| Razor Ramon HG | 07-05-2009 02:34 PM |
Quote:
Yes and no.
Swoopo is a scam in the sense that it is an online gambling site posing as an auction site.
However, Swoopo is not a scam in the sense that they will steal your money, they have a legitimate (although misleading) model. Just don't be fooled into thinking that the site has anything to do with auctions.
They use terms like bids and auctions when in reality, they are an online gambling site where the game is a bit like a cross between a raffle (lottery) and a game of chicken, the the prize is some item you receive (if you win) at an extreme discount.
Leaving aside all this "auction" talk (who are they kidding?) the game works like this. Each game has a prize, and a clock that counts downward to zero. Think of it like this. Everyone who wants to play the game (or the bidders, if you will) is, in a virtual sense, putting dollar bills in a stack, since each "chance" (or "bid" although that term is misleading) costs $1. (50 pence for the UK Swoopo)
When the clock reaches zero, whoever put the last $1 on the stack wins the item, but each time a dollar is placed on the stack, 15 seconds is added to the clock. It's easy to see this game makes a lot of money for the house, or Swoopo. Each bid is like a raffle ticket. You are paying $1 for the small chance that no one else will put $1 on top of it before time expires. Keep in mind the players, or "bidders," can use an automated bidder called bid butler. When multiple people use these, they can instantly bid back and forth dozens or hundreds of times, adding minutes or hours to the clock. Swoopo tells that this is a "strategy" and sad thing is that people seem to be buying it!
You might be asking, "Why is there a price if this isn't an auction?" The funny part is that for a lot of the "auctions" there is no price! These auctions have fixed prices, (the "100% off" have a fixed price of $0.00), and you can see from these that the price displayed is, more or less, just a counter for how much Swoopo is pocketing! Take for example a high end digital camera with a fixed price of $79 plus $12 for shipping. The "price" on this "auction", which I am looking at now as it is still active, is $828. This number is completely irrelevant unless you are interested in how much Swoopo is making. Since that number increased one "bid" at a time by $0.15 and each of those "bids" costs someone a dollar, that means there have been over 5500 bids! $5500 in Swoopo's pocket and the game is still going! You can see how it is no problem for them to send the lucky winner a $1500 digital camera for less than $100 when they made so much money from the game.
Some of the games are not fixed price, and so the winner of the game wins the item but has to pay $0.15 for each "bid" that was placed. On these games there is, I guess, (and I am being generous here), some semblance of strategy, since each subsequent bid is worth a little less. For example, the first bid on a $300 XBOX 360 is a chance to get a $300 item for $0.15, but the 100th bid is a chance to get a $300 item for $15.00, which is worth a little less. I guess the strategy is to wait until the price is high enough to weed out a lot of players and thereby increase your chances, but PLEASE keep in mind you chances are still SLIM!
In conclusion, I would call Swoopo a scam, but that is just my definition. It is what it is. It preys on human weakness, and lots of them.
1. Desire to get a good deal. (At first glance you are buying something at an incredible price, right???!!!) You can see this is their main hook as all of their ad material is just history of past games showing how some lucky fool snagged a Wii for $20 or an HDTV for $200.
2. Throw good money after bad. (You bought 20 chances, and someone kept jumping in with 5 seconds left! I don't want to have wasted $20, so I'll get $20 more in chances and keep trying!)
3. Gambling is fun. (No real need to elaborate here)
| A fairly good read. |
