Too good to be true?

  • Smokenjoe
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Post 3+ Months Ago

So heres the basic rundown:

Each credit costs $1

Then, the starting price of all auctions is $0.00. Each bid costs 1 credit and raises the price of the product by $0.01. The countdown shows how much time is left until the end of the auction. With each bid, the countdown starts over at the given interval of the auction.

Seems OVERLY confusing and cheap but after reading the site it appears that you pay $1 for each time you bid. After winning, you then pay the actual ending price to obtain the item.

At first, seems to be a terrible deal. Would mean that an item selling for $2.00 has actually been bid on 200 times and has already made the site $200. But, if you only bid 3 or 4 times and win, you could concievably get an item for considerably less than a regular tag price and the site makes money too.

Not totally sold, and it certainly feels like a scam site to me, but thought it was interesting.

Heres the site, enjoy: http://www.pennycave.com/
  • Don2007
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Post 3+ Months Ago

The first thing I do when I want to investigate a site is, do a whois. Notice that the site was registered through a private registrar. There is nothing wrong with that, except that leaves me no recourse if there is a problem. Also, notice that they don't except any snail mail leaving me less recourse. The phone number belongs to the registrar in the Netherlands, not to the owner of the site. I still haven't opened the site and I don't think I will.
Registrant:
PrivacyProtect.org
Domain Admin (contact@privacyprotect.org)
P.O. Box 97
Note - All Postal Mails Rejected, visit Privacyprotect.org
Moergestel
null,5066 ZH
NL
Tel. +45.36946676
  • camperjohn
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Post 3+ Months Ago

That's really a scam. Basically, you pay for things you don't win so others can win them at a cheap price.

You *HOPE* that you win it, which is why you keep bidding, but in the end people pay for things and end up never wining anything and just spending money for nothing.

In order for the site to make money, they need X number of bids on the item. Which means that if the timer is less than 5 minutes and only 10 people have "bid" on a $200 item, they computer just auto-bids on the item, with a fake user, and bam you no longer own the item and have to re-bid.

Once the item recieves 201 bids on a $200 item, then the timer is allowed to elapse and someone wins it, while everyone else loses. And that would be you who loses.
  • camperjohn
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Post 3+ Months Ago

Taking a second look at the site, actually as a business plan, it's great way to scam people out of their money.

Here is how you can do something the same:

- Make the same website, with a database of products and pictures and prices
- Make a database of fake users
- When the product gets near 5 minutes and not enough people have bid, auto bid from a fake user
- When more than the product price + 10% have bid, allow the item to elapse and the user buys the item.
- Go to another website that sells the product, buy it, and have it shipped to your place.
- Re-package it and ship it to the buyer.

This way, you don't need any inventory, and it doesn't matter how many people or how many users you have when you first start the site. The first person to sign up sees a full site with lots of products and people bidding.

Now lets think marketing. The person who bids, obviously must bid more than the item is worth to win. But you could switch it around, where the person is allowed to win the number of credits they have bought. Such that, if they buy 1000 credits, they can win a $999 TV for the first 10 credits ("Wow, a $999 TV for $10"), BUT then they are not allowed to win anything else for the next 990 credits (computer auto bids them out). At this point you already have their money so the TV you gave them for $10 and their inability to win anything else will always match up to a win for you.

That is a scam, but there are lots of scams on the internet. Just in case you haven't heard.

And you don't need any inventory. Just buy the items from costco or frys electronincs once someone "wins"
  • camperjohn
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Post 3+ Months Ago

You could also pro-rate credits such that 1 credit matches to $0.75 cents even though they paid $1 for each credit. This way you are incorporating a profit factor directly into the website blinding the user.

I really like this website actually.
  • Smokenjoe
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Post 3+ Months Ago

Don2007 wrote:
The first thing I do when I want to investigate a site is, do a whois. Notice that the site was registered through a private registrar. There is nothing wrong with that, except that leaves me no recourse if there is a problem. Also, notice that they don't except any snail mail leaving me less recourse. The phone number belongs to the registrar in the Netherlands, not to the owner of the site. I still haven't opened the site and I don't think I will.
Registrant:
PrivacyProtect.org
Domain Admin (contact@privacyprotect.org)
P.O. Box 97
Note - All Postal Mails Rejected, visit Privacyprotect.org
Moergestel
null,5066 ZH
NL
Tel. +45.36946676


Awsome link, cant believe Ive never heard of that site. Thanks for the info

camperjohn wrote:
I really like this website actually.


I agree. I believe its a scam as well and had all the same thoughts as yall, but its an AWSOME idea. Whoever thought up the site really put some time and effort into it. Part of me wants to dump a couple bucks into it just to see what happens. Then again, not terribly enthused to throw money away.
  • camperjohn
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Post 3+ Months Ago

Smokenjoe wrote:
Part of me wants to dump a couple bucks into it just to see what happens. Then again, not terribly enthused to throw money away.


I bet if you spend $2 on "credits" you will only be able to buy something worth $1.50

The website isn't giving products away. It's not rocket science. You can't buy a $1500 TV for $10 worth of "credits". Someone is paying and it's going to be you.

If I lived in Russia, or had just %.01 less morals than I have (which I am am unashamed to admit that I have few morals) I would make the same site, and make EVERY sale fall through, taking every penny with me.
  • joebert
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Post 3+ Months Ago

Now if you were like Walmart and able to get stuff dirt cheap, it might be doable without AI bidders.
  • Smokenjoe
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Post 3+ Months Ago

Would be interesting to try and run a legitamate business off based on this notion, but I wonder how it would fare when compared to all the scams? If someone hits their site first, gets scammed, then sees mine doubt they would be willing to give me a chance.



camperjohn wrote:

If I lived in Russia, or had just %.01 less morals than I have (which I am am unashamed to admit that I have few morals) I would make the same site, and make EVERY sale fall through, taking every penny with me.


Cheers! Its a rough out there in the business world. Eat or get eaten :)

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