Placeholder Bids 101: Closed Auctions
Today is the first part in a 4 part series discussing the strategy known as the Placeholder Bid. Over the next 4 posts, I’m going to discuss what a closed auction is, how a Placeholder Bid can help, how this relates to win percentages and why those scary bidders aren’t that scary.
So What Are Closed Auctions?
Last year Swoopo began “closing” auctions on occasion. When an auction is closed, no new bidders are allowed to participate for the remainder of the auction. This means that the competition in a closed auction is only those people who have already bid in that auction at least once.
It’s hard to say for sure why Swoopo began closing auctions, but most Swoopers would agree they were trying to improve the auction experience. Some auctions stretched far too long and involved too many bidders. The press and others who don’t understand Swoopo would pounce on these skewed auction results and use them as an example of why Swoopo is a bad deal.
Closing auctions allows Swoopo to ensure that it will end in a reasonable amount of time, that the winner will get a good bargain and that those who’ve spent bids already are rewarded with a greater chance of winning.
Closing Is A Mystery
Swoopo doesn’t reveal if and when an auction will be closed. This mystery around closed auctions can sometimes be frustrating to bidders, but it’s necessary. You see, if bidders knew when an auction was going to close, it would have opposite the desired effect. Bidders would flood into the auction hoping to get in before it closed (much like a dance club 30 minutes before last call).
This would be true regardless of whether they closed auctions based on time, bids, competition or any other metric. If Swoopo decided to close auctions based on a metric that other bidders could measure and track, it would result in too much competition and it would defeat the purpose of the closed auction.
Therefore, Swoopo closes auctions arbitrarily. Or if they do have an algorithm in place for when an auction closes, I haven’t been able to crack it. I also haven’t read anyone else who has learned with any certainty when an auction will close.
If you can’t predict closed auctions, can you still use them to your advantage to win more Swoopo Auctions? The answer, of course, is yes.
In the next post (Placeholder Bids 102) I’m going to explain how you can use Placeholder Bids to get access to closed auctions and win more auctions.
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Swoopo on Multiple Devices
A Swoopo Manual owner noticed something about the Swoopo system that bears mentioning. I’ll let him tell the tale:
Hi Matt,
Thanks so much for the information, which is very helpful. I’ve encountered one weird problem twice when bidding on an auction from both my laptop and my iPhone at the same time. Attached please see a screenshot of the weird error message. “Sorry – Swoopo has had a problem. We’re letting our techies know right now, who’ll work on getting this fixed”. At this point, I couldn’t even log on to my account or purchase any bids.
Is this because I bid from two different IPs? The reason I’m use both laptop and iPhone is that sometimes our wireless network connection is not very stable. Would this be a trigger that Swoopo blocks my account temporarily for a review or something? Have any other members ever got this error message? Please let me know your thoughts on this.
Thanks so much,
[name redacted]
I tried to replicate this user’s experience but wasn’t able to. However, I think it might not cause problems unless you’re casting bids from one or both devices. It’s also unclear at this point if Swoopo’s system genuinely has technical issues with multiple sign-ins or if they’re preventing them intentionally in a passive agressive manner.
If you’re bidding on Swoopo and need to switch computers, or if you have a secondary device you’re using to track other auctions, I’d suggest you sign in to only one at a time to avoid any possible IP address conflicts.
Note: This advice pertains only to signing into Swoopo’s website. This does not affect your ability to sign-in or use Swoopo Analytics.
If you have any more information on this issue, let us hear about it in the comments.
Update (5.17.10): This same user writes in again to note that this is not an issue of IP address conflict. Swoopo will block simultaneous log-ins from bidding even on the same device. Just stick to a single log-in and you’ll be fine!
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Thoughts on Swoopo Changes from a Winner
I got an email from Nige, who’s a valuable member of our forum. Nige has won 6 of the 8 Swoopo auctions he’s participated in…so his win percentage is great. He’s also been on Swoopo since fall of 2009, so obviously he’s not a “Swoopo Pro.” He just plays and wins when he has time and when he sees a great auction to jump into. This should ring true for most of our Swoopo bidders who just want to win a few auctions. Nige writes:
Can i just say i’m disappointed reading on the forum that so many people seem to have forgotten all your advice on how to win and have been relying on [Swoop It Now]…now they think it’s all over.
I have had a good time and they are all missing out. [I won an] LG plasma last week for £3.07 + 124 free bids. I have started passing my knowledge on to 2 family members, who now have had some good wins without having the [Swoopo Analytics] tool to help. [They're bidding] blind so to speak.
Cheers Nige
Nige is of course referring to the recent Swoopo changes. What he meant was that those users who are complaining that Swoop It Now no longer allows 100% discounts should reconsider their complaints. Swoopo didn’t have Swoop It Now until fall of 2009, so this is a relatively new tool for the Swoopo bidder. What the changes do is democratize the bidding a bit more. Swoopo Pros can no longer dominate the auction and rely on Swoop It Now as a backstop. This means more opportunity for more bidders and in Nige’s case – more auction wins.
Best Time to Bid on Swoopo?
Back in the Wild West days of Swoopo (remember 2008?) there wasn’t a single bit of advice on the Internet about how to win on Swoopo. It simply didn’t exist.
When I first discovered the site, I needed to use old library books and lots of trial and error to learn Swoopo techniques. Soon, the first Swoopo guide appeared on the market. It was called “Beat Swoopo” and it was a 7-page PDF with some research on a few thousand auctions. It left purchasers very “underwhelmed” to put it kindly.
A second guide appeared right as I was getting ready to launch the Swoopo Manual. This guide was called “Win Swoopo” and offered more advice and tips than it’s predecessor. One of the strategies it advocated was the “1 Second Rule” which stated that if you’re casting single bids, you should wait until 1 second is shown on the Swoopo clock.
Did It Work?
This advice was logical and mildly effective. If you cast bids at 7, 10, or even 20 seconds on the clock, you have little chance of remaining the high bidder when the clock reaches 1. I included the 1 second rule in my own Swoopo Manual upon launch, and practiced it regularly on Swoopo.
But it wasn’t too long before other Swoopo bidders and I began to notice the flaws in the 1 Second Rule. For one, Swoopo sometimes has issues with “lag” which make the 1 Second Rule nearly impossible to execute consistently. Secondly, the best bidders on Swoopo use BidButler to their advantage to bid and win. Casting single bids at the last second seems a bit like bringing a knife to a gun fight.
Is the 1 Second Rule Still Relevant?
I don’t have a good answer to this question, so I’m opening it up to you in the comments and in the forums (if you’re a Swoopers dot org member). Do you think the 1 Second Rule still makes sense for Swoopo bidders? Are you using it with any success?
Do you have any other tips about the best time to bid on Swoopo?
Swoopo Shill Bidders
On Shill Bidders
I’ve handled a few emails from skeptical Swoopo bidders in the past few days. They are interested in Swoopo, but ask “Can you prove there aren’t shill bidders on Swoopo?”
Bad news: I can’t
No, I can’t prove their aren’t shill bidders on Swoopo. And I cannot prove that UFOs aren’t real and that aliens haven’t secretly been walking the earth for years.
Here’s what I can tell you…
Swoopo has existed for a few years now. They’ve had employees come in and out of the company and currently employ no fewer than a few dozen employees. They have offices in California as well as Germany. They received venture funding in 2006 in Germany and again in 2009 by a major venture capital firm in the United States.
With Swoopo Analytics, we track almost every single auction on Swoopo. We can see the bidding history of every single bidder. We’ve haven’t noticed a single thing in all this data that would suggest shill bidders.
I’ve read every single article and study written about Swoopo I can possibly find. They all have interesting conclusions regarding the Swoopo business model. But none has ever suggested with any proof that Swoopo does anything other than run auctions exactly as they describe.
I’ve won items on Swoopo’s site and received them exactly as described and in short order.
A healthy dose of skepticism is good for everyone. But at the end of the day, you need to rely on facts.
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