Online auctions - selling on the Internet will become increasingly easy

An auction is an online portal in which participants bid for products and services on the Internet. The functionality of buying and selling in an auction format is made possible through auction software which regulates the various processes involved.

eBid, one of the sites in the world's largest online auction, is one of the best known examples. Like most auction companies, eBid does not actually sell goods that it owns itself. It only facilitates the process of listing and displaying goods, bids on items, and pay for them. It acts as a marketplace for individuals and businesses who use the site to auction off goods and services.

eBid operates in ten countries, the United Kingdom, United States, Canada, Australia, Ireland, Italy, France, Germany, Spain, the Netherlands. eBid uses its own online payment service PPPay to allow buyers and sellers to pay each other in euros and pounds, even if members do not just use this form of payment.

Unlike eBay, which lists a basic auction on eBid is free and a small percentage commission on the final value is paid to sell your item.

The advantages of using eBid sell your goods include:

1. There are no time constraints. Bids can be made at any time (24/7). Objects are listed for a certain number of days (usually between 1 and 10, at the discretion of the seller), giving purchasers time to search, decide, and bid. This convenience increases the number of bidders.

2. There are no geographical constraints. Sellers and bidders can participate from anywhere that has internet access. This makes them more accessible and reduces the cost of "participation", an auction. This increases the number of elements listed (eg number of sellers) and the number of bids for each item (eg number of bidders). The items do not need to be shipped to a central location, reducing costs and the reduction acceptable minimum price of the seller.

3. Intensity of social interactions. The social interactions involved in the bidding process are very similar to gambling. Bidders are expected to hoping to "win". Just like gambling addiction, some bidders may submit bids in the first place to "play" rather than to obtain products or services. This creates a very loyal customer segment.

4. Large number of bidders. Because of the potential for a relatively low price, wide range of products and services available, ease of access, and social benefits of the auction process, there are a large number of bidders.

5. Large number of sellers. Because of the large number of bidders, the potential for a relatively high price, reduced selling costs, and ease of access, there are a large number of sellers.

6. Network economies. The large number of bidders will encourage more sellers, which in turn, will encourage more bidders, which will encourage more sellers, etc., in a virtuous circle. The more the circle operates, the larger the system becomes, the more important becomes the business model for all participants.

7. Captures consumer surplus. Auctions are a form of price discrimination can. As such, they attempt to convert part of the consumer surplus (defined as the area above the market price line but below the firm's demand curve) into producers surplus .......