Win/Lose or draw, penny auctions here to stay

Dec. 16, 2009 - PRLog -- How Does SwoopBug Offer Such Low Prices?
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Every day SwoopBug sells products at 60-90% below their retail price. The most common question we are asked is “How do you offer such low prices?” SwoopBug is able to offer such low prices on its products because of the unique auction model that we use.

Traditional auctions consist of people bidding higher and higher prices until the item being auctioned is finally sold. However, during a traditional auction the item often sells for a price around its actual market value. The SwoopBug auction model ensures that almost every auction will end with the winner paying a price far below the retail value of the product. This is possible because each bid in a SwoopBug auction costs $ 1.00

For example, SwoopBug will often auction Amazon.com’s amazing Kindle. The Kindle costs $259.00 when ordered from Amazon, but it recently sold in a SwoopBug.com auction for only $8.70! Here’s how that is possible:

SwoopBug purchases the Amazon Kindle for $259.00. It then schedules an auction for the Kindle to end sometime in the near future. Each auction has a banner in the upper left corner that indicates what cent increment the auction is. That number can be $.01, $.02, $.05, $.10, or $.20. It represents how much the final sales price will increase each time a bid is placed.

So an auction is scheduled for the Amazon Kindle as a $.02 auction and as the timer counts down bids begin to be placed by users who are competing for a chance to win. Eventually, the bidding ends at the price of $8.70. Because it was a $.02 auction that means that there were a total of 435 bids placed during the course of the auction.

435 bids x $.60 bid = $261.00 ( this formula is based on 60 cent bids ) formulas change according to the actual bid cost ) but the concept remains the same

Cost for SwoopBug to Purchase the Amazon Kindle = $259.00

Cost for the Auction Winner to Purchase the Amazon Kindle = $

The bidding in this auction paid for SwoopBug cost to buy the product. As a result the winner of the auction was able to win a Kindle at a 90% discount to its retail price.

But what about the users that didn’t win? In order to make our auction model as fair as possible, SwoopBug offers every user that placed bids on this auction the ability to redeem the value of their bids towards a “Buy it Now”. When a user chooses to execute a “Buy it Now” SwoopBug applies the value of all the bids placed in that auction towards the cost to purchase a second Kindle. The user pays the remainder of what it costs SwoopBug to purchase the second Kindle. This way there is no bid that is ever wasted on SwoopBug.

If you have more questions about how the process of winning an auction works check out this article. Or, if you can learn more about how much profit SwoopBug really makes here

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We are a penny auction site offering Name Brand items for auction at an almost 95% savings from retail store prices. A most significant difference between swoopbug and most other auctions is we deliver all our merchandise from our own warehouse..