The Penny Auction is a phenomenon (in my humble opinion.) Such companies as: Swoopo, and MadBids were the trailblazers of the industry...in Europe and the UK. Swoopo made profits on 32 million USD in revenue just last year alone and now, there are so many bidders on the site that the prices for "won" items are getting seriously pricey. Think about it - how many pennies fit into $50, $100, $200? Lemme help - if a product sells for $100 - the company just made $6,000 (@ .60/bid)!!! (Not a bad margin on an iTouch eh?)
Let me explain: I go to a penny auction site and I buy a package of bids(@FSCAuctions bid prices range from $.50-$.70/bid). I then find an item I would like to win and I bid on that item. Every bid that is posted drives the price of the product up a penny and 30 seconds are added to the auction timer. It is a HOOT! It's completely viral and addictive by mere nature. It's also so profitable that the companies who are running penny auctions are under a great deal of criticism. Our concept? Instead of hording all of that money as a company...why not pay the field a huge amount of the profits in commissions and overrides? Clunk.
So, that's exactly what we're doing.
For anyone who is interested:
Sunday, April 11, 2010
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