Trading Platform Price Variation Unit for Sealed-Bid Auctions
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Solution Overview
Problem
Existing trading platforms face challenges in achieving short trading times while safeguarding the interests of both offering and inquiring users, often resulting in inefficient price determination and delayed purchasing decisions due to unpredictable price fluctuations.
Innovation Solution
A method for operating a trading platform that uses a price variation unit to dynamically adjust the price of goods over time based on a parameterized price function, ensuring the price drops from a starting price to a minimum price and potentially increases again, allowing users to make informed purchasing decisions within a defined offering period.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Quantity of substance
If the price is increased over time through anonymous competitive bidding, then the offering user may achieve a higher price, but price distortions occur and the inquiring user is disadvantaged
Solution Approach 1:
The patent introduces a trusted third party (the trading platform operator) as an intermediary that collects sealed bids from offering users and distributes them to inquiring users without revealing identities. This mediator ensures fair price determination through transparent yet anonymous bidding, eliminating price distortions while maintaining fairness for both parties.
Solution Approach 2:
The bidding process is segmented into distinct phases: bid submission with sealed envelopes, bid distribution to multiple inquiring users, and final award announcement. This segmentation allows the offering user to receive the best price while inquiring users can compare offers without pressure, ensuring both price optimization and fairness.
2Ease of operation
If the price drops continuously over time from starting price to end price, then the inquiring user is incentivized to purchase, but purchasing decisions are delayed and goods are not sold
Solution Approach 1:
Instead of continuous price dropping, the patent implements periodic bid submissions at predetermined intervals. The offering user submits bids at regular time intervals, creating periodic opportunities for purchase without continuous pressure. This maintains incentive while preventing excessive delay, as inquiring users know when to expect new offers.
Solution Approach 2:
The offering user preliminarily determines a price range and submits sealed bids in advance according to a predetermined strategy. This preliminary action allows the system to present fair prices without continuous negotiation, enabling inquiring users to make timely decisions based on pre-calculated optimal prices rather than reacting to continuous price changes.
3Stability of the object's composition
If fixed price offers are used, then the offering user can maintain price stability, but trading times become very long and the assortment is limited
Solution Approach 1:
The patent transforms the static fixed-price model into a dynamic sealed-bid system. Instead of posting a single fixed price, the offering user dynamically generates multiple sealed bids within a price range, allowing the system to adapt to market conditions while maintaining price stability through the confidentiality of the bidding process. This increases trading volume without sacrificing price stability.
Solution Approach 2:
The system changes the parameter of price presentation from a single fixed value to a range of sealed bids. By submitting multiple bids at different price points in sealed form, the offering user maintains price stability through predetermined strategies while enabling the system to match with inquiring users at optimal prices, thereby increasing overall trading volume and productivity.
4Measurement precision
If multiple bids are submitted to determine actual market price, then price accuracy improves, but data traffic between users and computer system increases
Solution Approach 1:
The patent extracts the essential price information from multiple detailed bids by identifying and submitting only the critical bid parameters needed for market price determination. Instead of transmitting all bid details, the system extracts key elements (price range, quantity, timing) and processes these condensed data sets, achieving accurate market pricing while minimizing data traffic between users and the computer system.
Data Source
AI summary
The invention relates to a method for operating a trading platform for selling goods using a computer system, the computer system including a communication interface configured for the exchange of information between users and the computer system via at least one communication network, a memory unit for storing information associated with a good to be sold, and a price variation unit, connected to the memory unit and the communication interface, for varying a price associated with the good as a function of time, based on a parameterized price function. The invention further relates to a trading platform, a computer program product, and a computer system.