February 17, 2006

Francis fixes the universe, part 17

Today I'm editing crossword clues at work, and one of the clues I had to change was the word "eBay", and while free-associating in an attempt to think of a new clue, my thoughts turned to the problem of sniping -- you know, that thing where you put in a reasonable bid on something, and you think you've got the auction won, and then suddenly some twit swoops in at the last possible second and outbids you by a dollar. Seriously, does anyone who's not a total jerk think it wouldn't be a good idea to do away with that somehow?

Well, anyway, here's my solution: don't tell people when the auction ends.

I mean, you'd give a general idea. You might say, "This auction will end sometime on Friday, February 17," for example. You just wouldn't say what time on that day. So anyone who was really interested in the item would be obliged to put in a bid by the 16th, and anyone who would otherwise have been sniped would almost certainly find themselves with plenty of time to rebid, should they want to do that. And at some point, the auction would end. A good idea? Yes?

Posted by Francis at 03:28 PM

A good idea, yes.

I'd also be up for the 'grab bag' idea. You bid on a mystery package, with some theme (e.g., "something you'd wear to your mother-in-law's third wedding), and see what gets sent to you.

Posted by: Mona Buonanotte at February 17, 2006 04:03 PM

I think sniping is an arms race. If some people are sniping, everyone has to snipe, otherwise it unbalances the system. You can say "I won't snipe" but that also means you will overpay or not win auctions.

I won't pay a fee to snipe, so I use a service that lets you snipe three times a month free [auctionstealer.com]. So if I REALLY REALLY REALLY want something (that is, if I think someone is going to snipe it away from ME), I send off a snipe bomb. Otherwise I just bid the regular way and forget about it.

I think admitting I occasionally snipe is one of the ways I could make Francis say "You are Dead to Me!"

Posted by: Erin at February 17, 2006 04:25 PM

Yes, oh god, yes! For the love of slipcovers YES!

Posted by: beth at February 17, 2006 04:30 PM

Erin: I confess that even I feel the temptation to snipe sometimes, but the closest I come is to bid in, like, the last hour of an auction, which is only sniping if the bidder is totally not paying attention, because, seriously, that's plenty of time to rebid.

Anyway, I can forgive you on this one because I don't think we're ever bidding on the same things.

Posted by: Francis at February 17, 2006 04:49 PM

I like your idea, which seems a just one, but I fear justice is not an eBay ideal.

Posted by: Songbird at February 17, 2006 05:14 PM

Well, no. The idea of proxy bidding, like on eBay, is that you put in the absolute maximum that you're willing to pay for the item, and it bids for you. If you lose an auction, you have no idea how much you lost it by; they may have put in twice the bid you did, but the proxy bidding again just bids it up as far as necessary for them to overtake you.

If you get sniped regularly and think you would have been willing to pay more, then you should just bid more in the first place. Sniping reduces emotional bid wars and keeps prices from being inflated irrationally.

A better solution (for the buyers, not the sellers) would be for everyone to put in their bids and not publish any until the end. Whoever bid the most wins, and pays the price they bid. No proxy, but not really an auction at that point either.

I'm not a habitual sniper, by the way. But I do understand why it happens.

Posted by: Ben Brockert at February 17, 2006 06:08 PM

The other solution is to go the route that Amazon auctions take and say that no auction can end until X minutes after the most recent bid. Since a sniping bid just extends the end time long enough for someone else to bid again, there's no value to waiting until the last minute. One of the problems, though, is that for small values of X (and if memory serves, Amazon's value of X is pretty small), it doesn't really work because there isn't always enough time to get back to the auction.

But if you're just willing to put in a proxy bid for the amount you're actually willing to pay for the item, then sniping won't have any effect on whether you win. It just means that you won't necessarily get quite as good a deal on the item as you would have if you'd waited and sniped. So you're trading off some amount of savings for an increased certainty that you'll get the item you want at a price you're willing to pay.

For more information, I could point you to my ex-girlfriend's dissertation, but I suspect I've already outstayed everyone's interest level.

Posted by: Scott at February 17, 2006 06:38 PM

Good idea. Even an uncertainty of several hours would prevent the escalation of sniping strategies. (Although you didn't state it, I guess you meant that the variability would be randomly determined rather than under the control of the seller. If the seller had control of the end time, then they could attempt to select between bidders based on bidder history. New counterproductive games would develop.)

Questions that spring to mind:
Would eBay want to implement the idea?
Is it in eBay's financial interest to implement a fairer system?
I don't think the answers are straightforward.

The current system makes sellers think that they have a chance to get better deals, due to non-snipers having to overbid. It makes buyers think that they can usually get a bargain. It forces all the action to converge at an exciting climax (which for some customers provides a little adrenaline rush). For most of the auction period a product is being advertised with a low value bid next to it, furthering the impression of eBay as a place to pick up dirt-cheap goods.
How much of the huge success of eBay is due to the emotional dynamics of the auction system and how much is due to providing a scalable, accessible marketplace? A fairer system may not be good for eBay.

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