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Author Topic: Why penny auctions are not a scam  (Read 2319 times)
mokimarket
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November 29, 2011, 01:57:05 AM
 #21

On the other hand, it helps to have auctions that are 'hot', like look at deal dash. You can only bid within 60 sec of an auction close, then it resets to x sec after a bid is placed, that way it is fun. Not 127:5:23 before the auction closes. Things people want also helps, I know that it costs money to buy them, but honestly.

Sorry, we wont be posting any ipads anytime soon lol. My niche in the industry is posting lower value items and introducing the bartering concept. The problem with posting all high valued products is that you get many powerbidders on your site, also everybody wants the product so you have 50 bidders on one auctions resulting in 49 losers. But with lower value products, you have only a few people interested in the item so it's alot easier to have a larger variety of winners without much cost to the site.

Big ticket items is why many sites shut down, they auction off products they can't afford, don't make enough money to cover their losses, then cut and run with everyone's money. I definitely would be cautious of any new sites with big ticket items.

While it makes perfect sense, I didn't even say you needed big ticket items. Just things that I can bid on, and win within 10 minutes. I'm fine with bidding on BTC or some of the other little things you have, but not one of the auctions has less than an hour and a half left on it. You even said not to bid with more than 1 minute left.

Good point. Well, as we grow we will be posting more auctions at higher frequency and hopefully have more posters as well so you don't have to wait for auctions ending soon. Many sites overpromise and underdeliver with late or non-shipment of wins. I just want to make sure that I can deliver the products I do auction off in a timely fashion to the winners.




I still get what you are saying, but as you are a small site (so far), I'd be willing to compromise as a casual user. I play for the fun. On other sites, I bid and usually lose, but I have fun playing the game for a few minutes. After I win, I don't usually care how quickly my item ships.

On the other hand (and you should work on this) I don't find it fair how the site capitalizes and makes money on so many fronts, such as:
Bids bought
bids used, even if the bidder loses the bid war. Forcing the user to buy more bids to use.
After bids are bought, and used, the user must pay for the item they were bidding on. Effectively buying it multiple times.

By 'saving money' on the front of the end price I pay, I might still be spending more on the bids I used to win, and then pay for the item.



Still, I'd work on having more auctions in the near time frame, I'd have more fun.


Thanks for the constructive criticism. I do believe there is a misconception about how profitable the penny auctions are, especially for new sites. Originally my goal was to offer free shipping on all items thinking the market would determine the value of shipping in the bids placed on item; however we realized very soon that wasn't the case. Items that may cost $10 to ship may only get 1 bid with or without the shipping cost.

And the winner is usually only paying a most a few dollars more, often this money helps to cover shipping with no profit as we do not make much money on the bid fees. Every now an then we will have an auction that makes money, but not if we had free shipping.

And I'll will definitely work on having more items ending in the afternoons tomorrow, again thanks for your feedback.


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November 29, 2011, 02:11:47 AM
 #22

On the other hand, it helps to have auctions that are 'hot', like look at deal dash. You can only bid within 60 sec of an auction close, then it resets to x sec after a bid is placed, that way it is fun. Not 127:5:23 before the auction closes. Things people want also helps, I know that it costs money to buy them, but honestly.

Sorry, we wont be posting any ipads anytime soon lol. My niche in the industry is posting lower value items and introducing the bartering concept. The problem with posting all high valued products is that you get many powerbidders on your site, also everybody wants the product so you have 50 bidders on one auctions resulting in 49 losers. But with lower value products, you have only a few people interested in the item so it's alot easier to have a larger variety of winners without much cost to the site.

Big ticket items is why many sites shut down, they auction off products they can't afford, don't make enough money to cover their losses, then cut and run with everyone's money. I definitely would be cautious of any new sites with big ticket items.

While it makes perfect sense, I didn't even say you needed big ticket items. Just things that I can bid on, and win within 10 minutes. I'm fine with bidding on BTC or some of the other little things you have, but not one of the auctions has less than an hour and a half left on it. You even said not to bid with more than 1 minute left.

Good point. Well, as we grow we will be posting more auctions at higher frequency and hopefully have more posters as well so you don't have to wait for auctions ending soon. Many sites overpromise and underdeliver with late or non-shipment of wins. I just want to make sure that I can deliver the products I do auction off in a timely fashion to the winners.




I still get what you are saying, but as you are a small site (so far), I'd be willing to compromise as a casual user. I play for the fun. On other sites, I bid and usually lose, but I have fun playing the game for a few minutes. After I win, I don't usually care how quickly my item ships.

On the other hand (and you should work on this) I don't find it fair how the site capitalizes and makes money on so many fronts, such as:
Bids bought
bids used, even if the bidder loses the bid war. Forcing the user to buy more bids to use.
After bids are bought, and used, the user must pay for the item they were bidding on. Effectively buying it multiple times.

By 'saving money' on the front of the end price I pay, I might still be spending more on the bids I used to win, and then pay for the item.



Still, I'd work on having more auctions in the near time frame, I'd have more fun.


Thanks for the constructive criticism. I do believe there is a misconception about how profitable the penny auctions are, especially for new sites. Originally my goal was to offer free shipping on all items thinking the market would determine the value of shipping in the bids placed on item; however we realized very soon that wasn't the case. Items that may cost $10 to ship may only get 1 bid with or without the shipping cost.

And the winner is usually only paying a most a few dollars more, often this money helps to cover shipping with no profit as we do not make much money on the bid fees. Every now an then we will have an auction that makes money, but not if we had free shipping.

And I'll will definitely work on having more items ending in the afternoons tomorrow, again thanks for your feedback.



Thanks for listening. I feel that you seem to have understood what I've ranted about more than other penny auctions have. I have a better understanding of how your site works, and how (barely) profitable it is for you. I didn't know that your site had bid packs for practically free. I almost want to say you could raise the price and I'd still be happy, especially comparing it to DealDash (bids are like $60 for 100 or something ridiculous).

I plan on being an active user on your site, under the username 'idontquit'. I'm told it makes for a good tactic. (hehehe)

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mokimarket
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November 29, 2011, 03:09:40 AM
 #23

On the other hand, it helps to have auctions that are 'hot', like look at deal dash. You can only bid within 60 sec of an auction close, then it resets to x sec after a bid is placed, that way it is fun. Not 127:5:23 before the auction closes. Things people want also helps, I know that it costs money to buy them, but honestly.

Sorry, we wont be posting any ipads anytime soon lol. My niche in the industry is posting lower value items and introducing the bartering concept. The problem with posting all high valued products is that you get many powerbidders on your site, also everybody wants the product so you have 50 bidders on one auctions resulting in 49 losers. But with lower value products, you have only a few people interested in the item so it's alot easier to have a larger variety of winners without much cost to the site.

Big ticket items is why many sites shut down, they auction off products they can't afford, don't make enough money to cover their losses, then cut and run with everyone's money. I definitely would be cautious of any new sites with big ticket items.

While it makes perfect sense, I didn't even say you needed big ticket items. Just things that I can bid on, and win within 10 minutes. I'm fine with bidding on BTC or some of the other little things you have, but not one of the auctions has less than an hour and a half left on it. You even said not to bid with more than 1 minute left.

Good point. Well, as we grow we will be posting more auctions at higher frequency and hopefully have more posters as well so you don't have to wait for auctions ending soon. Many sites overpromise and underdeliver with late or non-shipment of wins. I just want to make sure that I can deliver the products I do auction off in a timely fashion to the winners.




I still get what you are saying, but as you are a small site (so far), I'd be willing to compromise as a casual user. I play for the fun. On other sites, I bid and usually lose, but I have fun playing the game for a few minutes. After I win, I don't usually care how quickly my item ships.

On the other hand (and you should work on this) I don't find it fair how the site capitalizes and makes money on so many fronts, such as:
Bids bought
bids used, even if the bidder loses the bid war. Forcing the user to buy more bids to use.
After bids are bought, and used, the user must pay for the item they were bidding on. Effectively buying it multiple times.

By 'saving money' on the front of the end price I pay, I might still be spending more on the bids I used to win, and then pay for the item.



Still, I'd work on having more auctions in the near time frame, I'd have more fun.


Thanks for the constructive criticism. I do believe there is a misconception about how profitable the penny auctions are, especially for new sites. Originally my goal was to offer free shipping on all items thinking the market would determine the value of shipping in the bids placed on item; however we realized very soon that wasn't the case. Items that may cost $10 to ship may only get 1 bid with or without the shipping cost.

And the winner is usually only paying a most a few dollars more, often this money helps to cover shipping with no profit as we do not make much money on the bid fees. Every now an then we will have an auction that makes money, but not if we had free shipping.

And I'll will definitely work on having more items ending in the afternoons tomorrow, again thanks for your feedback.



Thanks for listening. I feel that you seem to have understood what I've ranted about more than other penny auctions have. I have a better understanding of how your site works, and how (barely) profitable it is for you. I didn't know that your site had bid packs for practically free. I almost want to say you could raise the price and I'd still be happy, especially comparing it to DealDash (bids are like $60 for 100 or something ridiculous).

I plan on being an active user on your site, under the username 'idontquit'. I'm told it makes for a good tactic. (hehehe)

Well, the cool thing about the site is that you can charge different amount of credits for different auctions. Some are 1 credit a bid and some are 50 credits per bid. And I always hated how sites make you pay a minimum of $30-40 for a bid pack; I think you should let users purchase a small amount to test out your site to see how they like it first; which is why my bid packs start at $1 and even less for bitcoins.

And yes in theory, the penny auction business seems like a cash cow, but it's much harder to far less profitable than it seems. Only the big sites with high marketing budgets rack up major bidding fees.

Definitely appreciate you trying out myself; remember you can also post items too if you'd like Smiley




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November 29, 2011, 03:37:11 AM
 #24

Our group thought about and in fact started to make a penny auction site for bitcoin long before mokimarket came out, but we ended up shutting it down because we felt it to be:


A) A highly unprofitable business

B) A high risk business that requires much liquidity

C) A business that requires a massive userbase from day 1 in order to break even.



Excusing the moral and economical retardation of running a penny auction site, as a bitcoin business I do in fact wish you luck in your endeavor. We actually have some support for your site from our own group (which I don't quite understand myself but whatever).

This thread though looks like the kind of stupid self promotional scammy threads that Leo Camilo from coinexchanger.com would make to remind you that "HE IS A LEGIT UNREGISTERED ILLEGAL BUSINESS YOU CAN TRUST OH BTW BITCOIN IS FAKE MONOPOLY MONEY".

Probably don't want to post these types of threads anymore.

mokimarket
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November 29, 2011, 04:10:51 AM
 #25

Our group thought about and in fact started to make a penny auction site for bitcoin long before mokimarket came out, but we ended up shutting it down because we felt it to be:


A) A highly unprofitable business

B) A high risk business that requires much liquidity

C) A business that requires a massive userbase from day 1 in order to break even.



Excusing the moral and economical retardation of running a penny auction site, as a bitcoin business I do in fact wish you luck in your endeavor. We actually have some support for your site from our own group (which I don't quite understand myself but whatever).

This thread though looks like the kind of stupid self promotional scammy threads that Leo Camilo from coinexchanger.com would make to remind you that "HE IS A LEGIT UNREGISTERED ILLEGAL BUSINESS YOU CAN TRUST OH BTW BITCOIN IS FAKE MONOPOLY MONEY".

Probably don't want to post these types of threads anymore.

Not sure who Leo Camilo is or the history behind that, but in hindsight, I guess the title is misleading in my intent. From my first post I was mainly suggesting that there is a strategy to penny auctions; I guess people I can see how people conclude that I'm promoting the penny auction model as a great investment scheme of some sort. I do not consider penny auctions an investment in anyway; it's a fun game that some people like to play and there's a strategy to give users an advantage.

I have two customer bases, traditional penny auction users and new bitcoins users. The traditional PA users already use these strategies and I was posting to inform bitcoin users on my site of these techniques.

Also note that our site is not anywhere close to being run like a traditional penny auction site. Users can create their own penny auctions plus we cater mainly to low value items. The goal of our site is to become a bartering exchange not for us to be a major powerseller.

You should never have to purchase anything from our site to use the site.

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