One of the most confusing things new members here on Steemit confront is the use of Bots. We are trained by our experiences on other social media platforms to have only one account, not to spam and to learn the rules in order to be a good citizen.
That's not to say that Steemit is different in that regard but there are some peculiar things that are within the rules and continually debated among members. The fact that many members have more than one account seems odd at first but makes sense the longer you are a member. It can be hard to find your voice as a new member and we tend to blog about several categories. In order to keep things consistent, it might be a good idea to have one account for your photo blogs, one for your crypto blogs and one that is just entirely about a hobby.
Some will say that multiple accounts is simply a way to game the system and funnel money and votes to yourself. If that is your opinion, fine. You may be right but it is within the rules and we are not really here to debate the rules in this post, just explain them.
Bidbots are probably the most confusing thing for new members so it is important to understand what they are so you can explain them to your contacts that you are promoting Steem and the Steemit community to.
A bot is just program that handles tasks faster than a human can. Nothing controversial there but many of the bots here on Steemit are designed to monitor accounts and vote based on money sent to them for the service.
Hey, that's cheating! But is it?
There is a lot of debate about whether sending Steem or Steem Dollars to bots in order to get votes for your blog posts is cheating. Again, here we are not going to debate right or wrong. For now, bots are within the rules so we will talk about them. The main reason we are touching on them is that if you spend time on Steemit you will encounter them.
The bots provide a legitimate service but you need to understand them before you start crying foul. Most people just use them to make money on their posts but that is really difficult to do unless you really know whats going on.
When you first get going on Steemit you run into a lot of guides from helpful members trying explain what minnows should do in order get acquainted with Steemit and avoid minnow frustrations. Nearly all of them mention the use of bidbots but few explain how to use them and that is the hardest part.
I tried a few in the beginning and lost money every time. I really wasn't aware of it and I didn't even care but you'd think if everyone was using them then everyone would be profiting from them.
Steembots are there for 3 reasons.
- To Help You Trend
- Grow Your Following
- Grow Your Income
One thing I'd like to make clear upfront is a concept that I couldn't wrap my head around until I studied these bots. They are called the wrong thing! We refer to them as bidbots and that would imply a clear winner of some type of auction. But that doesn't happen. And, that is where the confusion sets in.
The supposition is that you have made a blog post and will send some amount of Steem or SBD to the bot and receive a vote worth more than you sent right? Wrong. When we hear bid bot we think that if you bid higher than the next guy, you will win the voting power or at least a higher portion of that. In theory that is true but it doesn't work like that. The problem is that users don't know the rules .
Let's return to why the bots exist. If you are really promoting good content it shouldn't matter if a vote costs you money. Think of it as a marketing expense. When we promote content on Facebook or Google we understand that we are spending money to promote but we don't expect a monetary return on that investment from Facebook and Google. We expect that more eyeballs will see our content and grow our following.
It is the same on Steemit. If you are a minnow and have only a few followers, who will see your content? Probably nobody so it is important to get that content to trend. And that is what a bot can help you do.
If you spend some Steem or SBD to promote your post you will receive votes back from the bots and start to trend. When members see you trending they will take notice. If your content is good, they will vote you up. If it is really good and members see possible curation rewards coming their way consistently, they will follow you. More followers mean more income and you are on your way.
So in that regard priming your own pump using bots seems to work but I suspect most people expect more from using a bot. In an ecosystem like we have here people want an edge and they think if they send money to a bot they will profit from the transaction immediately. This is where most of the confusion sets in so we are going to take a look at these bots.
Bidbots or Gambling?
Let's look at things from the standpoint of a new Steemit member who is looking to cash in. Let's face it. These people do exist and every single one of us would prefer to make money on our posts. There is nothing wrong with this and it is currently within the rules.
The biggest obstacle to this approach is other Steemians. And it isn't malicious for the most part, it is ignorance. There is a big movement of members who deplore using bots to game the system and I'm fine with that because it could potentially harm the ecosystem by discouraging the creation of good content. Lucky for them, most people using bots don't profit like they want to.
I said that the biggest problem is other member's ignorance and here is what I mean. They simply don't know how bots work and that is not their fault. I said I had a big problem with the term bidbot because it implies that it is something totally different from what it is. We need to stop thinking of them as bid and win type deals and understand for what they are. They are limited gain bots and once people understand that they can profit.
It is easiest to explain this by opening Steem Bot Tracker in a new tab. This is a great tool that allows you to compare several bots currently available for Steemit. We will go through it so you can understand the concepts but I would like to point out that not all of these bots are completely safe to use.
There is a new a policing initiative here on Steemit that wants to change how we use bots and make them more beneficial to the entire community. Agree or Disagree it is here so lets talk about it. Basically there is a feeling that many users try to game the system buy using bots to upvote their posts in the final hours of earning simply for profit. This doesn't benefit the community and they want it stopped.
The solution is a bot that goes around and flags posts that sent money to bots that allow users to upvote their content this way. The flagging reduces potential earning but in the comments the bot tells you how to do it properly. They only want you to use services that allow a maximum age of a post to be 3.5 days old. That's fine with me but it will take time for the bot services to adjust.
In the meantime only use bots that declare this. As of this post these are the only ones that specify 3.5 days so they should be safe to use:
I'm sure that in the near future more of these bid bots will lower their post age and come into compliance so keep your eyes peeled.
So now lets take a look at Steem Bot Tracker itself.
First thing you may have noticed when you opened the site was a disclaimer pop up. They are trying to tell you that earnings are not guaranteed and they want you to understand how these bots work. They are right.
Next, scroll all the way down the page taking notice of each section and all the informational links provided. They are very important. Don't skip over them. Learn how things work.
Lets start in section 2: Bid Based Voting Bots
Click on How Bid Voting Bots Work and read it. Then read it again lol. It's important. It sounds easy but it's not because they leave out one important detail and that is over funding.
This is my main issue with bid bots. They shouldn't collect more money than they can give out per vote but they do. We will learn more about this when we tour an actual bot.
Next click on Vote Calculator. This is a great feature but it will lull you into complicity because it is an estimate. When you choose the bot you would like to calculate, it will tell you how much you can expect in return based on your spend. It will even show you the estimate after the curation. If your results are green you should make the spend. If they are red you are estimated to lose money.
Sounds easy right? Wrong!!!! These estimates to not consider overbidding and you can lose. Remember that pop up disclaimer when you loaded the site? It makes reference to estimates there so you know.
The next important section is in Red and it shows the current price of Steem and Steem dollars. This is great to have handy. Most bots now accept both Steem and SBD so make sure you are clear on what you are spending and your expected return.
Finally lets take a look at the bid bots and the information Steem Bot Tracker provides about each one.
Here's the Info and what it means.
Bot Name: The name of the bot and a link to its page. But you don't need to visit it.
Vote Value: This is important. It tells you the total amount of the vote you are bidding on.
Minimum Bid: The minimum amount you can send to participate
Max Post Age: Important! Don't use bots that allow more than 3.5 days
Total Bids : Current bid total but it NEVER matches.
Max Profitable Bid: The most you can bid and expect a profit.
Last Vote: When the last vote took place
Next Vote: When the next vote will occur. Imortant!
Details: Details of the transaction: CRUCIAL
Send Bid: Click to send bid from within Steem Bot Tracker
Now let's get into the good stuff!
I've opened a "details" tab on a random bot as an example. Then I clicked on "last round" to show what happened to the last set of voters on this bot. You will see arrows pointed to the total vote value, total bid value and ROI.
First, the total vote value of $137.51 is the total vote value to be distributed to those who have bid on this transaction. The total bid value of $356.43 is the total amount bid to get a total return of $137.51. Are you starting to see the problem? The total ROI on that round for the bidders is -25.54%. A loss on their spend.
Why does this happen? It happens because people get confused by the bidding process. During the countdown there very well be a profit but as more people bid the ROI for each is reduced. Once people bid more than is available in the Total Vote Value, it goes negative. The solution is that people need to stop bidding before there is nothing left so everyone who has already bid will get a profit. But, either people don't realize that this is happening or they just don't care.
Take a look at the red lines I put next to the bid value and the vote value. These numbers decrease as more people bid but you can easily tell that in this case you are bidding more then you are receiving.
What usually happens is that people watch the clock on Steem Bot Tracker and bid right before the countdown ends. If there is profit left then it's fine but most of the time they bid believing that the estimate that they did with the calculator that showed them profit is still valid. So they pretty don't know how to bid properly on these bots and don't even realize they are screwing it up for everyone else.
Early voters take the most risk so the majority of votes steam in towards the end. Ideally you would find a bid bot that a lot of profit left towards the end and jump in. This is the only way to profit as I see it and it involves posting your blog post and then watching the bots in real time. It'a a lot of work but you can profit this way.
So now you know a little more about the bid bots and you can decide to play that game or not. The important thing here as we continue to promote Steemit to new people is to help them understand how things work and let them make their own decisions. The more help we give to our networks as we bring them on board, the better the Steemit ecosystem will be in the long run.