The Finer Points of Internet Auctions

WHAT IS A PENNY AUCTION?

Penny auctions have exploded in popularity with the massive growth of the internet. However, few people know the true origins of penny auctions.Beginnings actually stretch back to the Great Depression. Those were hard times for everyone, but even harder for farmers. Farmers struggled to bring in steady income because of droughts and crops not selling as well as they had previously. As a result, the banks would foreclose on the farmers who couldn’t keep up with their mortgage payments.

The banks weren’t satisfied with just repossessing the house, they wanted to raise as much capital as possible, so they resorted to selling off the possessions of the owners of the repossessed houses. There was not much the farmers could do about it so they began bidding ridiculously low prices, pennies, on the items while threatening others who dared to bid higher than a few pennies.

The auctions of today hardly resemble their tremulous beginnings. Being part of a penny auction today is exhilarating, fun, and addictive. It combines the selling format of auctioning with a little bit of chance factored in.Auctions are a game of strategy but also a game of luck.

The premise behind penny auctions is giving people the chance to win an item at a drastically reduced price.Auctions make that possible by spreading out the cost of the product among multiple bidders. In order for a person to take part in an auction, they must pay a set price for each bid. For example, if a person wanted to bid on a fifty dollar Amazon gift card then he would spend a dollar for each time a bid placed. If he ended up winning the gift card, then he would only have spent a few dollars for a fifty dollar gift card. Usually penny auctions sell bids in packages.

HOW PENNY AUCTIONS WORK!

The main foundation of penny auctions is the pay-per-bid format. It is the key that allows bidders to win items at the fraction of their retail value and allows the auction owners to keep their site profitable. Most y auction sites run on the same premise: people pay a set amount for each bid, whenever a person places a bid within the closing seconds of the auction time will be added, the last person left with a unique bid after the clocks runs out will win the item. There are a large variety of items that can be won, but they tend to be popular electronics or gift cards to popular stores.

There are two types of auctions: lowest unique bid auction and highest unique bid auction. Lowest unique auction sounds confusing but it is actually quite simple. A unique bid is when only one person has a bid at a certain price. Bids usually start at one penny, a bidder can then place a bid at two pennies. Until another bidder places a higher bid, the most recent bidder will be the lowest unique bid because that was the only bid at two cents and nobody bid higher. However, penny auctions generally don’t stop at one penny. It is not uncommon to find auctions that end up at a couple hundred dollars based on the popularity of the item being auctioned. However, the same principles apply for those auctions. Highest unique bid auctions follow the more traditional auction format such as eBay. The person with the highest bid at the end of the auction wins the item.

Auction site owners turn a profit by selling bids. Say twenty people are bidding on a ten dollar gift card at one dollar per bid, at the end of the auction if there were twenty bids placed in total then the site owner would have made twenty dollars with a ten dollar profit.Auctions do seem like a win-win situation:The site owner makes money while the bidder gets an item for dirt cheap. However, not everyone wins in penny auctions. The people who paid one dollar each bid but left with nothing to show for their investments will not be so happy.

HOW TO WIN!

Penny auction has a lot of chance mixed into it, but one can incorporate strategy that will help raise the chances of winning. Playing smart can make all the difference between gambling and auctioning.

The first crucial tip to winning penny auctions is to know how to manage your bids. Your goal should be to win as much as possible without spending a ton of money buying bids. Managing your bids means that you should already know how much you are willing to risk in order to win an item. The amount of capital you are willing to risk will determine how many bids you can use. Once you know how many bids you have to spend on an item, then you will be better able to manage how and when you place a bid. That will keep you from blowing away all of your bids in the first few seconds of the auction.

The next tip is to practice time management. When fighting in the trenches of penny auctions, you have two enemies: other bidders and time. Knowing when to bid is a must if you want to have success. Placing a bid when there is a lot of time left on the clock is never a good idea. You have to remember that the key to winning a penny auction is being the last one standing when the clock runs out and that each bid increases the amount of time left. It would be a good practice to wait until the last few minutes of the auction before you begin to bid.

The final tip for successful auctioning is to keep your emotions under control.Auctions have a lot of similarities to gambling, and just like gambling, your spending can get out of control. If you keep your emotions level, it will keep you from making rash decisions and blowing loads of cash. Keep your mind clear so that you can gage the behavior of the other bidders and outsmart them.

HOW TO AVOID SCAM SITES!

Penny auctions are a great addition to the web whether you want to win an item that otherwise you wouldn’t be able to afford or if you simply enjoy the thrill that comes with bidding in auctions. Unfortunately, scam sites have tarnished the reputation of the legitimate penny auction sites. However, there are ways that you can protect yourself from scamers and enjoy your auctioning without having to worry about losing your money due to dishonesty.

Checking the reputation of the auction site before you start spending your hard earned money is always a good idea. Chances are other people have tried the site before you and some of them have left reviews. The reviews are your way to gage whether a auction site is trustworthy or not. If a site is getting overwhelmingly negative reviews, then that is a clear indication that you should steer your business elsewhere.

Another tool you can use to protect yourself is checking the Alexia ranks of the auction sites. Alexia rank will give a solid view of how much traffic the auction is getting. If you see a huge difference in the amount of traffic Alexia is projecting and the amount of active bidders on the site, then warning signals should be ringing in your head. Some auction sites have been known to set up robots that automatically bid on projects in order to keep the auction going and inflate the price. That is known as shill bidding. You can sniff out those sites by comparing the traffic the site should be getting to the amount of users using this site.

CONCLUSION!

New legislation may come out later down the road that will officially make penny auctions gambling, but until then, it is a fun, exciting auction that allows one to win the item they’ve always wanted but couldn’t afford.Auctions are also quite lucrative for the site owners because of the pay-per-bid strategy they’ve incorporated. Penny auctions had humble beginnings with farmers who just wanted to get back at the banks who kicked them out of their house. More recently, auctions have enjoyed an explosion in popularity with the rise of the internet.

There are two main formats fora auctions, lowest and highest unique auction, however they both run on the same premise where the last unique bid wins the item. Winning a penny auction will require a certain amount of mental tactic and a bit of luck. However, you can increase your odds of winning by practicing certain techniques such as managing your bids wisely, learning how to work with the time, and keeping a level head and your emotions under control. When you combine those three strategies to your bidding plan, you will find that you win a lot more often.

It is important that you do your due diligence to protect yourself when participating in auctions. Not every auction is run by honest and trustworthy people. There are people out there who just want to take your money. You can protect yourself by ensuring that you only bid on sites that already have a very positive reputation from real users.

What Is the Best Home Based Business To Start in 2013?

The first thing to keep in mind is that the best home business to start is one based on the internet. It is no secret that more and more people are buying products and services online and, as the sales of online business transactions continues to increase, sales in the offline world continue to decrease.To begin an online business from home you do not need a lot of technical skills or a lot of money to get started out. There is no age barrier, or level of education required, it does not matter about your current internet practical experience or even that you do not have any products to sell.The best home based business simply starts with no stock. So, how can you have a business without any stock to sell? Basically, you sell products and services on behalf of other people and when you sell them the product owner pays you a commission. This home based business model is called online affiliate marketing.Unlike a traditional offline trading business, an online affiliate marketer does not have to buy the stock before he or she goes on to sell it. Firstly, you find products and services which are currently popular. This can either be physical products or digital products. Digital products are those which a buyer will download directly to their computer. This may be something like an education course.Once you have found a product, you promote it to a target audience who would be interested in it. When somebody buys it, you get paid a commission.For example, you can become an Amazon affiliate (which costs you nothing) and look for a product that interests you and that people are currently buying. Let’s say for example it is camping equipment. You insert an advertisement in an online camping magazine for the latest high-tech tent which you found on Amazon. When somebody clicks on your ad and buys the product, you will get paid a commission.This is why affiliate marketing is one of the best home based businesses to start. You do not have to worry about shipping the product, holding it in stock, sorting out any returns or any other customer queries.If you do not want to get involved with physical items and you prefer to have a home based business that sells digital products, you can find a huge selection at Clickbank. This is an online marketplace that deals in thousands of digital products for many different markets. Again, there is no cost to become a Clickbank member.Keep in mind that your home based business is a business and not a hobby. It will require work and some investment. Whilst the set up costs for the best home based business are a lot less than a traditional bricks and mortar business, it will need financial commitment for such items as a website, hosting, marketing, advertising, mentoring and education.An online home based business may not appeal to some individuals as they might believe that they do not have the technical skills required to get the best home based business possible. All of the reasons for not setting up a home based business on the internet can be readily overcome if you are prepared to learn and have the determination to build a sustainable and long term business.

Running an Online Home-Based Business – Are You A Businessperson or A Consumer?

If you run an online home-based business and you behave like a mere consumer, then don’t be surprised if all your efforts at growing your business is undermined by this mindset.Businesses make rational buying decisions after careful thought and based on a good feel for how what they are buying fit into their business model.Consumers make decisions based on impulse and what they feel will bring them satisfaction.If you are going to be successful in your online home-based business you have to understand this distinction.How do you adopt the mindset of an online business-person rather than a mere online consumer? Well maybe if you understand the implications, then this will force you to adopt the correct mindset.The implications from behaving as one or the other for your business are huge. And especially so if your business is home-based and run online.Every marketer trying to sell you something online is selling you based on their perception of you as the consumer who will instinctively pick up that tempting chocolate bar at the check-out.Not as a shopper who entered the store with a list of what is required and who is going to buy only what is on that list. And certainly not as an operator of an online home-based business having specific requirements.If you operate with the mindset of the consumer, each of your purchasing decision is most likely going to be driven by the mindset of a mere consumer. Not the mindset of a business person.That is because your online activities are most likely not based on a business model that have specific requirements, but are based on a purely money-making model looking to consume business opportunities presented to you.With this mindset you morph into an online business opportunity consumer, not an online home business operator.It leads to irrational decisions based on whims and driven by sales pitches creating an unhealthy level of anxiety that end up fragmenting your efforts, your time and your financial resources, damaging to your efforts at running a successful online business.These are the ultimate consequences of being an online business opportunity consumer rather than truly being an online business operator. And these consequences are what will eventually cause you to get exhausted and de-motivated only to end up putting your faith in another crazy idea with the same outcome over and over again.You cannot afford to have this mindset if you are going to run a successful online home-based business. So before you even contemplate running this kind of business online, get the correct mindset in place and the underlying resolve that comes from a deep understanding of the consequences of not doing so.Any other approach is just courting failure.