Friday, 18 September 2009

UK's Largest Auction Site Sees Traffic Grow Over 5,000%

With a team of only 10 full time employees, Bid4Vouchers launched onto the UK auction scene with a fanfare not seen since rival German auction site Swoopo entered the market in 2008. From an initial membership of only three thousand the site has grown beyond all expectations increasing in size by over 1500 new members every week. This has left the company with a few initial growing pains but one of the fastest growing companies on the internet.

Founder and technical director, Oliver Hutcheon, explains;

"There's a significant difference between us and other auction sites in that we create substantially more winners because of our business model. We only auction gift vouchers for all the major high street stores and each auction varies in value from £10 to £500.

When we launched we planned for a steady growth so we could meet the challenges of higher traffic along the way. It hasn't been like that at all.. the growth has been phenomenal and driven partly by the auction winners themselves recommending the site. What we didn't factor in was the time that our members spend using the site which is sometimes up to one hour. Thankfully our hosting company, Red Technology, have been excellent in upgrading the hardware necessary to cope with the added traffic.

At present, we keep stocks of around £10,000 worth of vouchers on any of 30 high street stores we represent so delivery is quick and by registered post. You can play and win the day before you go shopping."

So how do the auctions work? It's a tried and tested model where each bidder pays a small amount for the right to place a bid and drives up the price by a few pence. But what's new about Bid4Vouchers?

Jon Molton, sales director explains,

"People have become comfortable with the standard auction model where anywhere up to a few hundred people will chase a very valuable prize for only a few pounds, paying a small price each time to bid. The trouble with the existing model is that this leaves one winner and many, many losers. We run auctions where you can fairly easily win bundles of high street gift vouchers for 30% to 40% of their face value, sometimes with as few as only 3 or 4 members participating in the auction. This new way of generating more successful auction winners has proved to be quite a significant attraction and the levels of interest we've experienced have certainly given us some late nights. But it's a great problem for the company to have."

Looking at some of the recent auctions on the website its easy to see why the growth has been so explosive;

£250 of Boots the chemist vouchers sold recently for only £12.18.
£500 of House of Fraser vouchers went for only £34.84
£25 of Argos vouchers went for only 89p.

Jon Molton again… "Some of the auctions only raise the price by 1p for every bid, so the final value is incredibly small but we're happy with that. Over 70% of the auctions do lose us money, but the 30% that don't make up for the other 70%."

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