Swoopo?

[fundeals]

Hey, anyone ever heard of Swoopo? Is it a legit company or is it a scam? I've read all of the rules, etc and it seems to be OK, but I also looked them up on the Better Business Bureau and they've had complaints, but they as of now, have all been resolved. Any info will be greatly appreciated. Also, has anyone really won anything for cheap? If so, how did you do it? Thanks in advance!

[Dutchess]

My boyfriend lost a fortune just trying to "bid" on one item. Instead of trying to explain the whole ordeal, i found this on the web.

 

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Looks like a basic scam to me. Basically, once the number of bids reaches a number that is equal to 87% of the numeric value of the cost of the item to the website, the website has fully covered its costs.

 

The reason for this is, bidding starts at $0.15, each bid increases the price by $0.15, and each bid costs $1.00 upfront. As a result, for each bid made on an item, the website is guaranteed to receive $1.15 - $1 upfront from the bidder, plus the additional $0.15 the eventual winner will have to pay on account of that bid.

 

Thus, what matters is not the final price at which the auction closes, but the number of bids made in the interim.

 

It is this aspect that makes this website a scam because it is basically, as far as I can tell, intentionally designed to lure people who are used to bidding on eBay with the illusion of very low final auction prices, and to leverage off the ingrained habit learned from eBay of getting into bidding wars where each bid ups the price by a very small increment - which is costless on eBay because bids don't cost money, but which can quickly become very costly here.

 

For example, if the website auctions off a TV that they paid $100 for, all they need to have happen in order for their costs to be covered is for 87 bids to be placed on the TV. At that point, they've received $87 upfront from the costs of bids, and will in due time receive $13.05 from the winning bidder (plus, of course, their "small fee" for running the auction - the vigorish in the equation).

 

What's interesting about this is that, even though the item seller has fully recouped its cost of goods sold, the winning bidder will only pay $13.05 as the final price of the good - from the outside this looks like an astounding deal, since what everyone sees immediately is just the winning bid.

 

That, I think, is essentially misleading, because it implies that something can be had for a song when, in fact, it's been fully paid for, in the main by the losing bidders.

 

Essentially, even though the winner is determined by individual action and not by chance, this is basically a very expensive lottery ticket because, each time a bid is made, the bidder is paying $1 and taking the chance that no-one else will come along after and make a higher bid. Paying money up front for the chance to get something at less than fair market value is gambling, or the lottery.

[hannahs_momma]

This should probably be moved to the deal discussions

[noehlp]

Moved to deal discussion forum

[MonsterMutts]

So what you are saying is, if I bid on an item and still don't get it I have to pay?

[jeninpa]

So what you are saying is, if I bid on an item and still don't get it I have to pay?

You prepay $1.00 for each $0.15 bid PLUS on the off chance you do win you still pay the full price for the item too.