Thursday, March 5, 2009

Silliest auction site ever

Swoopo is possibly the silliest auction site ever.


The breakdown:

- You pay ~$1 for every bid you place

- Your bid raises the purchase price by a set amount (either $.15 or $.01 depending on the type of auction)


So, to take this auction for example:

Canon Rebel XSi

MSRP: $899.99

Final Purchase Price: $23.96

Winner placed 249 bids.

This auction was a ‘penny auction’ which means that each bid increases final price by $.01. The starting price was one penny.


So let’s do some math:

- The winner placed $249 worth of bids, plus pays the final price. So the winner came out with a great deal at $272.96 for a nine hundred dollar camera.


- All the people who placed the other 2,146 bids lost out. As a group they paid more than $2k for the privilege of playing this fancy slot machine.


- $23.95 / .01 (price increase increment) means that Swoopo received $2,395 for all the bids that were placed. Swoopo makes out like a bandid, 266% of the MSRP.


Now take THIS auction for instance:

Nintendo WII

MSRP: $249.99

Final price: $213

Winner placed 18 pids

This auction started at $.15 and each bid increased the price by another $.15.



- the winner gets merely an okay deal paying $215.70 including their own bid fees for a $250 piece of merchandise.


- $212.85 / .15 = $1419 paid to swoopo in bid fees, an astounding 567% of the MSRP!!!!!


My question is: why not just go to vegas to lose all your money with the off-chance of hitting it big? At least there you get pretty girls and a mild sense of luxury.


Brandy Young said...

I came across that site awhile back...such a rip off...LOL!
But great if you do happen to be the one that won!

TomboCheck said...

Yeah, great deal for one person, very shitty deal for the masses.

CRM Business Analyst said...

Yes, I also is totally rip off....I am going to dig more into details how much swoopo made so far by scraping all the ended actions till date ( there are around 89000) and analyze the data)
I am going to post it on my blog.

TomboCheck said...

CRM - I'd be interested in seeing the results of that scrape. Most especially I would be interested in seeing an average profit margin vs. the average MSRP for their products.

It just amazes me that people are willing to waste so much money on a site like that...