Devaluing the practice of sniping auctions

eBay has developed a serious problem with sniping; the current response is to develop a better sniper. I propose a revision to the end-of-auction process, such that sniping becomes pointless.

Sniping is the art of registering a slightly higher bid five seconds before the end. It's a new thing in auctions; in most real-life auctions, a snipe bid results in the opportunity for a counter-bid; on eBay, a snipe bid can take advantage of the timeline and win.

Introducing a counter-bid opportunity into nearly-closed eBay auctions, then, might counter the problems introduced by sniping.

When a snipe bid is placed, a few seconds before the end of the auction, extend the auction slightly; provide a short period of time for counter-bids to be registered. Limit the bidding to those who previously bid on the item -- after all, the auction's closed at this point.

Each time a counter-bid is placed, extend the auction by a short period of time. This gives the bidders who've participated in the auction a chance to recover from a snipe bid, while keeping the auction closed to new bidders.

One possible scenario that could result from this is the death of snipe bidding: what's the point in sniping, when they can just outbid you? The act of sniping itself creates an opportunity for the snipe to fail; when you provide the other bidders a chance to beat your price, the value in sniping begins to fade, somewhat.

You could add restrictions on counter-bids, if you liked. If you post a counter-bid that fails, no more bidding for you until someone else beats the current bid; then you can try again. This would prevents malicious price inflation, while limiting the counter-bid process to active, interested bidders.

The end effect is to circumvent sniping entirely, to make it an ineffective way to bid. That'd be nice to see; I haven't purchased anything from eBay in over a year because of sniping. Perhaps they'd get some other disillusioned customers back, too.

Update: One possible solution would be to mask the highest bid towards the end of the auction, such that people could see what had been bid recently, but couldn't see the maximum to snipe it — or to make intelligent pricing calls. It's an interesting theory.

Link: http://www.wired.com/news/business/0,1367,55204,00.html

Link: Someone's started a lot auctioning business with the counter-bid improvement.

Comments

[Skip]

Maybe then the snipers would go back to video games instead of playing games on commercial sites.
I would be interested in the rate of completed transactions for 'snipes' as opposed to legitimate bidders.
Skip

[John]

Maybe you should make your bid your max bid. Don't get mad if someone snipes you because your to cheap and then when the auction ends your mad because your a loser. Time is part of the game. The reason why the sniper wins is because he bid higher than you. Bid your max and don't worry about it.

[floating atoll]

I don't feel that my auction purchases are enhanced by the presence of the "game" of time; I'm not paying eBay to provide me with entertainment. Your thoughts appear to differ on this point; do you get something out of the "game" that you feel is worthwhile?

[Alan]

I paticipate in many industrial online auctions for my work. Companies like GE conduct these auctions with their suppliers bidding on who will sell a particular product at the lowest price, sometimes called a reverse auction. Any bid received in the last 2 minutes, automatically extends the auction another 5 minutes. That makes it pointless to snipe and fairest to all. The person conducting the auction gets the best price becasue all who want to bid get the best chance. If you think about it, this is exactly how real world auctions have been conducted for thousands of years. The auctioneer always says, "going, going, gone" giving everyone a chance to offer their best price. There never was a real world auction where bidding was closed until everyone was done bidding. There is no reason why ebay shouldn't adopt this policy. Sniping would end in one day.

[floating atoll]

Thanks for the real-life example; it's exactly what I was thinking of, but really didn't have any experience to speak about. I've only read about auctions in books (and movies) -- but even then, I'm left with an impression that eBay would benefit from this change.

Sniping is good for auctions it lets the most knowledgeable bid what the item is worth and others can't follow their knowledge to out bid them. I have a handful of people which track what I bid on then out bid me figuring I know the real value. Sniping is most of the time the only way I can win a online auction. People should bid their max then quit crying if they don't bid enought! If you extend the auctions then the people with the most money or emotions win and it will cut the dealers out which keep most auctions alive over the long run of time.

[Gordon]

Don't like snipers? Join em. Bid your max in the last minute. There is free sniper software. Free online snipe sites that will do it for you. Stop crying and either get on the bandwagon or quit trying to get a bargain. Bargains are gotten from yard sales, not auctions.

[floating atoll]

Thanks for your comment, Gordon.

I've helped friends get sniping software running before, but it's just not to my personal taste. I don't generally buy popular things on eBay, so none of my recent bids have been sniped; as a result, I've gotten some rather excellent bargains.

[pauljub]

i'm a powerseller on eBay. while the author points out that eBay is different than real-life auctions because of the timeline, he fails to point out that eBay is also different because it lets you enter your MAX bid, instead of just your "bid". John is correct. Sniping is absolutely not a problem for anybody if they would honestly and accurately enter their MAXIMUM BID, like they're supposed to. it doesn't matter when you enter your max bid during the auction. the end result will be that you either win it for a price you're willing to pay, or you lose because someone was willing to pay more. and if people are following you around (like the person who posted on November 18, 2003), then you need to be a snipe-bidder. it's not a game... everyone has equal opportunity. if you lose the item for a price you'd be willing to pay, it's YOUR OWN FAULT.

[floating atoll]

Bidding the maximum price I'd be willing to pay does indeed ensure that I'll get the item if I'm willing to pay the most. I don't mind competition, and my losses are indeed my "OWN FAULT", as you put it; however, I'm no more likely to enjoy purchasing something from eBay than I am to enjoy a rousing game of pigskin-kicking.

I prefer the environment of a friendly bazaar, perhaps due to my early exposure to the Oregon Country Fair. While the effectiveness of eBay's implementation is clear from a purely economic standpoint, the aesthetics of the experience leave me unwilling to recommend it to others as a first choice.

[jon]

One thing that I just thought of (though no doubt, like most things in life, someone else has already thought of it; likely many someones) is that ebay auction expiries could be "soft". Ie, the auction can be set to expire at a random second in the last minute or last few minutes of the final auction close time.

This does not offer any significant drawbacks on the current system and does not suffer from the artificial inflation of the price that a continually extending scheme may.

[Sue]

As for a couple of people asking how effective using a sniping tool is I can say first hand that it is VERY effective. I very seldom lose my auctions and happen to bid on Ebay items to an average of 10 per week, if not more at times. I NEVER bid on an auction on the Ebays actual site, I feel that by doing so, all you do is start a bidding war so by using a sniping tool as I have since they started coming out I dont make my presence even known til the last 2 seconds. Starting a bid war drives the price up and even with the proxy bidding it is very easy to place a bid and then see that you were outbid due to someone else having a higher proxy bid already in that is unknown of course. So, I put into my sniping tool what I am willing to pay at the highest and I normally always get my wins.

As I say - all's fair in love and Ebay ! If someone gets mad at being outbid at the last second - not my problem - though I have gotten some scathing emails from people that had their bids untouched for 3 days or more and I win at the last second.

In my mind any of the suggestions about ending an auction early by a few seconds or such like that is unethical for a seller to do. The auction was put up in good faith and do you really think a seller gives one tinkers "you know what" who wins or how they win ? No, they don't and I have NEVER gotten a bad word from a seller - they dont care at all - their item sold and thats what they are trying to accomplish.

Just my 2 cents.

But one last thought - who would be the one to determine if a bid is placed in the last 2 seconds that it is due to a sniping tool or a legit person sitting at their computer doing the actual bidding ?

Sue A