Penny Auctions – Exposed
Reading time: 4 – 6 minutes
I know you’ve seen all these penny auction websites popup like Beezid, Skoreit, BidCactus & Kudu Bids. Now there’s nothing illegal about it but if you want to really see a Hustle in action this is it. When it first popped up I contacted my boy in the bay to see how easy could it be built. I even sat down and thought about what things to offer to people so I can have one that moves and is a niche instead of trying to mess around with the big boys. I also sat around and waited until I saw what the court cases were saying against them and see if there was a new law. But, no lawsuit seems to be credible when I read over it so I eyeballed the Hustle and said let me put it on the R&G.
Let me first say this shit is genius and now let me show you how it works….
Each item that comes up only cost 1 dollar for a customer to bid. Each bid only moves up in increments of 1 cents. Since it’s 1 cents everyone jumps in because although 100 bidders put in a bid on the surface it only looks like the item went up 1 buck. This causes a frenzy of cats who bid the price up even more. The winner walks away with a car, tv, gift cards and baby pony happy as hell and willing to cosign the game on the internet. Most people who are on these sites are the same cats who probably were bidding on ebay. Since Ebay pretty much indocrinated a whole bunch of Customers to the game of bidding the penny auctions are making a killing.
The penny auctions sites are making a killing in money WHEN YOU DO THE MATH! So lets say you want a $100 dollar Wal-Mart gift card! You jump in the auction and you see it for 4 bucks and say shit… I’d take 100 for 4 bucks! But when you do the math you see at 4 bucks these places already made 400! Remember the bids only go up 1 cents and they cost 1 buck each time a Customer bids. So even if you try to game the system and wait til the bid is closing you’ll find out 400 Customers didn’t. Then when you get your bid in toward the end of the bid time you see everyone is jumping in. So when you have the bid there’ll be a countdown before it accepts your bid and all of a sudden someone else jumps in. This might bid that Wal-Mart card up to 8 bucks which is still a deal right? When the cat wins the bid at $8.30 he’s happy that he got $100 for $8.30 but the penny auctions site made maybe 800 bucks. The math is they bought the card for 70 wholesale and then sold it for $8.30 so net profit is like $760 BUCKS!
So when the average Customer sees a Mustang for 500 dollars he’s not thinking these cats are up to 50,000 dollars already. (There are 100 pennies in $1 so in $500 you’d multiply 500 by 100 or just take the 2 zeroes of 100 and add to 500 +00 = 50,000) When the Customer sees a Ipad for $110 dollars she’s not thinking they are up to $11000 on a $400 dollar item. Really what Customer really cares about how much money they make anyway.. as they get the item for cheap. Like I said it’s not illegal but you want to see the gold mine of game this one is it. I’m not so tech savvy to bring this into being but I can recognize money on the ground and the jingle of change in pockets.
So it wouln’t be the R&G without me saying let’s break bread right?
Most of these places basically carry the same items electronics, gift cards, jewelry, handbags and the like. So the niche is finding something and specializing in that only!
- Women would probably love a site dedicated to handbags if you can get your hands on the ones that move.
- Men would probably love sports memorabilia and shoes.
- Tech cats would love the newest gadgets and all software or computers.
- Jewelry might be harder to source but nonetheless cats would come to that one too.
- Gift cards will be a mover for all demographics as the idea of 5 bucks for 100 is very appealing.
See the game is you can go and buy the product after you collect your money. You don’t have to have it on hand because you have to send it to them right? So this is almost a no money down angle. Now don’t say I never gave you anything because we can all do this. All you have to do is find and pay the cat who can set up the site and get to advertising like no tomorrow!
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I had to read this over a couple times to see the math. WOW! Im going to put this hustle in my back pocket until I can do something with it.
WOW! Sounds like a great get rich scheme to me!
Man this is pure game right here. Like you said ebay got folks primed for auctioning sites…
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Love It!!!
@Anubis – Don’t sweat it the angle will work forever it’s just a matter of finding the right product and filling a niche. A small auction just for gift cards would be enough and could be ran right out of someone’s house!
@Keish – No scheme as it’s legal but the multiplier on this angle is amazing. When I saw it pop up I ran to research it because I saw the math right away.
@PM – Ebay got young gamblers ready to put their bid in Vegas style for anything. But with these guys you pay 1 buck to bid each time so they are making money on the bids and not really on the products.
@Supreme – Once you can do the math on these things some will WOW you! I try to figure out how they make money everytime I see a new business.
What a coincidence. I’m actually completing a penny auction website as we speak for a client. Freeman, great article as always!
Troy you are the missing link in this game if you are building penny auction sites. You got to let me know what the ballpark buildout on this would be.
WOW!!!! I definitely got to try this!
Welcome Wan – This is probably the most WOW’s on a post in the history of blogging! Glad you’re thinking about it!
@Freeman – Check your email.
Definitely and thanks!
Thanks for the heads up brother. This is a great hustle!
Yeah, the numbers are great! Now it’s just finding the right products that will make people bid like crazy. Once you have that you have the game and you have the money!
Troy could you also let me know what the cost of developing this website would be as well? You should build one for yourself brother!
Good stuff. My boss brags about the super bargains she gets on these sites on the regular. I’m taking my boss out to lunch. lol.
@Troy…how much does it cost to build one of these websites? Let me know as well.
@Hackneyking – It would cost under 5k to develop. This would be for your average penny auction website. Thanks for the advice. I haven’t seriously considered making a penny auction website for myself. I have a couple projects I’m working on for myself right now that take up a lot of my time which I think will pay off.
@AH – I think those who know how to bid properly should come up. I think the whole angle is great and who will know that many bids have been in.
The key is advertising so you can get a million people putting down a million dollars. So it’s not just the auction but people you get involved.
@Troy – Thanks man. Good luck with your other projects.
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