I have a small blog website that has been down for many months, but I gave it a facelift and a new focus. Right now I will make it into a general "great deals" website, where I find deals on the internet and share them with readers. Right now I only get about 5-10 unique views per day. But I am thinking of offering something of my own to get traffic going (and maybe turn a profit). I've seen some unique bid auction websites that center around charging people for bids and the lowest unique bidder gets the prize. It's fairly easy to calculate how much you need to set the numbers to make a profit. If your product is $100 (let's include shipping fees) and you want to charge $0.50 per bid, you'd need 200 bids to break even, and 250 to turn in a 25% profit. Now the difficulty comes in getting trust from visitors, especially since it's a blog that not many people visit or know about. What would help in encouraging people to bid? Would the first auction usually turn out a success in profits, or do I have to break the bank a little to get started? It's basically a lottery system and I would want to build their trust into participating in it. I realize I have to start out small. Give something away $10 or $20 in value and as profits build up I can afford to give away $50 or $100 items. But it's just the first step that feels like the hardest.
I guess I should be a bit more concise... Is it very likely to make some kind of profit or at least break even with doing unique bid auctions? I would want to start out by auction something of a lower value, something that won't easily break my budget, but still give me a bit of a profit when all the bids are entered and the auction is over. Would it also be a good way to drive traffic to the site (and therefore building more interest and anticipation for a future auction)?
I would say you must first build reputation for your blog. By sell off few thing at price lower than market price. And use referral system to help you gather more user.
I understand what you are looking at, but I think I would brainstorm with my friends some on this and see if you cannot come up with something a bit more unique as it has been done before. Try and find a twist to put to it. Perhaps create ways for people to "earn points" to utilize towards bidding. IF you could create some sort of market for this then you could contact "Sponsors" to donate the prizes. There would be no out of pocket for you. You could offer some sort of advertisement deal to the sponsor. But of course first you would need the traffic. Offer bidding points for free if people put your site on their myspace or facebook. (has to be there for 30 days to qualify) Offer big points for videos submitted to youtube for your site. Have some contests and give away bidding points. Of course such things would have to pass your specifications. Once you have the traffic then you can introduce your plan to monetize it. Pick up a reconditioned Xbox 360. They make great inexpensive prizes and attract the energetic youth that you could put to work. Should be interesting for you. Good Luck!
I probably won't start out giving away something like an Xbox 360. Something a bit smaller in value, like a new video game perhaps. Thinking of a few very anticipated games I could buy and then give away (you know invest a little before I get a return) when they're still new at launch. That should get more people to participate I think. For the first few auctions I plan to give x free points to the first y users that participate. Of course now I have to make sure each user is really a unique person, so I don't have people making multiple accounts with multiple e-mails.