Business POV

Don't necessarily follow the online auctioneer's advice for climbing to your highest bid to get the product you want, says Robert Zeithammer, an assistant professor of marketing at the University of Chicago GSB. Instead, participate in numerous future bids at a baseline price. It's a strategy, he says, that will get you the item you want for a lower cost than you expected.

“You shouldn’t just look at one item and decide on the maximum you’ll pay,” Mr. Zeithammer told Capital Ideas, a GSB publication. “The more options you have and the better those options are for you, the more you should lowball your current bid. Be patient, and if you lose the auction, play again. On average you’ll get the item you want for a lower price.”

Robert Zeithammer is assistant professor of marketing at the University of Chicago Graduate School of Business. He has a B.A. and an M.A. (mathematics and economics) from the University of Pennsylvania and a Ph.D. (management science) from the Massachusetts Institute of Technology.