A penny auction differs to a regular online auction in the following ways
. A seller lists an item to sell but at a very low price, lets take for example the person in question lists their computer for 50p but they charge everyone who wished to join the auction 50p for every bid they make. If the person gets 1000 people and each of them makes 10 bids you can see how they easily make their money back even if its not on the item directly.
Often the auction is timed and each new bid increases the time limit so that other users can also place bids and be in the position of potentially winning them. Once the timer does reach zero the user who made the highest bid gets the item in question.
So what advantages do penny auctions hold over standard online auction systems? Number one, the companies that host the penny auction benefit as they receive money by selling the rights to take part and make bids, as well as the final payment the winner has to make. From the customers perspective they benefit from a reduced final price on the item up for auction, even with the cost of bidding rights added, buyers still make a considerable saving. On a global scale they might turn out to be the only method for purchasing items unavailable in their country.
Do your research and find the average market price of the items you want to procure. This will help you to confirm good deals as and when you get involved with the live penny auction. Its not a bad idea to explore some of the forums and blogs online, they can inform you of the authenticity of the companies running the auctions youre considering taking part in. Do your best to evade fake sites, as there are many scammers out there setting up false auctions.
Its well worth taking the time and effort to fully understand the entire bidding process in order to know when to start, and when to stop bidding on items. There are numerous tutorials online that explain the procedure in detail. Another good trick is to watch more experienced bidders and note how they time their bids, have a look at their profile and see what sort of credentials theyve got. Also check their bidding patterns to know about their moves to win items in penny auctions.
Penny auctions can be a great way to make money on your unwanted goods but you must ensure enough people want to get involved otherwise you will end up make a significant loss.