Abstract: A method and system for conducting an auction. The auction system provides a mechanism that allows the winning bidder to receive a discount from the winning bid amount when a certain discount criteria is met. The discount criteria is met when the winning bidder was the first bidder to place the bid at the auction. That is, the bidder who places the first bid will receive a discount (e.g., 10%) if that bidder is ultimately successful in winning the auction. The mechanism, tracks whether each auction is subject to a “first bidder discount” and whether the winning bidder was the first bidder. The offering of a first bidder discount and the amount of any discount may be at the discretion of the seller of the item.