Oct 10, 2009

RackUp, the shopping game where you are sure to win!

Social Commerce permanently increases new forms of e-commerce and business models.  There will be winners and losers!

It is difficult to say whether RackUp, a new start-up model presented at the TechCrunch conference will succeed in asserting itself.  It does present more than one advantage:

RackUp renews auction items.  RackUp makes shopping fun, and RackUp assures you of winning!
How does RackUp work?  It is hard to explain without having used it before and I recommend the video demo, but here are the main aspects:

  1. RackUp is an on-line auction system of gift cards and gift certificates, with all kinds of attractive packages with companies like American Airlines and Travelocity Hotel, including Legal Sea Food restaurants, or brands like Calloway Golf or MocaShop jewelers.
  1. RackUp has auction rooms for gathering bidders who want to purchase gift certificates for a particular brand.
  1. Each bid is very quick, lasting only 60 seconds.  An auction is held every two minutes.  Therefore there is no long waiting period.
  1. At the very beginning of the auction, each bidder can purchase a gift certificate, but only the first will buy it at the purchase price, each of the following bidders will increase the bidding price by 10cents so that the 10th bidder will pay $51 for a gift  certificate of $50.
  1. However, as items are purchased, each bidder progresses to a level which gives complimentary value (from 3 to 100%) to his/her certificate.
  1. This progression continues for 60 seconds.  If you reach 100% after 60 seconds and the bid is marginal, it will be cancelled.  However, nothing is lost, you can start over, paying a little bit more for your certificate, for which you are assured a 3% reduction.

In the example given by RackUp, the purchase of a gift certificate for American Airlines at $50 for a price of $51.20 will in turn become a certificate of $76.80.  Well done!

RackUp is part of the array of on-line auction sites that Ebay made popular world wide, casual bidding that has become an incredible success with women and the gift card phenomenon.

RackUp is pretty clever in emphasizing the social aspect of bidding.  The competition sets people up to bid against each other but also increases the stakes by increasing the bonuses.

The bonus system, which is linked to group or personal purchases, is starting to appear more and more often in the new economic models of on-line auction sites.

In these tough economic times, the bonuses given by RackUp are a type of discount and will become more popular.

While you wait, is there anyone that has to take an American Airlines flight?

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