Vicesus to solve lack of penny auction customers?
After nearly a year of development, Vicesus finally opened their doors in August of 2012… only to shut them again last month, citing a lack of retail activity.
We are sorry to announce that the Grand Opening will be postponing.
The Main reason is the low activity. We have now tried to do it with affiliates as the main driving force to get custumers (sic) to the auction, this hasn’t worked.
In addition admitting that an affiliate-driven approach to generating retail activity hadn’t worked, Vicesus also announced that the company itself would be “focusing” on generating retail activity.
This naturally raised the question what exactly Vicesus needed MLM affiliates for, seeing as, other than deposit large amounts of money into the scheme, they didn’t really appear to fit into Vicesus’ new corporate marketing strategy.
That question remains unanswered, however Vicesus have pressed on and today announced their new retail customer generating strategy.
Have Vicesus fixed the problem of allowing affiliates to deposit money, fuel their own commissions and thus totally ignore retail? Let’s find out.
In an email sent out to affiliates sometime in last 24 hours, Vicesus announced
Friday November 29, 2013 is a day you should put in your calendar. This is the day where Bidwith will start hosting regular auctions every day throughout the entire day!
You will no longer have to wait for auctions to take place. We will have a lot of excisting (sic) prizes for our Customers and Affiliates.
That’s a great start. “Regular auctions” is surely better than the current “no auctions”. Sounds good to me!
If you have followed the development on Bidwith.me the last 5-6 weeks you have probably noticed that we have made a lot of improvements.
One of the improvements that is not really visible to you is very imporant (sic) for how the auctions work. We have introduced the option to add a reserve price on auctions. This will allow us to set a reserve price that must be reached before a specific auction item can be won.
Huh?
This way we can make the business profitable and our Affiliates will make money. We know that this takes time and we are willing to put in the time, however we also want to minimize the amount of money that is lost on auctions while we grow the business.
Oh right. So you’re aware having no retail customers spending money on bids to use means you lose money on your penny auctions…
Lets say we have a $600 (SRP) iPad on the auction. Our reserve price is based on the number of bids that we need to cover the purchase price of the iPad. To keep this easy lets say our purchase price is $600.
In order to cover the $600 we will need 1,000 bids as each bid is valued at $0.6. In other words this means that the auction could end on a price of only $10.
This way we will be guaranteed that we will not lose money on the auction and the customer winning the auction will still get up to 95% discount compared to the suggested retail price.
If the reserve price is not met before the time available on the auction runs out we will automatically relist the item 10-20 minutes later with ALL current bids intact (in other words 10-20 minutes will be added to the time).
Once the reserve price is met and the time runs out the last bidder will win the item, and everyone is a winner!
Well, except those that propped up your auction prices till it hit your mandatory “number of bids that must be used before anybody wins” figure.
So let me get this straight… Vicesus’ answer to not having any retail customers is to set minimum used bid quotas on all their auctions, in an attempt to get non-existent retail customers to purchase and communally use a fixed number of bids on an item before an auction ends.
Yeah, good luck with that fellas.
The problem here is a lack of retail activity, due to the fact that Vicesus reward affiliates directly on how much they and their recruited downlines spend.
Setting mandatory bid use quotas will obviously has an impact on affiliates who bother with the penny auctions (as in they’ll likely stop altogether), but how does this “feature” generate retail customers?
As I see it all it does is ensure Vicesus auctions will remain in a perpetual state of unending merry-go-round movement, with the auctions they initially launch with likely to be listed and relisted ad infinitum.
As per their update, Vicesus are preparing to implement this change and relaunch BidWithMe at the end of November. Guess we’ll have to see how this plays out.
That’s the “fun” part about these penny auctions: it’s a crap shoot who “wins”. The company can’t lose if they put up a “reserve price”. The “winner” is basically subsidized by all the losers… a lot like a Ponzi scheme.
The difference is, of course, that in a penny auction you’re told outright you’re going to LOSE if you don’t win. You’re told you’re winning, ALWAYS winning, in a Ponzi scheme when you’re in fact, losing. Thus, one’s fraud, and the other’s not.