TrueJournals

Tag: theory

Are Penny Auctions a Scam?

by on Jul.17, 2011, under technology, thoughts

If you haven’t heard, someone was lucky enough to buy a Chevy Camero for only $5.28. Now, if you actually read the article, you’ll notice a very important detail: this car was bought off a “penny auction” site. These sites, like quibids.com, are becoming more and more popular. Recently, I’ve had a couple of my friends ask me my opinion on these sites: are they a scam? It certainly sounds too good to be true. But, I will give this sites credit: real people do win real items from these sites. In this sense, these sites are not a scam.

So, how exactly do these sites operate? How can anyone run a profitable business by selling $1,000 products for about $20? The answer isn’t generous owners. While we might like to think that there are people that generous in this world, it’s simply not a sustainable business model. Click through to the rest of the post, and I’ll do my best to explain how these sites work, and why you shouldn’t (or maybe should) waste your time.
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