eBay was founded (and is best known) as an online auction marketplace. Today, around 10% of listings are still run as auctions. Though that percentage may sound low, keep in mind that over 1.3 billion listings are created every year on eBay.
Sellers who specialise in auction listings may have noticed a recent upswing in bid retractions. Indeed, it doesn’t take much browsing on the eBay subreddit to see this or notice that many sellers were not aware that buyers could indeed retract bids. Read on to discover the full story and facts about bid retractions and what this means for eBay sellers.
What is a bid retraction?
A bid retraction refers to the process of a buyer being able to ‘take back’ or remove their auction bid on a listing. When this happens, eBay’s bidding process recalculates and excludes the retracted bid from the current bid total. The buyer in question is therefore no longer in the running to win the auction and the corresponding item(s). Bid retraction is only allowed in specific circumstances, as set out in eBay’s bid retraction policy.
eBay’s bid retraction policy
To buy and sell on eBay, every member has to accept the User Agreement. In this, members agree that they will not ‘fail to pay for items….[without] a valid reason as set out in an eBay policy.’
Furthermore, eBay’s guidelines for buyers state that members:
- must pay for any item committed to buying
- should only bid if really intending to buy the item
- each bid made is a binding contract to buy the item if won
There are, however, some circumstances in which eBay buyers are allowed to retract their bids in an auction. eBay’s bid retraction policy explains these acceptable scenarios.
When buyers are allowed to retract bids
There are four main situations in which an eBay buyer would be able to retract their auction bid:
- The member bids the wrong amount e.g. a bid of $300 instead of $30. According to the policy, the buyer should immediately bid again with the correct amount after successfully retracting the bid with the typo
- The seller is unreachable via the provided contact details within a reasonable time period
- The seller changes the item description significantly enough that the item is different to the one the buyer originally bid on
- When the item is in a selling category with non-binding bids such as motor vehicles and real estate. These categories feature items with more complex selling processes and hence non-biding bids are allowed
There is a time limitation to the first three scenarios listed above. If the listing ends in less than 12 hours, only the last bid can be retracted. If there are more than 12 hours left, it is possible for a buyer to retract all their bids.
What bid retraction means for eBay sellers
Bid retraction is a negative feature for eBay sellers as it can mean loss of profit or a sale. It can also be frustrating when it is clear that some users are taking advantage of the system.
Buyers are not allowed to retract bids when they:
- Change their mind about purchasing an item
- Have placed multiple bids on different listings with the intention of only buying one item
- Attempt to manipulate bid prices
Manipulating bid prices is a serious violation of eBay rules. The most common method to do so is for a buyer to place fake bids with the intention of finding out the item’s reserve price. Another example would be a buyer trying to work out the maximum bid of another user.
Buyers are not necessarily the only eBay users attempting to manipulate bid prices with retractions. Unscrupulous sellers try to use the methods mentioned above to push the value of bids higher. This is also called shill bidding and is illegal in many countries around the world.
What to do about bid retraction violations
Unfortunately, eBay sellers cannot do much to reduce instances of bid retractions. Buyers who have a valid reason to retract a bid in an auction are able to do so without the approval of the seller.
Sellers can, however, report members to eBay who they believe to be violating the bid retraction policies. This is one reason why it is so important for sellers to know and understand eBay policy about bid retractions.
One proactive solution is to block specific bidders and buyers who are seem to be abusing the bid retraction system. This is very easy to do, with the eBay system allowing sellers to specify and block up to 5,000 eBay members. eBay sends sellers email notifications of bid retractions, so keep and eye out for recurring usernames.
The good news is that, besides being exasperating, bid retraction does not reflect badly on the seller in terms of performance or feedback. This is true for buyers too, but it is possible to see the details of their bid retraction history from the ‘bid history’ page.
Veteran eBay sellers, have you experienced an uptick in bid retractions recently? Do you find it frustrating?