Greed, fear and hope can be dangerous emotions if we let them drive our financial decisions, cautions Jason Ramos in a blog article published on Wealth Lift’s website. Ramos directs his warning at investors but it applies to bidders too, especially when we add a fourth and potentially the most sabotaging emotion to the top of the list.
Call it feeling frustrated, ticked off, annoyed, irritated or enraged, it takes only a second for anger to drag us blindly down a bidding path that we otherwise would avoid.
Our anger may be directed at bidders who cut into our clock time — and free bids. Or maybe it’s the long line of bidders waiting to jump us at a No Jump auction that ticks us off. Either way, abandoning our bidding rules to teach them whatever lesson we’ve decided they should learn doesn’t enlighten them.
It hurts us.
An odd phenomenon occurs whenever shiny, expensive electronics come up for auction. Even if we’ve already spent this month’s bidding budget and have three computers at home, suddenly we’re convinced that this MacBook Pro or 72-inch television set has our name on it. Mine, we think.I’m going to win. The problem happens when fifty other people simultaneously think the same thing.
We load up our Bid Buddy and then watch as the auction we felt certain we’d steal for eighteen cents goes on all day, into the night, through the next day and the one after that. Then just when it looks like we’ll finally prevail, the next in what we discover is a long line of bidders, jumps us at a No Jump auction. Even if we manage to drive off one jumper, another one takes his or her place. Like ants, the more we get rid of, the more come around.
As we watch the price rise we’re clear on only one idea: our bidding long ago passed the point of no return, that place where we’ve spent too much to walk away and we can’t afford to BIN (Buy It Now at retail price and get our bids returned). So we pump more bids into the automated bidder wishing there was a 911-Help-I’m-In-Over-My-Head Hotline for Bidders we could call.
We don’t want to think about how much money we’ve spent. We just want to win, even if that means losing because we pay more than the item’s worth. That’s when anger can escalate into fear. What were we thinking of? Well, probably that we’d win but most likely, we didn’t think. We bid based on how we felt.
Hope is not a winning strategy, according to the money gurus.
On my smarter days when I find myself in bidding hot water, I collect my senses, BIN, get my bids returned and vow not to do this to myself again. Here are some suggestions for how you can avoid the emotional traps that sabotage bidders and instead develop your own strategies for bidding smart.
Change hope to strategy by researching first, before you bid. Most of us have heard the adage, Information is Power. The reason that saying has been around so long is because it’s true. DealDash.com makes it possible for all bidders to stay equally well-informed. The Winners List at the top of the DealDash.com home page gives detailed information about how much an item has sold for in the past, who won it at auction and the day of the week and time of day it sold for a particular price. Each item auctioned has a home page that gives detailed specs. It’s also where we go to use the automated bidder. The spec page gives us a chance to review exactly what it is we’re bidding on and potentially buying. When emotions are driving our bus, it’s easy to forget that we may not win. Make sure you’re bidding on something you want, that there aren’t any glitches in that shiny, expensive electronic that will make it not-right for you. Get in the habit of using the auction search function, too. By searching for upcoming auctions on an item, we may find a different model – one we like more – or an auction taking place at a better time for us. From the results of that search, we can set up alerts that will notify us about all the upcoming auctions for any type of item. Use these tools to your advantage. And don’t forget to check your budget to make sure you’re not straining it.
Once you get in the habit of researching auctions, you’ll see the wide disparity in prices bidders pay for the same item. A camera that sells for $18 one day can auction for $299 the next. If that computer or camera can sell for $299 in one auction, it can go that high – or higher – in the auction you join. Remember, there are no guarantees that we’ll win; only that we don’t have to lose. The risk of needing to BIN comes with every auction, even when we’re convinced an item already belongs to us. The only way to eliminate risk exposure is to BIN when we don’t win.
Freeze fear by tracking all auctions you join. Worried about whether at the end of the day you’re really winning? Really winning means we pay under retail value counting the cost of bids plus the auction price. Be your own bookkeeper. Know where you’re at in any auction at any time. Your Dashboard can help you and it’s especially helpful if we’re involved with more than one auction at the same time. From the Dashboard, we can see total bids invested, how many bids are left in the automated bidder and it links directly to an item’s home page. Remember, keeping track means keeping track of our bid investment in an item, not just counting the auction price we’ll pay. And, make sure to bid from an item’s home page not the DealDash.com home page. You’ll stay more aware of exactly where you’re at. When you’re keeping track of your investment in an auction, don’t guess. Do the math.
If you intend to bid on an item you know you can’t afford to purchase if you don’t win, set a limit for yourself about how much you’ll invest. Decide on that amount before the auction begins instead of waiting until the heat of the moment, when you’re more vulnerable to allowing your emotions to drive your bus. How much are you willing to lose if the auction doesn’t play out as you hoped? Write that number on a piece of paper and don’t re-negotiate when you hit your limit.
Neutralize greed by setting and sticking to your limits. Greed takes over when we log-in to DealDash.com and see that sweet HD television that recently sold for $8.00 and an auction for that same item just started. Planning flies out the window. We start bidding. Soon the price for the television we’re bidding on is over $100. After two or three more days of watching the price rise on what we felt sure would be a snappy win, it’s not uncommon to start yelling at our computer about all the people in the auction who won’t just leave and let us win it. You don’t have to be that person. Stick to the facts instead of taking that emotional roller coaster ride. The facts include: retail value of the item, your total investment in the auction including bids and auction price and making certain your investment doesn’t exceed retail market value – no matter how tempting it is to teach that jumper a lesson. Set a bail time, a walk away dollar limit and then stick to it. Use common sense. If your emotions lead you down the wrong path, get out as soon as you realize you’re on it and then don’t beat yourself up. Vow to bid smarter the next time by sticking to your rules and not letting greed decide when you’ll bid. Bidding is fun. But it’s not fun to get sucked into bidding for six days on an item we don’t want but started bidding on because our greed led us there. You will win big. Just not every time and not as much as you’d like. Letting greed make your bidding choices guarantees you’ll lose.
Knock out angry bidding by sticking to your strategy. Whether your anger trigger is jumpers, new bidders who don’t understand the importance of letting the clock run out (because we get free bids) or any other aspect of the site, bidding rage won’t help you win. Getting angry won’t help other bidders learn their way around the site or learn to follow the rules. If a particular issue really bothers you, contact customer service. They can and do make a difference. Angry bidding won’t. If you’ve done your homework, then trust your plan. Take a few deep breaths or whatever technique you use when you get upset. What do you need to do right now to bid smart? If you’ve made a mistake and are frantically bidding on something you don’t want or if you’ve surpassed your budget, then it may be time to bail. Trying to negotiate losses rarely works. Let it go and focus on learning your lesson instead of teaching someone else theirs. Next time you participate in an auction, know that sometime things will work out. Sometimes they won’t. Screaming at your computer or quickly rewriting your bio to scold other bidders likely won’t help.
Online auctions can be a fun way to shop. They can also be frustrating when we allow emotions to shape our decisions. One way to eliminate frustration and anger from bidding is by taking the long view. Learning how to bid smart and get the best deals offered by DealDash.com is a marathon, not a sprint. It takes time, experience and commitment. The first year I began bidding, I lost money because I didn’t bid smart. Since then, I’ve recouped my early losses and now look at bidding at DealDash.com as my preferred and the least expensive way to shop.
When I balance emotions with rational thought, stick to my budget and respect the bidding rules I set for myself and save emotional indulgence for after the auction, my average discount rate at DealDash.comskyrockets back into the 80 – 95% range. I win more than I BIN. Instead of feeling outraged, indignant, afraid or greedy, I’m back in the game and biding becomes fun again.
Don’t let any of the four dangerous emotions sabotage your success.