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Re: [OM] Shill Bidding

Subject: Re: [OM] Shill Bidding
From: Frank van Lindert <franklin@xxxxxxxxxx>
Date: Mon, 20 Mar 2000 21:34:38 +0100
On Mon, 20 Mar 2000 10:05:20 -0800, Matt BenDaniel
<matt@xxxxxxxxxxxxxxx> wrote:

>While we're on the topic of bidding technicalities, I have another
>question. I beg your pardon if this issue is already discussed somewhere
>in the archives.  I asked this question of eBay and they had no
>substantive answer.  I've been concerned since I started using eBay that
>there are flaws in the bidding model.
>
>What prevents one or more bidders from working in conjunction with the
>seller to jack the price up?
>
>Perhaps bids over a certain amount should be restricted to only those
>bidders who have authenticated themselves in some stronger way than just
>an email address.  If seller X's shill bids on the piece, at least some
>record of it would available for scrutiny.
>
>Matt BenDaniel

Matt,

Like two other replyers already said, nothing but the rules prevents
bidders from working together. But it is not only the high bidders
being at risk here when the other bidders back out.
One of the things going through my mind when reading about the Nikon
shade auction was indeed that a few bidders might have conspired to
make the auction end with a very high bid. One seller with a few eBay
accounts could also have done this.
The purpose _may_ have been, to make all possible bidders think that
this cap is worth far more than they thought it was. Which might be
profitable in another auction for such a (or even this very same!)
shade, or in a direct sale of the item.... "eBay price is $5,500 -
check for yourself!"

This happens in real auctions too. I have attended art auctions,
working as a reporter a long time ago. A group of bidders, cooperating
with the seller of some paintings made by one artist bid extremely
high on two or three of his works. Something like eight or ten times
the actual value.
The similar paintings of the same artist in the following auction
ended less high - but still at five or six times the real value. And
the (real) winning bidders in those auctions returned home thinking
that they had bought the works very cheap....

It also happens in shops. A well known trick is, to offer a few equal
items in one long advertisement. Let's suppose (for the necessary OM
content) that a camera shop has five 300/4.5 lenses. Four are offered
at $450 each and the fifth one at $400. 
Of course the buyer will ask for that specific 'cheap' lens. Seller
wails and says 'this is a typo, you can't have it for less than the
other ones'. In the end he will give in and sell for the indicated
$400. Both will be happy - the buyer because he has got a $50
discount, and the seller because he has sold another of his $350
lenses with a $50 extra profit.

I must add that this camera shop example was made up by me - but it is
comon practice in the used car business. And there are many more
selling tricks like this one...

So take some care when bidding in auctions - and preferably buy your
Oly stuff from reputable list members, whenever possible ;-)

Frank van Lindert
Utrecht NL.

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