subject: Peace Of Mind For Bidders [print this page] It's become common knowledge to steer clear of "get rich quick" sites and "penny auction" websites. Unfortunately many penny auction websites have not implemented a strong auction model and many of their members fail to win auctions. The bids on some of these sites cost more than a dollar and members end up paying retail or more than retail value for products they big on. Don't be fooled, some of these sites can be deceitful. Be sure to read about the site before joining and seeing if their policies and strategies are clearly displayed.
Many people have said these penny auction sites are scams, but not all websites are created equally, in fact there are sites that are strictly, entertainment retail auction websites and should be noted. These sites are not scams and provide members with live auctions and the opportunity to bid on items based on an internet auction model that is legitimate.
Although many people would feel skeptical or hesitant when participating in a site that offers high-quality products at a fraction of the retail price, rest assured this is not a scam. Unique internet auction models are set up to ensure that almost every auction ends with a winner paying below the retail value. Typically an entertainment retail auction site with this unique auction model will charge a bidder a certain amount, typically $0.60. When an auction product costs $300 from an e-commerce site, but is sold on a live auction for only $9.00 for example the figures are as follows. The auction site purchases the product for $300 and puts it up for auction and bids begin to start, eventually this will end at the price of $5.45 and because each bid was raised by $0.01 that was a total of 545 bids.
Simple math shows:
545 x $0.60 = $327
Cost of product = $300
Cost for auction winner: $5.45
Thus not all sites are penny auction sites and not all sites are scam sites. There are legitimate live auction sites that allow members to bid on items and win prizes for "pennies on the dollar". There's also often a buy- out feature with some entertainment retail auction sites that acts as a safeguard for the consumer to where they don't have to walk away empty-handed or out any money. Be aware of scams, but don't be skeptical of every entertainment retail auction site you come across.
