Should I post my e-Bay starting bids at $0.99?

January 24, 2006 1:59 AM

I'm an eBay newbie, and would like to post some items up for sale. Is it a good option to post my starting bid at $0.99 instead of my lowest selling price (about $10-15)? What are the pros and cons of either options? Would love to hear feedback from experienced eBay sellers / users.
posted by arrowhead to computers & internet (30 comments total)

I'm always a fan of placing a low starting bid and still maintaining a reserve price.

You pay the same fee as a starting bid at the reserve rate (meaning, starting bid at $10 vs. reserve at $10 will have the same opening fees), but the lower inital price is visually attractive to buyers looking to snatch up an item.

Sometimes, you can tempt with a "reserve is less than $x" line in the listing to let serious potential bidders know that it might be worth their time to wait and watch carefully over the auction.

Naturally, setting a low starting bid with no reserve will get you a low listing fee, but you'll still pay a percentage based on the selling value. Anything in the $10-$15 range is going to stay close to the rates you're paying anywhere along that scale, but you'll only pay about 35 cents to ensure that you make it worth your while to complete the sale.

Summed up, I'd advise that you start at $0.99 and set a reasonable reserve.

Good luck!
posted by disillusioned at 2:19 AM on January 24, 2006

Hi Arrowhead,

There are a TON of previous MeFi questions similar to this, if you do a search.
posted by k8t at 3:06 AM on January 24, 2006

I personally find the low-start-plus-reserve approach useless.

It attracts a bunch of people who place low bids for the sake of the buzz they get when bidding, but they very rarely translate into serious bidders.

The only plus is that a low starting bid puts you at the top of a category when buyers sort by price ascending.

Most of the people I know treat ebay more like an ecommerce site than an auction site - they use buy-it-now because they can't be bothered to wait 5 days for the auction to end, and they'd rather pay an extra $2 than get outbid and have to start the process again. My experience as a seller bears this out. So my suggestion would be to set a fair buy-it-now price, and a starting bid a couple of dollars below. No reserve.

Having said all that, I'm selling new items at around the $100 mark to a very specific market - your experience may be completely different. I'd suggest looking at completed auctions in your category, and seeing what seemed to work for others.
posted by Leon at 3:25 AM on January 24, 2006

As a buyer, I never bid on reserve auctions.
posted by Marky at 3:29 AM on January 24, 2006

Reserve is useless. Look how much similar items are going for (you can search for only completed listings), then start the auction at $0.99 with a buy it now price for a couple of dollars less than most items are going for. If items similar to yours aren't going for $10-15, it probably isn't worth that much, and you wont get that much regardless of what you do.
posted by Orange Goblin at 3:57 AM on January 24, 2006

In my experience, reserves are only useful on high price items as a way to avoid a very high (and potentially off putting) starting price.

On eBay UK, the minimum reserve you can put on an auction is now £50.
posted by gfrobe at 4:17 AM on January 24, 2006

Reserve is no longer available on ebay.com.au (except for high-value items like cars) and the reason they give is that the average sale price of non-reserve items is much much higher - something well over 30% unless I'm mistaken. Lots of people are like Marky and just don't bid on reserve auctions.

The statistics say "don't use a reserve" but of course there is additional risk. How much that risk is will of course depend on what you're selling and how well defined the market is for it on eBay.
posted by polyglot at 4:22 AM on January 24, 2006

As a buyer, few things are more irrititating than the low-start/high-reserve. I'm not going to sit there and keep guessing what you want for the item - which is probably more than I want to pay for it, and by the time I've found out, I'm LEGALLY locked into buying it. No way!!
posted by mimi at 5:25 AM on January 24, 2006

Just a "me too". I've been using eBay for seven years now, and have never bid on a reserve auction. I doubt I'll have bid on one in another seven years. What's the point?

Just the same, I'm curious to read other responses. I did a round of eBay selling about five years ago, and I'm ready to do another. I need tips! I hope you get lots of them.
posted by jdroth at 5:57 AM on January 24, 2006

Don't use a reserve, they put off bidders and are expensive. When bidding on a reserve auction you should bid what you are prepared to pay and see if it is enough, if not then walk away. You should not keep guessing until you reach what the seller wants for it - that's what the seller is hoping for.

It would help to know what you are selling.

Say you are auctioning an X-Box game that has just been released. This is an item that is in demand, and one that has an obvious high street value that the bidders will all be aware of. This is the best type of item to start at $0.99. Both the seller and the buyer is aware of the value, the item is in demand, and there will be plenty of bidding which will take it to an expected figure, give or take a few dollars (not always, but usually.) The $0.99 starting price will immediately draw in interested bidders who will watch the item and bid early on it. Enticing as many people to bid early as possible should be your objective because as soon as they have participated in the auction they are more likely to get into a frenzy at the end of the auction and pay more than they mean to while defending their bid. If you start the X-Box game at it's true value ($40?) you will have plenty of people watch it, then maybe 1 or 2 bids at the end as it is coolly picked off.

It is harder if you are auctioning something with no precisely known value, that may be attractive to different people for different reasons. Say an old book about fishing from the 1930's. You try and look up it's value on Google but can't find it. It looks like it might be worth $5-10 and you bought it for $1 years ago. Ignoring the fact that it may be worth nothing, a few scenarios can happen when you put it on ebay.

1) Someone on eBay may have been searching for years to find this rare and out of print book.

2) A novice collector on eBay may collect old books, but not know a lot about fishing books.

3) The book may be worth thousands of dollars

It may seem a good idea to list this item at $0.99 and see what happens. In the case of the 3rd option above, there will probably be enough interest, and knowledgeable bidders, to take the book from $0.99 to it's true thousand dollar value. People only very rarely get expensive antiques and rarities from eBay for peanuts.

However, if there is just one person out there, one potential bidder, who has been hunting for this book for years as in the 1st scenario, you would be an idiot to let them have it for $0.99. So it is worth even guessing a figure that you might expect for the book. Inspect it, make a judgement, and price it ($15, 30, whatever.) This pricing also has an effect regarding scenario 2 above where you have an audience of buyers who don't really know about the item either, but would be willing to buy it if it seems attractive. Put simply, you can convince someone that an item is worth buying if you make it expensive. At $0.99 the X-Box game is still attractive because everyone knows that it's worth $40. However, at $0.99 you are telling the buyers that this unknown book is rubbish. Priced at $15 it seems a much better prospective purchase to a collector who may be vaguely interested in that genre. The quality of your listing also comes into play here - you need to be able to talk an item up, photograph it well and appear knowledgeable.

Of course it varies, and you can never predict what will happen in an auction, but I once sold a record to a man on eBay for £2 who later excitedly emailed me to tell me he would have paid £500 for it. It stings.

If you are selling something you've made yourself then start the auction at a price which will cover your costs and offer a little profit, and any growth in price after that will be pure profit. $0.99 in this scenario is madness, unless you make really, really cool stuff that will just fly.

If an item has a widely known value and is in reasonable demand, then start it at $0.99, or a little below it's full price. Either way the item should make it's money. If an item has no identifiable value, then value it yourself and do not risk the $0.99 option. Unless it's obviously just junk. Just my opinion.
posted by fire&wings at 6:08 AM on January 24, 2006 [1 favorite]

It's been a while since I sold anything on ebay, but when I did, it always sold at a higher closing price if I started with a lower starting bid.

If you start at something reasonable, you automatically lock out all of the people who think they don't want to pay that much, but if you start low, you also include people who aren't sure but may change their minds as they're faced with a chance to buy low that's taken away from them.

This may apply less now that there are all sorts of automated bidding tools, but I suspect the underlying psychology is still the same. Auctions are about tempting as many people as possible to bid as much as they can to match the seller with the particular buyer who wants it most. You can never tell where that one buyer who does want it most is going to start.
posted by Caviar at 6:14 AM on January 24, 2006

mimi: I tend to agree on not liking to buy stuff that has a reserve, but no way should you be bidding up an item just to see how high the reserve is. You should bid based on what the item is worth to you.
posted by SteveInMaine at 6:16 AM on January 24, 2006

I use low starting bids because it tends to get 4-5 bids right away at a low amount, from people who want to effectively steal it for nothing. Those bids then make your auction look more attractive in the listing than one that has 0 or 1 bids. This seems to drive more hits.
posted by smackfu at 6:31 AM on January 24, 2006

Just chiming in to say I almost never bid on anything that has a reserve. It annoys me that they won't just tell me what their minimum is. And it's frustrating to keep bidding and be told, no, you didn't get there yet. Phooey.
posted by CunningLinguist at 7:30 AM on January 24, 2006

I don't bid on crap if I don't know if my bid will win, but on the other hand I've only gotten things off ebay twice in my life.
posted by delmoi at 7:31 AM on January 24, 2006

I've sold a lot of stuff, mostly rather expensive (hundreds to several thousand dollars). I've bought the same amount.

The key things to getting a good price are:

Coherent, accurate, grammatical, correctly spelled description.
Sharp, detailed photos.
100% feedback.
Buy-it-now
Paypal
No reserve
Money-back-guarantee
Low starting bid
Desirable item

Um, that's it.

I will buy from people with feedback in the 98-99% range, nothing less. I will occasionally buy when there's no money-back-guarantee if it is clearly explained what's wrong with the item (great bargains to be had like this). I very rarely use anything but paypal and almost always use buy-it-now. Anyone who can't be bothered to describe or photograph their stuff properly is likely to be a pain in the ass down the line in my experience.

Final tip: auctionsniper.com
posted by unSane at 7:44 AM on January 24, 2006

Reserves are not useless if you state the reserve in the auction. The reason so many people hate reserves is because most sellers don't understand its function. They keep the reserve hidden thinking people are just going to keep bidding in order to hit the reserve, but they're not. Most people have a max and if your reserve is higher, you're SOL. So, feel free to use a reserve, but state what the reserve is in the body of the auction. People who think it's too high can just move along and not pay attention to your auction; people who think it's fair can bid--and place an early bid that meets the reserve in order to be the first person to meet it.

That said, your best bet is to search eBay for *completed* auctions of the same items you are selling. (There is a check box on the left column for completed auctions.) Once done, you're looking for three factors:

- closing price
- closing date
- number of bidders

The price on multiple similar items to what you're selling will give you an idea of what you can get for it.

The number of bidders will tell you how many people are interested in your item. If the item continually sells (multiple successful completed auctions) but only has 1 or 2 bidders, then you do not want to start your bidding low as there are not enough people to increase it. If there are 10+ bidders on each of the finished auctions, you can be safe with a lower start price.

The date will tell you how often the items are available--though this info isn't as useful as the other two pieces of data.

One other thing you can do: if auctions ended recently for a similar item, post your auction and then email those auctions' losing bidders with a link to your item and a note, like "I see you just bid on a X but weren't the winning bidder. I just thought I'd let you know I just put up an auction (item #) for a similar item with a start price lower than your high bid. Thanks, and I hope this email isn't an intrusion. Best of luck!" I have sold many items this way, especially when I have a buy it now price less than their high bid (by, like, a buck). For this very reason, I keep my own auctions Private so that other sellers cannot mail my losers--just in case I'm selling multiple items that are similar.

So:

- more bidders means start with a lower price
- less bidders means start with a higher price or a stated reserve (and that reserve should reflect the closing prices for similar items in similar condition).

You can also look closely at the completed auctions and see why auction X closed higher than auction Y. Factors will include:

- good use of the eBay title (what most people are searching for when using the search function)
- accurate, detailed description of the item's condition
- where the seller will ship to
- type of payment accepted
- feedback of seller

The above are what most people will base their biddiing on. Far and away you'll see the highest bids on items by sellers with the best feedback, that take paypal, that ship worldwide. People who won't ship out of their country are shooting themselves in the foot, frankly. Confirm this by checking past auctions--in my experience worldwide shippers (or at least north america and europe, compared to just usa) get 20 to 25 percent more $.
posted by You Should See the Other Guy at 8:06 AM on January 24, 2006

Oh, and yes, there are many past AskMe questions like this. Most of the techniques I listed are stolen from them.
posted by You Should See the Other Guy at 8:08 AM on January 24, 2006

One thing nobody mentioned: be clear about shipping. A common eBay quasi-scam now is to sell cheap, ship dear. Experienced buyers will be wary about signs of that.
posted by zadcat at 8:15 AM on January 24, 2006

I've been bidding and selling on ebay for five years with perfect feedback. I hate hate hate hate hate reserve auctions. There's nothing as annoying as bidding on something and getting a message that your bid won't be honored if it were to win.

I never sell with reserve auctions. If I'm unsure on the range of what I'll get for something, I start the auction at the absolute lowest amount I'd be willing to part with the item for.

If it's something I know will sell, or is worthless to me, I'll start it at $1. Most ebay users won't bid on something until the last possible moment, but, starting an auction at $1 will draw in people who are looking to steal something, and will get the auction moving.
posted by drezdn at 8:36 AM on January 24, 2006

I hate the reserve price so much that I almost never bid on things with them. I do think that the low start is a plus if you can stomach the risk. I don't understand the appeal, but then I don't understand the snipe either - I bid what I am willing to pay and that's that. I am in the minority, however, and I think it's the same impulse that drives the success - people get caught up in the back-and-forth bidding.
posted by phearlez at 8:43 AM on January 24, 2006

Ebay member since early 1998, near 400 feedback, 100% positive.

I never bid on auctions with a reserve. I've used them as a seller before, and found them to be useless. And you just open up a constant barrage of "OMG WILL YOU TELL ME WHAT THE RESERVE IS!??!???!" mails from buyers.

For the last couple of years, I've been mainly selling. I start low, and never use reserves. Most of my auctions (records usually) I'll start at £1.99. If it's a bigger item, the highest I'll generally go for the starting price is £4.99. You need to get some bids in early, and if you set a high starting price you'll just put people off until the last minute.

If you're selling items that you absolutely can't afford to let go for less than a certain amount, you really shouldn't be selling them on Ebay, other than with a "Buy It Now", imo.
posted by coach_mcguirk at 10:07 AM on January 24, 2006

I've got 280+ feedback. I rarely ever bid on reserves either. If the item will definately sell for say, $20, like Final Fantasy for NES probably would, I would feel comfortable putting it at $0.01 to start with just to encourage bidding (especially if I only paid like $8 for it). Starting it at $20 might get some, but won't generate enough bid watchers or people who will keep an eye on it throughout the entire run and try to snipe it at the end. If it's something unlikely to get lots of bids, just set the start price as the minimal you'll let it go for, simple as that. Be clear about shipping. If you set the shipping rate low, you'll get way more bidders. I absolutely hate auctions with the shipping set high to compensate -- it's like there is no confidence in the product -- meaning I have no confidence in the seller. Provide oodles of pictures, up close and afar off. Tell a story about how you can across it and give the item character. A recent purchase I made remarked that his girlfriend had given it to him but for Christmas got something better and didn't need it anymore, that it was still in good working condition, etc.
posted by vanoakenfold at 10:15 AM on January 24, 2006

Putting something at a low price seems somewhat pointless. As a couple have said earliers, the low end bidders can't be serious. They may be, but like i'm going to sell a laptop for $100. The other thing is, bidding the amount of time left is usually more of an indicator that the low beginning price. Usually I don't see much happening untill the last 12 hours; that's when the price usually goes up to a respectable zone. .

I have and have not used reserves when selling old computers. Basically, it comes down to not selling something below the price and that guarantees it. I didn't have any problems finding buyers. BUT, from reading what others have said about that, it all makes sense.
posted by _zed_ at 10:22 AM on January 24, 2006

Another thing about the shipping: Set expectations. Especially for the stupid eBay n00bs. I no longer sell to anyone with less than 10 feedbacks because of too many problems with eBay n00bs. Classic example: I'm in California. I sold an item to someone in Kentucky. It was his second eBay purchase. He paid via PayPal on Sunday night. The auction stated I would ship the item via UPS Ground on Tuesday. On Tuesday, he wrote me a nasty email asking why he hadn't received the item yet. I told him that the item was going out UPS Ground, as the auction stated. He replied saying that was unacceptable and he expected me to change the shipping to overnight air and to pay for the difference in shipping out of my own pocket.

I told him that I would happily refund all of his money for the item and sell it to someone else. This got his attention and he replied with "Well, I expect the item soon." What a dick. I shipped the item on Tuesday via UPS Ground, and it got there Friday.

So, I cannot stress this enough - be very clear about shipping costs and shipping times.
posted by drstein at 10:31 AM on January 24, 2006

I heartily agree with those who suggested looking at closed auctions of items you want to sell. That has been the most useful source of info and confidence when I'm selling something on eBay.

Also, drstein's advice is excellent -- both about people new to ebay and about placating someone by apologizing and offering a refund. I've had two experiences with complaining buyers who relaxed and became satisfied with their purchases once I showed a willingness to return their money.

And to address your a actual question: I have bid many times on reserve auctions, but only when I definitely want the thing and it's hard to find.
posted by wryly at 12:37 PM on January 24, 2006

I updated my own Seller FAQ just last week, and I just finished a batch of auctions this weekend. I'm not a high-volume seller, but I've been using the site for seven years. It might prove helpful.

The answer to your question depends on what you're selling. Unless you're selling something obscure that's unlikely to attract many bids, then yes, you should start with a low price. EBay is pretty reliable in terms of establishing a fair market price, partly because it attracts so many visitors every day. Unless you're selling something that only appeals to four people in the world, you can almost guarantee your auction will work its way to a fair price.

If it helps you, I'll tell you that I usually start CDs at $0.01 with a $3.00 charge to cover eBay's listing fee, PayPal's fee, a padded envelope, and First Class postage. I do sell obscure jazz CDs, so it's not uncommon for my auctions to end at $0.01 with only one bidder (in which case I'd lose money, if it weren't for that $3.00 fee); but almost every auction sells, whereas starting at $2.99 or more often failed to attract even one bidder.

One of the most important points in my FAQ is that I restrict my auction payments to PayPal only. Personally, I'd prefer not to use PayPal; but after seven years on eBay, I have to admit that it's the best way to avoid deadbeat bidders. I haven't noticed any drop in my closing prices since making that decision. There might be people who refuse to bid on my auctions because of that, but they aren't enough to make a difference.

Finally, I'd echo drstein's advice: Be clear. Don't write complicated instructions, because the more you write, the less they'll read; but be forthright. Here's an example of one of my auctions. Clear, simple instructions help avoid problems.
posted by cribcage at 12:46 PM on January 24, 2006

Just another ebayer who NEVER bids on reserve auctions.
posted by LittleMissCranky at 1:20 PM on January 24, 2006

I may be in a minority, but when I get e-mails from sellers using the technique You Should See the Other Guy describes, they've gone on my personal seller blacklist. It just creeps me out.

Please read the help files. A somewhat newbie seller offered me something second chance, thinking he was offering it at the reserve price, not at my bid. That turned into quite an unpleasant fiasco.
posted by QIbHom at 9:09 PM on January 25, 2006

I would like to point out that all the people saying "omg I never bid in reserve auctions" and the statistic about prices ending up lower in reserve auctions are both things to note as a buyer -- because it means that you'll get things cheaper in those auctions and have less competition doing it. Just don't bid more than you're willing to pay, and you'll be fine.
posted by reklaw at 2:03 PM on February 7, 2006