Why did an auction just extend after a bid was placed?

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On Flippa we try to avoid "sniping", which is bidders putting in bids right at the end of the auction listing time. Sniping leads to sellers getting lower prices, and buyers missing out on items they want.  This advantages no one but the sniper, and we don't like it.

To avoid sniping, in the last hour of a listing, any non-BIN bids which are higher than the current bidder, will extend the end time by one hour from the time of the bid.  This allows the seller to evaluate the last bid, and gives other bidders a chance to reply to that bid, if they choose. 

Some specifics around this:

  • We consider the time the bid is accepted as the time of the bid
  • Only auctions with more than one bidder qualify for an extension

This extension continues as long as there are new winning bids.  This means that it will not extend if a bid is placed that does not result in a new winning bidder.  It also means that extensions are not applied if there is only one bidder.

Let's see how this plays out in the following scenarios.

  • Scenario 1 - New high bidder enters auction in last hour -> extension
    Bidder 1 is the highest bidder at $4,000. Bidder 2 places a higher bid of $4,100 with 30 minutes remaining on the auction.
    Result: Bidder 2 is the highest bidder and the auction IS extended by a further 60 minutes (ie ends an hour after Bidder 2's bid) to allow Bidder 1 to increase his bid if need be.

  • Scenario 2 - High bidder ups his bid in the last hour -> no extension
    Bidder 1 is the highest bidder at $5,000. To ensure a win, he places a higher max bid of $6,000 with 20 minutes remaining on the auction.
    Result: Bidder 1 remains the highest bidder and that auction IS NOT extended as there is no new highest bidder.

  • Scenario 3 - New bidder enters auction in last hour but doesn't take over lead -> no extension
    Bidder 1 is the highest bidder at $5,000 but with a max bid of $6,000. Bidder 2 places a higher bid of $5,500 with 10 minutes remaining on the auction.
    Result: The system automatically places a bid of $5,600 for Bidder 1 to keep him in the lead. Bidder 2 is immediately informed that she needs to place a higher bid to win the auction. The auction IS NOT extended as there is no new highest bidder.
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