Imagine that I'm selling something with real value 10,000. The bidding starts at 1 cent. Each credit you buy is worth one euro. Let say the bidding goes to 2 cents, but the problem I see is a person who will bid, if it will be no other bidder, he will win and you will waste your money. How can I avoid that? By placing a bid, or what?
A. 1) Traffic is a king of penny auction business.
For getting traffic, your you should plan a good advertising campaign, think about marketing tools and let some people win items on your website and they will definitely tell others. You just cannot launch such business with 2 or 3 customers.
Any business cannot start without advertising, not only penny auction. We have seen, how with proper advertising, or existing base of customers, new penny auction business have made profit from the first month.
I want to say: if somebody “for extra insurance” will bid by himself, the website will live maximum 2 months, because if visitors can’t win anything and only lose money on the website, they will share this information with friends and will never buy a second bid package.
2) We have optional module #46 “Reserved price auction” - the auction is cancelled if the target “reserved” price is not achieved. All spent bids are returned to the participants’ accounts.
If the item’s real cost is 10,000, you can set “reserved price” at 100 – this means that the auction would be successful after visitors spend on it 10,000 bids.