WO2004107237A1 - Raffle-based collaborative product selling and buying system - Google Patents

Raffle-based collaborative product selling and buying system Download PDF

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Publication number
WO2004107237A1
WO2004107237A1 PCT/US2003/024744 US0324744W WO2004107237A1 WO 2004107237 A1 WO2004107237 A1 WO 2004107237A1 US 0324744 W US0324744 W US 0324744W WO 2004107237 A1 WO2004107237 A1 WO 2004107237A1
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seller
buyer
ware
server
system
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PCT/US2003/024744
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French (fr)
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Raul Mihali
Tarek M. Sobh
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Rtm Technologies
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    • GPHYSICS
    • G06COMPUTING; CALCULATING; COUNTING
    • G06QDATA PROCESSING SYSTEMS OR METHODS, SPECIALLY ADAPTED FOR ADMINISTRATIVE, COMMERCIAL, FINANCIAL, MANAGERIAL, SUPERVISORY OR FORECASTING PURPOSES; SYSTEMS OR METHODS SPECIALLY ADAPTED FOR ADMINISTRATIVE, COMMERCIAL, FINANCIAL, MANAGERIAL, SUPERVISORY OR FORECASTING PURPOSES, NOT OTHERWISE PROVIDED FOR
    • G06Q30/00Commerce, e.g. shopping or e-commerce
    • G06Q30/02Marketing, e.g. market research and analysis, surveying, promotions, advertising, buyer profiling, customer management or rewards; Price estimation or determination

Abstract

A system (100) for selling wares via a network connection, the system (100) comprising a server interconnected to the network connection, a buyer profile database accessible by the server, the buyer profile database having stored thereon at least one buyer profile for use as a gateway to control entry to the system and to store buyer information, a seller profile database accessible by the server, the seller profile database having stored thereon at least one seller profile for storing seller information into a public portion and a private file, the seller information containing seller preferences, information about the seller's ware and seller administrative information, a web interface in communication with the server, the web interface accessible by a buyer and the web interface displaying the public portion of seller profile including information about seller's ware, a selection module coupled to the server, the selection module allows buyer to choose a ware listed on the public portion of seller profile through use of a user interface.

Description

Title Of Invention

RAFFLE-BASED COLLABORATIVE PRODUCT SELLING AND BUYING SYSTEM

Field Of The Invention

[oooi] The present invention relates to a web-based system for facilitating the sale of wares by raffle and more particularly to a system, ," which provides the administrative infrastructure for such a raffling system.

Background Of The Invention

[0002] E-commerce can be thought as a simplified apparatus composed of a hyper fast information and transaction network, wares, buyers, sellers and financial institutions. There are other factors that may contribute to the quality of the e-commerce model, e.g. transportation, legislature, energy, but it is sufficient to note that the elements mentioned above are enough to develop a viable e-commerce model.

[0003] The simplified e-commerce model can be organized into three distinct implementations. The first implementation is the primary or basic implementation, which includes the scenarios in which large manufacturers, distributors and sellers provide their products to buyers through websites. This is the most common implementation and it is the choice for most of the sellers that provide mass produced, or new, "from the manufacturer," merchandise.

[0004] The basic implementation does work to some degree for large manufacturers, distributors and sellers but these vendors do face some major disadvantages by using the basic implementation. One disadvantage is that buyers are forced to deal with generic pricing models, which generally only decrease based on competition between sellers or through a technological advancement by a seller. Another disadvantage is that a significant percentage of products are not successfully integrated into the basic implementation such as used products, rare products, antiques, expensive, luxury or overpriced products. Also, sellers have additional costs by using the basic implementation due to the need to ensure generic and expensive quality standards as well as pay for control and support of their products, all of which adds to the buyers' costs.

[0005] The second implementation is the auction implementation. Auctioning is the choice for most of the sellers and buyers who offer and purchase used, person-to-person, "second hand" type of products. Although still a growing market, it too has its disadvantages. For instance, expensive products are usually not consumed well in this implementation because quality assurance is difficult due to buyers and sellers having different quality standards and expectations. The difference in quality standards and expectations can also vary significantly from the merchandise standards imposed by the sellers of the primary implementation and this often results in non-satisfying or sub-standard transactions. The auction implementation also suffers from the freedom of sellers to set their own price, which does not necessarily allow for bargains, thereby causing a high number of transactions to remain incomplete.

[0006] And the third implementation is the raffle implementation, which does address some of the voids in the first two e-commerce models for the types of products that do not fit well under the first two implementations. Consequently, the raffle implementation would be the choice for sellers of highly expensive products and also rare or hard to price products. The raffle implementation is currently a very limited implementation of the e-commerce model because most of the time it is used for publicity purposes, charity/donations, or gambling, and therefore the raffle implementation sites tend to have an inconsistent lifecycle. For example, a charity runs a fundraiser using the raffle implementation and when the raffle prizes are awarded, the raffle implementation is shut down. Also, the raffle implementation typically has the disadvantage that it has very limited profit control.

[0007] Consequently, the three implementations of the present e- commerce model have considerable disadvantages as outlined above and therefore what is needed is a new perspective that builds on top of the three implementations mentioned and provides a much more efficient synergy between buyers and sellers. Consequently, what is needed is a new e- commerce model in which any type of product or service can be successfully sold or purchased. Using a raffle-based auction system, new, used, rare, expensive and cheap products and services can be raffled through independent consumers, dealers, charities or manufacturers alike.

Summary Of The Invention

[0008] Accordingly, it is an object of the present invention to expand the raffling implementation in a way that it can provide for any type of seller and buyer a faster, easier, and guaranteed sales path regardless of the product characteristics.

[0009] Another object of the present invention is to provide a collaborative type interface that allows users, e.g. buyers and sellers, to interface on the basis of a raffle process. [ooio] A further object of the present invention is to provide a new direction for the e-commerce model that will expand and improve upon the present e-commerce model by assimilating the old implementations and making the new e-commerce model the implementation of choice.

[ooii] Still another object of the present invention is to provide a web-based e-commerce system that allows for efficiency in the interface between demand and supply.

[0012] Yet still another object of the present invention is to electronically automate the raffle from start to finish.

[0013] And still yet another object of the present invention is to provide a way for charity organizations to utilize the raffle service provider for a charity function or sale of a ware without the charity having to deal with the details of setting up and running a raffle.

[0014] These and other objects of the present invention are achieved by provision of a system that includes a method for selling wares via a network connection, the method comprising the steps of providing a server that is connected to the network connection, the server running a web interface that is accessible by a user interface, collecting on the web interface identifying information from at least one buyer to create at least one buyer profile, gathering on the web interface identifying information from at least one seller containing seller preferences, information about the seller's ware and seller administrative information to create a seller profile, the seller profile being divided into a public portion and a private file, displaying the public portion of seller profile to buyers on the web interface, providing a selection module on the web interface for the buyer to choose, by using the user interface, an offered seller's ware in, presenting rules to the buyer about an exchange for the selected ware, verifying to see if a buyer has sufficient funds in a financial agent account of buyer to cover the exchange, placing a lock on the sufficient funds amount necessary to cover the exchange on the financial agent account of the buyer, furnishing a ticket or more as a receipt for the exchange, ensuring that all the rules of the exchange have been met, using a random chance algorithm to choose a winner from among all the ticket buyers of the ware according to the rules, charging each buyer financial agent account that participated in the exchange for the tickets purchased and then removing the lock on the financial agent accounts of the buyers and sending notice to all buyer profiles that purchased tickets for the ware of the winner of the ware and crediting the seller of the ware private file with proceeds of the exchange according to the rules.

[0015] Preferably, the method further comprises the steps of adding the ticket to a shopping cart, calculating the probabilities and variable scenarios of winning for the seller and buyer, querying the sellers to see if they will exercise one of the rules that allows the winner to be chosen early, supplying a search module that can search the seller profiles public portions, helping the seller price the ware by providing access to a pricing algorithm, querying seller to identify what percentage of exchange proceeds go to charity, setting up a separate web interface for seller, limiting the opportunity to participate in the sale of the ware to selected group of buyers and wherein the pricing algorithm utilizes historical pricing data and present pricing data.

[0016] Preferably, the invention provides a system for selling wares via a network connection, the system comprising a server interconnected to the network connection, a buyer profile database accessible by the server, the buyer profile database having stored thereon at least one buyer profile for use as a gateway to control entry to the system and to store buyer information, a seller profile database accessible by the server, the seller profile database having stored thereon at least one seller profile for storing seller information into a public portion and a private file, the seller information containing seller preferences, information about the seller's ware and seller administrative information, a web interface in communication with the server, the web interface accessible by a buyer and the web interface displaying the public portion of seller profile including information about seller's ware, a selection module coupled to the server, the selection module allows buyer to chose a ware listed on the public portion of seller profile through use of a user interface and the selection module presents the rules of exchange for the ware, a financial agent module in communication with the server, the financial agent module checks a buyer's financial agent account for sufficient funds when a buyer selects a ware and then locks a sufficient fund amount in the buyer's financial agent account to cover the selected ware, a receipt module accessible by the server, the receipt module records into the buyer profile which buyer purchased a ticket and then issues a ticket to buyer via web interface and raffle logic coupled to the server, the raffle logic runs a raffle, the raffle logic includes a routine that utilizes a random chance algorithm that determines a winner of the ware in the raffle, charges all buyer financial agent accounts that purchased tickets for the raffle, notifies all buyers that purchased tickets for the raffle of the winner of the ware and credits seller's private file with proceeds from the sale of the ware in the raffle according to the rules.

[0017] Preferably, the system further comprises a search module coupled to the server, the search module searches the seller profile public portion according to user defined criteria, a probability calculator coupled to the server, the probability calculator used for calculating winning chance probabilities for both the seller and the buyer, a pricing module coupled to the server, the pricing module accessible by the seller to assist seller in determining a pricing structure for their ware, an indexing module in communication with the server, the indexing module used to index sellers profile public portion for distribution on the web interface, wherein the rules module has different rules for different seller profiles, wherein the raffle is run simultaneously with other raffles on the same web interface and an administrative module coupled to the server, the administrative module automatically figures and adds the administrative fee to the price of the ware for sale.

[0018] The invention and its particular features and advantages will become more apparent from the following detailed description considered with reference to the accompanying drawings.

Brief Description Of The Drawings

[0019] FIG. 1 is a block diagram of a system for facilitating the raffling of wares in accordance with the present invention;

[0020] FIG. 2 is a flowchart illustrating an exemplary depiction of how a seller interacts with the present invention of FIG. 1;

[0021] FIG. 3 is a flowchart illustrating an exemplary depiction of how a buyer interacts with the present invention of FIG. 1;

[0022] FIG. 4 is a flowchart illustrating an exemplary depiction of how a raffle operates under the control of the present invention of FIG. 1; [0023] FIG. 5 is a graph illustrating an exemplary depiction of how the price and quantity of an arbitrary product varies over time within the boundary of the present invention of FIG. 1;

[0024] FIG. 6 is a graph illustrating an exemplary depiction of how the price of an arbitrary product and the average price of the category of the respective product vary over time within the boundary of the present invention of FIG. 1; and

[0025] FIG. 7 is a graph illustrating an exemplary depiction of how the price of an arbitrary product and the price trend of the respective product vary over time within the boundary of the present invention of FIG. 1.

Detailed Description Of The Drawings

[0026] Referring first to FIG. 1, a system 100 for facilitating the sale of wares, e.g. products and services, by raffling in accordance with the present invention is shown. System 100 includes server 128 executing thereon raffle logic 132, web interface 136, pricing module 130 and profile module 126. Web interface 136 is composed of hosted web sites, virtual hosted web sites, dedicated hosting sites, raffle portals and the like as well as links between such sites. Pricing module 130 contains pricing algorithms that utilize historical pricing data, present pricing data and present sales data from archive 158 (FIG. 1) by which a ware price will be derived and presented to seller 116. Profile module 126 contains questionnaires and forms for seller 116 to fill out including such information as seller contact information, detailed description of the ware, form of web interface, e.g. link on portal, hosted web site, virtual hosted web site, dedicated hosting and the like, duration of the auction, desired sale price, the binding agreement that outlines the rules of the selling forum agreed to by seller 116 and other relevant seller 116 information. System 100 also includes database 140 accessible by server 128 having stored thereon seller profiles 144, buyer profiles 148, financial agent profiles 152, charity profiles 154, administrative profiles 156 and archive 158.

[0027] The information stored on database 140 is retrievable by a system user within the limits of their designated permissions as defined in administrative profiles 156. A system user is defined as a buyer 112, seller 116, administrator 124, financial agent 108 or the like that is a participant in system 100. System 100 is preferably accessed by the system users through web interface 136 by using user interface 104. System 100 also includes network connection 120 that connects all the system's components. Network connection 120 can be a wired or wireless connection such as coaxial cable, twisted wire pair, fiber optic, radio frequency, high frequency, microwave, infrared, satellite link or the like.

[0028] Referring now to FIG. 2, system 100 begins operation from seller 116's point of view when at least one seller 116 desires to sell a ware over the system. Consequently, since seller 116 chooses what ware to offer for sale, it is therefore possible for a raffle to offer one product, one service, multiple products, multiple services and combinations of these for sale at one time. A variety of sellers 116 such as charities, foundations, not for profit organizations, manufacturers, distributors, wholesalers, resellers, collectors, service providers, one-time sellers, charity groups and the like can utilize system 100 simultaneously.

[0029] Seller 116 accesses web interface 136 and creates seller profile 144 by interacting with profile module 126. Seller 116 is than queried as to the type of transaction seller 116 is trying to achieve at block 160. [0030] Seller 116 can choose between a sale or they can set up an event. The event choice leads to block 164 in which a raffle website or link, which is a component part of web interface 136, is set up for seller 116. The event choice option will generally be utilized by organizations performing fundraisers and these fundraisers have a tendency to be one-time or infrequent happenings. Consequently, system 100 is highly attractive to charities, foundations and not for profit organizations because system 100 will reduce administrative costs and burdens.

[0031] For example, an organization promoting literacy may have a charity book raffle with the proceeds going to benefit a local library and literacy group. To facilitate such a raffle, system 100 will contain a charity portal, which will contain links to many different raffles on which the literacy charity link will appear. The advantage of the charity portal option is that it will greatly reduce the administrative work that the organizer will need to do to set up the raffle as well as reduce the overhead of running such a site, e.g. shared resources such as T-carrier system lines for connections.

[0032] In an alternative embodiment, system 100 will host websites, which are a component part of web interface 136, for individual organizations that may not want their organization associated with any other charity or cause. Again in this hosted version, the reduction in administrative work and shared resources greatly benefits the charity organization's ability to raise funds rather than sink the funds into administrative costs.

[0033] System 100 will accommodate different formats of fund- raising activities for charities, foundations and not for profit organizations such as where a donated ware is raffled off as a prize and the proceeds collected from the sale of raffle tickets will be contributed to certified charity organizations minus operational costs. Another example of fund-raising activities is when a partially donated ware is raffled off as a prize and seller 116 defines the percentage of the proceeds from the sale of raffle tickets that will be contributed to certified charity organizations minus operational costs. Also, in an alternative embodiment of the invention, the price of auction items can be increased by system 100 automatically with a certain percentage earmarked for donation to a chosen charity.

[0034] The alternative option in block 160 is where seller 116 can arrange for the sale of its wares. For example, suppose a Lamborghini dealership has a hard time selling a particular car because the car has been stocked for too long, the market price is too high, the market is already satisfied or simply because seller 116 wants to speed up the sales cycle of such car models. Putting the car on an auction site or a direct sale website will more than likely not sell the car because the economics of the sale have not changed as described in the background of the invention section. However, one of the advantages of the present invention is that it utilizes a different economic model to sell the ware.

[0035] For example, the Lamborghini may not have sold for the above stated reasons and changing the sales venue would not change these factors. But if the pricing plan was changed, buyers 112 would become interested in the vehicle. Buyer 112 may not be willing to pay $200,000 dollars for the Lamborghini but may be willing to pay $100 for the opportunity to win a Lamborghini and hence there is an increase in the psychological factor of "affordability."

[0036] Most consumers have hundreds of products that they desire but cannot afford. The more these consumers desire a certain product, the greater the probability that they will at least invest in an opportunity to acquire it. This factor alone will attract a stream of buyers 112 because it will allow relatively expensive type of products or hard to consume or price products to be sold "in pieces."

[0037] Also, since the items are being raffled, it is much easier to lower the standards of support, quality assurance, maintenance and distribution without adversely affecting the expectations of buyer 112. Therefore, a manufacturer or distributor may decide to sell some or all of its output through the proposed model, to cut costs. The reduction in standards of support, quality assurance, maintenance and distribution will not impact sellers 116 because the product has been raffled, and so the price paid by buyer 112 is several orders of magnitude smaller than the actual product price and therefore the complaint factor would be significantly diminished. Consequently, non-constrictive quality assurance will be a benefit to the present invention, which is in direct contrast to present auction sites such as Ebay™ whose sales are subject to customer dissatisfaction due to the fact that many sellers 116 do not have the same quality standards as buyers 112 as was described in the background of the invention section.

[0038] In both the event and sales options, seller 116 will then be queried in block 168 if they need help pricing the raffle item. In block 172, if pricing help is needed, pricing module 130 (FIG. 1) will be accessed.

[0039] A series of pricing algorithms and models are provided to both sellers and buyers, which can greatly improve the quality and quantity of the raffle transactions. The key behind these tools is the in-depth categorization and historical product archiving that the system provides. During the process of preparing a new raffle entry, the sellers are being provided with algorithmic tools designed to advise and optimize parameters as follows: - Estimate the min/max price range for which the auctioned product is expected to sell

- Improve upon the poor historical sale of a certain product by suggesting specific charity donations

- The maximum donation amount for which the sale price is optimal and advise regarding charities amongst which the donation should be distributed and in what sub-percentages

- Is it a good (profitable) time to sell a particular item, and if not, what would be a better timing?

- What price should be asked to meet a specific short duration of sale

- For selling groups offering auctions of hundreds or thousands of identical items at a time, calculate pricing distributions that may improve the final price or speed of sale.

- How well the product sells in comparison with other products under the same category

[0040] For any product that is about to be raffled, system 100 will retrieve from the historical database the following:

- the historical price of sale of the respective product over a period of time (The timeframe may be adjusted for any time period such as weeks and years)

- the historical duration and times of sale over the respective period of time

- the historical quantity of products sold at intervals of the respective period of time

[0041] As an example, a seller may decide to sell a new digital camera, model "XYW. The seller has 200 pieces of this unit, and as a retailer trying to clear his / her stock, would find it of great use to be able to estimate the profit based on the duration of the auction. As soon as the seller picks the correct categories in which the respective digital camera belongs, system 100 will prepare in the backend a chart that presents the historical pricing information of the respective camera as shown in FIG. 5.

[0042] In this example, the XY 10 camera has at most been raffled in a lot of about 50 pieces in July 2002, after which the price has continued to decline and then finally show a steady increase. Note that the charts are only being prepared from the successful transactions and they also omit the transactions that have been ended early by sellers. Such transactions would not offer a valuable statistical pricing model.

[0043] Given that the seller's quantity of 2000 pieces is unusually large for the last year, system 100 may prepare additional pricing information. System 100 may decide to compare the historic price of the XY 10 digital cameras against digital cameras in general, such as in the sample shown in FIG. 6.

[0044] The time frame is again adjustable and the category is narrowed down or expanded as found suitable by system 100, for example from amateur digital cameras by the same manufacturer, up to cameras, or electronics, or even all the products that have been auctioned through system 100. In one embodiment of the invention, the chart of FIG. 6, as well as all the charts presented in the figures are not being presented to buyers and sellers and are only a means of explanation of the algorithms hereby. Both sellers and buyers are being efficiently spared the complicated details and are only presented with full text, natural phrase-like suggestions, for ease of use. In an alternative embodiment of the invention, the charts are presented to the buyers and sellers. [0045] System 100 calculates an OSD as a relationship of For optimum seller feedback, system 100 also employs parameters such as follows: Product Volatility (defined as the ratio of the price of successful sales out of the total raffles that have been completed on XY 10); Average Time of Sale (defined as the average of the duration of all the successful sales of the camera; Optimal Sale Date (OSD) (defined as an estimation for a date on which the product has the highest chance of selling at an optimal price); Products Sale Density (quantity of sold items in a small interval of time) over a period of one year and the change of price. System 100 analyzes the price deviation of the product relative to the density of sales, and if a proportional relationship is determined, system 100 considers two algorithmic options:

1) an anticipated sale time based on a polynomial trend line estimation

2) an option to keep track of the sold items of the same time and notify the seller via email when the product's availability has entered a scarce period of time, or an unusual increase in the sale price occurs (or a decrease in the duration of sale), or when a favorable charity is in place at a given time that could help the sale of the product (more on charities in the next paragraphs)

If system 100 does not determine a proportional relationship between the sales density and price over time, the OSD is considered undetermined.

[0046] System 100 also keeps track of historical charity donations associated with the sale of a certain product and disregards them when calculating the OSD. Each charity is being assigned a weight value and a weight percent value, this value is calculated as the average return of money per interval of time, respectively as the average percent of buyer donated money per interval of time. For example a weight value of 3000$/day means that the charity gains on average $3000 per day. A weight percent value of 3%/day, means that buyers on average donate 3% of their products to the charity. Other important parameters associated with a charity are the average donations per day and the minimum and maximum donation per buyer, all of which are self-explanatory.

[0047] When a seller decides to sell a product that falls well under the weight value of a certain charity, and is in between the minimum and maximum donations per buyers and in the vicinity of the average donations per day, the sellers is informed and suggested to adjust the price to include a weight percent value for the respective charity. Depending on fine tuned constants that have been previously optimized by system 100, a series of charities may be suggested to be included for donations, with exact percentage donations that should go to each, such as to optimize the duration and time of sale. System 100 also employs an estimated sale price, based on a polynomial trend line of the historical price information, such as the one in Figure 7.

[0048] Another tool that is designed to help a seller is for cases of larger quantities, such as the example given with the XY 10 camera. Since the quantity of XY 10 that the seller wants to raffle is unusually large for this product, it may be difficult to sell all of them directly. System 100 can suggest the maximum items per day, which is based on the average daily volume of the respective product. For the XY 10 camera for example, there is a daily average of 4.28 pieces per day over the last year. This would mean that by selling the cameras in the vicinity of the average daily volume, the seller can sell all the cameras spread over a period of 20 different closing days.

[0049] In the case the seller finds this process rather long, system 100 provides price variations that can optimize this time, or the final price. For example, assuming that the seller wants a price of $145 per camera, system 100 may recommend and calculate prices such as the followings:

- "buy one get one free"; this would turn the price to $290 for the "non free" camera, or an increase of only $1.45 dollars in a raffle of 100 tickets per item;

- "every 10th ticket wins", that is in addition to the chance of winning as a ticket purchaser, if the purchase in place happens to be a multiple of 10, wins automatically; this would be a raffle in which the current number of ticket purchasers is held private and the price per ticket would be increased to match the 11 cameras that actually sell (10 for the "10th"buyer, plus 1 regular); the total comes to $1595, or a $15.95 per ticket

- provide a price progression; given 200 pieces of XY 10 at $145 each, the seller may decide to sell 100 of them in a promotional/advertised direct (non raffle) sale, for very low prices. For example, first 10 are $20 each, second 10 are $30 each, third 10 are $40 each, etc, while the advertisement constantly promotes the rest of the cameras on raffle, at higher prices that can compensate for the promotional prices. For example, the seller may have lost on average $45 per camera on the 100 cameras that were sold in a promotion, which would mean an increase of only 45 cents per raffle ticket for the remainder of the cameras, which, based on the promotion, may sell even faster than the non raffled ones.

System 100 estimates the lower and higher price ranges for which the number of buyers is likely to stay steady.

[0050] Just as system 100 provides the aforementioned tools for sellers, by using the exact same historical data, variables and calculations, it can provide the buyer with the values that can optimize the buy price. For example by forecasting the price through polynomial trend lines, a buyer may be suggested to wait a few days. A buyer may also choose to be notified by email when the desired product approaches a recommended low price of sale.

[0051] The main difference in buyer tools versus seller tools is the different use of charities and donations. A buyer's choice in relation to a charity may only be adjusted in case the buyer would be interested in donating to a charity that happens to be tied to a product of their purchase choice. For example, if the buyer would be interested in buying the XY 10 cameras at $140 dollars (price at which currently the camera is not available), but wouldn't mind spending $145 if a certain percentage of the price would go to a charity for liver cancer treatment, system 100 provides this product information to the buyer, if it is available. Besides the different use of charity information, the rest of the parameters that are employed for the sellers are also used for the buyer, such as the ability to analyze historical prices against any other product categories or provide estimates on buy time versus desired time.

[0052] Pricing module 130 also contains algorithms to aid seller 116 in determining their profit from the sale of the ware. For instance, using the Lamborghini example from above, assume that the car dealer's embedded profit was $1000. The car dealer may desire to adjust the price to embed a profit of $10,000 resulting in a difference of $4.50 (i.e. 4.5% increase) per biding ticket. From a buyer 112 point of view, the price difference is negligible in relation to the cost of the ticket as well as to the value of the Lamborghini. This pricing flexibility also holds true for charitable sales and substantial donations can be achieved because of the negligible effect of raising prices has on ticket prices. [0053] System 100's pricing flexibility is particularly appealing to sellers 116 of used items. For example while it may not be easy for an individual seller 116 to market their used car for more than $17,000 but there is no reason why they would not be able to get the $18,000 through the proposed raffle model because the cost difference per ticket will be negligible for buyer 112.

[0054] Price flexibility also allows for covering the administrative fees of system 100 management such as operational costs, e.g. employees wages, communication carrier expenses, physical plant costs, software and hardware costs and the like. Consequently, system 100's operational costs can be distributed and included as a fixed charge for the buyers 112 on a per ticket or membership fee basis.

[0055] Regardless of whether there is embedded profit on the sale or not, seller 116 can use the presented price, or use it as a benchmark, to help them set the price in block 176. Once a price is set in block 176, system 100 will query seller 116 if a percentage is to be set aside for a particular charity in block 180. Block 184 identifies the available charities according to their charity profiles 154 and the chosen charity donation percentage is indexed and earmarked to the chosen charity profile 154.

[0056] After the percentage is chosen for charity or if no percentage is chosen for charity, seller 116 is queried to set up the parameters of the raffle, which is part of raffle logic 132 (FIG. 1), in blocks 182, 192, 196, 198 and 199. If the percentage chosen for charity is greater than zero, then buyer is also presented with charity types and details in block 184. Because the price has already been set in block 176 and the relationships between blocks 182, 192, 196 and 198 are fixed in relation to each other, only one parameter needs to be chosen in blocks 182, 192, 196 and 198 to set the remaining three out of four. Seller 116 can adjust the parameters in 182, 192, 196 and 198 until they find what they consider an attractive price point for the tickets to their wares. Once blocks 182, 192, 196 and 198 are set, the information is transmitted to web interface 136 and therefore made available to buyer 112 at block 200 where the raffle begins.

[0057] Looking now at FIG. 3, buyer 112 can be anyone who accesses web interface 136. Buyer 112 can search system 100 according to different criteria such as by ware, block 224, or by category, block 220, or by charity, block 216 or by other equivalent criteria. Buyer 112 then can choose a product in block 228 whereby they are presented with relevant ware details. The relevant details come from raffle logic 132, e.g. ticket probabilities, block 192, winning percentages, block 196, and the like, as well as from seller profile 144 (FIG. 1), e.g. details of what organization is selling and how much goes to charity, block 232, browse by charity organizations, block 236 and details about the raffle such as is the raffle public or private, block 240.

[0058] A second algorithm provided by system 100 is derived from the ability to combine historical pricing data and historical winning probability to forecast optimal scenarios for buyer into a SCWP, Statistically Corrected Winning Probability (for Buyers).

[0059] As an example, a digital camera such as XY 10 is being raffled at $150; a hundred tickets are being provided at $1.50 each. Mathematically, the purchase of one ticket will translate into a chance of 1 to 100 of winning, 2 tickets into 2 to 100, and so on, a purchase of all the tickets will guarantee the buy of the product. While this fact remains true mathematically, by using an analysis of previously purchased tickets, through various time frames, on the same product or expanded to a category, system 100 may reveal probabilistically different results. [0060] For example, it may prove that over the past, an optimal chance of winning a camera such as XY 10 by purchasing 11 tickets was, statistically, much better than 11 out of 100, or possibly 40 out of 100.

[0061] By going through the reverse of this analysis, a buyer may only want (or can afford) to purchase 3 tickets. In such a case, system 100 will statistically provide the chances of winning based on previous winners that have purchased 3 tickets. As applied in previous scenarios, system 100 may narrow down or expand the category of products and the time frame used for optimal calculations.

[0062] As an example, it may prove that by purchasing 3 tickets, there is a chance of around 2 out of 100 of winning, or adversely, of 30 out of 100, this possibly relating to the fact that for the last "n" (arbitrarily large) purchases of 3 tickets, buyers have not won at all.

[0063] A third type of tool is provided, this time for sellers, OQSPD, Optimized, Quantized Sliding Price Distribution (for Sellers). While mathematically a raffled product that offers 100 tickets to potential buyers may logically mean that with the purchase of each additional ticket there is a linearly higher probability of winning, system 100 may provide logic that allows for more powerful ticket choices that have an increased purchase appeal on the buyer side.

[0064] For example, the digital camera XY 10 would be offered at a "traditional" $1.50 dollars a ticket. While normally a buyer would try to measure and compare whether buying 37 tickets (for example) would give him / her much better chances than buying 36 tickets, system 100 offers an alternative. [0065] The seller may consider offering the raffle through an automated method (offered as part of the web system) that only allows a pre-quantized number of tickets to be purchased. For the example above, a buyer may only be offered the choice of purchasing blocks of 1, 2, 5, 10, 20, or 40 tickets at a time, out of a predetermined total of 100 tickets. However, the probability of winning on these ticket groups is highly different, as follows:

- Pay for 1 ticket; buyer gets 1 out of 100 chance to win (1 ticket).

- Pay for 2 tickets; buyer gets 3 out of 100 chance to win, or 3 tickets for the price of 2 (odds are better than purchasing 2 tickets separately).

- Pay for 5 tickets; 8 out of 100 chance, or 8 tickets for the price of 5 (odds are better than purchasing 2 sets of 2 tickets and a single one).

- Pay for 10 tickets; 17 out of 100 chance, or 17 tickets for the price of 10 (odds are better than purchasing 5 sets of 2 tickets, or 2 sets of 5 tickets).

- Pay for 20 tickets; 35 out of 100 chance, or 35 tickets for the price of 20 (odds are better than purchasing 2 sets of 10 tickets).

- Pay for 40 tickets; 71 out of 100 chance, or 71 tickets for the price of 40 (odds are better than purchasing 2 sets of 20).

[0066] In the above example, the "optimal" case scenario, or the minimum amount of revenues generated would be as follows:

1 package of 71 tickets (Price of 40 tickets) + 1 package of 17 tickets (Price of 10 tickets) + 1 package of 8 tickets (Price of 5 tickets) + 1 package of 3 tickets (Price of 2 tickets) + 1 package of 1 ticket (Price of 1 ticket) Total 100 tickets sold, for the price of 58 tickets. [0067] The other extreme case would be for 100 different sales for 1 ticket each, which would imply 100 tickets sold, for the price of 100 tickets. If the "optimal" case scenario were to occur, there would be a need to inflate the required price of the product to be raffled (as requested by the seller) by a certain percentage, depending on the "optimal" worst-case scenario. For example, in the above scenario, the price would have to be inflated the following percentage: (100/58 - 1 ) x 100 %, or 72.4 %.

[0068] Assuming a requested sale price for the product of $150. The price would have to be inflated to $258.62. The price per ticket (assuming 100 tickets to be generated) would accordingly be $2.59. This has to be done, so that if the "optimal" worst case scenario of purchases occur, and the price of 58 tickets only were to be collected, the price of these tickets would be $58 x $2.59 = $150.

[0069] The automated system will quantize, as above, using different finite scenarios, the multiple ticket purchases pricing scheme based on the item's price range. System 100 will automatically generate a pre-determine number of tickets per product to be sold, based on its price range, and then generate a multiple tickets sales scheme (as in the above example). System 100 will then inflate the product price (and accordingly the ticket price) based on the worst case scenario as described above, and then make available to the ticket buyers the ticket packages,

[0070] As an example, the following ticket generation scheme could be used for differently-priced items:

- items $1 to $100, 50 tickets to be generated

- items $101 to $500, 100 tickets to be generated

- items $501 to $1000, 200 tickets to be generated - items $1001 to $5000, 500 tickets to be generated

- items $5001 to $10000, 1000 tickets to be generated

- items $10001 to $50000, 2000 tickets to be generated

- items $50001 to $100000, 5000 tickets to be generated

- items $100001 to $500000, 10000 tickets to be generated

- items $500001 to $1000000, 20000 tickets to be generated.

[0071] As in most of the previous scenarios, based on the nature of the product and historical data, system 100 may employ custom time frames and product ranges to determine the optimal price distributions. By having system 100 calculate ticket prices in such a way, the duration and quality of a sale is greatly improved, thus providing sellers with yet another useful mechanism.

[0072] Buyer 112 is then queried about purchasing a ticket to become eligible for the chance to win the ware, block 244. A no response allows buyer 112 to continue shopping on the site. A yes response leads to a query about buyer 112 membership status in system 100. If buyer 112 is not a member then the prospective buyer fills out a buyer profile 148 (FIG. 1) that include the membership/liability disclaimer agreement of block 208. All members then login at block 212 for further access to system 100. However, the amount of access can be limited just like a regular auction and seller 116 can decide to label the sale of their ware as a private auction thereby limiting the displayed information to buyer 112. Accordingly, private raffles would not be accessible by the public, and a security access gateway will enable a member of such private raffles to purchase ticket(s) and view the raffled item(s). A yes response adds the ticket to buyer 112 profile, block 248, and initiates financial agent transaction 252. [0073] Financial agent transaction 252 is typically a credit card transaction although other financial agent services would work as well such as verified check services, payment services, merchant accounts, debit services and equivalents thereof. First the financial agent is queried, block 256, to find out if buyer 112 has sufficient funds to cover the transaction. If no, the purchase is cancelled in block 260. If there are sufficient funds, then a lock is placed for the purchase amount in block 264 on buyer 112 financial agent's account. After the lock is placed on buyer 112 financial agent's account, an itemized purchase report, block 268, including details of the ware(s), the number of tickets, drawing dates, raffle rules and the like is generated for buyer 112.

[0074] A raffle begins, block 200, when a seller 116 registers with system 100 and offers a ware to be sold. As soon as the auction is started, a number of "tickets" are available for interested buyers, block 240 (FIG. 3). The number of tickets available can be specified by the seller, block 198 (FIG. 2), as well as the probabilities for each ticket block 192 (FIG. 2). Consequently, buyer 112 may always purchase as many tickets as they desire as long as tickets are still available and thus probabilistically control their winning chances. Also, over the course of a raffle, buyers 112 may review the raffle's status to view the number of tickets still remaining to be purchased thereby allowing buyer 112 the opportunity to further increase their odds of winning by buying more tickets if buyer 112 so desires.

[0075] Referring now to FIG. 4, when a raffle begins, block 200, the raffle is regulated by a set of rules defined in raffle logic 132 (FIG. 1) that is composed of user defined parameters, e.g. price, block 176 (FIG. 2), ticket probabilities, block 192 (FIG. 2), drawing date selection, block 199 (FIG. 2) and the like, and system 100 rules, e.g. the random chance algorithms used for selecting a winner. Raffle logic 132 has a calendar routine onto which raffle dates are indexed from seller 116 entries in block 199 (FIG. 2) to see if a drawing date has occurred, block 268. If no drawing date has occurred, raffle logic 132 queries seller 116 if they are satisfied with the number of tickets that have been purchased and if they want to close the auction early, block 272. System 100 will also allow a seller to cancel the auction according to the rules if predefined criteria are not met.

[0076] If a drawing date occurs or seller 116 decides to close the auction early, then the raffle is closed in block 276 and raffle logic 132 executes a random chance algorithm to randomly select a winner for the raffle, block 280. Raffle logic 132 then charges all buyers' 112 financial agent accounts, block 268, for the price of the purchased tickets, records this in each respective buyer profile 148 and administrative profiles 156 and removes the lock on buyer 112's account. Raffle logic 132 then notifies all buyers 112 of the raffle winner in blocks 292 and 296.

[0077] Although the invention has been described with reference to a particular arrangement of parts, features and the like, these are not intended to exhaust all possible arrangements or features, and indeed many other modifications and variations will be ascertainable to those of skill in the art.

Claims

What is claimed is:
1. A method for selling wares via a network connection, the method comprising the steps of: providing a server that is connected to the network connection, the server running a web interface that is accessible by a user interface; collecting on the web interface identifying information from at least one buyer to create at least one buyer profile; gathering on the web interface identifying information from at least one seller containing seller preferences, information about the seller's ware and seller administrative information to create a seller profile, the seller profile being divided into a public portion and a private file; displaying the public portion of seller profile to buyers on the web interface; providing a selection module on the web interface for the buyer to choose, by using the user interface, an offered seller's ware in; presenting rules to the buyer about an exchange for the selected ware; verifying to see if a buyer has sufficient funds in a financial agent account of buyer to cover the exchange; placing a lock on the sufficient funds amount necessary to cover the exchange on the financial agent account of the buyer; furnishing a ticket as a receipt for the exchange; ensuring that all the rules of the exchange have been met; using a random chance algorithm to choose a winner from among all the ticket buyers of the ware according to the rules; charging each buyer financial agent account that participated in the exchange for the tickets purchased and then removing the lock on the financial agent accounts of the buyers; and sending notice to all buyer profiles that purchased tickets for the ware of the winner of the ware and crediting the seller of the ware private file with proceeds of the exchange according to the rules.
2. The method of claim 1 further comprising the step of adding the ticket to a shopping cart.
3. The method of claim 1 further comprising the step of calculating the probabilities and variable scenarios of winning for the seller and buyer.
4. The method of claim 1 further comprising the step of querying the seller to see if they will exercise one of the rules that allows the winner to be chosen early.
5. The method of claim 1 further comprising the step of supplying a search module that can search the seller profiles public portions.
6. The method of claim 1 further comprising the step of helping the seller price the ware by providing access to a pricing algorithm.
7. The method of claim 6 wherein the pricing algorithm utilizes historical pricing data and present pricing data.
8. The method of claim 1 further comprising the step of querying seller to identify what percentage of exchange proceeds goes to charity.
9. The method of claim 1 further comprising the step of setting up a separate web interface for seller.
10. The method of claim 1 further comprising the step of limiting the opportunity to participate in the sale of the ware to selected group of buyers.
11. A system for selling wares via a network connection, the system comprising: a server interconnected to the network connection; a buyer profile database accessible by the server, the buyer profile database having stored thereon at least one buyer profile for use as a gateway to control entry to the system and to store buyer information; a seller profile database accessible by the server, the seller profile database having stored thereon at least one seller profile for storing seller information into a public portion and a private file, the seller information containing seller preferences, information about the seller's ware and seller administrative information; a web interface in communication with the server, the web interface accessible by a buyer and the web interface displaying the public portion of seller profile including information about seller's ware; a selection module coupled to the server, the selection module allows buyer to chose a ware listed on the public portion of seller profile through use of a user interface and the selection module presents the rules of exchange for the ware; a financial agent module in communication with the server, the financial agent module checks a buyer's financial agent account for sufficient funds when a buyer selects a ware and then locks a sufficient fund amount in the buyer's financial agent account to cover the selected ware; a receipt module accessible by the server, the receipt module records into the buyer profile which buyer purchased a ticket and then issues a ticket to buyer via web interface; and raffle logic coupled to the server, the raffle logic runs a raffle, the raffle logic includes a routine that utilizes a random chance algorithm that determines a winner of the ware in the raffle, charges all buyer financial agent accounts that purchased tickets for the raffle, notifies all buyers that purchased tickets for the raffle of the winner of the ware and credits seller's private file with proceeds from the sale of the ware in the raffle according to the rules.
12. The system of claim 11 further comprising a search module coupled to the server, the search module searches the seller profile public portion according to user defined criteria.
13. The system of claim 11 further comprising a probability calculator coupled to the server, the probability calculator used for calculating winning chance probabilities for both the seller and the buyer.
14. The system of claim 11 further comprising a pricing module coupled to the server, the pricing module accessible by the seller to assist seller in determining a pricing structure for their ware.
15. The system of claim 11 further comprising an indexing module in communication with the server, the indexing module used to index sellers profile public portion for distribution on the web interface.
16. The system of claim 11 wherein the rules module has different rules for different seller profiles.
17. The system of claim 11 wherein the raffle is run simultaneously with other raffles on the same web interface.
18. The system of claim 11 further comprising an administrative module coupled to the server, the administrative module automatically figures and adds the administrative fee to the price of the ware for sale.
PCT/US2003/024744 2003-05-29 2003-08-08 Raffle-based collaborative product selling and buying system WO2004107237A1 (en)

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WO2015114527A1 (en) * 2014-01-29 2015-08-06 Belmonte Roberto System and method of lottery and electronic type for purchasing a plurality of goods

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