imo, reserves are pointless. most everything i list on ebay i know will sell for around a certain price (based on completed auctions), and am not afraid to make my starting bid $.01 with no reserve, because i'm confident it will rise to market value. if i ever need to make a certain amount on a sale, that will be my starting bid so i'm not worried that it will sell for any less than i need.
I make my starting bid 20-30% below the average going price of the last few of the item sold.
Not always, of course, but it's my rule of thumb.
I thought that the entire point of an auction was to get rid of an item regardless of cost. I have XYZ item to get rid of, start telling me how much you want for it, highest bidder wins.
If reserves are pointless then why do all my auctions do not exceed the reserve due to product demand...I also think people where most likekly bid on a auction that has a low starting price as opposed to a high starting price instead of a reserve.
Ausm
I always list w/o reserve. As long as your item is in reasonable demand and you list your auction correctly, it's pretty easy to get a low and high range that the item will sell for. Just watch other auctions for the same item. It's also nice strategy to start at .01 to get as many bidders interested and encourage a bidding war. With a little bit of luck, you can get people to pay more than the retail price sometimes.
However, if you choose to use a reserve, you should not tell someone who asks the reserve price. The idea is to make them bid the highest amount they are willing to pay. If your reserve is $100 and you tell them, then they put in a bid for $100 instead of $120 (the amount they were willing to pay). Then someone else might come along and bid $101 and win it for that price. If you had kept it a secret and the original person puts in a bid of $120, then the second person would have bid the price up until they lost interest or eclipsed the first persons bid of $120. The bottom line is revealing your reserve price can cost you money.
However, if you choose to use a reserve, you should not tell someone who asks the reserve price. The idea is to make them bid the highest amount they are willing to pay. If your reserve is $100 and you tell them, then they put in a bid for $100 instead of $120 (the amount they were willing to pay). Then someone else might come along and bid $101 and win it for that price. If you had kept it a secret and the original person puts in a bid of $120, then the second person would have bid the price up until they lost interest or eclipsed the first persons bid of $120. The bottom line is revealing your reserve price can cost you money.
reserves prices suck
people are willing to pay up to what the item is worth to them.
reserves prices are no use because the point of reseverve prices is to protect the seller from selling at a low price.
by simple microeconomics, if your item has a high demand, people will bid on it and be competitive, therefore giving u a high price anyways. so there is no need to put a reserve price on it.
on the other hand, if your item doesnt have a high demand, the price will be lower, maybe lower than your reserve, but this is because people arent willing to pay that extra dime for it. so no matter what u think u should sell the item for, the reality is that people just arent gonna pay that much to get it, this time or the next time, provided the demand of a item hasnt changed much. so a reserve price is useless here too because it prevents u from selling the item.
although u might take a loss in selling the item lower than your reserve, but it is better than not selling it at all because u aint gonna do any better the next time with the same reserve since the demand of an item doesnt change that much during a short period of time.
people are willing to pay up to what the item is worth to them.
reserves prices are no use because the point of reseverve prices is to protect the seller from selling at a low price.
by simple microeconomics, if your item has a high demand, people will bid on it and be competitive, therefore giving u a high price anyways. so there is no need to put a reserve price on it.
on the other hand, if your item doesnt have a high demand, the price will be lower, maybe lower than your reserve, but this is because people arent willing to pay that extra dime for it. so no matter what u think u should sell the item for, the reality is that people just arent gonna pay that much to get it, this time or the next time, provided the demand of a item hasnt changed much. so a reserve price is useless here too because it prevents u from selling the item.
although u might take a loss in selling the item lower than your reserve, but it is better than not selling it at all because u aint gonna do any better the next time with the same reserve since the demand of an item doesnt change that much during a short period of time.
This is only really true for certain things. It may be the case that your 10k Persian rug only has one interested party in a one-week span. You could get a very different result the next week if someone else became interested also. Reserves do have their place. All big auction houses use them b/c they realize lack of demand at one particular time does not always mean there will not be demand at another time.
Like many here I hate reserves and regard them more as a pain in the arse than anything useful.
Almost all the auctions I've seen that have had reserve prices tend to have them near or at the upper end of the selling spectrum for that item. Heck, there have even been times where that price is 2-3-5X over even the most outrageous price I ever saw those items go for.
If I ever listed stuff with a reseve and someone e-mailed asking what it is, I'd probably tell them. With the suggested slight inflation, of course.
Still, as a buyer they annoy the hell out of me. I hate trying to nickle and dime my way up to ususally a few percent off of full retail/high end prices.
Almost all the auctions I've seen that have had reserve prices tend to have them near or at the upper end of the selling spectrum for that item. Heck, there have even been times where that price is 2-3-5X over even the most outrageous price I ever saw those items go for.
If I ever listed stuff with a reseve and someone e-mailed asking what it is, I'd probably tell them. With the suggested slight inflation, of course.
Still, as a buyer they annoy the hell out of me. I hate trying to nickle and dime my way up to ususally a few percent off of full retail/high end prices.
Why don't you enter your max bid once and be done with it? If it's not enough for the reserve, then find another auction. Better yet, do this with a sniping program. No need to ever bid more than once if you know your max.
Well, two reasons. 1) I hate paying my limit for an item. Like everyone, I want to get it for as little as I can. Why I bid on in-production item auctions sometimes instead of going retail. Trying to get the best deal. 2) Because sometimes my limit is just below what the reserve might have been. Take the example tosses out here, setting the reserve at $100.02. If my self imposed limit was $100, then I wouldn't win. But if I knew I could go to $105 or whatever and get it, then I probably would.
Really, if getting a minium value for an item is SOO important to you, list it at like 5 or 6 bids under what you want and save the guessing game.
DrPizza
Administrator Elite Member Goat Whisperer
There are 2 points I'd like to make:
1. As a seller, I know that starting at a lower price (rather than the reserve price) often gets bidders into a bidding war. If I start an item I expect to sell for $50 at $45, I'll be lucky to get 1 bid. If I start it at $1, I'll usually get 3 or 4 people bidding on it. Their bids get a lot of other bidders to take a second look at the item, enticing some of them to bid also. Often, it will end up selling for more than what I expected if this is the case. Plus, the listing fee is lower if you start the bidding lower.
2. I want what I said in #1 to happen... more interest, and more bids resulting in "auction fever" where people end up paying more than it's actually worth. BUT, as Ausm stated, in small niche markets, there's a chance that only a limited number of people will bid on an item, and I won't get anything near what the item is worth. THAT's when I use Reserve.... as a way to protect myself. And, in these circumstances, I can see nothing wrong with telling a potential buyer what the reserve is, if they ask.
Plus, since you're not alone in selling certain types of items, someone doesn't want to be bidding on your auction with an uncertainty of winning when they can bid on another auction without a minimum. So, by finding out what the reserve is, it assures them that they can win your auction with a bid of what they feel is reasonable.
1. As a seller, I know that starting at a lower price (rather than the reserve price) often gets bidders into a bidding war. If I start an item I expect to sell for $50 at $45, I'll be lucky to get 1 bid. If I start it at $1, I'll usually get 3 or 4 people bidding on it. Their bids get a lot of other bidders to take a second look at the item, enticing some of them to bid also. Often, it will end up selling for more than what I expected if this is the case. Plus, the listing fee is lower if you start the bidding lower.
2. I want what I said in #1 to happen... more interest, and more bids resulting in "auction fever" where people end up paying more than it's actually worth. BUT, as Ausm stated, in small niche markets, there's a chance that only a limited number of people will bid on an item, and I won't get anything near what the item is worth. THAT's when I use Reserve.... as a way to protect myself. And, in these circumstances, I can see nothing wrong with telling a potential buyer what the reserve is, if they ask.
Plus, since you're not alone in selling certain types of items, someone doesn't want to be bidding on your auction with an uncertainty of winning when they can bid on another auction without a minimum. So, by finding out what the reserve is, it assures them that they can win your auction with a bid of what they feel is reasonable.
Well, two reasons. 1) I hate paying my limit for an item. Like everyone, I want to get it for as little as I can. Why I bid on in-production item auctions sometimes instead of going retail. Trying to get the best deal. 2) Because sometimes my limit is just below what the reserve might have been. Take the example tosses out here, setting the reserve at $100.02. If my self imposed limit was $100, then I wouldn't win. But if I knew I could go to $105 or whatever and get it, then I probably would.
Really, if getting a minium value for an item is SOO important to you, list it at like 5 or 6 bids under what you want and save the guessing game.[/quote]
1)I think you misunderstand the way proxy bidding works. Simply, you enter a max price and you win the item by a 1 bid increment over the second highest bidder. You would only pay your limit if someone else is willing to pay 1 increment below your limit.
2) Well, then you should put in $105, since that is your max. BTW, never use round numbers. $105.67 is a better bid for example.
There is something wrong with it if you want to insure the highest price for your auction. I explained it above.
How is telling them your reserve prices going to make any difference? IF the item is worth more most likely people will continue to bid on it the same whether they know the reserve or not. If you do not tell them, they will probably not bid and you may be $.50 off when they stop bidding, and next time you probably try to sell it you'll bump the reserve down a few dollars and you could have sold it a couple of weeks prior.
Lots of benefits to allowing people to know the reserve. I understand why you have one, but not telling them seems a little odd to me if you are wanting to sell it. You will get no less money by telling them what the price is, because others will still be able to bid after them if they want it.
Lots of benefits to allowing people to know the reserve. I understand why you have one, but not telling them seems a little odd to me if you are wanting to sell it. You will get no less money by telling them what the price is, because others will still be able to bid after them if they want it.
While we can argue the merits of Reserve Pricing all day long, it really doesn't matter to Ausm because he has already made up his mind (which is perfectly ok). I personally don't like reserve pricing but it does have it's place and I can understand why people use them. But those same people need to understand that reserve pricing should be set at or near the BOTTOM of the market range. All sellers should be realistic about what they sell and it's MARKET value. If you are not willing to be realistic and accept the fact that your item will fall BETWEEN the high and low ends then DON'T sell it! If it has more 'sentimental' value to you than it may be worth on the market.....THEN DON'T SELL IT! Reserve=low end with the hope that it will elevate to the mid-high end. That is my 1.5 cents (and there was no reserve on that ).
Good luck Ausm
SDC
).Good luck Ausm
SDC
Originally posted by: TravisT
How is telling them your reserve prices going to make any difference? IF the item is worth more most likely people will continue to bid on it the same whether they know the reserve or not. If you do not tell them, they will probably not bid and you may be $.50 off when they stop bidding, and next time you probably try to sell it you'll bump the reserve down a few dollars and you could have sold it a couple of weeks prior.
Lots of benefits to allowing people to know the reserve. I understand why you have one, but not telling them seems a little odd to me if you are wanting to sell it. You will get no less money by telling them what the price is, because others will still be able to bid after them if they want it.
I already supplied the answer above. Here it is again.
However, if you choose to use a reserve, you should not tell someone who asks the reserve price. The idea is to make them bid the highest amount they are willing to pay. If your reserve is $100 and you tell them, then they put in a bid for $100 instead of $120 (the amount they were willing to pay). Then someone else might come along and bid $101 and win it for that price. If you had kept it a secret and the original person puts in a bid of $120, then the second person would have bid the price up until they lost interest or eclipsed the first persons bid of $120. The bottom line is revealing your reserve price can cost you money.
Eessh
I know exactly how proxy bidding works. And I know exactly how you can jack the price a rival will end up paying through it. I've done that before, actually. It was out of spite that his proxy kept topping might slightly higher bids. So I pushed his bid up as high as I felt safe to go. The seller was happy with me in the end, as he got a high end price for the item, though I was annoyed that I had to go look for it again and restart the whole process.
As to your second point, my max bid and what I'm willing to pay are to SLIGHTLY different things. Max bid is just that, how high I'm willing to bid knowingly. What I'm willing to pay is potentially a few bucks more, and that depends on the item. If the reserve price is just SLIGHTLY over my self set limit, ie within the limits of being able to scrape crash together from other sources to afford, then I might consider the extra expense worth it. Assuming it's hard enough to find and still low enough to be considered reasonable. Not blowing your whole wad at the start gives you some wiggle room to convince yourself at the end.
Of course that whole scheme assumes regular bidding (each bid is what the new price will be set at) as opposed to proxy, which egay uses. With proxy, you'll still end up with potentially a $102 final price (minimum) using your above example.
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