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Julia Wilkinson AuctionBytes Blog
Covering auctions, collectibles and marketplace selling.

Julia Wilkinson is Editor of the AuctionBytes Blog and is author of the "eBay Price Guide," "eBay Top 100 Simplified Tips and Tricks," "My Life at AOL" and numerous ebooks about selling online. You can also find her writing on Yard Salers.
Tue Mar 5 2013 13:32:31

Are 99-Cent Auctions Still Effective?

By: Julia Wilkinson
Sponsored Link

I thought about titling this blog post "Are 99 Cent Auctions Dead?," but decided that was overly dramatic. I've seen some discussion of this strategy lately, and wanted to investigate it further. If you sell on eBay or other auction sites, do you still price your items, or even some items, at 99 cents to start? (I don't mean with a reserve).

There seem to be situations in which it makes sense, and others where it is too risky. In the eBay Guide, "Why I start all my auctions at $0.99," eBayer "stamptraveller" advises us to start all or most of our auctions at 99 cents, for the following reasons (summarized/paraphrased by me in places):

- "If you start an item at $0.99 (or lower), you will definitely attract more bidders than if you start it at even $5 (regardless of its intrinsic value)." Also, people who set e-mail alerts with a maximum starting bid amount in the Search settings won't see your auction if you start it too high.

- "If you set a low starting bid, people will be inclined to view you as "fair,"" says "stamp." This is as opposed to being a greedy jerk (the latter being my words).

This certainly does not mean everyone will see your above 99-cent auctions as being overpriced, but haven't we all had that "gimme a break!" feeling when seeing some sellers' opening bids?

- "As long as the item has some definite value, you will always make a sale." Stamp says he is often pleasantly surprised by his ending prices, but on a couple of occasions over the years he was disappointed. It averages out well over time, he asserts.

- "With a low starting bid, having attracted more bidders, you are likely to see some dramatic competition at the end of the auction. This happens to my auctions virtually every time. If you have a relatively high starting bid, you will have less potential buyers watching to begin with and there will be little room left for any serious increase in bidding at the end."

So, how has this strategy worked for "stamp" lately? Well I took a look at some of his (or her?) auctions, and here are how the most recent ones went:


27 Canada Used Minisheets with some Recent 2012 Issues +$10 Whale All Fine Used

Starting bid: $0.99

Winning bid: US $61.10, with 19 bids. (Note, image below does not show final bids; it ended at $61.10).

Australia Used QEII Minisheet Plus Complete Bathurst sheet plus IP High Values

Starting bid: $0.99

Winning bid: US $18.75, with 8 bids

Great Britain UK GB 2012 Olympic Gold Medal set of 29 with 6 minisheets + extras

Starting bid: $0.99

Winning bid:US $43.68, 24 bids

So, this strategy seems to be working fine for "stamp."

However, someone else out there is frustrated: "Who else is done listing auctions at .99?" he asks. Granted, the site is not eBay, but blowoutcards.com.


"Have a bunch if items ending tonight, and it seems like everything that has ended so far is well below average closing prices. I don't know if I'm just unlucky or what, but I'm done selling for .99 anymore. It seems like the majority of the time you are leaving money on the table and getting screwed," he writes.

"I am just going to list my auctions at the minimum price I want auction style and if they sell they sell. So tired of getting the shaft 90% of the time." He conclueds, "Unless you have some super hot player, running .99 auctions are just asking to take it in the culo."

Culo..I may need to Google that. My feeling? If it's something you can't afford to have sell at $0.99, put the least amount you'll be satisfied with. Otherwise, I'm going to play around with starting some of my long-sitting merchandise at 99 cents.

What has your experience been with the 99 cent auction? Do you still use it, and why or why not? Or, have you moved to more fixed-price items? Post a comment here! 




Comments (40) | Permalink
Readers Comments

Are 99-Cent Auctions Still Effective?   Are 99-Cent Auctions Still Effective?
by: Duke This user has validated their user name.
       
Tue Mar 5 14:56:53 2013
I've found that setting opening bid prices is not a one size fits all solution.  

99 cent auctions never worked for me, even ten years ago.  After losing money using that model, I started setting the opening bid at what research indicated the market was accepting so the item sold quickly for a decent profit.  This continues to work for me, since I don't have huge quantities and my items are somewhat easier to find (not commodities, but not rare, either).

But 99 cent auctions can work out well for sellers.  eMoviePoster.com and Buy.com's original eBay auctions are two success stories that come to mind.

So, I don't think there is one solution for every seller.  I think it depends on the type, quantity, and rarity of the items along with the amount of competetion in that particular field.      
Are 99-Cent Auctions Still Effective?   Are 99-Cent Auctions Still Effective?
This user has validated their user name. by: Basset
       
Tue Mar 5 14:59:58 2013
Several years ago (in the good ole days) I could feel comfortable enough starting certain brands at .99. I have not done that for a long time, though.

I have moved to mostly fixed price & it works for me. If I do an auction to spark visibility   they almost never sell for much more than the starting bid - usually $9.99. Sometimes, no bids at all.

Like everything, it is relative to what you sell and its value. A few years ago I remember seeing .99 auction items (clothing) with ''free'' shipping sell for .99 & the seller would have lost money.
Are 99-Cent Auctions Still Effective?   Are 99-Cent Auctions Still Effective?
by: AgendaSwallowsAll This user has validated their user name.
       
Tue Mar 5 16:30:01 2013
A seller in one of the catagories we list in set almost 300 listings off not only at an 0.99 start price for all but free ship as well and the bulk of their listings were not for light weight items. Per our calculations this individual gave away a good $8-10k in one fell swoop, such actions seriously harm the attempt of others trying to make a living.

Never done 0.99 start auctions even in the good times after the first few trial attempts as we felt horrible when we'd not get item value, more horrible when one paid $20-$100 or more than they should have had to pay so for this reason and the one stated in paragraph #1, we've always just listed at a fair Buy it Now.
Are 99-Cent Auctions Still Effective?   Are 99-Cent Auctions Still Effective?
This user has validated their user name. by: Anonymous Annie
       
Tue Mar 5 17:45:15 2013
Oh what fun it was back-in-the-day! My 99-cents auctions were so busy. Some items went for MUCH more than I thought they would ever sell for, others were ''about right'' and what I expected. And very VERY few ended up selling for less than what I expected.

I think that auctions still have great potential... but only IF eBay gives them the respect that they deserve... and stops treating auctions like red-headed-stepchildren, or something that they're ashamed of.

Without exposure or views, auctions just languish. No competition, no bidding, no sales. Or, that *one* buyer who happens to stumble upon the auction gets to take home a bargain at the opening 99-cents bid.

I'm sure that a lot of it depends on the item being auctioned. Some items will always do better than others (no matter if eBay ''hides'' the listing or not).

But for a great many items, potential buyers/bidders don't KNOW they want it until the SEE IT in the first place.

By that, I mean that many bidders are ''impulse'' bidders... they bid on something interesting because it was presented to them... they weren't actually looking FOR the item when they originally arrived at eBay.

The same way that your local Kroger, Safeway and K-mart displays racks of ''impulse-items'' at checkout. Why do they do it? Because it works.

You may not have driven to K-mart for the express purpose of picking up some nail-clippers, batteries, breath-mints, or chap-stick. But, there they are on the impulse rack... right at the checkout counter... and you buy it!

In eBay's grand years... auctions were front-and-center. Proudly displayed! Arranged by ''ending-soonest'' and that created a sense of urgency and excitement that made potential bidders want to ACT NOW or forever lose a chance at a bargain (or other one-of-a-kind item).

Back-in-the-day... eBay knew how to WORK auctions and DRIVE buyers/bidders.

These days... not so much. eBay's commitment has disappeared, and buyer-interest has waned. For me, it's too risky to even consider it any more.
Are 99-Cent Auctions Still Effective?   Are 99-Cent Auctions Still Effective?
by: bitbybit This user has validated their user name.
       
Tue Mar 5 18:25:06 2013
IMO it all boils down to visibility. Whether your items have value, are rare or collectible, doesn't mean SELLING if ebay is in blackout mode, search glitch, favorite sellers only, punishment mode, or promotion saturation phase.

This is how and why auctions are being killed off and IMO, on purpose, as part of JDs 3 year going on 6 year plan.

Just listing now in the auction format has become a BIG gamble. I know several sellers who start all their items at .99 and see 26 pieces of dinnerware selling for around $20.00. Packing all those breakables, packing costs and fees .. how crazy is that?!

Now some items DO have value and/or are rare but still sell low. This brings the price down for all sellers since if an item would previously sold for $50.00 is then sold for $10.00.

Collectibles probably do have a better chance at ending well and sellers should have good descriptions, photos, etc. It really does boil down to trusting in ebay. Are the buyers out there and will they see our listings? Are my listings being shown country and worldwide? Or will I sell my items at the opening bid to California residents only even though I am on the east coast?

Are 99-Cent Auctions Still Effective?   Are 99-Cent Auctions Still Effective?
by: Mr. Me This user has validated their user name.
       
Tue Mar 5 22:50:57 2013
99c Auctions worked well when eBay was a vibrant AUCTION site, however I would not start any auction for 99C , since eBay is flooded with cheap and common junk and Auctions are basically ignored.
Are 99-Cent Auctions Still Effective?   Are 99-Cent Auctions Still Effective?
This user has validated their user name. by: elpereles
       
Tue Mar 5 23:48:05 2013
I used the idea of lower starting prices. I don't worked for me.  
Are 99-Cent Auctions Still Effective?   Are 99-Cent Auctions Still Effective?
by: bitbybit This user has validated their user name.
       
Wed Mar 6 02:01:22 2013
The best deals were when we could ''browse'' and like Annie stated to find something on impulse. Now buyers have to know exactly what they want since searching on ebay is a chore. There is no such thing as browsing on ebay and seldom any more enjoyment of winning an auction. Oh, I outbid s***5. How exciting is that?
Are 99-Cent Auctions Still Effective?   Are 99-Cent Auctions Still Effective?
This user has validated their user name. by: Rexford
       
Wed Mar 6 07:50:41 2013
Time ending soonest as search default was the magic of eBay.  Without it, I wouldn't dare list an auction for 99 cents.

The magic is gone.   Annie summed it up beautifully.
Are 99-Cent Auctions Still Effective?   Are 99-Cent Auctions Still Effective?
This user has validated their user name. by: permacrisis
       Web Site
Wed Mar 6 09:48:06 2013
But, but, but... best match! It's the best there is, get ready to drink from the firehose!

http://bit.ly/XSNbaq

The stupidity is utterly shocking.
Are 99-Cent Auctions Still Effective?   Are 99-Cent Auctions Still Effective?
by: JohnGermaine This user has validated their user name.
       
Wed Mar 6 10:30:00 2013
If it sells at eBay, note I said ''if'', then it sells for my initial price. I haven't had a bidding war in years. I never started anything at 99¢ as it would be a waste of time and I would lose money.
Are 99-Cent Auctions Still Effective?   Are 99-Cent Auctions Still Effective?
by: walrus2646 This user has validated their user name.
       
Wed Mar 6 10:37:08 2013
As a retired cost accountant as part of my retail management job for 40 years 99¢ auctions are a delusion to which some folks use as therapy on eBay.
Are 99-Cent Auctions Still Effective?   Are 99-Cent Auctions Still Effective?
by: beverly This user has validated their user name.
       
Wed Mar 6 10:41:36 2013
I buy at least 10 -15 jewelry items a week on ebay

The starting prices have become over priced. why don't these sellers just do a buy it now so that I can exclude them from my search

Also, so many  99 cents sales has reserves that I just waste my time again opening up the listing

I hate reserve items..why not just do a buy it now..so I don't have to waste my time
Are 99-Cent Auctions Still Effective?   Are 99-Cent Auctions Still Effective?
by: walrus2646 This user has validated their user name.
       
Wed Mar 6 10:48:00 2013
Slight correction to Beverly - In my not so humble opinion - starting prices have, as a general rule, not become overpriced - they merely reflect the minimum cost of doing business at a modicum of profit (profit still being the motivation ?).
Are 99-Cent Auctions Still Effective?   Are 99-Cent Auctions Still Effective?
This user has validated their user name. by: elpereles
       
Wed Mar 6 10:56:12 2013
For me it is ridiculous start a $0.99 auction with reserve. I still don't understand some sellers because as far I know "reserve" price isn't free.

As a buyer, I avoid reserve auctions. It is a lost of time.  
Are 99-Cent Auctions Still Effective?   Are 99-Cent Auctions Still Effective?
by: Tiffee Jasso This user has validated their user name.
       
Wed Mar 6 11:01:21 2013
No, not really. I was recently looking at several brands of clothing and noticed that fixed price auctions brought $8.00 or more for the same item that sold on auction for 99 cents (one bid). So you can either get $8.00 up for your items or give it away for 99 cents, the choice is up to the seller. Ebay and Paypal fees still come out of that dollar unless you have the profit factored into the price of shipping and then it's iffy if you will survive the low DSRs in shipping and the negatives that business model will bring. Now if you are selling certain antiques, silver, gold, etc., 99 cent auctions make sense, but are risky in other ways due to Ebay's penchant for burying a seller so far down in search the sun never rises.  
Are 99-Cent Auctions Still Effective?   Are 99-Cent Auctions Still Effective?
by: FREDDY This user has validated their user name.
       
Wed Mar 6 11:04:28 2013
I have tried that approach a few years ago. Lost on 8 out of the 10 listed. Not worth it.  Especially now that you have to have free shipping.
Are 99-Cent Auctions Still Effective?   Are 99-Cent Auctions Still Effective?
by: Steevo This user has validated their user name.
       
Wed Mar 6 11:30:47 2013
Annie said it.

We used to be able to list things at 99 cents and if they were worth $400 the market would determine that value. It was great!

Now, that just doesn't happen. They are just as likely to end at $1.30.  It's a waste of time selling a $400 item for $1.30.

The sellthrough in our categories is only 20% or less.  Few bidders.

Ebay is only about 20% auctions now, the rest is fixed price maybe with best offer. Auctions are a dead issue in most categories, and we hardly ever use them because they usually only have one bidder, and auction items now sell for a fraction of what the items are worth.

I think every item has a value. I determine that value and list fixed price between the minimum and the maximum, depending on condition, testing we are able to do and how popular the item is. Most of our items are business or IT items.

We use lots of best offer and we sometimes get crazy offers of 90% off the listed price, most of which I ignore and let expire. Bottomfeeders! Cheap dealers who want to buy that item and flip it.  That's what we are doing!

The situation agenda mentioned where someone in their category left up to $10,000 on the table is a big part of the problem with ebay.  

Everyone has stats now and they see one of those selling for $1.30 they don't think it's actually worth $400 when a new one might be $10,000!  This breaks the price on ebay and results in buyers being unwilling to buy items that are priced right because of a few sellers who priced insanely!

This all goes together to make ebay what it is today: a place where buyers expect to be able to buy things for so low that no one can afford to sell those at all.  I sure can't afford to list worthless items on ebay.  I just scrap them.  

Prices too low.  Costs too high.  Sellthrough rate too low. Sales cycle too long.  
Are 99-Cent Auctions Still Effective?   Are 99-Cent Auctions Still Effective?
by: AngelaTC This user has validated their user name.
       
Wed Mar 6 11:49:43 2013
Sadly I have to agree that the .99 cent auction isn't the best way to sell any longer.  For me, that changed when eBay started tacking on their FVF to postage, because it turned a .99 cent winning bid from  break-even to a loss.
Are 99-Cent Auctions Still Effective?   Are 99-Cent Auctions Still Effective?
by: Gail This user has validated their user name.
       
Wed Mar 6 12:04:42 2013
The eBay Guide quoted above was originally written by stamptraveller in April of 2006.  eBay has, since then, changed drastically.  There was no Best Match, auctions were not buried, Chinese knockoffs did not permeate categories, etc. in 2006.  

I find that most buyers, who are not also sellers, are not aware of the various ways Search Results can be altered to show Ending Soonest, Lowest Price First, Auctions Only, or by narrowing down using Advanced Search.

If buyers can no longer find a listing, a low starting price is irrelevant.  With a $0.99 starting price, how many bid increments will it take to bring the price up enough to cover costs?  What are the odds today that only one buyer will even find an auction listing?  I don't have an eBay store, and I certainly can't afford loss leaders.  I have to ask myself, ''For the amount of time I take to create a unique listing for each of my items, how many of them am I willing to give away?''
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