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Automatic max bids

Im fairly new to ebay auctions. And apparently I am interested in items that other members like to bid on. I have read the automatic bidding info from ebay. Yet fail to see how to use it since this isnt a silent auction. You can place a max bid on an item. But the other users can see your high bid and out bid you. Ebay says you can enter a max bid and they will incrementally increase your bid to beat others until your max is reached, but how is this achieved when max bids are transparent? 

Ive also been on the buyer end where i have been bidding on an item and it is immediately outbid. This is explained in the ebay info as what happens when someone else is using automatic bidding. So why not show me their max bid outright and i can decide if I want to outbid it? 

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Automatic max bids

@wilschaa-0 

Maximum bids are NOT transparent. Ebay keeps the bidders' maximum proxy bid hidden until their maximum proxy bid is outbid.

 

You should not depend on someone else's bid amount to place your bid. Decide how much you are willing to spend on the item, the absolute MOST, and bid that amount. If you become highest bidder, that's great, but if someone else's bid was more, you can just walk away knowing that someone else was willing to spend more than you.

lady_madonna
Volunteer Ebay Community Mentor

Message 2 of 13
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Automatic max bids


@wilschaa-0 wrote:

Im fairly new to ebay auctions. And apparently I am interested in items that other members like to bid on. I have read the automatic bidding info from ebay. Yet fail to see how to use it since this isnt a silent auction. You can place a max bid on an item. But the other users can see your high bid and out bid you. Ebay says you can enter a max bid and they will incrementally increase your bid to beat others until your max is reached, but how is this achieved when max bids are transparent? 

Ive also been on the buyer end where i have been bidding on an item and it is immediately outbid. This is explained in the ebay info as what happens when someone else is using automatic bidding. So why not show me their max bid outright and i can decide if I want to outbid it? 


bc ebay has decided to use the system they have implemented

 

here is an ebay link explaining if u'd like to read it>

 

https://www.ebay.com/help/buying/bidding/automatic-bidding?id=4014

Message 3 of 13
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Automatic max bids

So where is the separate options to place a bid or to set a maximum bid. I only see one option. You place a bid and it raises the high bid amount on the auction page. I can see when others raise the bid as well. So how do you set a maximum bid amount w out that being 

Message 4 of 13
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Automatic max bids

ANY bid is treated as a "maximum bid" under the automatic a/k/a proxy a/k/a incremental bidding system. It's not an option that you do something special to invoke or can even opt out of; it is simply HOW eBay auctions work (highest bidder wins, but price is calculated primarily from the maximum bid of the second highest bidder, and eBay hides the full amount of the leader's/winner's maximum bid to the extent it exceeds that calculated price). Even if you just bid the minimum, you can end up with a hidden maximum (if the prior leading bid is cancelled). The notion that eBay "automatically bids on your behalf" is an analogy to describe the process for those who want simple answers but results in many misundertandings of what actually happens in particular situations (such as thinking there is a difference between "regular" and "automatic" bidding).

So, mechanically, you bid the same way you bid now (unless you are using a 1-click bidding button that purports to put in a bid in an amount eBay says, in which case do not use those as they are not only tactically bad--they encourage bidding round numbers in an amount based on the current bid amount--they are outright dangerous in that the amount can change just as you are going to click), except that instead of putting the minimum bid or whatever amount you are now using in the bid box, you put your TRUE maximum you are willing to pay for that item as listed WITHOUT REGARD to what anyone else appears or doesn't appear to be bidding. Since what is needed to beat the second highest bidder, whether s/he bids before or after you, is already figured into the price if you win, there is no need to factor it into your bid amount; all you have to figure out is at what price point you would rather someone else have the item than you having to pay more than that price.

Tip: make your bid a little higher than the round number you are likely to come up with; this increases your chances of being on the winning side of what might otherwise have been a tie (most bidders bid the round number) and decreases the odds of losing to someone else who knows this tip. I strongly advise that you bid ONLY ONCE at your TRUE maximum: there are circumstances where already having bid on the auction can prevent you from rebidding; further bid late in the auction (but in time for the bid to be received at eBay before the end--the countdown is not reliable for timing that within the last few seconds) for several good reasons, including keeping your options open and not using up your limits.

Message 5 of 13
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Automatic max bids

Shown on the public format. Sorry probably stupid question but i dont see the seperation or how to make an automatic max bid w out it being a normal bid. 
and to your other point. If an item is at $200 and im willing to pay $400 why would i make the $400 bid if i could have hade it for $300 if thats what the next highest bid is

Message 6 of 13
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Automatic max bids

@wilschaa-0 

 

< if someone else's bid was more, you can just walk away >     

 

But don't buy it somewhere else, not just yet, because that higher bid might get retracted or cancelled,  and put you in the lead and maybe ultimately win.  You are responsible for your bid until the auction is completely over ... do you remember reading that?  

 

Message 7 of 13
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Automatic max bids

Sorry but i did say i have already read their automatic bidding info. It just says to set up automatic bidding you make a bid. Then how is it different than a normal bid. Im obviously misinterpreted something 

Message 8 of 13
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Automatic max bids

Yes I understand the contract. I dont understand the difference between placing a normal bid everyone can see and being able to set an automatic max bid that no one can see and that your bids are being made incrementally and automatically until your max bid has been exceeded 

Message 9 of 13
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Automatic max bids

@wilschaa-0 


@wilschaa-0 wrote:

Yes I understand the contract. I dont understand the difference between placing a normal bid everyone can see and being able to set an automatic max bid that no one can see and that your bids are being made incrementally and automatically until your max bid has been exceeded 


There is NO difference...there are not 2 kinds of bids. ALL bids are "automatic".  When you place your bid, Ebay will use just enough of your bid to keep you in the lead and the rest of your bid will remain hidden. As other bidders come along an place their bids, Ebay will raise your bidding to keep you in the lead until your maximum has been exceeded.

 

Example: You decide to place one bid of $5 on an item. Current bidding level is $1  with 1 other bidder bidding. Ebay will take just enough of your $5 bid to keep you ahead of the other bidder by one increment. Your $5 maximum remains hidden for now. Then let's say someone comes along and bids at least $7. At that point your maximum bid is revealed because the other bidder bid more than you. Up until that point, your maximum proxy bid would not have been revealed yet.

lady_madonna
Volunteer Ebay Community Mentor

Message 10 of 13
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Automatic max bids

Ok thankyou for that I understand what your saying.  Was confused by the fact that once you bid you dont see the process of the bidding until your bid is beaten. 
Is also weird that your allowed to place a bid at their recommended bid price then immediately told it hasnt beat the highest bid. 
And so every time someone is outbid is when the price jumps at the auction for everyone to see. And does not jump when a bid is placed. Still bit confused but i think you answered my main question.

Message 11 of 13
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Automatic max bids

@wilschaa-0

>>Was confused by the fact that once you bid you dont see the process of the bidding until your bid is beaten. <<

You can see the bidding activity on the bidding history page. Go to the listing and click on the number of bids in order to see the bidding progression. You can "see" the bidders and amounts bid. (the highest bidder will not have their maximum proxy bid shown)


>>Is also weird that your allowed to place a bid at their recommended bid price then immediately told it hasnt beat the highest bid. <<

The recommended bid amount is only one increment above current bid showing on the listing page, not one increment above the high bidder's hidden maximum proxy bid. Even though you may bid the recommended amount, you could be immediately outbid by the other bidder's maximum proxy bid.


>>And so every time someone is outbid is when the price jumps at the auction for everyone to see. And does not jump when a bid is placed. <<

The price changes when there are competing bids.

lady_madonna
Volunteer Ebay Community Mentor

Message 12 of 13
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Automatic max bids

It is not a "recommended amount", it is the MINIMUM amount.  A lower bid will be rejected because it does not meet the requirement that a new bid must be at least 1 bid increment more than the currently displayed "current bid" amount.   If you only bid that amount it is very likely it will be immediately outbid.  How is that "weird"?

 

Every time a new bid is placed the "current bid" is recalculated.   There are only 2 situations where that calculation does not result in a higher "current bid":  1.  The very first bid will leave the "current bid" at the amount of the Starting Price (unless there is a Reserve Price that that bid is high enough to meet);  2.  When the current high bidder places a new bid the "current bid" will almost always remain the same (unless, again, there is a previously unmet Reserve Price that the new bid meets, or possibly--this keeps changing--if the high bidder is leading by less than a full bid increment over the underbidder's maximum so the leader's maximum bid is fully exposed the "current bid" might increase to the full bid increment over the underbid.

 

You seem to have a lot of misconceptions about how bidding works and correcting them one by one is exhausting.  Please pretend you know nothing about the process and read my explanation of how eBay bidding REALLY works (as I note, eBay's explanation is unsatisfactory and leads to wrong results):

 

eBay does not use an English Outcry auction format (bid and counterbid, going going gone to the last bidder at the full amount of the last bid) and you put yourself at a big disadvantage if you try to bid like it was such a format. eBay's auctions use a fixed-time semi-sealed-bid modified second-price (Vickery) format. This makes them fair to all potential bidders no matter their timezone or schedule. What you need to know to understand how eBay (this does not include "Live Auctions" on the eBay site which have different rules) auctions work:

The highest bidder (as of the end of the auction) wins, regardless of when his bid is placed (even if it was received in the last second and didn't show on your screen when your countdown got to 0), but the price is set by the SECOND highest bidder (generally that underbidder's highest bid plus 1 bid increment; less if the winner's bid is not a full increment higher than the underbid, including an earlier tie; more if needed to meet the reserve in a reserve listing; the starting bid amount set by the seller if there is only 1 bidder and no reserve).

During the auction eBay calculates and posts a "current bid", which is simply what the price will be if there is no further bid activity before the auction ends, and uses that "current bid" to set a minimum amount for new bids (1 increment over the "current bid" except for the very first bid, which need only be at least the "starting bid" amount set by the seller).

During and after the auction, eBay hides the full amount of the leader's/winner's bid to the extent that it exceeds that calculated price. (If the winner/leader has made multiple bids, only those that exceed the price have their full amount hidden.) For any such hidden bid amount, eBay substitutes the calculated price amount for the full amount of the bid.

When you bid less than what the current leader has bid before you, you are immediately outbid and become the new underbidder and the "current bid" is recalculated at 1 increment higher than your bid (or the full amount of the previously hidden maximum if less than an increment over your new bid, including an earlier-placed tie--ties go to the earlier placed bid). When you bid more than what current leader has bid before you, you take the lead at 1 bid increment over his/her (previously hidden) maximum (or the full amount of your bid if it is less than a full increment over his previously hidden maximum; but if it was "Reserve not met" before you bid and your bid was at least as high as the previously unmet reserve price you take the lead at the exact amount of the reserve price unless the general rule would dictate a higher price because the previously hidden maximum was less than an increment below the reserve).

Some people, including eBay, try to simplify this by drawing an analogy to an outcry auction, but one where eBay automatically "places bids on your behalf" up to your maximum bid (hence the phrase "automatic bidding"). This is an imperfect analogy, and in many cases people trying to apply it to a particular situation end up either oversimplifying or overcomplicating the process leading to many misconceptions. If you want to understand how the eBay bidding process happens you need to get away from that analogy. (It is not necessary to understand it if you know and use the winning strategy below and are willing to accept the results as accurate even though you don't understand how they were arrived at.)

The only winning strategy on an eBay auction is to bid your real honest wouldn't-bid-an-increment-more TRUE maximum that you would pay for this particular item WITHOUT REGARD to what anyone else appears or doesn't appear to have bid. Since what anyone else has or will have bid by the time the auction ends is already figured into the price if you win, there is no need to try to figure it into your bid (other than to assume that someone else is likely to bid about the same amount as you, so it is a good tactic to bid a bit over the round number you likely have in mind as your true maximum to increase your odds of being on the winning side of what might have been a tie or a loss to someone who knows this tactic); all you need to figure is at what price point you would rather someone else get the item than you having to pay more. When you bid, early or late, or whether you put in a lesser bid(s) before your true maximum, those are tactical matters that may or may not influence the behavior of others (other bidders, potential bidders, and the seller) to your advantage or disadvantage.

 

 

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