Why Do I Always Get outbid?

eBay online auction bidding
Getty Images/Matt Cardy

Question:

Why do I always get outbid?

One of the most common complaints from new eBay bidders is that they get outbid with frustrating speed and consistency. More cautious new users are often convinced that eBay is full of shill bidding. In actuality, it's very common to be outbid on eBay, and even to be outbid quickly, for several reasons.

Answer:

The simplest answer to the question "Why do I get outbid?" is that you get outbid because your bids are too low.

eBay is a very popular marketplace. However, there are several more nuanced answers that might help to further illustrate common reasons for being outbid:

 

  • There are many bidders on eBay. Since its beginning in the 1990s, eBay has played host to hundreds of millions of auction listings. These auction listings don't exist in a vacuum—they are supported by millions of bidders around the world. If you've got a hankering for a particular item, chances are that someone else somewhere has a hankering for that same item. In fact, chances are that if there's one buyer for an item in the world, there are dozens. Though bidding for many of the items on eBay begins small, often at $1.00 or even $0.01, there are usually far too many interested parties for that price to last.
     
  • Auction prices always tend to reach fair market values. At first glance, an iPod with a current price of $10.00 looks like a great deal—but you must remember that most eBay items are sold as auctions. Whether at eBay or elsewhere, until an auction has closed, other people are likely to bid on it if the current bid is below market value. The international nature of eBay compounds this likelihood. In general, someone somewhere will always be willing to bid on an item that is undervalued. By the time most auction listings close, therefore, the winner has agreed to pay a fair market price for the item.
     
  • eBay's proxy bidding system leads to rapid outbidding. More than being frustrated simply because they've been outbid, many new users are frustrated at having been outbid so very quickly. It is not at all uncommon to be outbid immediately on eBay and to be outbid this way over and over again with repeated attempts to bid on the same listing. This happens not because another bidder or the seller is cheating but rather because of the proxy bidding system that eBay uses.

    If you are a new eBay user and find that you are repeatedly or rapidly outbid on auctions that you'd very much like to win, you may want to learn about the eBay bidding system and how it works so that you'll be less likely to be outbid in the future, and so that you will understand why you've been outbid when it happens to you.