Swoopo is a Scam
Posted on | March 18, 2009 | 38 Comments
TechChrunch has an article about Swoopo saying that it has a Hint of Scam. Well, SHAME ON YOU TECHCHRUNCH!! It doesn’t have a ‘Hint’ of scam, IT IS VERY BLATANT THAT SWOOPO IS A SCAM!
I am very saddened to find out about Swoopo today, in light of the other scams that have been going on right now. So moved that I am, it was hard for me to focus on work. I have to get this article out, and tell the world: SWOOPO IS A SCAM.
Now if you have some patience and curiousity on why Swoopo is a scam, read on:
One afternoon, I was in “Game Theory” class, and our professor David Housman ask the class to engage in a game. David was to sell a hundred dolar in an auction, with a starting bid of just two dolar, with one dolar increment. The highest bidder will walk away with the $100 after paying the bid amount. So if there is only one bid, s/he walks away with $100 – $2 = $98 dolar for nothing!! The only catch, the rule specifies that the ’second highest bidder’ has to pay his/her bid without getting anything.
Try that game in real life, you will for multiply your hundred dolar!! Initially, greed would motivate the bidders, as they are driven by the potential of the money gained. Soon as the bids reaches the fair falue, the potential gain is reduced, but the potential loss for the second bidder increases. This potential loss would then drive the bidders not to loose money, and they would continue to bid well pass the $100 value. Even the winner would loose money. The only guaranteed way not to lose is not to play. Can you see that this is a scam ?
Now let’s consider how Swoopo works. Here are the main rule (there more and there are variations):
- The auctioned are run on a specified time duration.
- Bids starts very very low, they lure people with very high potential gain.
- Each time bidder places a bid, they increase the bidding price by $0.15.
- Each time a bidder places a bid, they pay bidding fee of $0.75.
- Each time a bid is placed, the auction duration is extended.
- The winner gets the goods for the bidding price, which is typically way lower than the street price.
Okay, the rules seems quite inocent, right? Everything seems reasonable. Most people would not count the mathematical implication of that $0.75 bidding fee that they pay.
Let’s consider the ’scam’ that David showed us in the class. In that auction, the second highest bidder has to pay while getting nothing. In Swoopo’s case, it’s not only the the second highest bidder that pays for nothing, but ALL bidders pay the bidding fee, regardless if they win or not.
Just like the classroom scam, it was initially greed that drives the auction. But soon remorse would be the bigger drive. Remember, all bidders carry some cost! They would certainly want to get something to reduce the lost.
Let’s see this real auction that I watched as I wrote this post.
An Xbox 360 Red Elite Edition & Resident Evil 5 was to be offered at $160 when I got to the site. It was just 2 minutes left on the clock, and the auction gets heated. The several contenders who eyed the item started to bid more towards the end time, which unfortunately would also increase the auction time. Because of the high bidding frequency, the auction time gets extended 30 minutes, and during that time the price go up to over two hundred towards the end time. But again, bid frequency increases again just in the nick of time, postponing the end of the auction, and increasing the price. Finally, the auction ends with the selling price of #389.79, only $10 less than the street price. The winner pays an aditional $669 for bidding fee, so the total cost of that Xbox is about $1000. But is that the only income that Swoopo gets? Remember that the losers also pay bidding fees. For this item alone, Swoopo gets about 2600 bids, worth about $1900. So the total revenue for that Xbox is $2200. Is that not a scam to you?
I know that Geithner has been tough with AIG this days, but I hope the government would hire some good Game Theorists to catch these Scamers. I personally consider Swoopo’s scam as more evil than Madoff’s because they target lower class people who has less to spend, and quite likely less power to fight back.
Please help me spread the news, Swoopo is a scam. It should be closed as soon as possible.
Comments
38 Responses to “Swoopo is a Scam”
Leave a Reply
About
What I'm Doing...
- @slingman You do?? I wouldn't have guessed it ;-P in reply to slingman 5 days ago
- Popping pills starting now. Allergy pills! 1 week ago
- Strong quake in Sumatra, Indonesia. No casualties reported yet. http://bit.ly/cn4Qi3 1 week ago
- Indonesia may not have a curling team, but we have this ninja octopus! http://www.youtube.com/watch?v=H8oQBYw6xxc 1 week ago
- It's interesting that some people just have the desire to continually talk. 2 weeks ago
- More updates...
Posting tweet...
Powered by Twitter Tools.
SUBSCRIBE TO OUR FEED
Archives
Tags
Meta
Liking what you read?
March 19th, 2009 @ 7:19 am
Hi,
Interesting article indeed. I think you have a few valid points. Scammish it may seem if you walk away with nothing. Yep. But, Swoopo does a very good job explaining that you are buying the right to bid. So, when you pre-purchase your bids, that is like buying your membership into an auction site that has potentially very good prices. They do not deduct directly from your bank account. That would be a scam.
I also think that it’s not a scam because it’s not one person paying the total revenue that Swoopo is seeing. It’s a community effort and Swoopo sees the sum of this activity.
Just my two pennies. I know you understand the game and I understand the frustration you might feel, but when you think about it, Swoopo is definitely not a scam. It’s just a different auction style that has proven to be quite profitable.
More of a gamble that requires a certain strategy when approached. Do you go sit down at a poker table in Vegas with high rollers and ask the dealer to teach you Hold’em? No. You go in prepared and with the knowledge to take down your opponents.
Let the bids resume, haha.
March 19th, 2009 @ 9:49 am
David,
So now, how many auctions have you won? Do you make money at all from Swoopo?
Or the only money that you make is from Scamming people to buy your services?
March 19th, 2009 @ 9:50 am
I agree with David actually. Gambling perhaps, but scam most definitely not.
When a school holds a raffle you wouldn’t accuse them of scamming those who don’t win. Swoopo is like a raffle with a bit of skill added in.
March 19th, 2009 @ 9:57 am
Mathew,
All casinos are tightly controlled by the government agents.
Even slots machines are regulated.
Swoopo rules are absolutely not fair, and no one is currently regulating it.
Would you pay $1 for a 25c raffle ticket? Would anyone do it?
But Swoopo is selling 15c raffle tickets for 85c!!
Worse yet, for the penny auction, they are selling 1c raffle tickets for 76c!!!!
That allows them to get over $12000 for a piece of LCD TV worth $800.
Show me mathematical proof to debunk my claim, or SWOOPO IS A SCAM!
March 19th, 2009 @ 10:15 am
Hello all,
I think the main point here is that of gambling, or a lottery. A lottery is defined by three central elements: (1) Consideration for entry (2) Prize and (3) Chance.
Swoopo has consideration for entry, i.e., the bids. It has a prize, meaning the thing you’re going to win. The third element.. chance. That’s the tough one because it depends on strategy. If you believe you have a strategy, then, like poker, you can win eventually. If you believe it’s impossible to have a strategy, then it IS pure chance and therefore a lottery.
http://www.PriceDrip.com however is slightly different. For full disclaimer purposes, I should state that I am from PriceDrip. We have eliminated the chance element.. or at least made it controllable. You can bid and wait (like eBay) or you can bid the current price and pay more points.
By doing so, there’s only a chance element if you want there to be. Your thoughts?
Shamoon Siddiqui
PriceDrip.com
March 19th, 2009 @ 12:34 pm
Hi,
So, I don’t bid on Swoopo because my fiancee and I just bought a house and I don’t want to bid with money I don’t have. Perhaps the decision some people should make before they decide to bid and call Swoopo a scam.
As a side note, I find it very ignorant for you to call my site/strategy a scam when someone who is studying game theory doesn’t take into consideration that trends and odds play a significant part in a game, especially one that shows such results when you look at consumer (auction trends) at a product/day of week/time of day level that Swoopo shows. I encourage you to ask your professor if there are no trends that can be uncovered by looking at bidding behaviors. If you can see these behaviors, you will know when you should be bidding and it will increase your odds of winning an auction. I’ve had many people come back and tell me that the guide has worked. I can guarantee (and you can ask many of my clients) that I don’t pressure anyone into buying, if they ask for a refund, I give it, and if they ask any questions, it’s usually answered that day, if not the next day.
So, I’m not here to defend myself and the strategy I know works, I’m here to state that Swoopo is not a scam. It’s been cleared by the European Commission that Swoopo is not one as well. They provide all information needed and don’t mislead the consumer. If they hide the fact that the bids will be lost, that would be misleading but they present everything to the consumer who then knows the so-called ‘consequences’ for bidding on Swoopo. Here is a bit from Technologizer back in October from a Carol Franklin interview who represents the European Commission regarding online auctions:
““The Unfair Commercial Practices Directive (2005/29/EC) applies to commercial practices of this kind. Under this Directive, the consumer must receive the material information he needs in order to decide whether to purchase an item or place a bid on an auction site. Complete information about the price and the costs involved must be provided. In the case of auction sites, consumers must therefore be clearly informed whether they will be charged for bids that will not lead to an eventual purchase. Omitting to provide such information would constitute a misleading practice which is banned under the Directive.”
So clearly, Swoopo is following all the rules. What do you guys think? Regardless if you think it’s a scam or not, it’s been proven not a scam so far. If you still feel it’s a scam, then don’t use it.
-Dave
March 19th, 2009 @ 1:05 pm
David,
I’ve never bid anything in Swoopo. I did make an account because I thought I’d give it a try.
But as I was learning the rules, I came to consideration that this is not fair.
The “Unfair Commercial Practices Directive” that you quoted states that you need to expose all the rules to customers, which Swoopo did. But that’s often not enough.
Do you remember when Pyramid schemes were rampaging everywhere? Those companies also disclose all the rules to potential targets. But pyramid schemes are illegal now, right??
So it’s not just about the full disclosure. Most people would not go through the rigor of computation to see that for pyramid scheme to make 100 people to be rich in a city, there aren’t enough people in that city to be targeted; or to make 10.000 people to be rich, there aren’t enough people in the world to be targeted (just illustration, but this is true).
I have the following 2 issues with Swoopo’s rules to claim that they are not fair:
1. The cost of bidding is more than the bidding increment. Like my previous comment, it’s like buying 1c raffle ticket for 76c. That’s a rip-off.
2. The fact that they extend the bidding time when a new bid is coming.
Dave, you can increase the chance of winning, I believe that. I can even come out with some ideas.
But your strategies do not change the fact that their bidding rules are not fair.
March 19th, 2009 @ 1:28 pm
I suppose it all lies in your definition of fair, and fair is opinion not fact. I think it’s perfectly fair that Swoopo outlines all the rules and even all the literature on the internet clearly defines how Swoopo works (including your post) so it’s difficult to plead that you had no idea what was going on. In early stages of Swoopo, maybe you would bid and lose and say, ‘No problem. Wait. Problem. Where are all my bids?’ But now it’s tough to plead ignorance when all the facts about Swoopo are out there.
So, as you can see, I think it’s a fair and just system. Everyone is entitled to their opinion (yes, opinion) about Swoopo. Perhaps if you won something on there for a fraction of the retail price, your opinion would change.
Ok, and last thing about the pyramid schemes. They were misrepresented. Guaranteeing riches to the rich and poor alike while putting your money in without knowing what you would possibly get in return is a scam. Swoopo you at least know what you’ll get and don’t depend on recruitment of others for your own personal gain. In fact, you hope there are less people for less competition so bidding stays low!
-Dave
March 19th, 2009 @ 9:41 pm
I believe that if you do the math correctly with all the risks involved, you won’t want to put your money there.
It’s very sad that in this economy, people become victims of such scam.
My advice is avoid using this site. IT IS SCAM.
March 20th, 2009 @ 4:50 am
Hi,
I just wanted to post these two pages on the Swoopo site that clearly explain how Swoopo works.
1) This is the page you click in to register on. Clearly explains that each bid costs $0.75. https://www.swoopo.com/register.html
2) This is the, “Ok, so that explanation didn’t help, what else ya got?” page for people who might not know every detail about Swoopo. http://www.swoopo.com/new.html
Also, another way to think about Swoopo is relating it to big discount stores such as CostCo, or BJs that require a membership to take advantage of their discounts. The bids are essentially a membership that gives you the right to bid.
Thought of that this morning on the train so I figured I would share, haha.
-Dave
April 18th, 2009 @ 5:20 pm
David seems very confident that swoopo is not scamming people as they are supposedly fully aware of the rules. I would like to pose this question:
Are the people made aware that they are bidding/competing against people in differnt countries for completely different products at diffent currencies/values?
An example will illustrate my point much better than any words could.
Go to any swoopo auction and change the county domain for any of the other country domains that swoopo currently serves. Currently they are (.de / .co.uk / .es / .com / .at)
an example would be:
http://www.swoopo.co.uk/auction/tomtom-go-940-live/170320.html
(changing the .co.uk to .com)
http://www.swoopo.com/auction/tomtom-go-940-live/170320.html
How can this possibly be fair to anyone?
Replies to this comment will cost $0.75 (or £0.5 or €0.5).
Pete
April 20th, 2009 @ 11:02 am
Pete,
Thanks for pointing this out. I knew that Swoopo has presence in several countries. However, I wasn’t aware that people from different countries are actually bidding on the same items!
I have been planning to write another article with more analysis on Swoopo. I am just so swamped these days, arghh!!
Swoopo is really really really bad!!
May 14th, 2009 @ 10:43 am
OK, everyone. I will say I see both sides. One I have won 6 swoopo Auctions at this point. I have won a Nintendo Wii and several Games for the Wii. Now is it a scam, NO. Is it unfair? Yes, in a way. Have I really got a bargain buying from Swoopo? NO. In Actuality, I have spent more on Items I have won than I would have if I bought Retail. My winning Items at this point, would Retail at Approx $450 I have Spent about $500 on swoopo. Now I am probably in a better boat than most people. But of coarse I stategize my bidding and stay away from items that are too low. Also, I know when to walk away from a crazy bidder that will just jack up the cost.
BTW, I just got my Wii today and am very happy with my purchase. I got it for $76.30, and spent more than that to get it but it still feels like a win!
May 14th, 2009 @ 12:09 pm
Sean,
Just think about it. You consider yourself to fare better against other people. Yet you actually lost money so far, right? Be it not much.
But have you considered that for every one person in your situation, how many people actually lost tons of money? Especially with the penny auctions, the number of people who jump in because of the perceived low price is big!
Ever imagine if Swoopo runs sub-penny auctions ? Then you’ll see the picture clearer..
June 1st, 2009 @ 4:56 am
It definitely is not a scam in my opinion, it is an ingenious way for business. Besides the people participating in these bidding were not forced in the first place. You just have to have a lot of luck with the bids you make.
June 2nd, 2009 @ 2:18 am
have to admit i used to be skeptical of a company that could sell a laptop for £15. However, having analized the principles they use i came to the conclusion that at increments of $0.5 per bid, they make a profit even at such a low price, so that should be all right I suppose.
actually i even came across the resembling site, that is likely to be younger than swoopo. As far as guessed that is why their price for a bid is even lower – just $0.05. Really!
Has anybody participated in their auctions? – http://www.luckberry.com
i’d like to know whether everything is ok with them…
June 8th, 2009 @ 9:53 am
It’s sucks for people too, they spend money on the lottery, and most people don’t walk away with anything, but the person that spent 5 dollars and wins $260 Million, that the risk that people take. People that use that site know what they’re getting into!
June 10th, 2009 @ 12:45 am
I totally agree with matthew!
Swoopo is a pretty genius idea imo as far as a business model. Get people to pay for every bid, continually increasing auction times with each bid as well the shear competitive nature of people in general really helps drive their revenues.
As for Luckberry.. it seems to be reliable. I’ve tried it several times, they have suchlike rules and offer decent items..
i’m more determined than ever!
their young age turns out to be pre-eminence in this case. the fewer participants bid, the more chances of winning everybody has! close reasoning, isn’t it?;-)
i succeeded in winning lcd 65′ for eur 107 and saved eur 300, so i’m mightily pleased!! soon i gonna spend the left bids trying to win xbox for my son
ps. by the way no problems with delivery occured
July 10th, 2009 @ 9:18 am
I think it is sad that anyone would defend this site other than those who are profitting from it. It takes advantage of people’s ignorance, greed and at the end of the auction perhaps thier desperation to cut losses. In my opinion it is worse than a gambling site because at least with gambling you can at least have some idea of the odds of winning. This is a wolf in sheeps clothing!
July 10th, 2009 @ 9:27 am
I also think it is similiar to a pyramid scheme as it requires new inexperianced users to make the site successful because as Sean saysm he knows better than to bid when the price is too low. So it takes the uninitiated to bid the price up to a level where the experiance will take a chance at coming in and swooping the item up at the others expense.
July 10th, 2009 @ 2:15 pm
Mike,
I think you really got it!
Swoopo is worst than lottery because the winning is not defined as chance.
Swoopo is a scam and evil!
July 23rd, 2009 @ 4:30 pm
You’ve got the premise, but you’re over complicating things a bit. You don’t need any knowledge of game theory to figure out their business model. Every bid costs $.65 to the consumer, while yielding anywhere from $.02 to $.15 in bid “utility”. Hence, their break-even winning bid is between 3(!)% to 23% of the item’s raw costs. Once the site gains in popularity and there’s a large enough of a consumer base, you can bet there are people would would want to buy an item at a 72-97(!) percent discount and thus you have a money making scheme–clever, arguably unethical, but not illegal in my books. Their biggest risk is a lack of a large enough bidding consumer base. That being said, if you did have insufficient consumers, and hence not even achieving your 30%~5% break even winning bids, how quickly do you think it would take word of mouth and greed to naturally kick in to start bidding up prices again?
July 29th, 2009 @ 11:26 am
So basically, if there were many less users, it wouldn’t be such a bad idea? For example, I use a site called bidfire.com. After watching just a few people duke it out for a nintendo wii, it sold for $3.30 (bid increases a nickel each time) I decided to give it a shot and won myself a game for less than $1… Now how is that a scam? Would it only be a scam if it was being done on a larger scale? At what point does it transition from having a good chance at a great deal to being a scam?
August 26th, 2009 @ 7:21 pm
I agree with you that SWOOPO is a total SCAM.
visit my blog for more info on Swoopo scam and more Penny Auctions that will steal your money. But I also found few of them that actually worked.
August 27th, 2009 @ 1:00 pm
James,
Thanks for stealing my article, and claiming it as yours. See: http://penyauction.blogspot.com/2009/08/do-not-join-swoopo-because-they-will.html
I am impressed that you dared post your comment here. See: http://www.ezran.org/blog/2009/08/highlight-of-the-day-ive-been-plagiarized/
October 5th, 2009 @ 5:54 am
Hello all.
I have to say that I TOTALLY disagree with this article and some of the comments herein.
If one takes into consideration the content of this article, then we should simply consider that Online Casino sites, Online Poker sites, Bingo sites, betting sites, and all other similar type websites … even your National Lotteries ought to be classified as scams too then?
Swoopo is simply an ingenious business model that is being replicated, and I have to admit that some other websites are perhaps better business models than Swoopo as they offer more features.
The founders of Swoopo used an existing concept that has been on the Radio and TV for years and brought it to the Net. What is amazing is that users define Swoopo’s business model as a scam, yet have the audacity to mention that other penny auction type websites … work??? This does definitely not make any sense.
News Flash for those negatively charged persona – Any penny auction site that requires a user to purchase bids to place a bid on auctions whether these are traditional, reverse, revealing price, or other type of auctions… they are still based on the Swoopo business model.
Thus, to define the Swoopo concept as a scam is a bit far fetched, especially when to some other penny auction sites are supposedly… legit?
Perhaps the person who wrote this article and some of those who left comments tried Swoopo out, did not win, lost some monies in the process, and are furax since, or are simply jealous of the concept.
Who knows.
I personally tried swoopo out, loved it. Loved it so much that myself, with a group of associates, are in the midst of creating our own penny auction website.
Swoopo, is a great idea, it is undeniable that the ratio of earnings will be far more significant for the company than to the user, evens so, the Swoopo business model allows winners to make a great deal in the process. Try find a store that grants you the possibility to purchase a top notch brand LCD or any other product at a fraction of the retail price, brand new, boxed with guarantee?
Swoopo is purely strategy type auction website with a glitch of addictive fun to it. Yes you have to pay per bid, but look at the savings one can make in the process.
And whether Swoopo uses bots or shill bidders – All these type of websites do anyway – it is a necessity for revenue control, the winning rate for the user is far higher than a Casino, Poker, etc or evan a lottery can grant you as they function purely by luck and they too require that you PAY to bid or play, and alas are solely based on pure luck.
Have a nice day.
Chris
November 11th, 2009 @ 4:30 pm
When I start hearing tons of people saying they WON and are raving about how much they saved, THEN maybe I will try it….only IF they are legit statements from real people. I have not heard ANYONE raving about how much they have saved or won. IT’S A SCAM until then.
My advice is to …. read, read, read and get ACTUAL Facts and testimonies from real users before wasting your hard earn money.
They call it “Entertainment Shopping” for a reason….because it is a GAME for Swoopo to take your money and run, it’s not a REAL auction site. How can you trust a site that has total control on who wins and who doesn’t…. makes me LAUGH! Who in the world would ever think of such a CRAZY thing and think people are going to fall for it. LOL!
I read from another site in reference to Swoopo “for years we have been enjoying free bids, we have been spolit” from sites like ebay. It is a privilege to bid for “Free” and not to pay for it. That is the most ridiculous stupid statement I have ever heard. Who comes up with this stuff, LOL! the owner of the company made this statement and is trying to convince everyone that Swoopo is not a scam so they get you in and robe you blind. Don’t believe all this nonsense.
also beware all the people you think are bidding may not even be actual people but false auto up bidding by Swoopo to make it look like winners. I am sorry… as of right now I do not trust the site.
November 17th, 2009 @ 2:13 pm
What really bits my ass about this site is Twice I have been bidding on something and it gets down to crunch time (under 4 seconds) and the damn thing has technical difficulties (I have bid on a total of 4 items in my swoopo lifetime). I even have a e-mail from these scam artists saying there was technical difficulties but all they would do for me was to return my bids. So now I have a bunch of bids, That I am not going to use and nothing else to show for it. I didn’t want my bids back I wanted the items that I was bidding on. It is an absolutely TERRIBLE SITE!!! Don’t waste your time and money. I AM TELLING EVERYONE I KNOW THAT THIS SITE IS AN ABSOLUTE SCAM!!!!
November 20th, 2009 @ 10:48 am
its a total scam – just watch a single auction and see how many different people are bidding on the same item (and loosing cash). The rules may be clear but there is a total lack of transparency. I give this model a year at the most.
November 28th, 2009 @ 1:43 am
I agree. Swoopo is a total scam! If not, then why have we never seen photos and/or names of “winners”?? Possibly because there aren’t any!! Lottery ticket winners photos/names are posted! Why aren’t Swoopos?? It doesn’t seem anyone personally knows of a person(s) that have won! Interesting! I say SCAM!!
December 2nd, 2009 @ 8:34 pm
Swoopo is not a scam. The rules are clearly posted. They even link to a NY Times article at the top of the page talking about why it is so profitable and why you should beware:
http://www.nytimes.com/2009/08/17/technology/internet/17shop.html?_r=1
Simply click the “Swoopo in the news” link at the top to see for yourself.
It’s not a scam because someone is getting these items for a significant discount while all the losers are willfully or unwittingly subsidizing the cost. Granted, Swoopo is taking advantage of people, but this is a buyer beware world and it is up to the consumer to educate himself/herself. Besides, religion takes advantage of people all the time AND they don’t pay taxes. Religion is the greatest scam ever perpetrated on man by man, but I’m sure that comment will make at least 50% of people’s blood boil.
December 28th, 2009 @ 10:25 am
Swoopo is a total Scam, and the owners are major con artists. The one reason, above all else, that no one has mentioned here, is that it is highly likely, from all the experiences people have had on the site, including myself, that Swoopo use internal BOTS to bid on items, thus making real users use more and more of their prepaid bids. This way, Swoopo pockets all the money it has already collected through prepaid bids. Regardless of their claims that they do not bid up things (and hwo exactly is going to check their claims unless the Government does?) I guarantee you they do. Furthermore, as someone mentioned, has anyone ever seen or heard of any real actual winners from this site? Has anyone ever been on TV to show how they have won cheap things on this site? I have contacted Swoopo directly several times, asking them to provide me the names of some actual real winners, and they have refused to do so “because it is against our policy to reveal that information”. I told them that it’s quite simple – just contact a winner, and ask them if they will give permission to use their name to be contacted, and there are bound to be some people who will give permission to do so, and then they can send me the information. Months have passed, and still nothing. All of this evasion, and secrecy, and avoiding the truth reeks of deception, and con, the site is worse than any con gambling site, where owners somewhere in the Caribbean are controlling the cards so that people lose their bets. This site is a total scam, run by major con artists, who are raking in big big money by basically cheating people out of their purchased bids. The governments in all countries where Swoopo operates should immediately investigate the company with a view to closing them down.
January 1st, 2010 @ 7:50 pm
At last…Marc’s on the right track..it’s the BOTS. Would you go to a genuine auction and be pleased if 8 of the auctioneers agents sat behind you ramping up the bid you were trying to win?
Apart from that it is wholly technologically flawed…test it yourself…open Swoopo.co.uk on one tab and Swoopo.com on another. they’re synchronised…except not all goods items are identical-although the (phantom) bidder/time and price are…plus they are the same amount in different currencies?? I smell a rat.
January 23rd, 2010 @ 3:42 pm
At the risk that arguing with idiots makes you one, I’ll wade in.
Scam? – No
Stupid way to buy merchandise? – Yes
Brilliant way to make money from people with tremendous amounts of time on their hands and the inability to do simple (and I mean simple) math? – Yes!
Swoopo clearly describes the rules, they are fair to everyone, no one has a better chance than anyone else. It’s not a scam.
I think the duller bulbs out there are confusing “scam” with “terrible way to buy stuff”. The markups are obscene, but so are the markups on lottery tickets, raffles, slot machines, and rental furniture.
The foreign currency argument is specious. What difference does it make that the site converts currencies?
However, the shill bidding argument is valid. If this were true, then this site would be a scam. Shill bidding is illegal because the shill bidder would know if the auction were about to end and bid to keep the auction going. Or they could keep a sucker bidding until a new fool logged in. This type of auction format would be very vulnerable to this fraud as the company makes money even if the shill bidder ends up with the item. This could be easily proven one way or the other by statistically looking at several auctions and calculating odds of certain events happening. I would advise Swoopo to submit to an independent audit to demonstrate that this isn’t happening.
Find better uses of your time and money, but stop whining about a scam where none exists. An chek yur speling befour yuo poste. Maikes yo look stupad.
January 26th, 2010 @ 11:24 am
THEO: “However, the shill bidding argument is valid. If this were true, then this site would be a scam.”
WELL DONE THEO, YOU ACTUALLY FIGURED IT OUT.
THEO: ” This could be easily proven one way or the other by statistically looking at several auctions and calculating odds of certain events happening.”
I HAVE LOOKED AT THE TYPES OF BIDS UNSTATISTICALLY, AND I DEFINITELY FIND PATTERNS WHICH SUGGEST THEY ARE DOING SHILL BIDDING IN ORDER TO MAKE PEOPLE USE UP AS MUCH OF THEIR PREPAID BIDS AS POSSIBLE.
THEO: “I would advise Swoopo to submit to an independent audit to demonstrate that this isn’t happening. ”
FAT BLOODY CHANCE OF THAT HAPPENING. THEY WON’T EVEN REVEAL ANY ACTUAL WINNERS, THEY WON’T REVEAL ANYTHING (MORE EVIDENCE THAT THEY HAVE SOMETHING TO HIDE), SO UNLESS A GOVERNMENT AGENCY STEPS IN, THERE IS NO WAY THEY WILL REVEAL THEIR MODE OF OPERATIONS, SIMPLY BECAUSE IT IS A SCAM.
February 9th, 2010 @ 10:05 pm
Swoopo may not be a scam outright but there seems to be some similarities.
March 1st, 2010 @ 4:56 pm
Speaking to the New York Times, Glen Whitney, a mathematician and a former quantitative analyst at the hedge fund Renaissance Technologies, stated: “In aggregate, consumers trying to obtain these products are overpaying. Unless you have an edge over other people who are bidding, and you can get them to subsidize your purchase, you shouldn’t do it. It’s a chump’s game.” (NY Times, Aug. 16th, 2009)
Here is a perfect example:
http://www.swoopo.com/auction/apple-iphone-3gs-32gb-black-/289906.html
Do the math and figure out what Swoopo earned on this “great deal” and also look at the “deal” the winner got.
March 2nd, 2010 @ 12:00 pm
Matt, thank you for the comment!
This is precisely what we learned in our Game Theory class. The only way to beat Swoopo is to bid collectively among all the bidders. The larger the pool of bidders, the more Swoopo makes money. Swoopo is even more evil than other penny sites because they cross list the same items in different regional sites. Swoopo bidders are fighting against the whole world!
Save your money, guys! Just look for good offers in deal sites.