P3D Re: eBay auctions

[Michael Kersenbrock <michaelk@xxxxxxxxxxxx>]

Dan Vint wrote:
> I don't know what the reasoning is to hide a reserve vs setting a
> minimum bid. 

It's part of the psychology of auction that can yield a better
result for the seller if, say, a red-button Realist viewer is sold
with a $1 starting price (and a hundred dollar reserve) rather
than just having a $100 starting price.  Because people don't
know the reserve, folk who wouldn't touch the $100 starting bid
will start bidding, and once one has a personal commitment to
WIN THAT ITEM, they'll go higher (statistically) than they would
otherwise.

> I think the reserve setting might get you an idea of what the
> value to the customer is because you can see their final bids, but
> otherwise I see no advantage. I hate the folks who post something form a
> minimum bid of $5.00 and then want $5,000 as the reserve price.
> 
> About 6 months ago eBay start to change the policy and was setting rules
> for how big the difference could be and they wanted to charge extra - well
> that never happened. I think this whole low starting bid and set a reserve
> was their initial idea anyway which I never understood.

Wasn't really ebay's idea.  Having a reserve price on auction items is
an old idea done with live auctions that ebay just picked up.

Mike K.