Authors: Fusun F. Gonul, Peter T.L. Popkowski Leszczyc
Addresses: School of Business, Slippery Rock University, Slippery Rock, PA 16057-1399, USA. ' School of Business, University of Alberta, Edmonton AB, T6G 2R6, Canada
Abstract: Our research investigates what factors make snipe bidding more likely, whether sniping pays, and how an auction can be designed to minimise sniping. We estimate sniping probability in eBay auctions using multivariate models to examine novel datasets compiled from auctions of the Norelco electric razor and the Sony PlayStation2. Our main results reveal that the winner of an auction is more likely to be a snipe bidder and that a lower ending price increases the likelihood that the winner of an auction is a snipe bidder; everything else held constant. We find that experienced bidders are more likely to engage in sniping behaviour. In addition, we find that an auction designer or a seller can discourage snipe bidding by setting a longer duration and/or a lower (or no) reserve price.
Keywords: choice models; data collection; online auctions; snipe bidding; eBay; sniping probability; multivariate models; novel datasets; Norelco; electric razors; Sony; PlayStation2; computer games; internet; world wide web; lower prices; ending prices; bidders; auction designers; sellers; longer durations; reserve prices; electronic marketing; e-marketing; electronic retailing; e-retailing.
International Journal of Electronic Marketing and Retailing, 2011 Vol.4 No.1, pp.16 - 29
Received: 13 Feb 2009
Accepted: 12 Jan 2010
Published online: 21 Oct 2014 *