Bidding Frenzy: The Problem With Auctions
Bidding frenzy is a common problem in joining auctions which also makes some people reluctant in buying from such. Why is this happening and why are there some people who just can't stop even when the rationality of auctioning is crossed?
Here are three reasons behind this:
One, it may be due to the combination of arousal, excitement, competition, an overwhelming desire to win and extreme reluctance to back out.
Bidding frenzy is comparable with addiction to gambling in terms of the adrenaline rush and the continued excitement running in the psyche of the people involved. The more intense the bidding war becomes, the more interested the bidders become.
The rush of emotions can't be discounted when trying to understand why people participate in bidding wars. At this point, it really no longer matters whether logic is working or not, what is more important is that the person is satisfied emotionally. Also, people loose their best judgment when their minds are clouded with emotions.
Two, it may not be purely on winning the item but on testing the personal threshold of the bidder and the competitor.
People who aren't so interested in the item but get caught in the bidding war no longer feel the need to get the merchandise but the need to make the other person pay dearly when the ending price is several times over than the original price.
Three, it may be due to the lack of experience with auctions.
Bidding wars are more commonly observed among people who are just beginning and are not backed by sufficient information on how exactly they work. It must be noted that some bidding wars are intentionally encouraged by the auction organizers themselves. This is working on the principle that the more interest the public has on the merchandise, the higher the value it receives and the more interested buyers bid on it. This does not only increase the hype over the item but also adds to its market value.