eBay Auctions are eBay's Lifeblood.

eBay built it's business around the excitement of the auction and invites the world to join: more specifically it invites you to join.

eBay's auctions follow the general pattern of a normal auction, with each successive bid trying to top the one before with some notable differences:

Duration

Whilst an auction in an auction house goes on for a few minutes an eBay auction goes on for several days - typically between 1 and 10.

The seller decides how long it will go on for, too short limits the number of bids: too long may result in no bidders entering the auction until the last minute.

Bidding Increments

To prevent endless bidding wars with tiny price increments, eBay requires every new bid to raise the price by at least a 'bidding increment' calculated by eBay base on the current price.

So if the current highest bid is $10.00 there's no point bidding $10.01 because eBay will not accept a bid lower than $10.00 + the 'bidding increment'.

You can find the 'bidding increment' by trial and error as any bid lower than eBay's calculated minimum will be rejected and any bid above it will be the subject of a proxy bid.

Proxy Bids

You bid to your maximum, provided that that is more than the current bid an eBay places a 'proxy' bid for you.

This sounds complicated, but in fact it works in the bidder's favour.

Say the current highest bid is $10 but you are willing to pay $20.

1. You bid the $20 dollars straight away.
2. eBay looks at the current highest bid - $10 - and tops that by an amount known as the 'Bidding Increment' - and places a bid of say $10.20.
3. If someone later tops your current bid - $10.20 - eBay tops that by adding the bidding increment again.
4. eBay will continue to do this until it reaches your original bid of $20.
5. If you win you pay the last proxy bid - up to $20 but quite possibly less.

Buyer Beware
'Caveat Emptor', buyer beware is the underlying basis of most auctions, eBay included. However can act as referee in the event of problems.