Friday, November 12, 2010

Quibids Strategy 3: The Waiting Game (exposing some Quibids Myths)

This is Part 3 of the series on Quibids strategies that I want to publish. These strategies are not conjured up from thin air. They are written from personal experience, but more importantly, personal research. Most penny auction strategies, like Quibids strategies, are to do with Game theory and probability.

You can also find Part - 1 and Part - 2, which deal with different strategies.

Theoretical Efficiency Vs. Practical efficiency:

To understand Quibids and indeed any other Penny Auctions, you should first understand that the theoretical best Quibids strategy need not be the best practical strategy.

To illustrate, consider a typical Quibids macbook auction, as shown below:

Quibids strategyThe cost of the Macbook, finally, was $426.65. This was a 1 cent Quibids auction (see the top left hand side of the image). This means each bid incremented the cost of the macbook by 1 cent. Thus, in all, there were 42,665 bids placed. That's quite a lot of bids!

Now, consider the time it takes for placing these many bids. This is a really hard question to answer, as anyone who has followed the Quibids auctions knows. There could be 2 people bidding in tandem, in which case things can move quickly but usually people only place their bids when there are less than 5 seconds left.

As an average case, I am assuming it takes 2.5 seconds between bids (I think it is a good number for an average in this case. Other smaller auctions usually have larger average time between bids).

So the time required to complete the auction is 42,665 * 2.5 seconds = 106,662.5 seconds. This comes out to 29.6 hours. That is a huge time interval of over 1 day!

Now, let me ask you - how many people can sit non-stop in front of their computer looking at the auction process for nearly 30 hours to choose their best strategy? Not many.

This is why the theoretical best Quibids strategies will differ so much from the practical best Quibids strategies.

Best Theoretical Quibids Strategy:

Here is the best theoretical Quibids strategy: Wait for the last moment to place your bid. This means, bid on the Quibids auction when the timer is 1 second.

This seems simple enough and most people intuitively do use this for their bidding - let the people fight it out and I'll come in when the time is right.

This is a simple strategy and people are easily deceived by its applications. Let me expose the myth that this is THE strategy to apply to penny auctions. In fact, all the videos on Youtube that claim to show 100% Quibids strategy wins simply use this basic technique, which turns out, isn't the best practical strategy after all for all Quibids auctions.

The problem is, this isn't always the best practical strategy. For example, in the above Macbook auction, can you sit for 30 hours non-stop in front of your computer to see when the timer reaches 1 second? Well, I don't think so.

When to use this Quibids Strategy:
The waiting game strategy should ONLY be used for small Quibids auctions. By small, I mean auctions that usually have less than 200 bids placed on them. In such cases, you can win Quibids auctions by using this Quibids strategy of waiting till the timer goes to 1 second and bidding.

Word of Caution:
When you are using this waiting game Quibids strategy, it is very important that you never quit! This holds even if there is an aggressive bidder, using a strategy I described here (who uses the volunteer's dilemma problem).

The reason for this is simple: If you quit, you will be left with nothing at all. This doesn't hold for all strategies, but in this instance, you must not quit.

Why People Fail?
This particular Quibids strategy seems intuitive - you wait till the last moment to bid, thus saving your bids and ensuring they are not wasted when someone else is placing his bid before yours.

So why do people fail? Simple - they quit!
When someone is bidding aggressively, they will quit. The problem with this strategy is that it appears to reduce risk, while the truth is it can practically be a very high risk Quibids strategy. The reason for this is what people practically do - they get intimidated by aggressive bidders and never win. They lose a few bids in hundreds of auctions and thus they end up with nothing to show for their efforts and bids.

Therefore, this seemingly simple Quibids strategy can backfire and you need to ensure you know exactly why, when and how to use it. Do not try this on big auctions like Holiday trips, cars and macbooks.

What Auctions Can I win this way?
Try out the smaller bids: 15,25 bid auctions are ideal for this. Also, anything with a price of less than $30 can be a good start. Once you know how never to quit and understand how Quibids auctions work, you can proceed to slightly bigger auctions (but never on the heavyweights!)

Good luck Quibids bidding!

18 comments:

  1. This comment has been removed by the author.

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  2. To be an aggressive bidder, are you saying to always be the most recent one that has bid on an item regardless of the time?

    Also for the items that are less then $30, is it $30 MSRP or $30 bidding price?

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  3. Yes, that is the strategy of an aggressive bidder. It might be helpful if you read my posts on Quibids Strategy-1: Volunteer's Dilemma and How to Win on Quibids-1. Both these posts deal with how you can be an aggressive bidder to win.

    If you are fine with buying the item at the MSRP, you can be quite safe using this strategy, because if you don't win, you can still purchase the item at the retail price. An item of MSRP $30 will allow you to use up to 30/0.6 = 50 bids for you to break even.

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  4. Just discovered this info.

    I disagree with your analysis that placing one's bid at the last second during an auction is the best strategy. Even for small auctions, like $15 bid voucher packs, my experience has been that this strategy does several things adverse to one's winning chances:

    (1) by bidding at the last second, one extends the auction, allowing others to join in the bidding; this has two effects:

    (a) last second bidding gives dominant bidders the impression that they are winning the auction soon, thereby giving them confidence to continue bidding;

    (b) last second bidding gives new bidders hope that the auction is nearly over, thereby giving them encouragement to join in the bidding; and

    (2) by bidding at the last second, one is also providing a fail-safe floor that experienced pro bidders will quickly recognize. Does one really want to invite pros to one's game?

    It's better to do research to learn where auctions on select items naturally end and to monitor the dynamics of those auctions before bidding. That sort of waiting game works more often than what you are recommending.

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  5. love your blog. recently joined quibids and won small gift cards. very encouraging. have been watching the other, more larger items, looking for strategies. Question for you, how are you able to get your post comments to show like this? i've looked everywhere for how to get this done and it just isn't working

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  6. Heather,
    I am really glad you liked the blog - it is encouraging to know that it is helpful and it helps me write more! Good luck with your Quibids journey - if you are bidding on gift cards, always use real bids (that you purchased) so that you always have the option of buy now if you fail to win an auction (though my strategies really help you win, they can never guarantee a win). Also, do follow me on Facebook - I am giving out a free eBook that I am writing to my Facebook fans, which will contain all the information you will ever need!

    I don't really get your question about the post comments. I didn't do anything special - I am only using the default Blogger themes (only a few modifications but nothing with the comments). What exactly do you mean when you say comments show like this?

    And thanks for dropping by :)

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  7. The waiting game or holding out till you expect the auction to end before you join can guarentee at least one thing. A target on your back! "Jumpers", as they are referred to are probably the most hated bidders there are. Yes, it is a strategy, and there aren't rules against it. At one time it was considered a matter of ethics. When other bidders have been in an auction from the beginning, investing time and many bids, can you imagine how they feel when someone jumps in at the end, trying to win with just a few bids. It may sound like a smart strategy, but don't expect a warm welcome. Most bidders will bid more than usual just to make sure a jumper doesn't win. Better yet, put yourself in their shoes. How would you feel? No, there's nothing to stop you from doing it anyway, if you think it's worth it, go for it. Forget about a woman scorned, hell hath no fury like a bidder jumped. If revenge doesn't get you, then karma will.

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  8. i don't see how waiting until the last second to bid is advantageous in any way.

    it's not like you are getting the winning bid in under the deadline; each bid adds 10 or more seconds to the clock. everyone else still has time to make another bid.
    since so many people bid at the last second your bid gets caught up with several others and can in effect, be wasted, since 4-5 bids will be processed at once.

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  9. vv, it is advantageous because if someone else bids instead of you, the highest bidder till that time fails to win while you do not spend your bid. It is quite simple to see why this is the case. Of course it now depends on the psychology of bidding. Read also my Volunteer's Dilemma strategy to know more.

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  10. The "don't quit" strategy seems flawed, since not all bidders can simply not quit. Everyone but the winner has to decide to go find something else to do eventually. Then there is the practical limit of how many bids committ, knowing you may still lose.

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  11. Waiting until the last second can be a bad strategy as I have seen many times myself on my computer that there will be anywhere from 2-6 seconds remaining and the auction mysteriously ends. I have queried the Quibids staff on this and they told me my top of the line computer or my fibre internet connetion of 100m down/20m up was at fault for being too slow. I left it at that as I did not want to argue anymore with them nor have them try and tell me more lies that amount to preferential bidding. You can see this by the minority of players that appear to be the majority of the winners. Some of those people must spend hundreds of dollars daily if not thousands.

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  12. I used to experience this same problem when I used Internet Explorer. I now use Chrome and have not seen this problem.
    However, I now win a lot less often. When I used IE, my bids were terribly erratic and unpredictable. Now that my bids go through when I push the button, I think I am no longer "unpredictable". Now I never win:-)

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  13. There certainly is strategy involved with winning. The best strategy is to be very visible when bidding. ..that is to say, the winner of an "auction" is chosen on a random basis and not according to the highest price offered. Typically with any raffle, the more tickets you have in the hat the more likely your chances that you will win..

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  14. You don't need o bid hundreds of ties. You let the computers bid. Wait and wait... THEN JUMP! It is random though............

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    1. Yes, the "randomness" factor is the time line. The "auction" expires at a random/unknown time dictated by an inhouse algorithm. If you are lucky to be the bidder when the time expires, you win! Like a lottery or raffle, winning is based on "chance". Good luck!!

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  15. So if Quibids gets 42,665 bids on a macbook as in your example, am I correct in assuming they make $25,599 on this auction when they are getting $0.60 per bid?

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  17. investing time and many bids, can you imagine how they feel when someone jumps in at the end, trying to win with just a few bids.free games to download

    ReplyDelete