Telebid.com is not the usual auction website as you may know it. The best practice for auction websites (err ebay.com for instance) would allow you to set a price you would be ready to pay for this item. If the item becomes to expensive for you, you can nicely drop off. Cost of the operation: ZERO!
On telebid.com you can in theory buy normally expensive items at very low price (playstation 3, iPod touch etc.) as every auctions start at 0€, the maximum raise is 10cts and every auction has a limited lifetime. However there is a trick:
- Everytime you bid on an item, it costs you 50cts (however you do it, per phone or online)
- Everytime a bid is placed in the last 20 second of the auction, the time is reset to 20 seconds (it can actually go up to 2min depending on the number of users bidding at this very moment)
Let’s take an example to understand this better:
After 3 days, a Playstation 3 has reached the price of 100EUR. This means that 1000 bids of 10cts were made, each of them costing 50cts. So before the item is actually sold, users have already given out 500EUR (and the auction is not over). But as time is running and reaches 20 seconds before the auction ends, users start rushing and this is were the fun starts… I believe until the price of the auctions gets close to / or matches actual retail price, users will keep on bidding. For the sake of the example, we’ll pretend the auction ended at 350EUR (50EUR less than what Amazon.de offers it) and make some simple calculations:
Price sold: 350EUR
Number of bids: 350EUR/0.10cts= 3500 bids
Amount paid by bidders on the auction: 3500 bids*0.50cts=1750EUR
Total: 350EUR+1750EUR=2100EUR
Take a look at this auction to get a graphic explaination: http://www.telebid.de/auktion/sony-playstation-3-konsole-40-gb/54833.html
The business concept is very clever. While I think this might get some momentum at first and one might actually get a good deal with a bit of luck, I don’t think it will attract and retain users like more conventional bidding sites do. Or if it does, it will be a different type of user: the gambling one.
Ebay bidders will agree that it is rather satisfying to bid on an item and win the auction (this is actually one of the USP eBay is basing its marketing on). With telebid’s system, chances of winning the auction are very low (and cost money). So out of the 100s of bidders, there will be a lucky winner, and the rest can start all over again. What’s in for the user? You figure that one out yourself… I for one haven’t found anything!
I would compare Telebid as a new form of online gambling, which has been ruled illegal in Germany on January 1st 2008. I’m curious to see how this is going to evolve…
How it works…
In order to understand the heavy criticism and controversy that Telebid caused in its home country it is necessary to understand the basic concept of the whole thing, i.e. how Telebid works. I’ll do my best to explain.
Telebid sells brand new stu…
critical approach, but only fair, considering the controversial concept
ps: might want to check out my blog on the issue
Indeed – this isn’t an auction; this is gambling. Keep spreading the word – there are lots of people out there who won’t realise they are being fleeced – the only real winner is Telebid.
I agree about the Gambling and Not auction point.
This is clearly not an auction site and to actually win an item you have to be prepared to spend some money with the risk of losing everything.
I have watched the workings of this site for some time and have noticed that the so called BidButler system wins 9 times out of 10 which forces me to question why people still use Single bids against a BidButler as again 99% of the time you will just end up wasting the single bid.
Personally i’m suprised how far and how much people will spend to get a “bargain”.
Example:
Telebid offers FreeBid vouchers in their “Auction” in increments of 50, 150 and 300 FreeBids.
I watched an “Auction” for 300 FreeBids and when it ended, suprise suprise. The person who used the BidButler won.
Now thats fine except for the fact that a 300 Bid voucher normally retails at £150 and the person who won this “Auction” paid over £200 in Bids.
Now to work this out we have to see how much the Voucher went for. £189 was the finishing bid i think.
£189 / 7 (price the item increases each time a bid is placed) = 2701 Bids placed.
2700 bids at 50p a bid = £1350 from all the people who bid in this “Auction”.
So thats £1200 profit to Telebid for “Auctioning” an item instead of just selling it for the normal price.
£200 of bids from the winner is 400 bids so the other hard to comprehend thing from this is why would a person bid for 300 FreeBids with 400 of their Paid Bids because at the end of the day they have lost £50 (100bids).
Now i dont really know if there are “insiders” working for telebid, just bidding to keep the single bidders bidding which of course is illegal but what i do know is that if your looking for a bargain then Telebid is definately not the site for that.
However if you have money to burn and are a compulsive gambler then telebid is a great way to lose a LOT of money very quickly with nothing to show for it.
I hope this review helps.
have a look at this weblink and see for yourself,
http://www.telebid.com/auction/nintendo-ds-lite-crimson-red-and-black-/81576.html.
in this weblink, i dont understand why a person will keep on bidding even he knows that he is not saving anything.
winners total bid is 273 and that already cost him £136.50 and to be able to get that “bargain item!” he needs to pay the final price of £79.03. And for that, the total spending will be £215.53. Take note, the item can be bought for £100.
hmmmn! interesting…