.), that is almost 4 times the retail value or about $2,000 over retail.
They sold $2,469.35 worth of bids to folks who did not win anything, zero return for their money, they just got to play the game
Awesome deal for the sellers.
Lot of folks contribute their funds to someone else getting a good deal. You can win with the system if you get lucky. First you have to commit to buying a lot of bids and using them all up if necessary. Next you gotta hope you are not going head to head with someone of the same mindset (and an equal or greater number of bids to use), as you get farther into the process you get so much money invested you don't want to toss it away, so you gotta keep pushing. Think of it as a game of chicken with your bank account, who will break first and lose. You may win with a good price, or lose a lot of money in the process and not get anything, pay close to retail or even pay over retail to avoid a greater loss.
Some folks like gambling. You think the casinos in Vegas get this kind of return?? LOL.
Edited to add this one.
http://pa.egunner.com/index/detail?auction_id=5132
They got over $260 for a $50 store credit.
Winner spent over $30 to save an extra $20.
Seller lost money here, someone got a heck of a good deal.
http://pa.egunner.com/index/detail?auction_id=5048
.
For example, take a look at this closed auction.
http://pa.egunner.com/index/detail?auction_id=5087
The final price of the gun was $40.73
The winning bidder used 273 bids for $177.45, paid $40.73+$15 shipping. That persons total cost for the $700 gun was $233.18, a pretty good deal.
Now lets look at what the seller made, to keep it simple we will use the cheapest bid (bought in large bulk purchases to save bidders money) of $0.65.
It took 4072 bids for someone to win. 4072 x $0.65 = $2,646.80.
Add that to the purchase price, $2,646.80 + $40.73 = $2,687.53
(Not going to worry about the shipping costs.)
So at the end of the day, seller made about $2,687.53 on a $700 gun (not even considering that they do not pay MSRP for their guns, so profit margin even greater.), that is almost 4 times the retail value or about $2,000 over retail.
They sold $2,469.35 worth of bids to folks who did not win anything, zero return for their money, they just got to play the game
Awesome deal for the sellers.
Lot of folks contribute their funds to someone else getting a good deal. You can win with the system if you get lucky. First you have to commit to buying a lot of bids and using them all up if necessary. Next you gotta hope you are not going head to head with someone of the same mindset (and an equal or greater number of bids to use), as you get farther into the process you get so much money invested you don't want to toss it away, so you gotta keep pushing. Think of it as a game of chicken with your bank account, who will break first and lose. You may win with a good price, or lose a lot of money in the process and not get anything, pay close to retail or even pay over retail to avoid a greater loss.
Some folks like gambling. You think the casinos in Vegas get this kind of return?? LOL.
Edited to add this one.
http://pa.egunner.com/index/detail?auction_id=5132
They got over $260 for a $50 store credit.
Winner spent over $30 to save an extra $20.
Seller lost money here, someone got a heck of a good deal.
http://pa.egunner.com/index/detail?auction_id=5048
.
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243winxb
Member
All good for the seller.
Bottom line is that so-called "penny auctions" work by charging you a fixed amount to place a bid. Each bid increases the amount that will be paid to the seller by 1 cent (hence the name "penny auction"). Unlike eBay, it doesn't matter what your maximum bid is, it is who has the highest bid when the auction ends.
wally
Member
These are basically a lottery. Only one lucky person wins, everyone else pays something and gets absolutely nothing.
IMHO stay away from them!
IMHO stay away from them!
Elkins45
Member
Exactly. I lost a lot of respect for Buds when they went into the penny auction business, and told them as much. Evidently a lot of other people did too because they posted a lengthy explanation of how they were merely the exclusive supplier for the auctioneer. Uh huh.
Even the name "penny auction" is two lies in one. It's not a penny, it's actually 65 cents, and it's not an auction as the term is universally understood. In an auction only the highest bidder pays. In this abomination, everyone who placed a "bid" pays too. That's why they make you buy a package of "bids" in advance: so they don't have to chase you down to get your money after you realize you're on the hook for your losing bids too.
redneck2
Member
I have two schools of thought on this. You're a free individual. Nobody is twisting your arm to make you bid.
On the other hand, it plays into basic human greed. The "something for nothing" camp. A fool and his money and all that.
I feel the same way about casinos. I talk to people that are totally convinced that they actually win. IMO, if you think they build multi-multi million dollar complexes so that you can walk away with their money, you're a total chimp.
Justin
Moderator Emeritus
Total scam.
Thunderchicken
Member
It is true that no one forces people to engage in penny "auctions," but they don't force anyone to play three card Monte, either. The other important difference: the misnamed "auctions" are legal. But most people don't carry out the analysis of what's really happening and realize that they're getting in on the wrong end of a lottery (the right end is selling the tickets). Lotteries are great if they benefit a cause you like--you donate some money and get a chance of a nice prize. In the case of the "auction" you donate money to an anonymous recipient and usually don't get anything, including satisfaction!
Thanks for drawing attention to this so people can at least go in understanding the math. Gambling is great if you understand the proposition ahead of time.
Thanks for drawing attention to this so people can at least go in understanding the math. Gambling is great if you understand the proposition ahead of time.
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