9 Jun 2011

All-pay auctions for Bon Jovi

Yes, *this* JBJ
Cristie wrote me with this fascinating application of all-pay auctions:

I am winning a Bon Jovi contest right now. The link to the contest on his website is here. If you scroll down, on the right you will see a pic of me and you can click on the Tour Manager For a Day / Referral contest.

I am trying to apply some game theory to this and after reading your link [more] regarding all pay auctions, I think that there are some similarities.

  1. As of now, I am at 115 referrals (fan club memberships) and the girl just under me is at 73.
  2. The contest ends on June 26 (it began in September of 2010)
  3. There are prizes along the way (at 15, 25 and 50 referrals) ... but then the person with the most referrals wins the big prize.
  4. After 50 referrals, all referrals are in an effort to win the grand prize, so I have to assume that this girl is trying to win as well.
  5. Anything over 50 referrals is a sunk cost; this is why I liken it to the all pay auction.
  6. I am in it, to win it.
My strategy so far was to put up a big number quickly to try to dissuade competitors (so I had 70 or so by the 2nd week of the competition). I have also had a goal of having at least a 40 referral lead over the next closest person (so that I had time to add more and would be able to see her coming after me).

Who could resist?
At this point I am buying the fan club memberships for folks and I have at least another hundred ready to go in... but I don't want to spend the money if I don't have to. That being said, I don't want to play it so close that she has an opportunity to blitz me at the end.

This is all probably so silly to you ... and as Joshua would say "The only winning move is not to play the game." Yet, here I am... looking for war strategy, not wanting to lose the game by giving her an edge.

If you find the time to respond (without too much laughter at my decadent mid life crisis contest), I would be very grateful.

By the way, the grand prize is a a weekend flyaway thing (for two) to the final Bon Jovi concert of 2011 where the winner works backstage as a tour manager for the band all weekend. AND ... you interview Jon Bon Jovi for his fan club website.....so, it is flights, hotel, food, great tickets to the show, and the priceless component of the tour manager / interview component.

My response:

Wow. What a fantastic (and useful!) application of game theory!

There's DEFINITELY the risk of a last minute push, but the further ahead you get, the more expensive it is for others (also beware of people below #2).

It may be a good idea to get another 20+ sign ups one week before the end (use the ones that are cheapest to you) -- more intimidation (and cost) for others EARLY enough that they see it and have to think about it.

Cristie's response:

I will likely increase my minimum lead to 50 or 60. She is probably deciding right now whether it is worth coming after me or not. In all honesty, because I do have such a lead and such a sunk cost, if she (#2) thinks that I will give that up, she is incorrect.

So happy that you had a good chuckle; at least you can use this funny example to augment your "dollar for sale" lessons!!

Thanks for blogging this. My referral link is here.

Bottom Line: Academic auction theory applies in the real world and it's useful for getting fans together with their rock 'n' roll idols :)

No comments:

Post a Comment

Note: only a member of this blog may post a comment.