With the introduction of customer bid bots placing automated bids for customers in penny auctions, one of the ongoing concerns those who participate in the auctions has been that of legitimacy.

From a penny auction customer viewpoint there’s pretty much no way to verify that they are indeed bidding against actual customers, especially when automated bidding bots are outbidding them in under a second.

Am I bidding against actual customers or “the system”?

As we all know, the more bids used in a penny auction the higher the revenue for the company running them. In an MLM penny auction, this usually also means higher commission payouts for the field.

One of the shortfalls of the MLM penny auction model is that the companies rely on their affiliates to advertising for them and attract auction customers. The affiliates of course only do this if they’re getting paid.

In a legit MLM penny auction the affiliates only get paid when the auctions do well, so it’s a bit of a catch-22.

One potential way for an MLM company to ensure their affiliates earn enough commissions is to have what penny auctions customers the company does have, bidding against bots run by the company itself.

At the cost of undermining the legitimacy and integrity of their penny auctions, an MLM penny auction can thus ensure their affiliates are earning enough to continue promoting the opportunity.

Usually it’s penny auction customers who raise concerns, as ultimately they are the ones who lose money bidding against company run bots they cannot win against (or have to spend so much in bids to win against that it’s not worth their time).

In a recent email sent out to Blue Bird Bids corporate however, Vice-President Eric Swaim expressed some penny auction bot concerns of his own.

Hi all.

Just a quick note. I have been getting some serious questions from the field on how the auction site is working. We have people that sit and watch the auction basically all day and are accusing us of having auto-bots bidding against the field.

I hope that is not the case. We have enough that we are dealing with at this point.

I have been watching the site most of the day and have noticed that we have had the same usernames bidding all day. When I tried to look them up in our system they do not show.

Some of the user names that are bidding are nivea, leontas, nija, zavania, evelin4ev just to name a few. None of these show as reps are customers in the system.

I just need to know how to respond to the field when I am asked about auto bidders.


My source also writes:

The latest fantasy auction was busted running over 103,000 bot bids and was abruptly shut down in the middle of the auction with a “winner” after (Mardy) Eger received an email from VP Eric Swaim confronting him with the question.

The above email from Swaim is the email referenced.

Looking at the Blue Bird Bids website, it appears the latest fantasy auction was for SuperBowl tickets and was won by Blue Bird Bids member ‘oldpro79’. If the above bid figure is accurate, that would mean Blue Bird Bids raised $103,000, sans affiliate commissions and the purported $10,000 retail value of the auction prize.

As for the issues Swaim and the rest of Blue Bird Bids management ‘are dealing with at this point‘, unfortunately Swaim doesn’t go into any details however the Blue Bird Bids website itself might reveal some clues.

Currently the Blue Bird Bids penny auctions are offline, with the company putting up a notice sometime over the last few days stating:

Blue Bird Bids site will be under maintenance for the next 72 hours or so, so please be patient with us as the site goes through rigorous testing and behind the scenes structural changes.

As many of our long time users already know, we’ve had some minor challenges and Non successful security attempts on our system at the close of 2012.

So, with the last fantasy auction of 2012 being completed timing is perfect to do all the needed things to ensure a seamless, exciting and rewarding 2013 for everyone.

We anticipate to have all functions back and running no later than Tuesday Jan 8th or Wednesday Jan 9th, as we want to allow our technical, our security and our creative teams all the time needed to do complete over haul as needed.

“Minor challenges”, “security attempts” and the VP of the company sending emails out to corporate with concerns about auction bots after personally observing the Blue Bird Bids penny auctions?

Stay tuned…