SHOPPING AND SELLING: What's the Best Way to Win an Auction on eBay Without Overpaying

When you bid on an eBay item, it's all too easy to get caught up in the thrill of the game

. When that happens, the item you want becomes less important than winning the auction, and you end up paying more than you intended.

Because of the way eBay conducts its auctions, your most rational bidding strategy is to enter a bid for the maximum amount you would like to pay and then refuse to give in to the temptation of going higher when someone outbids you. But that requires Herculean willpower. Even worse, if you place your bid early on in the auction, you give other bidders an opportunity to run up the price, resulting in an emotionally charged bidding war. This is great for the seller (and for eBay, which collects a percentage of the selling price), but bad for you when you end up paying an inflated price for an iPod or a Kate Spade handbag. But there's a way to take advantage of eBay's method of holding auctions. In a real-life auction, the bidding frenzy for a desirable item doesn't stop until everyone but the highest bidder gives up. However, eBay's auctions end at a precise time, after which no more bids can be placed. Savvy eBay bidders know how to use this built-in time limit to help them win auctions at low prices. They use a bidding strategy called "sniping."

Sniping simply means entering your bid at the very last possible moment before an auction closes, so that other interested bidders don't have a chance to react and outbid you. The truth is, there's no reason to ever place a bid in the first days of an auction-it only encourages others to become interested and bid against you. To avoid competition, always place your bid at the very end of the auction. That's the advice of Harvard Business School professor Alvin E. Roth. After studying different bidding strategies on eBay, he concluded that sniping is a great way to not only win an auction, but to win it at a lower price than you would using any other bidding strategy. In other words, if you're not a sniper, you're a sucker.

There are two ways to become a sniper. The first is the manual sniping method, and it's free: a few minutes before the auction closes, go to the eBay page for the item you're interested in. Enter your bid, and click the "Place Bid" button, but do not click the "Confirm Bid" button that follows. Instead, wait until the last 30 seconds or so before the auction ends, and then press the "Confirm Bid" button. (Use your computer's clock, which you can synchronize to eBay time here:

Manual sniping is free and certainly better than simply entering a bid the usual way, but it is inconvenient-especially if the auction is due to end at 3 A.M., or during a meeting at the office-and there's chance you'll hit the "Submit" button too late and miss out.

It's better to use an online sniping service that automatically places a last-second bid for you. To use an online sniping service, enter your maximum bid (as early as the first day of the auction if you wish-the sniping service keeps your bid private until it enters your bid on eBay at the end of the auction), and then forget about it. My favorite sniping service is eSnipe. After a free fourteen-day trial, eSnipecharges 1 percent of the winning auction price (up to a maximum of $10). You only pay for successful snipes, so it's in eSnipe's best interest to make sure you win. For more information on shopping on ebay visit http://www.internetbillionaires.net

SHOPPING AND SELLING: What's the Best Way to Win an Auction on eBay Without Overpaying

By: kelvin

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