Using a hidden reserve price in auctions.

Hi Steve; I've done several eBay auctions and have usually used a "hidden" reserve-- eBay explains the benefit (reasons) for using it: paraphrasing, a lower minimum bid (than reserve) will attract more bidders, but may not be the minimum price a seller is willing to accept. OTOH, if you post the minimum you will accept up-front, you may attract no bidders at all. And in fact, I've found this to be true. I guess it's just auction psychology.

As a buyer though, I tend to agree with you, I don't care for the hidden reserve either. Craig

Garfish, is right about auction psychology. I watched a listing of friend, who for a month had a classified add for a very clean $3000 CD player. He listed it for under what everyone else was selling them for thinking he would turn it quicker that way as he had already bought another machine. He was at least $200 under everyone else by the end of the add at $900. Well the add expired, and still no sale. He decided to auction it. He didn't use the hidden reserve though, he went no reserve and started at $1. I have seen him sweat on these no reserve auctions before. It takes real balls! Anyway at the end of the auction the thing sold for almost $1300! There is no other way to explain it than that someone else must think it is worth buying so I better bid more, when a week before they could have bought it for $900. It was VERY interesting to watch.

I agree with Garfish. Also, I think the idea with the low opening and higher reserve is to entice bargain hunters into bidding at a low price, hoping they will get into a bidding frenzy and meet your reserve. As a buyer I don't like them because since I don't want to bid higher than the reserve, I have to place a lot of bids as I slowly work my way up to the reserve.