Definition Of Penny Auctions And How They Work

If you have been using the internet for any prolonged period of time, it is pretty clear that when it comes to shopping, online auctions have become one of the primary ways for people to purchase retail items at a discount. Ebay started the online auction craze all the way back in 1995, when it began offering consumers a way to purchase discount retail good in a fun and exciting manner.

Flash forward almost 15 years later, and Ebay is still going very strong, but there is now a new and exciting way to use online auctions for even larger potential

Penny auctions have taken the internet by storm over the past several years, mainly because they offer consumers a chance to buy products at insanely low prices. Through penny auctions it is not uncommon to see items valued at $500 to be won for less than $5. Unlike regular online auctions that Ebay offers, penny auctions are very different.

Here is a brief overview on how penny auctions work:

1. Before bidding on an item, you must first purchase bids from the auction site. Bids usually cost less than $1 and represent $.01 of the final purchase price
   of the auction item.
2. When a certain item is up for auction, it generally starts out at $0 and has no reserve. It also is set on a clock that has a clock that counts down to 0:00.
3. Unlike other online auctions where the clock counts down regardless of bids, in penny auctions, the clock goes up by 20 seconds for every bid that is placed. This is where the fun comes in as bidding wars can last hours depending on how many people are bidding on an item.
4. For every bid that is used, the price goes up and once the clock hits 0:00, the last person who bids will have won the auction. All of the other people that bid on the item receive nothing and have lost the money they spent on buying however many bids they used.

As you can see, penny auctions can be a very fun and exciting way to purchase products at major discounts. For more information on penny auctions, as well as information on tips and strategies to make the most out of penny auctions, you should visit http://fyi411.weebly.com/penny-auctions.html