Ahhhh, eBay… the ultimate worldwide flea market. Everyone from Midwestern grannies to jobless goatee-ed neo-hippies (as if there are any other kind) are in on the action, peddling their wares in the wee hours of the morning. Chances are if you want to buy, some poor sucker is selling, and if you want to sell, there's some poor sucker willing to buy.

We know what you're thinking: How do I avoid being the aforementioned "poor sucker"? Well, we're here to save your sorry ass. But first we have to make one thing clear: This article will assume you have at least a basic understanding of how eBay works. Why eBay, and not some lesser known online auction service? Because it's the largest and most high-profile service around. However, if you're an anti-establishment type who prefers to frequent the underdog (i.e., you use Bn.com instead of Amazon.com), realize that you can still use this SYW - most of our pointers are applicable to all online auctions, no matter where you choose to buy and sell your crap - we mean "valuables."

1. GET STARTED

First things first: eBay requires all registered users to enter the following:

  • Name.
  • E-mail address.
  • Mailing address.
  • Phone number.
  • Credit card number. This last criterion is new as of October 22, 1999, and doesn't apply to everyone. For example:

  1. Sellers who sold items prior to October 22, 1999 can ignore this policy. These sellers are not required to list a major credit card in order to sell items.

  2. If you have a free e-mail address from a service such as Hotmail.com or Yahoo.com, you MUST register with a credit card. No exceptions.

  3. For those who don't wish to register with a credit card, eBay provides an "ID Verify" service. ID Verify will match your personal information with the information on your credit record in order to verify your identity. There's a $5 fee for using ID Verify, and the service is good for one year.

There's also a bunch of optional information that you can provide. Whether you give it or not is up to you; just make sure that you don't lie about any of your information.

As soon as you've registered, you may be tempted to start bidding on stuff, most of which you probably don't need. ("A glow in the dark towel rack! Just what I always wanted!") Not so fast. First you've got to become aware of three invaluable tools offered by eBay that every savvy participant should utilize:

  • User feedback allows users to comment on each other's activities. When commenting, the user either assigns a positive, neutral or negative ranking to his/her description. By looking at the user feedback, a user's reliability can be determined easily by their rankings, with a high positive ranking meaning that the user received a large number of positive comments. This feedback can indicate if a seller sells quality merchandise, if a seller is recommended by others, and if a buyer submits his/her payment quickly. All good things to know!

  • Security Center is eBay's "comprehensive safety resource and protective arm"-basically a service that allows eBay to monitor its users. Whenever users log into the system, eBay's servers record their Internet addresses. Although users cannot view this information, SafeHarbor personnel will respond to complaints by users and will determine whether, for instance, an eBay user is using multiple usernames in order to manipulate auction prices. So it prevents you from registering 15 times with 15 e-mail addresses, and bumping up an auction price to get people to pay more.

  • Users may also view each other's bidding histories. A bidding history shows which auctions a user has bid on, and also lists the other users who have bid in those same auctions. This can be helpful in determining whether users are playing by the rules. We'll elaborate on this later.

In the meantime, you should familiarize yourself with the two types of auctions eBay offers:

Single winner auctions
Dutch auctions

Single winner auctions

With these auctions, the item goes to the highest bidder, just like any normal auction. So you're first question may be "Do I have to go to eBay every day and submit a new bid?" Not at all! eBay has this amazing feature called "proxy bidding." This allows a buyer to enter the maximum amount he's willing to pay for an item. But instead of instantly putting your bid on the item, it'll put in a lower bid for you, and if anybody makes a higher bid, eBay will automatically increase your bid for you until it hits your maximum. Hmmm... an example may be called for.

Jimmy really wants to bid on a donkey-bone yo-yo. The current bid is $100. If Jimmy's willing to go as high as $500, he can ask eBay to proxy bid on the item for him. eBay will then put a bid in for him of, say, $150, which is the highest amount of any other user's proxy bid. Jimmy will now be the high bidder, and eBay will keep increasing his bid to keep it the highest until another buyer bids over $500. Then Jimmy loses, or he can go back in and place another bid.

Another feature of single winner auctions is the reserve price, which is the amount at which the seller is willing to sell the item indefinitely. Another example, you say? No problem.

Jimmy puts his Playboy collection up for auction, starting at $1. Jimmy is worried that only one person will bid on the Playboys and that they will be auctioned for $1 (much less than Jimmy is willing to sell them for). So Jimmy puts a reserve on the auction of $100. This means that until someone bids over $100, he doesn't have to sell the collection. If someone only bids $99, Jimmy will get a report at the end of the auction stating that the reserve was not met and that the highest bidder offered $99. At this time, if Jimmy is willing to sell the Playboys for $99, he may contact the buyer and offer them for $99. However, the buyer has no obligation to buy the Playboys since the reserve was not met.

Dutch auctions

These auctions can have multiple winners, all of whom are bidding on the same item. Since you love our examples so much, we'll oblige with another one (starring that social miscreant, Jimmy!).

Jimmy has 10 banana trees that he wants to sell, starting at $1 per banana tree. This means that 10 people could go and bid on an individual banana tree, and each would win one banana tree.

Dutch auctions also allow buyers to bid on multiple quantities of an item. The great thing about Dutch auctions is that, specific to eBay, the lowest winning bid for any user is the amount that all users will pay. Dutch auctions are complicated, so please read the complete rules.

Of course, none of these special auction features are required. You can always just put in a real bid and if anyone bids above you, you can go back and make another one. Whatever floats your eBoat.

2. SELL SMART

OK, we're going to assume that you know the fundamentals of how to sell something on eBay. If you don't know how, then read this eBay seller's tutorial. What we'd rather spend out time doing is giving you those all-important tips to getting the best price possible for your junk.

Title your items effectively
Beware of "collaboration"

Title your items effectively

The number one way sellers screw themselves over and not find buyers is by promoting their product with a poorly written auction title. Although this may seem like a relatively minor issue, spelling mistakes and insufficient descriptions can be the difference between an item attracting buyer interest and garnering a high price, or going for a paltry sum offered by one lone buyer.

Remember Jimmy? Let's say that he wants to sell his new TV set (since he needs room to practice with his donkey-bone yo-yo). Jimmy has a number of options for how he can title his item, including:

a) big TV
b) 27-inch television
c) Sony Trinitron 27-inch television TV, model #tbk-889

The last item description is the best, and here's why:

  1. eBay's search engine favors titles that include the most information. Jimmy's TV will turn up for multiple users, whether they type in "television", "TV," or "Sony TV."

  2. Listing items in this specific manner allows for more exact matches.

Another example:

Sally is looking for the exact model of Sony TV that Jimmy is selling. Sally doesn't want to have to wade through all the other 27" TV sets on eBay, so she searches for Sony #tbk-889. If Jimmy had used one of the first two auction titles, eBay's search engine would have passed over his listing, because it did not include the words Sally was searching for.

While being as specific as possible is good, don't stress over the capitalization, exclamation points, and dashes - they do not affect the eBay search engine.

Beware of "collaboration"

Collaboration occurs when buyers communicate with one another in order to affect a low final price for an item. Think of it as a Survivor-esque alliance (without the melodramatic speeches about snakes, rats, and "island spirits"). Although traditional collaboration is difficult to pull off, the gigantic size of eBay's bidding community makes it possible for users to collaborate in a modified form. For instance, in a traditional auction-where all bidders are sitting in the same room-collaboration could be achieved if all the bidders interested in an item decided that only one person would bid so that they could later split the profit. On eBay this would be virtually impossible to do, since there is an unlimited number of potential buyers.

The modified form of collaboration on eBay involves bid retraction and bid defaulting. Example example!

Jimmy and Sally (who are now good friends, having met on eBay) decide that they want to both win an auction by collaborating. Jimmy bids extremely low ($2) on a ceramic lawn gnome early in the auction. Sally then bids extremely high ($100), ensuring no one else will outbid him and buyer interest in the auction will remain low. Then, just before the auction ends, Sally retracts her bid and Jimmy's $2 is reinstated as the highest bid. Jimmy will now probably win the auction, as Sally's former high bid scared everybody else away. Alternatively, Sally could also wait until after the auction ends and then default on her bid, forcing the seller to either offer the item to Jimmy, or hold the auction again.

Unfortunately, it's hard to catch slimeballs like Jimmy and Sally. The best way to determine whether collaboration is occurring is to analyze Jimmy's and Sally's bidding histories. If their histories show that they both bid on all the same auctions (or that one or both of them have a large number of bid retractions), then there is reason to believe that they are collaborating. It should also be noted that "Jimmy" and "Sally" could be the same person. A single person could register multiple user names and then do collaboration between these usernames. If you suspect that buyers are collaborating, be sure to contact Security Center.

So our point is that when you're selling, you should constantly check the bidding histories of the people who are placing the bids. If something fishy is going on, then report the names to SafeHarbor and immediately pull your item off the market.

3. BUY SMART

Buying on eBay is really easy: you just type in a bid. For greater detail about the technicalities of how to buy stuff, read this buyer's tutorial.

Buyers who do not research the value of the items they are bidding on often end up paying a much higher price than they should. So do your homework before bidding on any item so that you won't screw yourself over.

  • Always go to online shopping sites first to determine the lowest retail price being offered. To find out which retail sites are selling a particular item, check out search engines like MySimon.com, or Yahoo!'s shopping section.

  • Also use eBay's completed auction search to determine the average price of the item on eBay. When considering the price difference between a retail site and eBay, one should factor in such things as warranties and customer service that are often absent from eBay purchases.

Even if you've done all the proper research, though, you're still not safe. Buyers incur the most risk using eBay because they're required to send their payment first, often without proof that the seller has any intention of actually shipping the item. And the merchandise they receive - if it comes at all - may not be of the quality they expected (e.g., a heavily-scratched CD, or a knock-off instead of an original). Here are three types of sellers you should be wary of:

Sellers who never ship the merchandise
Sellers who accept really low bids
Sellers who use multiple usernames

Sellers who never ship the merchandise

To avoid this situation, examine the seller's user feedback. If the seller has 100 unique messages attesting to his/her reliability, it is likely that he/she is reliable. If the seller has many negative comments attesting to his/her failure to ship the item on time, then insist on using an escrow service (such as iescrow) to ensure that you will get what you pay for.

In the case that you don't want to use an escrow service (they can get expensive), here are some other tactics for determining the reliability of a seller:

  • When a seller sends you a name and address to send payment to, it is always a good idea to look up the address on a White Pages service, such as Yahoo! People Search.

  • If the name and address matches a listing in the White Pages, the seller should probably be afforded some credibility. (Would you want people to be able to track you down easily if you were a scam artist?)

  • Also try looking up the seller's name and address in a search engine like Google to determine whether any other information pops up about his/her reliability. While you're at it, you may even find pictures of the seller in compromising positions.

Sellers who accept really low bids

If you know that the price you are paying is unreasonably low compared to the true value of the item, you might want to think twice before sending payment. Here's a real life example of the "too good to be true" syndrome:

Jimmy bids $500 on a video camera that he knows retails for around $1500 and typically sells at auction for around $1000. (He has already determined the average auction price by searching completed auctions on eBay.) Jimmy is outbid by a few bidders, but does not want to bid any higher than $500. Ten minutes after the close of the auction, Jimmy receives an e-mail from the seller that the high bidder has defaulted on his bid and that Jimmy is now the high bidder at $500.

It is obvious that the seller is trying to pull a fast one not only on Jimmy but on a number of other buyers as well. Since the seller can see a list of all bidders and their e-mail addresses (in the bidding history for the auction), the seller has probably gone down the list and told each buyer that the others defaulted and that they are now the high bidder. Jimmy has reason to be suspicious for two reasons:

1) It is highly unlikely that the high bidder defaulted within ten minutes, as three days is usually the period allowed for the seller and high bidder to make a deal. 2) $500 for the camera is unreasonably low. Why would the seller offer the camera to Ted when he could garner around $1000 simply by holding a new auction?

Of course, you could then ask us "Why would Jimmy bid $500, but then be skeptical when it wins? Why did he even bother bidding?" What are we, psychologists? We can't explain Jimmy. He has donkey-bone yo-yos and banana trees laying around his house! BUT if you don't find out until after the auction that the camera is actually worth $1000 and you got it for $500, then your skepticism is more well-founded.

Sellers who use multiple usernames

Sellers have been known to use another username to bid in his/her own auction, thereby driving up the price. If you are concerned that a seller may have been bidding in his/her own auction, then you should contact SafeHarbor to determine whether foul play was involved. It's hard to know when this happens... you just have to go with your gut. But if you suspect it, then drop out immediately.

4. TAKE ACTION IF YOU GET RIPPED OFF

You've followed our advice, but somehow, they gotcha anyway. The bastards! Now you need to make the best of it and try to get even. Fortunately, there are a number of ways to seek retribution (and legal ways at that!):

  1. Clarify the situation with the seller. Often, there is simply a misunderstanding and the seller has every intention of shipping the item. Or maybe he/she has already shipped it, but there's been some sort of delay. So when you make a deal, always ask the seller for a tracking number so that you can locate it if need be. Major carriers like Federal Express and UPS allow customers to track shipments online.

  2. If that doesn't work and you're sure that the seller is trying to defraud you, then you should write negative feedback about him/her on eBay. This will prevent others from getting screwed by the same person and will make the users auctions much less popular. There is no need to falsify or exaggerate your negative feedback about the user, as this may shed doubt upon the truth of and motive for your comments, but simply explain the situation and why it is your opinion that no one should do business with that user ever again.

  3. Although negative feedback may keep others from being screwed, it won't get you your money back. Fortunately, eBay offers $200 in insurance, minus a $25 deductible, to any user who has been defrauded. "Defrauded" means either you paid for an item and never received it, or you received an item that wasn't exactly what you had in mind (you got a fake Rolex instead of a real one). In order to receive the insurance though, eBay has a few requirements, including that both you and the seller were in good standing at the time of the transaction. If the problem is that the buyer and seller do not agree on the terms of the auction, eBay suggests using a service like SquareTrade.com in order to arbitrate the dispute.

  4. Other ways of getting even include issuing a complaint with the FTC, the National Fraud Information Center, or - if the seller is a business - the Better Business Bureau.

  5. Finally, contact the seller through other means. If you know that the seller is trying to screw you and you have previously contacted him only through e-mail, then this is when it will be useful to have his White Page listing. Call him over the phone! If the seller happens to be a kid (despite eBay's 18-year-old age limit), then you can speak to their parents in order to resolve the situation. Explain that you would like the item shipped or your money refunded, and that if the seller fails to comply, then you will contact their local authorities. The seller will probably do as you say in lieu of a potentially embarrassing appearance on COPS. Note: These measures should only be taken if the seller refuses to discuss the issue. If the matter concerns a disagreement over the terms of the auction, then arbitration should be sought instead of getting the police involved.

Well, by now you should be a savvy auctioneer, ready to take on the dangerous yet rewarding world of Internet bargaining. Go get 'em Tiger. Just make sure they don't get you. And if you see Jimmy out there, please tell him that the banana trees are a big hit!