Cross Bidding: New eBay Bidding Strategy Saves Auction Bidders 9 Percent

Cash Register A recent study by university economics professors highlights an eBay bidding strategy that saves auction buyers an average of 9% over normal bidding strategies.

The auction strategy, known as cross-bidding, involves selecting a group of auctions with listings for the same or similar items that are all closing within a relatively close period of time.

Here’s how to do it:

Add these auctions to your eBay “Watch List.”
Select the auction that has the lowest current bid and place your bid for the minimum amount required.
If that bid was insufficient to become the listing’s current high bidder, check the listings in your Watch List to determine which auction now has the lowest standing bid.
It it’s the same auction listing, bid the minimum again as explained above. If the lowest current bid now belongs to a different listing, select that auction and bid the minimum permitted.
Repeat as necessary until you are the high-bidder for one of the listings.
If you get out-bid on this auction, start the process over with the auction in your watch list that has the lowest current bid.

The study found that auctions that close within a minute of each other in which cross-bidding occurs saved the winner an average of 9% over auctions in which the winner was not a cross-bidder. Cross-bidders who competed for listings closing within an hour of each other saved an average of 7%. Those who cross-bid on auctions that closed within a day of each other saved an average of 6%. The findings were statistically significant.

The object of the bidding strategy is to force competition between sellers - not just competition between bidders as is the norm under normal bidding strategies.

The study did not compare the cross-bidding strategy to auction sniping which, in my opinion, is still the most effective eBay bidding strategy. You can access AuctionInsights free eBay sniper at http://auctioninsights.auctionstealer.com.

The report, entitled “Bidding Behavior in Competing Auctions: Evidence from eBay,” studied bidding behavior for 41,849 eBay listings for computer CPU’s. Approximately 10,000 listings were subsequently excluded because they failed to attract a bid or had a reserve price. All of the listings were of eBay’s standard auction format (listings with Buy It Now were excluded). The researchers also discarded any listing in which there was bidding activity where it appeared that the buyer was looking to purchase more than one item (such as professional dealers). These listings were evident when bidders were winning multiple auctions for the same item concurrently - vice bidding aggressively on only one auction at a time. The study defined “‘true’ cross-bidders to be those who (a) are never the winner of more than one auction and (b) are never the highest bidder in more than one auction on the last day of the auction.”

The paper’s authors are: