Reverse Auction Strategy

Try to pick the least common low bid amount. Easier said than done though, but here are some ideas to get you thinking more strategically.

Most punters will not fully understand how the reverse auction works, at least when they place their first bid. So most bids are likely to be based on guesswork. In this case the most obvious amounts will be bid on such as:

• Unlucky 13 - nobody else would bid this?
• 1p - it's so obvious, maybe nobody will bid this?
• Every price up to say £10 - since there will be 1000's of entries.

Now consider the numbers of people entering, and how many bids they place. There are only 1000 different prices from 1p to £10 and many prices in this range will be picked multiple times so it would be hard to get a unique bid in this price range. Also, realization of this difficulty may drive people to bid higher to make it easier for them to get unique bids.

From £10.01 to £100 there are 9,000 different price points, so unless there are say 100,000 bids placed, how likely is it that every single price point in this range is covered?

So depending on the number of people bidding and the length of time the auction runs you can use some skill to identify price ranges where you feel there is a better chance of identifying a unique minimum bid price.

• What is a Reverse Auction?
• Auction Reverse UK - home page