Pre-orders allows to bid on items while being absent, or, self-explanatory, "orders pre-emptively while the item is not yet on the market", example: pre-ordering 1 ash of invisibility at X amount while ash of invisibility is not yet on the market. It is not possible to pre-order on an item that is already on the market, as it would not be a "pre" order, and it'd strongly abuse the market while bidding for no turn cost (depending of the server).
Pre-orders don't work the same way on Arch & Archwar than on other servers. For A&AW, it costs 1 turn to set a pre-order, and with a maximum of 1 pre-order with a cap of 5 items (e.g.: 5 ash of invisibility) while on the others there is an unlimited amount of pre-orders possible, for free, which makes it able to buy things on the BM without spending a turn (which on the other hand boosts inflation on servers such as guild/blitz greatly).
A question was what would happen if two (or more) persons have set a same pre-order (same item, same price); at first it was thought it would randomly pick inbetween pre-orderers, but it isn't, actually the first one to have set the pre-order gets it. Meaning, if you see an item getting pre-ordered at 20m, don't set the pre-order at 20m too else there is strong chances that you will never get it if the person has set for "999" items, you would have to set it a bit higher.
Discovery made through experiments with a ~99.98% confidence interval by Magewarfelix, Zalithian and Laanders