What does this word mean?

[dezinerite]

I don't get what 'reserve' mean (in terms of domains). Can someone be kind enough to explain to a no0b? Thanks! :red:

 

[nielsencl]

A reserve usually means something that is held back. In auctions, it's the minumum amount that a seller needs to get in order for them to sell. This keeps them from selling something much too low due to only getting low bidders.

To make sure this is clear: If I had a domain that I felt was worth at least $50, I might put a reserve of $50 on the auction. If the bids don't reach at least $50 I don't have to sell it. If I don't have a reserve and only get a few bids, the domain could be sold for only a few dollars. This is one reason why you see people posting about auctions on some forums and classified ads sites, they want as many bidders as possible.

Reserves are generally not known until they are reached, and I think that in some cases when you have a reserve you can discourage people from bidding because they may bid and bid only to find out the seller has a reserve they think is too high.

On the other hand if there is no reserve, people may bid more since they know they have a chance to win the auction right away.

 

[dezinerite]

Thanks a lot for your explanation, it's very clear to me now! *rep*