| Revision as of 12:52, 20 August 2012 editJP22Wiki (talk | contribs)142 edits womens own reference amendment← Previous edit | Revision as of 14:01, 20 August 2012 edit undoJP22Wiki (talk | contribs)142 edits BDO referenceNext edit → | ||
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| MadBid’s business model is very similar to ] however MadBid.com added a number of features that allow it to fall into the ] category<ref name="Guardian Article">{{cite web | url=http://www.guardian.co.uk/money/2012/jan/28/penny-auction-websites | title=Penny Auction sites can leave a hole in your pocket | publisher=''Guardian Newspaper'' | date=January 28, 2012 | accessdate=August 20, 2012 | author=King, Mark}}</ref>. Features such as Buy Now on most products ensure all users can own the products advertised on the website. The Buy Now allows users to develop their bidding strategies in the ] and if they do not win, they can buy the product using paid ] placed in the auction as a discount of the product’s selling price. Most Buy Now auctions on MadBid.com have a ] tab so shoppers know the price they have to pay compared to other online retailers. | MadBid’s business model is very similar to ] however MadBid.com added a number of features that allow it to fall into the ] category<ref name="Guardian Article">{{cite web | url=http://www.guardian.co.uk/money/2012/jan/28/penny-auction-websites | title=Penny Auction sites can leave a hole in your pocket | publisher=''Guardian Newspaper'' | date=January 28, 2012 | accessdate=August 20, 2012 | author=King, Mark}}</ref>. Features such as Buy Now on most products ensure all users can own the products advertised on the website. The Buy Now allows users to develop their bidding strategies in the ] and if they do not win, they can buy the product using paid ] placed in the auction as a discount of the product’s selling price. Most Buy Now auctions on MadBid.com have a ] tab so shoppers know the price they have to pay compared to other online retailers. | ||
| The pay-to-bid auction process of MadBid.com is based on users buying credits, which allows them to place bids in an auction. Users must purchase these ] before participating in an ]. Credit packages range in price from £14.99 to £374.99. Every auction has a ], which counts down; it can be from 2 minutes to as low as 5 seconds. Each auction also varies in the amount of credits needed to ], for the smaller auctions users only need 2 credits every time they want to place a bid. For the bigger and more popular auctions the number of credits required to place a bid can go up to 8 credits every time you want to place a bid. Numerous ] do state that if the correct techniques are used bidders can make huge ]. Every time a person places a bid the timer restarts and counts down again. If the timer runs out before anyone places a bid, the user with the last bid placed wins the item and has the right to buy the won auction. Every time a ] is placed and the timer restarts the auction price goes up by 1p, in the end the winner of the auction has the option to pay the closing price in order to obtain the won auction or in some auctions convert the auction value into MadBid credits. Furthermore, the postage and packaging charges (if applicable) are to be paid by the auction winner in order to receive their won items. | The pay-to-bid auction process of MadBid.com is based on users buying credits, which allows them to place bids in an auction. Users must purchase these ] before participating in an ]. Credit packages range in price from £14.99 to £374.99. Every auction has a ], which counts down; it can be from 2 minutes to as low as 5 seconds. Each auction also varies in the amount of credits needed to ], for the smaller auctions users only need 2 credits every time they want to place a bid. For the bigger and more popular auctions the number of credits required to place a bid can go up to 8 credits every time you want to place a bid. Numerous ] do state that if the correct techniques are used bidders can make huge ]. In 2011 the company was reviewed by BDO who confirmed such discounts.<ref name="BDO Report">{{cite web | url=http://www.madbid.com/media/madbid-bdo-report.pdf | title=BDO Report on MadBid | publisher=''BDO'' | date=December 9, 2011 | accessdate=August 20, 2012 | author=BDO LLP}}</ref> | ||
| Every time a person places a bid the timer restarts and counts down again. If the timer runs out before anyone places a bid, the user with the last bid placed wins the item and has the right to buy the won auction. Every time a ] is placed and the timer restarts the auction price goes up by 1p, in the end the winner of the auction has the option to pay the closing price in order to obtain the won auction or in some auctions convert the auction value into MadBid credits. Furthermore, the postage and packaging charges (if applicable) are to be paid by the auction winner in order to receive their won items. | |||
| In August 2012, the company was nominated for the Small Online Business of the Year Award at the ] (UK)<ref name="National Business Awards Nomination">{{cite web | url=http://www.nationalbusinessawards.co.uk/page.cfm/Link=162/nocache=06082012 | title=National Business Awards | publisher=''National Business Awards'' | date=Unknown | accessdate=August 20, 2012 | author=Unknown}}</ref>. | In August 2012, the company was nominated for the Small Online Business of the Year Award at the ] (UK)<ref name="National Business Awards Nomination">{{cite web | url=http://www.nationalbusinessawards.co.uk/page.cfm/Link=162/nocache=06082012 | title=National Business Awards | publisher=''National Business Awards'' | date=Unknown | accessdate=August 20, 2012 | author=Unknown}}</ref>. | ||
Revision as of 14:01, 20 August 2012
MadBid is a pay-to-bid auction site registered under Marcandi Ltd. in the UK. Founded in 2008 the company operates in 5 European countries including UK, Ireland, Spain, Italy, and Germany. It is quoted by The Times newspaper that MadBid.com users can save up to 98% of RRP on new products. The company received £4million in funding from the Skype founder’s Venture Capitalist firm Atomico in July 2010.
The company & mechanics
MadBid’s business model is very similar to penny auctions however MadBid.com added a number of features that allow it to fall into the e-commerce category. Features such as Buy Now on most products ensure all users can own the products advertised on the website. The Buy Now allows users to develop their bidding strategies in the live auctions and if they do not win, they can buy the product using paid credits placed in the auction as a discount of the product’s selling price. Most Buy Now auctions on MadBid.com have a price comparison tab so shoppers know the price they have to pay compared to other online retailers.
The pay-to-bid auction process of MadBid.com is based on users buying credits, which allows them to place bids in an auction. Users must purchase these credits before participating in an auction. Credit packages range in price from £14.99 to £374.99. Every auction has a timer, which counts down; it can be from 2 minutes to as low as 5 seconds. Each auction also varies in the amount of credits needed to participate, for the smaller auctions users only need 2 credits every time they want to place a bid. For the bigger and more popular auctions the number of credits required to place a bid can go up to 8 credits every time you want to place a bid. Numerous independent websites do state that if the correct techniques are used bidders can make huge savings. In 2011 the company was reviewed by BDO who confirmed such discounts.
Every time a person places a bid the timer restarts and counts down again. If the timer runs out before anyone places a bid, the user with the last bid placed wins the item and has the right to buy the won auction. Every time a bid is placed and the timer restarts the auction price goes up by 1p, in the end the winner of the auction has the option to pay the closing price in order to obtain the won auction or in some auctions convert the auction value into MadBid credits. Furthermore, the postage and packaging charges (if applicable) are to be paid by the auction winner in order to receive their won items.
In August 2012, the company was nominated for the Small Online Business of the Year Award at the Orange National Business Awards (UK).
Controversy
Sites such as MadBid.com often come under scrutiny and are likened to gambling. In December 2008 the BBC questioned if Madbid.com and similar sites were like an online lottery following comments made by a gambling expert. The controversy surrounding Pay-to-Bid auction sites has increased awareness of the risks that come with careless bidding in auctions. MadBid.com have taken precautions to minimise risks by allowing shoppers to buy the products with the bids placed in the auction as a discount, therefore if a user spends all of the credits in an auction they can still buy the product for the selling price using the credits placed in the auction as a discount. MadBid.com have also created Rookie auctions for new users to familiarise themselves with the website. Rookie auctions only allow users who have never won an auction before to participate. If a new user purchases credits and does not win in any of the MadBid.com auctions, their credits are automatically refunded within 24 hours. To help new customers develop their bidding strategies MadBid.com also have the Sneak-a-Peek feature which lets users check details of other bidders including bidding times, bidding categories, their auction wins and their bidding activity. With the Sneak-a-Peek information of rival bidders, users can refine their own bidding strategies.
Profitability
MadBid.com reports turnover of £4.5million in 2011. The cost of participating in an auction ranges from 0.20p to 0.80p per bid. Every bid placed increases the price of the product in the auction by 1p, keeping the final closing price much lower than the RRP of the product. If the collective bidding for the product exceeds the RRP then MadBid make a profit, however if not enough people bid (some closing prices are 0.1p) then MadBid makes a loss.
MadBid.com’s most famous auction was a Mini One that closed for £6.83 Popular products such as iPhones close in auctions sometimes for £48 or less, LG HD Ready 32” LCD TV’s go for as little as £2.93. These auctions have also been covered in the media from the Mini auction being featured in the Sunday Times to £500 Tesco voucher’s going for 1p covered in Woman’s Own Magazine and MoneyWeek.
References
- Goodman, Matthew (July 25, 2010). "Madbid.com Times Online Article". The Times Newspaper. Retrieved August 20, 2012.
{{cite web}}: Italic or bold markup not allowed in:|publisher=(help) - Butcher, Mike (July 26, 2010). "Madbid secures 4m Funding". Techcrunch.com. Retrieved August 20, 2012.
{{cite web}}: Italic or bold markup not allowed in:|publisher=(help) - King, Mark (January 28, 2012). "Penny Auction sites can leave a hole in your pocket". Guardian Newspaper. Retrieved August 20, 2012.
{{cite web}}: Italic or bold markup not allowed in:|publisher=(help) - BDO LLP (December 9, 2011). "BDO Report on MadBid" (PDF). BDO. Retrieved August 20, 2012.
{{cite web}}: Italic or bold markup not allowed in:|publisher=(help) - Unknown (Unknown). "National Business Awards". National Business Awards. Retrieved August 20, 2012.
{{cite web}}: Check date values in:|date=(help); Italic or bold markup not allowed in:|publisher=(help) - Pennells, Sarah (December 20, 2008). "Penny Auctions Under Scrutiny". BBC. Retrieved August 20, 2012.
{{cite web}}: Italic or bold markup not allowed in:|publisher=(help) - Melanie (July 12, 2011). "Madbid to treble Turnover with help from Scandinavia". Directorsof. Retrieved August 20, 2012.
{{cite web}}: Italic or bold markup not allowed in:|publisher=(help) - Unknown (2012). "Good Deals Section". Women's Own. p. 43.
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