Friday, August 23, 2013

Is ebay Sniping EVIL?

Ebay Sniping - the act of bidding in the waning moments of an ebay auction in the hopes of securing the desired product at your price, while excluding other last minute competitors due to auction expiration. Bid sniping may be done manually by a buyer using the ebay bid entry system, or through a resident program or web-based service.

If there is one topic that is guaranteed to spark a lively debate whenever invoked by buyers and sellers on ebay, it's SNIPING! Snipers claim it wins them the auctions they desire at a price which they find acceptable. They further site convenience, flexibility, easy bidding discipline, and the avoidance of emotional and potentially costly bidding wars vs. other potential competitive buyers. Sellers, on the other hand, decry the system as unfair or unsportsman-like, in the belief that an earlier bid might've provoked competitive buyer-bidders to enter additional amounts, thus driving the price, (and profit margin), higher. Over the years many sellers have asked ebay to automatically extend auctions each time a high price is reached, insuring that there will always be adequate time for other bidders to decide whether to beat the new high or now out.

To date, ebay has refused to take any step to curtail bid sniping and probably never will. As the pure no reserve auction continues its decline in the face of ebay's move to a Buy it Now Amazon-type model, it's unlikely that the site ever will make the change. Simply put, ebay sees its future in competition with Amazon, not old style Saturday morning auction houses. Auctions currently represent only a third of their current income, and are slowly, but steadily, declining. Ebay's attention is focused far away from the old auction format. They're more than happy to keep banking the commissions paid to them by the Seller using the Auction format, but that's as far as I believe they're willing to go. Given this unchanging reality, let's look at the sniping issue one last time assuming the current basic bidding ground rules.

In a market-based capitalist economy represented by ebay, both buyer and seller have goals which, while similar, do in fact diverge. The buyer wants to acquire the Seller's product at the lowest possible price. The Seller wishes to find himself an interested Buyer for his wares, but desires to do so at the highest possible price. If you're someone with Communistic leanings you may find some objective evil in both or either of these motives, but I do not. In a market economy prices are set by supply and demand principles. No product or service has an inherent worth distinct from what a buyer is willing to trade or barter. In other words, it's worth what someone is willing to pay for it!

I find the Seller's best argument, that the auction should last longer by automatic extension to be more like a real auction, nonsensical. Most ebay auctions last three, five, or more days. Surely that is sufficient time for the price discovery mechanism to function adequately. The reason your item sold at ebay auction for a price lower than you wanted isn't the last five second sniper's fault, but the fault of the other bidders who procrastinated in placing their higher winning bids. For me, the situation is like the new "Nanny State" we find ourselves increasingly occupying in the US. If someone is lagging behind don't chastise them for their tardiness, slow down the rest of the group to avoid leaving the laggard behind!

The ebay Sniper is playing by the rules when he places his bid. Ebay's rule book does NOT care when or how you place your bid. The winning bidder is the person who bid the highest amount by the auction expiration dates and time. Period! Of course, ebay the company would love you to use their proxy bidding service if given the choice, because it automates the bidding war process for them. I've seen many ridiculous numbers of bids placed on auctions tht go up a few dollars at a time for days. What a bore! Who even has time to play games like that anymore? I want to win the auction, not play some extremely dull version of an online game!

As a Sniper myself, I recently secured a roll of Kennedy silver proof halves with a winning bid that was only $0.77 higher than my nearest competitor, 3 seconds before the auction expiration. Great price too! I found out afterwards that he and a few others had been fighting one another viciously for days. I hope they had some fun together, as my automated web-based Sniper service snagged the roll while I was watching TV!