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Just saw an advert on TV so went to check it out; www.madbid.com - apparently you can get anything from iPod Touches to cars for a fraction of the price. A certain phrase springs to mind; if it's too good to be true... - especially when you see £450 cash going for £4.05 :S
madbid isn't an auction, its a lottery - and a very lucrative one (for them)
i.e. you pay per ticket (bid). Ever seen an auction do that?
More bids = higher chance of winning.
Every bid increases the price by 1p (but costs you £1).
So if there are just 400 bids for an ipod,
thats £400 revenue for madbid,
and one of those bids gets it for £4
(and everyone else loses their bid money (£1 per bid).
Now it is supposed to be the last bid wins - but it is acceptng bids after "auction end", so I suspect they have a set amount of revenue to receive before really closing...
60p a bid at the moment but still.. considering the fact that bids can only go up a penny at a time that's a lot of money they're making from anything going up by a pound even
The actual price the item goes for is completely arbitrary, you could replace the £4.04 for a counter that reads 404 suckers and it would mean the same thing. That money doesn't actually exist.
Oh so you just pay for a raffle ticket basically, I see.
I've debated making a site like this, it's very profitable. I can't remember which site I started using for "penny bids". But I got a Wii Console and Wii Fit for £20. But the catch is when you buy "bids", I think it was like £25 for 50, and I bought 100. Used around 50 of them, so I spent £45 on Wii Console and Wii Fit.