Online auctions delivered to users via the World Wide Web have become a popular activity for users interested in purchasing goods and services at the least possible amount online. Many online auctions allow a person to bid on an item in an attempt to obtain a winning bid and an associated opportunity to purchase the auction item at the winning bid price. Known online auction websites allow several users to compete with other online auction participants by submitting bids on a particular item until a predefined period of time has elapsed, and the highest bidder is determined.
At least some known online auction websites require users to purchase a bid unit that represents an opportunity to submit a bid in an auction and to redeem a bid unit each time the user places a bid on an auction item. Once the user has redeemed all of the bid units, the user cannot participate in the auction until additional bid units are purchased or provided. By requiring a user to purchase bid units to participate in the auction the online auction receives revenue from each user participating in the auction.
Many auction participants are attracted by the opportunity to win new auction items of high value at a low price, but may become frustrated with a requirement to purchase new bid units each time a user wishes to place a bid on an auction item. Auction participants may also become frustrated by purchasing bid units, participating in the auction, and not winning an auction. Likewise, online auction providers desire new auctioning opportunities to appeal to their auction participants, entice users to place additional bids, spend more time in the auction website, and have additional opportunities to benefit from winning new auctions. Accordingly, there is a continued need for systems and methods that create, provide, and facilitate new and interesting online auctions that are fair to each customer.
Some online auction formats, such as the penny auction, also known as a click to bid auctions have been known to be subject to fraud, cheating, and abuse by both customers and auction operators. The two most common forms of cheating are known as “shill” bidders and “bot” bidders. A “shill” bidder is used by an auction operator to artificially inflate the price of the auction while increasing the amount of the customer bids by having employees of the auction operator pose as bidders and bid against the real customers. A “bot” bidder accomplishes the same result, however the false bidding is accomplished by software code, or script, which poses as a real person competitively bidding in the auction. The reputation of the penny auction industry has been severely damaged by the use of shill and bot bidders. The reputation of fraud in the industry has been so damaging that many people refuse to participate in a penny auction for fear of being cheated out of their money.
Another detractor to acquiring new customers and retaining existing penny auction customers is the potential for any customer to be out bid by a well-financed competitor customer, thereby winning most auctions. For example, a customer who has the personal financial ability to purchase ten times the bids of a lesser well-financed customer is at a distinct and nearly insurmountable advantage. The better financed customer could simply keep bidding in an auction against the lesser financed customer until he or she runs out of bids and is unable to purchase more bids to remain competing in the auction. This appearance that penny auctions unfairly provide advantage to well-funded customers is known to prevent many new potential customers from trying the product for a first time, thereby severely limiting the potential growth of a penny auction business.
The present invention is aimed at one or more of the problems identified above.