Not sure about these auctions but many others have an auto bid feature. It is not required but you can give the max you want to pay and the increased bid increment and it will automatically big again if a large bid comes in. For example, if someone bids higher than you you can automatically bid x miles (say 2,000) over their bid. If you go into history you will see that person always out bid you by the same # of miles and it happened seconds after your bid. It is a mice way for the airline to increase the # of miles, but is also convenient for the bidder.

So yes, the computer outbid you but it was based on the directions of someone who really wants the package.