Are you competing against yourself?

Last week I bid on a domain at Flippa; the seller had set a reserve on it, which is a smart move.

No one else was bidding on the domain and I decided to max out my budget, as my tax refund was generous this year.

After several attempts to meet the reserve, the auction ended. Later that day, I was contacted by the seller, setting his BIN price, which was far too high for the particular domain.

Similar sales were less than 50% of that asking price, so I did the obvious: I countered.

After two more rounds, I made it clear that since I was effectively bidding against myself, that’d be my max offer.

At that point, the seller canceled the communications without accepting or countering further.

I don’t blame him, as he wants to maximize his ROI for the domain, and he probably will re-list it at Flippa.

However, the process reminded me that by competing against myself I gave the seller the advantage of regulating his countering strategy.

Ideally, domain auctions that have a reserve require at least two bidding parties; the one that wins the domain eventually, has the largest budget.

Although it sounds bizarre, when competing against yourself you risk going beyond the actual budget, believing that you are dollars away from the reserve.

The best strategy, in these cases, is to wait until the domain is relisted, or to contact the seller outside of the selling venue once the auction ends.

Alternatively, give up on that particular domain, as I did.