A couple of years ago there was an online auction site that a number of people semi-seriously described as “pure evil”. Items would appear for sale, and you could bid a small amount, maybe $5 for a stereo or something. But you gave up that $5 there and then. People would eventually buy a $300 item for $60 or so, but the site would take in $1000 for that $300 item. Wish I could remember the name of that site...
This is much like a game I saw: the experimenter auctions off $20, with the catch that the second highest bidder has to pay whatever they bid. I think the intent of the example was that there are some games where the only winning strategy is not to play, but I think it fits into sunk cost well, too.
I did the math and these sites are making far more money per item than if they sold them at the inflated prices they list them at.
This is true even of the money used on the website. E.g.: the right to place 50 bids had 124 bids placed on it, bids which would have cost 50 cents each if bought in the $500 bulk pack.
Brazen. If people spend their money after seeing that, there’s nothing for it.
A couple of years ago there was an online auction site that a number of people semi-seriously described as “pure evil”. Items would appear for sale, and you could bid a small amount, maybe $5 for a stereo or something. But you gave up that $5 there and then. People would eventually buy a $300 item for $60 or so, but the site would take in $1000 for that $300 item. Wish I could remember the name of that site...
Swoopo. These are generally known as penny auctions.
This is much like a game I saw: the experimenter auctions off $20, with the catch that the second highest bidder has to pay whatever they bid. I think the intent of the example was that there are some games where the only winning strategy is not to play, but I think it fits into sunk cost well, too.
I think there are a bunch of these sites now such as http://www.bidzillion.com/ and http://www.offandaway.com/
I did the math and these sites are making far more money per item than if they sold them at the inflated prices they list them at.
This is true even of the money used on the website. E.g.: the right to place 50 bids had 124 bids placed on it, bids which would have cost 50 cents each if bought in the $500 bulk pack.
Brazen. If people spend their money after seeing that, there’s nothing for it.