I’ve been doing some bidding on eBay lately and I’ve seen a lot of ads for “sniper software”. I’m sure I lost at least one auction to a sniper, and it started me thinking.
I can’t find anything on Google or Wikipedia about what, exactly, sniper software is or does, other than it puts in one bid for you at the very last second.
The supposed advantages, as touted by the sniper software websites, are that “you don’t get into a bidding war and bid more than you wanted to” and “you don’t advertise your interest in the item, thereby driving up the price” and"you don’t have to sit by your computer watching the auction."
I just don’t get it. How is this advantageous over, say, eBay’s proxy bidder? I tell it my maximum bid, so it does the “bidding war” for me. I don’t think that there’s anyone out there trolling eBay for my userID and saying “oh, there she is again…I’ve gotta go outbid her NOW!”, so the “don’t advertise your interest” seems rather nonsensical to me as well.
eBay’s proxy bidder also is the one to “sit by the computer” and automatically increases my bid by the minimum increment required as long as it doesn’t go over my max stated price - so again, where’s the advantage?
Can you program sniper software to not go over a certain price as well, or do you just tell it “I want THAT THING” and it bids on it, even if you didn’t want to pay that much?
And what if your sniper software swoops in at the last second, fires off a bid, and “hey presto”, the prior bidder used eBay proxy and gets it anyway, because either he put a higher proxy limit than your sniper bid or he has priority due to an earlier bid time?
Can someone help me out here? Why use the sniper software if eBay proxy already does all that stuff? I understand that eBay isn’t the only auction house out there, and that many other auctions don’t do proxy bidding, so I can see where the sniper software would serve as a sort of “proxy bidder” at that point. But what’s the advantage of using it specifically on auction sites that do offer the proxy bid service?
It does it for you, but at the wrong time. It raises your bid as soon as it can, therefore making the current bet higher, thus making the minimum bet increase higher. Here’s a couple of scenarios (To make it simple, I’m assuming just you and another bidder):
You see an item you are willing to apy $50 for, so you type in your max at $50, and maybe it will go for less. Another bidder had a max of $45, so your bid is automatically upped to $46. Towards the clsoe of the auction, the other bidder checks again, see’s he is outbid, and eventually outibds you, increasing his bid by $1 at a tiem until he gets to $51. You just lost the item. Or, you deicde you realyl want it and raise your max bid to $55, and end up paying $52 or whatever. More than you originally intended.
If you used sniping software, then here’s what would happen:
You see the item, and tell the software (or website or whatever) that you have a max of $50. But, since it is designed to place the bet in the last couple of seconds, it doesn’t actually make a bid for you yet. So the toher bidder comes along, and sees that he is still high bidder with his $45 max (and let’s just say the current bid is $40.) Now, with a couple of seconds left, the snipe goes into action and puts in your max bid for you. You end up paying $46, and the other bidder doesn’t have time to raise his max bid.
Sniping only works because some people are influenced by what they see others are bidding for something, so they move their maximum bid higher to beat another’s bid. If everyone bid just on their own evaluation of an item, then sniping vs. proxy bidding would make no difference.
The same thing is true of live auctions (and I’ve participated a few of those for houses, where the stakes are pretty high). You don’t want to bid too fast, becauise if you do, others may decide the house is worth more, so you act if that bid of $190,000 was dragged out of you when you really would be happy to go to $210,000. There really is a psychological aspect to bidding.
It’s human psychology that makes it work. Bidding activity tends to attract more bidding activity, as does a higher “current bid”. In some eBay auctions, you will see someone bid $20, $25, $30, etc. until they get high bid or the price gets too high. If outbid, many people will raise their bid to recapture high bidder status. Sniping avoids some of these problems.
There is one huge advantage to sniping that I do not see mentioned elsewhere. Once you have placed a “proxy bid,” you are locked into your bid for that product. That means that if you have placed a maximum bid of $30 for an item, and 1 hour later find the item on sale for $20, you cannot safely buy that item without fear that you will later buy a second copy for up to $30.
By sniping, you avoid locking your money into something that may not be resolved for several days.
Further, eBay seems to discourage the practice of sniping. They say that if you just puts the max value you are willing to pay in your proxy bid, then you will either lose because someone was willing to pay more, or you will win because you were willing to pay more than anyone else. But they don’t address this psychological issue of auctions where you update the max you are willing to pay in real time when you see what others are bidding.
Which invites the question, “Why is an item suddenly worth more to me just because it’s worth more to someone else?”
You’d be surprised. In some of the categories I watch, there are certain people that appear to have unlimited resources. When I see these bidders’ names, I can only moan and think “Will this person ever take a vacation so I can have a fair chance?”
If you decide a day later that you really don’t want to bid on anything because the car broke down and you need money for repairs, you can gracefully back out of your snipes. If you placed an actual bid, you’re stuck, and just have to hope you’re out-bid.
My guess is that the higher bid wins. If they are identical…then who knows. It probably depends on the software. Some might be advanced enough to compare all bids on the same item and if two are matched for the highest, then it can give it to the one who placed the bid in the sniper first.
If they really wanted to discourage sniping, they could have an automatic extention. That is, if someone bids in the last few minutes of the auction, the auction is extended by a few minutes. Yahoo! Japan’s auction has this option (the seller decides whether to enable this feature).
A few times I’ve found a desirable item that, due to the seller’s ignorance or poor labeling, is getting few views and no bids. I’ll bookmark the page for a future snipe. But then the seller, after he realizes his sloppiness, goes in and fixes the description and maybe even ups the reserve price. In floods the competition and up goes the bid price! This is a bad turn of events.
So, if the circumstances are right – bad description, few views, no bids – I’ve learned to toss in a token minimum bid at the outset just to lock down the item description and/or reserve price. I don’t bid anything that can’t be beat by a buck or two by a competitor, mind you – I don’t want him to know how much I really want the item. Then I go ahead and snipe away in the closing seconds.
Another nice feature of sniping programs like this one is that you can have it track say 10 different auctions for the same item (say, an iPod) that end at various times. You tell it that you want to buy 2 iPods. You enter a maximum bid of $100 for each one. It will snipe the each consecutive auction with you max bid until you win 2, then cancel all the remaining snipes.
Nobody has mentioned the big disadvantage of sniping.
Let’s say you and I each decide that an item is worth $10. You get to it first, and put in a snipe. I find it later, and put in an actual bid for $10. Even though you got there first, and we both bid the same amount, I win (or you have to go back and up your snipe).
That does not affect sniping. The sniper places his bid at the last possible moment. He still places his maximum bid (generally); he just does not do it prior to the last second of the auction.
Therefore, you won’t find it later and get it for an amount less than he was willing to pay. He in fact quite likely knows what your bid is (and can potentially play with it for fun, driving it up to test the range) well before he makes the snipe decision.