Penny Auction... Real Bargains or A Gamble?

A month or two back I stumbled on an online bidding site called Penny Auction which allows you to bid on mostly gadgets and electronic items (which tend to be quite pricey) and should you win, to purchase it at least 50% below market price.

In order to bid, you are required to sign up for an account with them at no cost and you get a number of free bids (I think it's 3 bids) to kick start your bidding experience on the site.  Once you're out of bids, you will need to buy more bids in order to participate in the on going and upcoming auctions.

HOW IT WORKS

The concept is very simple.  Each bid is in an increment of RM0.01.  Each item being auctioned will have a preset duration on their timer and every time someone bids, the timer is restarted.  To win the auction, you will need to be the last bidder when the timer ends and the system confirms that no other bidder is present.  There's a 50% off market price guarantee as well so for every item in the auction that is won at a price higher than 50% retail price, the winner need only pay up to a maximum of 50% and the balance is compensated by Penny Auction.


HOW TO BID & HOW MUCH DO THEY COST?

There are 2 methods of bidding at the moment.  The first being via their website (log-in required) and the second via SMS (standard telco rates apply and limited to maximum of 100 SMS per 30 days from a single number).  SMS bids however, do tend to have somewhat of a lag/delay.

From the website, there is an option to utilize the Autobidder tool where you enter the highest amount you are willing to bid for and the number of bids you would like to use for the particular item.  Again, keep in mind that the bid increments by RM0.01 and setting a maximum of RM10 for instance could easily cost RM700 (bid price).

Unlike sites like eBay & Lelong, bids aren't FOC.  You will need to invest in capital costs to purchase bids as per the following table:

WHAT ITEMS HAS PEOPLE WON? AND AT WHAT PRICE?

By clicking on the tab labeled "Ended Auctions", you'll be able to see a gallery of the most recent items that have been successfully won by members.  Below are a few of the sample items (and end prices):

You can also bid on "Free Bids", a.k.a. bidding to buy bids at a lower price than that sold through regular process.  Certain items also comes bundled with these free bids or xx% bids back (you get xx% of your bids back if you win).

CALCULATIONS & RISKS

An original brand new 13" MacBook Pro for a mere RM0.15 (<1% retail price!)?  An iPod Nano, iPhone 4 and an iPad for just RM3.87?  Anyone would be tempted to give this a shot, no?

After playing around on the site, I've got to say, as exciting as it seems, it's not as easy to actually win at such low prices.  Let's take the iPack bundle for instance.  A bid of RM3.87 basically equals 387 bids altogether.  Assuming a minimum of 2 bidders (although highly likely there are more than 2), that's 193 bids per person.  Thus, a maximum of about RM320 worth of bids to start with.  And there is no guarantee that while you are monitoring your auctions, you will get the items on your first try.

BID TIMES

Bidding is not available 24 hours for most items.  These auctions are open from 10am - 12pm daily.  However, items with the clock face icon is open for bidding round the clock.

PERSONAL TAKE ON PENNY AUCTION

While some are lucky to have won bids at incredibly low prices, I personally feel the site to be like a casino.  You purchase your chips or you insert your coins (money in first) with no guarantee you will win anything, then if you win, good for you cos it would probably be a bargain but if you lose the bid, it's good money spent on air.  As enticing as it is to get a TV for under RM1, I'd much rather put my money to better use with a result that is less vague and far more achievable.

Disclaimer : I am not affiliated with Penny Auctions, nor am I endorsing it in any way.  The above sentiments are of my own as per gained from my experience and observation on the site.  The purpose of this post is to provide information to my readers on the aforementioned site and readers in turn are in no way obligated to sign up and purchase any products and/or services from Penny Auctions. I shall not be held responsible or accountable should you choose to participate in the auctions on the site.  Proceed with caution and at your own risk.