People are competitive and they LOVE deals, so the idea of a reverse auction is a winning one. Pun intended.

But what do we mean by “reverse auction” exactly? Read more to find out.

Say you have something to sell and it’s worth $500, but you could still make a profit if it sold for around $300, particularly if you sold a bunch of them. Well, you can post it on Twitter for $500 using this service, Pibster, setting your minimum price at $300 (the minimum price is known only to you) and every person who retweets it lowers the price.

Wait, what?

Folks retweeting your offer can also buy the item after lowering the price if they like, but if they don’t click “buy” first and someone else does, they miss out on the deal.

As Felipe Coimbra, Founder of Pibster tells us, “the price may reset or the promotion may be over… so that’s the idea, the user never knows when it might be over and they may lose it.” Doh!

So it’s a game of chance. Nice.

When you set up your promotion, you can set it so that each tweet decreases the item’s price by a fixed amount or it can decrease based on a person’s individual Twitter account¬† – you know, depending on their Klout, Kred or the right political affiliation. Here’s mine (Republican):

Just kidding, I’m a Democrat. And it’s based on Pibster’s own algorithm, silly. It has nothing to do with politics.

How do sellers get paid? Directly through PayPal. No fuss, no muss. And the seller and buyer coordinate delivery separately.

So did Pibster just turn Twitter into a super-successful sales channel, or what? Guess time will tell, but once businesses start using the service, I’m guessing it will be wildly popular with sales-savvy consumers. What do you think?

(Laptop auction image from Shutterstock)