uBid.com is a leading retail auction and e-commerce site which offers a wide range of brand-name merchandise at up to 70 percent off the retail price by live-action bidding (ubid, 2002). They offer a rotating selection of over 12,000 brand name products from companies such as Compaq, Hewlett Packard, Sony, and Toshiba, and complete 11,000 auctions a day (Tillett, 2001). uBid.com lists 16 different product categories: computers, computer peripherals, computer components, home office, housewares, sports and hobbies, jewelry and gifts, accessories, off-lease computers, consumer electronics, digital cameras and videos, apparel and linens, home improvement items, collectibles, travel and events, and an "everything else" category (uBid, 2002).
At uBid.com, customers name the price they are willing to pay for a product (uBid, 2002). The bidding for each product starts with a set minimum and maximum price, a closing date and time, and the opportunity to buy the product outright at uBuyitnow. The winning bid is determined by price, quantity ordered, and time of bid. Sometimes a reserve price is set on an item, or the bidding is stopped if an item is bought at uBuyitnow. Customers can track the status of their bids at "My Page," or can have a "Bid Butler" do their bidding for them: they set the maximum price they are willing to pay for an item, and the butler keeps track of the auction and places bids for them. Bidders are notified by email if they have a winning or losing bid. All bids are final, and cannot be cancelled. Bidders cannot rebid on an item at a lower price than their original bid. The auctions are run like traditional auctions.
Add-on items can be ordered along with winning merchandise, such as batteries, ink cartridges, etc., and items are shipped by standard means (air or surface) (uBid, 2002). Sales tax is only charged to Illinois and Tennessee residents. uBid.com issues its own credit card, and businesses can...