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Ok, so I guess this is my write up about the economy. I'll try not to leave much out but I'm not really going to spend hours typing this either, so...
First off, some very common misconceptions about the economy.
1) Supply and demand
There is none, so get that notion out of your head immediately. In the real world supply and demand is a very simple concept that drives economies; if demand is high but supply is low, prices go up. If demand is low but supply is high, prices go down. This doesn't really exist in WoW at all and in some cases things play out the exact opposite way. Will go over this more below.
2) The value of items is decided by the players
Most people seem to think that players set the value of items because, unlike the real world, items don't have a set price. Quite the opposite tends to be true; all items have a pretty set-in-stone value to them. The confusion stems because 99% of players have no idea what's actually going on in the economy, while the other 1% pretty much control everything. This leads to stable prices on goods that the 1% have, but highly fluctuating prices on goods they don't. A good example of this would be rare patterns, which can fluctuate between 1g and 100,000g or more depending on who is selling. More on this later as well.
3) I can affect the economy
No, you really can't. I know, I know... you think that you've changed something by posting items cheaper than usual, but you really haven't. Unlike the real world monopolies are allowed in the World of Warcraft and in fact the economy of any given server is controlled by a dozen players at most. Everyone else is just along for the ride without even knowing it.
I think those are the three big ones so with that out of the way I'd like to present some statistics from 2013.
Only 4% of all players have hit the gold cap (~1 million)
Only 28% of all players have hit 100,000 gold
19% of all players have never broken 10,000 gold
The mean amount of gold per player is 472,979g (this goes to show exactly how much gold that 4% has compared to everyone else)
People who frequent gold-making forums have 138% more gold than the mean
People who pay for gold-making guides have 43% less gold than the mean
48% of all players do not use any kind of forums at all (including but not limited to the Battle.Net forums and MMO-C forums) and have 32% less gold than the mean
Serejai's tip: Don't buy a damn gold guide
Nearly 40% of all players use addons for the auction house
Players who use basic addons have 30% more gold than the mean
Players who use advanced addons have 183% more gold than the mean
Players who use the default Blizzard auction house have 76% less gold than the mean
Serejai's tip: Download an addon
65% of players don't farm for their gold
34% of players don't use the auction house for their gold
Hardcore raiders have 17% more gold than the mean
Casual raiders have 23% less gold than the mean (keep this statistic in mind; it's very important later one)
Players who do not raid at all have 32% more gold than the mean
Serejai's tip: More skill and game knowledge = more gold. Get skill
6% of players admit to botting
4% of players admit to duping
8% of players admit to buying gold
6% of players admit to selling gold
6% of players admit to using exploits
Serejai's tip: The real numbers for botting and gold buying are much, much higher. Don't be shy on surveys
Source
Now let's get to the meat of this post; the economy itself.
We start with supply and demand. As I mentioned earlier, there is none. I will use glyphs as an example because I had previously done so in a post.
Back in the day glyphs were consumables and thus the demand for them was fairly high. It wasn't at all uncommon to make 100k per week just selling glyphs. These days you're lucky to make a fraction of that in a month, so what happened? Well, this is where the supply and demand comes in (or lack thereof). Back in the day you could sell glyphs for 50g. The demand was there and the supply was there. Casual players (for the sake of this post "casual" will be a broad generalization of people that don't kill the final boss of a raid tier while it is current on normal mode - in this case roughly 98-99% of all players fall into this category) complained about having to constantly buy new glyphs (god knows why; they didn't need them for the content they were doing anyway) and so Blizzard eventually switched over to the current system where you learn a glyph once and it's yours forever.
Serejai's rant: Other things that have suffered the same fate due to the same complaining from casual players: gems, enchants, blacksmithing, all other professions to a lesser degree, cooking, fishing, first aid, spell ranks... etc.
So, after the glyph changes the logical assumption would be that prices would go up on glyphs to compensate for the tenfold decrease in demand. The reason why this doesn't work is because even though demand dropped to nothing, supply was actually increased due to brilliant design decisions by Blizzard (making glyph patterns freely available to everyone, doubling the spawn rate of herbs). Note that these changes were also due to massive complains by casual players on the forums. The result is that demand is 10% what it used to be, while supply is now 200%. The end result is that glyphs still sell for that same 50g (or even less in most cases) even though you're now only selling 1 a week instead of ten a day.
This applies to pretty much every item and every profession. I guess you can say there IS some semblance of supply and demand, but it doesn't work anything like the real world does. The equivalent would be that video games currently sell for $50 and sell 10 million copies, but suddenly a bunch of people that don't even play video games complain that the price on them is too high and that if they were to buy one single video game they should never have to buy another one. Prices would end up staying the same or going lower, but instead of selling 10 million copies per game the company would sell 1 million copies ever. Yeah, you can see how that company would be out of business immediately. It's really no different in WoW, and that's why people who were making 100k a week with glyphs back in the day are now lucky to make 1-2k a week without using an auction house bot or sitting at their computer 16 hours a day starting at the auction house UI.
Let us move on to the second misconception; item value. If you were to ask in Trade Chat what the value of an item is you will get dozens of different answers; likely all wrong, too. If not a numerical value, you will get an answer like "it's worth whatever someone will pay for it". That, too, is completely false. Nearly every item you see on the auction house has a well-defined value based on factors such as the cost to produce it, the volume of sales, historical data, and so on. Now, you might be thinking "but Serejai what you said about glyphs seems to contradict what you're saying now!" and you would be correct. There are some items that do not have a defined value. Well, that's not true, either. They still have a value... it's just that it is largely ignored by both buyer and seller. In the case of glyphs, every glyph costs the exact same to make. One glyph is no harder to acquire than another, either. So why do some sell for below crafting cost while others sell for a 1,000% markup? There really is no particular reason other than "if I gouge the price of an item and someone is stupid enough to buy it, why not?". Most of the markets that are now a shell of their former glory due to the complaints of casual players operate this way. What is the value of a certain gem? I can give you an exact number - but that doesn't mean I'm going to sell if for that. More often than not I'm going to sell it for far less or far more.
Let's look further into a gem. Gems have a very well defined cost; probably one of the most solid values out there. So why are their prices all over the place? Well, all gems cost the exact same to make. Let's say the cost to produce a rare gem is 20 gold (a very reasonable number for most servers). Why do some sell for 5g and others for 150g? You might think it's that pesky supply and demand, but you'd be wrong. In fact the value of gems is pretty much dictated by Blizzard and the changes they make (guess who is responsible for most of them!). Back in TBC gems were very profitable across the board. Nearly every single gem was in demand and every single gem had a nice profit margin. These days only about 10% of gems are even worth cutting in the first place and out of those less than half even provide decent GPH (gold per hour). So how did gems go from upwards of 20,000 GPH back in TBC to as low as 1-2,000 GPH today, even though the amount of gold in circulation is much, much higher? For that matter, why are gems today worth less than gems 3-4 years ago? Why are enchants worth less?
Once again we have to lay blame to the casual players who complained that the prices of gems that they didn't even need were too high. Remember epic gems? They were removed because the casual players felt entitled to having them, even though they weren't running any content that required them. Don't believe me? The same thing happens across the board. Remember when Legendaries were actually... legendary? And required some effort to get? These days all you have to do is look under your chair at an Oprah taping.
So, I'm getting slightly off topic here but all items do have a well defined value, and there are multiple websites, addons, and other sources of historical data that can tell you, down to the nearest gold (or even silver), exactly what an item is worth. The majority of players don't understand what opportunity cost is and end up selling items for less than they're actually worth. Sure, they're not physically losing gold by doing this... but they are losing it. I don't really care if you farmed the herbs yourself - you're still an idiot for selling the flasks at half their value when you could have just sold the raw herbs for more than that. Just because you choose to be stupid does not mean the value of a flask is now half, and that's the major problem with putting a value on things.
Even though items do have a value most players don't understand it at all due to either being unintelligent or simply not being aware of resources available to them. We know what an item is worth in real life because we can walk into Warlmart and see it for $20... then see it at Target for $20... etc. It would be nearly impossible for the price of that item to suddenly jump up to $40 without us catching on or the government stepping in. In WoW, it's trivial to manipulate a market. We simply buy out all of that 20g item and relist it for 40g. Sellers who don't know better will post theirs at 39g, sellers who do know better will gladly take the extra income and post theirs at 39g as well, and sellers who are complete morons will post theirs at 20g. Wait, what? Yeah, you can blame those people who the misconception that items have no value or that the value changes so rapidly that it cannot possibly be defined accurately. Thankfully a smart seller will generally just buy theirs, putting the price back at 39g... but over time the damage adds up. If one single player sees that 20g every time it's posted, it will slowly start to add up and devalue the item.
We see this most commonly with big ticket items like mounts and Darkmoon trinkets. Items that you can easily sell for 100k at the start of an expansion find themselves under 10k by the end. That must be supply and demand, right? No, because it doesn't exist! You sell one a week, every week, throughout the entire expansion. Demand doesn't change one bit, so why does the price? Because that one stupid seller posted theirs at 90k and it sold. A dozen players saw the auction and now it's worth 90k to them. Another stupid seller posts for 85k... another dozen players see it and now the item is worth 85k to them. Over time the amount of players that see these lower prices starts to add up and eventually the amount of players that still value the item at 100k shrinks to the point where you're not longer selling one a week for 100k... so now you have to target the 90k group. Then the 80k, and so on. Has the cost to produce the item changed? No. Has the demand changed? No. But the price tanks anyway due to the illusion that something has changed.
Which brings us to number three; I can affect the economy! I said you couldn't, but I lied. You can affect the economy, in very limited areas, if you choose to be an idiot. There's a reason why most auctioneers focus heavily on big ticket items at the start of an expansion and then transition into other things later on. It's because some items can be completely ruined by one person while others can only be ruined by the outcry of many... on the official forums... where Blizzard changes things. Damnit. Some items such as tradeskill recipes are a great example of this. I have bought rare, no-longer-attainable patterns for as low as 5g and resold them within a month for over 100,000g. No matter who you are and no matter what you do you're never going to devalue these. Likewise, common commodities such as gems, flasks, enchants, etc cannot be affected by the average player one bit. Prices drop on these for two reasons; poor decision making by Blizzard and rich players fighting each other for market share. If you don't have at least 500,000g you're just a fly on the wall to most markets. On the other hand, one single player can easily ruin things like pets, mounts, or BOE gear - especially the BOE gear. People with no concept of opportunity cost that will craft an item for you that cost them 30 days to make but they assign no value to those 30 days... *shudder*. That's why I no longer touch crafted gear. It's way too easy for a small handful of players to completely crash the perceived value of an item, and often the value can even be pushed under the value of the raw materials due to botting, duping, and general stupidity. See: Jeweled Onyx Panther - a mount that costs 80,000g in vendor mats alone, plus a handfull of other expensive mats, yet sells for 40,000g these days.
The short and sweet of this is that if you think you or anyone else other than the 2-3 players that control 99% of any given server's auction house is going to influence the majority of items, you're completely wrong. I have dropped millions of gold into a segment of the economy before in order to bend it whatever way I wanted. I have doubled the value of items, and on the opposite end of the spectrum I have been a dick and crashed the glyph market for 3-4 months straight just from boredom (oh, the entertainment value when you force the price of every glyph in the game to 1g and get dozens of hate mails and trade chat harassment from people trying to sell glyphs for a profit!). It's just not something you can do without hundreds of thousands of gold being put into it.
Now, remember that statistic about casual raiders having less gold than raiders and people who don't raid at all? I'm going to rub some people the wrong way with this but there's a reason why this is the case; good raiders put in effort. They watch boss videos, they read strategies, they show up on time, they use potions, they use flasks, they use feasts. They parse themselves to improve and they listen to others when someone else points out mistakes they make. They leave their ego at the door and focus on self-improvement for the benefit of their entire raid. People who don't raid at all also tend to put in effort; they explore, they do achievements, they pet battle, they pvp - and they do it all to the best of their ability, regardless of how low it may be. Once again, they put in effort. The reason why "casual raiders" have so much less gold than everyone else is because of the very fact they are "casual raiders". These are the people that half-ass everything and is by far the worst portion of the playerbase to play with. They're too good to use potions during raids. They're too good to buy real flasks so they use their budget alchemy or Timeless Isle one instead. They bring their ego with them everywhere and constantly brag about how good they think their DPS is but they put in no effort to parse or review anything and thus don't even realize they're not doing nearly as well as they could be. Remember earlier when I defined a casual player? The casual raider is the subgroup in there that is most toxic and causes most of the problems. They think they know what they're doing but they really have no clue. Gold making is no exception here. They half ass raiding to save money, then convince themselves they're good at the economy.
I say this to everyone, whether you want to learn how to make more gold or not; put in some damn effort. I was ranked in the top 0.1% of all Druids in the world earlier this expansion when I raided and never once did I stop and say "hey, I think I'm good enough. time to get lazy!". Nor did I stop when I first hit gold cap and say "hey, got a million gold... time to stop following the economy!". The single biggest mistake people make in this game, be it raiding, economy, or pvp, is that they hit a point where they think they're as good as they can be but in reality they're hovering around 70-80% and are too stubborn to realize it.
Don't be one of those people in Trade Chat that goes "damn, i though i had a lot of gold with 30k!". Don't be one of those raiders that half-asses it to save a few hundred gold per week. Don't try to get Gladiator wearing PvP gear simply because you're too lazy to spend a few weeks farming proper gear first. I guarantee every single person in this thread could double their gold income with a single day of research, get an extra 10%+ DPS with an hour or two of parsing, etc.
Most people are shocked to learn that only 1% of 12 million players actually raid (or whatever the current sub number is). Most people are shocked to learn that 100,000g is pocket change. Most people are shocked to learn that their amazing DPS doesn't even make the rankings. Shocked to learn how common botting and duping is.
Everything in this game has two sides; the public side and the behind the scenes. If you only know the public side then you don't actually know anything at all.
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There, I posted a rant with the intention of spawning questions. While there is a fair amount of information in there I intentionally left out most things and instead chose to basically tell anyone reading it that they don't have a clue what they're talking about and thus cause them to get mad at me and lash out with questions and examples of why they are wrong about something.
I suck at simply providing information and am much better at doing so when I am directly questioned about something so...
Deal with it.
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If i wasn't such a cheap dirty bastard i'd TL+ you.
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Wow. That post was incredible. Very insightful and interesting, as a side of WoW I've never really cared for. Also, if I still played enough, it'd probably be depressing as well lol.
Can't wait to watch discussion
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Interesting huge post, a lot of great information in there, but I disagree on a few things. First of all, supply and demand definitely exist and your post pretty much stated that it does not without backing that up. It does not work like the real world, but it's definitely there. On my server, there is pretty much zero supply of glyphs. I still need them, and so do everyone who creates alts, so there is demand. That's why glyphs on my server go for at least 300g (which should obviously raise supply, but it does not because no one is bothering I suppose). It depends on the server and item in question. Your example with glyphs is weird anyway since you said: "So, after the glyph changes the logical assumption would be that prices would go up on glyphs to compensate for the tenfold decrease in demand." It's the direct opposite, the logical assumption when demand disappears is that prices will fall massively. Since the glyph changes lowered demand, prices tanked. Which is exactly what happened. No demand = low price, unless there's a complete lack of supply to compensate. Which there isn't, on most servers (but on mine, there is).
(However, if your point was that changes Blizzard makes trumps/dictates supply and demand, you're completely correct)
I also think you've misinterpreted the raiding statistics. Yes, casual raiders have less gold than hardcore raiders. I don't think that's because casual raiders are half-assed idiots like you make it seem. It's because hardcore raiders spend WAY more time in game, have WAY better gear and wipe WAY less. I used to casual raid, and the amount of money you spent on flasks, food and repairs were insane, and you had no time left to actually make money since you spend your time in game trying to take down bosses, and failing. Not because of individual lack of skill or effort, but because the guild is casual and doesn't spend enough time and doesn't have enough coordination to get past them.
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Nice post
In other news, I'll start playing again later this week. I've ran into stop real life things which is why I haven't been online at all and playing different games. Pandemona can you give me an update on what classes you need the most?
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Pandemona
Charlie Sheens House51449 Posts
We see this most commonly with big ticket items like mounts and Darkmoon trinkets. Items that you can easily sell for 100k at the start of an expansion find themselves under 10k by the end. That must be supply and demand, right? No, because it doesn't exist! You sell one a week, every week, throughout the entire expansion. Demand doesn't change one bit, so why does the price? Because that one stupid seller posted theirs at 90k and it sold. A dozen players saw the auction and now it's worth 90k to them. Another stupid seller posts for 85k... another dozen players see it and now the item is worth 85k to them. Over time the amount of players that see these lower prices starts to add up and eventually the amount of players that still value the item at 100k shrinks to the point where you're not longer selling one a week for 100k... so now you have to target the 90k group. Then the 80k, and so on. Has the cost to produce the item changed? No. Has the demand changed? No. But the price tanks anyway due to the illusion that something has changed.
No Darkmoon faire trinkets decay due to their not as good anymore. That decay isn't down to anything other than they are not worth it anymore. You might spend 100k on it at the begining of an expansion due to its replacing a blue or a green to raid with, but by the time ToES came out they were lower than LFR ilvl but still good. By time ToT came out they just were not that good, now SoO is out they are exstinct. You can buy these trinkets for between 3-6k now. 3k be during a Darkmoon Faire and 6k out of the Darkmoon faire season.
Rest of what you right is semi agreeable, would like to see some sources for stats though ^_^
Average gold per player has to be way more than what you wrote it as. I have 180k and that is nothing. What you addressed about the 200% increased spawn rate of herbs and ore which happened in Panda land makes it easy for anyone to fill up their bags once a week with ore and then sell for an easy 4-5k.
On January 08 2014 17:48 buMf00d wrote:
Nice post
In other news, I'll start playing again later this week. I've ran into stop real life things which is why I haven't been online at all and playing different games. Pandemona can you give me an update on what classes you need the most?
DPS to be honest BuMf00d mate haha. But we haven't got any of these;
Hunter - Shadow Priest - Holy/Disc Priest - Kitty Druid - Tank Druid - Boomkin - Tree - Monk DPS - Monk Tank - Rogue
Not at level 90 yet anyway, one of our Shamans in Mini is about to ding his rogue to 90 but whether he wants to raid his Enh shaman or Rogue i don't know. But remember play what YOU want to play i can fill the rest of the positions with my mates xD
If you honestly wanted an answer though a Boomkin/Hunter would be pretty sick xD
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Hunter it is 
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Pandemona
Charlie Sheens House51449 Posts
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With regard to Serejai's awesome post: I am cursed to never break the 100k mark. Whenever I get close, I either buy a mount, get scammed (hey, it's just 20k gold and I almost have 100k, I can lose that money...) or get into stupid raiding-related bets. I think I paid all the repair money for my guild in the past month by doing that.
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On January 08 2014 13:21 Serejai wrote:
There, I posted a rant with the intention of spawning questions. While there is a fair amount of information in there I intentionally left out most things and instead chose to basically tell anyone reading it that they don't have a clue what they're talking about and thus cause them to get mad at me and lash out with questions and examples of why they are wrong about something.
I suck at simply providing information and am much better at doing so when I am directly questioned about something so...
Deal with it.
No your post is fine. I used to be an AH camper back in vanilla (mostly) having 10 to 30% of the AH with my name on it. And what you said is true about when you reach the gold cap. If you don't keep up and doing research into the market you are bound to not know what you are doing anymore in 2weeks.
Right now i just try to see what sells and what sells not (i'm not a raider. Not a casual one. I don't raid because i don't like people). But as i don't have the time that i once had, it's really difficult to understand the economy of the new server that i join.
There is however i think some "respect" by the seller/buyer that know what they are doing. For exemple, Bronze bars. I saw a lot of 20stack at 2/5gold. But when i put mine at something like 45gold. It sells... And when i look at it, i see that mine are gone but the ones at 5gold are still there. it's not the first time that i see that. That's quite strange.
But really the economy of a really high populated server is hard to follow. Started with 300gold. was at 2,5K next week but know i just can't earn that much because i just don't have the money to bend the value of just 1 item.
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On January 08 2014 19:50 FFW_Rude wrote:
There is however i think some "respect" by the seller/buyer that know what they are doing. For exemple, Bronze bars. I saw a lot of 20stack at 2/5gold. But when i put mine at something like 45gold. It sells... And when i look at it, i see that mine are gone but the ones at 5gold are still there. it's not the first time that i see that. That's quite strange.
There's actually a legit and humorous reason for this. The default Blizzard UI has a lot of issues and one of them is that higher priced items can show up at the top of the list for various reasons. Sometimes you can manipulate this; for example, the default UI sorts auctions by bid amount instead of buyout. So, your buyout could be ten times higher but if your bid amount is 1 copper less your item will be listed as the cheapest when default UI players sort it.
Obviously you don't want to put 1 copper bids on everything because people will just win the auctions by bids, but when in a situation like you mentioned above you could simply undercut those 2-5g bars by a few copper and post yours at 45g and the AH would list yours as the cheapest available.
There's no "respect" going on here; just uninformed players using Blizzard's terrible UI
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On January 08 2014 18:19 Pandemona wrote:
No Darkmoon faire trinkets decay due to their not as good anymore. That decay isn't down to anything other than they are not worth it anymore. You might spend 100k on it at the begining of an expansion due to its replacing a blue or a green to raid with, but by the time ToES came out they were lower than LFR ilvl but still good. By time ToT came out they just were not that good, now SoO is out they are exstinct. You can buy these trinkets for between 3-6k now. 3k be during a Darkmoon Faire and 6k out of the Darkmoon faire season.
Rest of what you right is semi agreeable, would like to see some sources for stats though ^_^
Average gold per player has to be way more than what you wrote it as. I have 180k and that is nothing. What you addressed about the 200% increased spawn rate of herbs and ore which happened in Panda land makes it easy for anyone to fill up their bags once a week with ore and then sell for an easy 4-5k.
It actually doesn't have anything to do with their usefulness. As I mentioned the amount of trinkets you sell week one of an expansion and the amount you can sell week 52 of an expansion is pretty much the same in most cases. The only thing that changes is the price you're able to sell them at. Items like this always have a use, but that use shifts from "omg this is bis" to "omg this will help me abuse ilvl to get into lfr" to "omg my alt could use this". If it weren't for people tanking prices I guarantee you could still sell a Darkmoon trinket for 100k today. In fact, the second tier of an expansion tends to be quite lucrative for auctioneers that want to dabble in the Darkmoon market without having to lift a finger. By the time the second tier comes around the prices on trinkets has usually dropped to half, but if you simply buy them out and relist them back at full price they will sell just the same as always. I actually made around 600k this expansion on Darkmoon cards and I don't even have a scribe.
I've said it before... I have a strong feeling EU players are generally more intelligent and better informed than NA players so it wouldn't surprise me if EU economies are a tad different because of this, but in general the demand for Darkmoon trinkets doesn't really start to change at all until very late into an expansion yet the price drops within the first month on most servers.
As for sources, clicked the link that says "Sources" lol.
As to why people have such low amounts of gold when they can simply farm ore or something... I'll use one of my favorite ways to make gold - selling vendor items.
For about 15 minutes a day and a hundred gold you can literally buy vendor items and resell them on the AH for thousands of gold. This happens because people are uninformed and don't realize that the item they just purchased for 100g is actually sold on a vendor for 15s. Coincidentally, that's the same reason why everyone isn't taking advantage of this - lack of research.
It is entirely possible to start fresh on a new server and hit the gold cap in a single month without even having professions. The ONLY reasons why people don't have gold is because they're either lazy or they don't know better. This is exactly why it bothers me so much when people whine about raiding being too expensive, and I touched on this in a previous post. You can spend literally 30 minutes a week doing dailies and walk away with a thousand gold, and yet the majority of players don't seem to do this. It completely invalidates any complaints about the cost of raiding if you're not willing to put in such a small amount of effort to make some gold.
I'll be honest; I get lazy myself. Once you hit a million gold you generally start to take it slower. Hit two million, slower still. etc. It's laziness, but it's intelligent laziness. Instead of making 10k per day you switch to slower-selling, higher profit items and make 100k every ten days instead. In the end it's basically the same but you tend to look for ways to cut down on time instead of ways to increase profit. At a certain point if I have the option of making double the gold per hour, or making the same gold per hour but cutting my time in half... I'm going to go with the latter simply because I can afford to be lazy at that point.
Most players become lazy far too soon.
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Pandemona
Charlie Sheens House51449 Posts
The source link is to a 403 permission denied Q_Q learn to source, reason i said it i thought it was Source to the survey you were on about.
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Italy12246 Posts
Lol you mean if i put, say, enchanting vellums on the AH, people would ACTUALLY buy them? I just assumed most people would be smart enough not to do it xD
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Pandemona
Charlie Sheens House51449 Posts
I remember for the first few months of the Panda expansion you could sell the Dust you use to re glyph and the other stuff you use for re talenting on AH ^_^
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On January 08 2014 16:42 Tobberoth wrote:
Interesting huge post, a lot of great information in there, but I disagree on a few things. First of all, supply and demand definitely exist and your post pretty much stated that it does not without backing that up. It does not work like the real world, but it's definitely there. On my server, there is pretty much zero supply of glyphs. I still need them, and so do everyone who creates alts, so there is demand. That's why glyphs on my server go for at least 300g (which should obviously raise supply, but it does not because no one is bothering I suppose). It depends on the server and item in question. Your example with glyphs is weird anyway since you said: "So, after the glyph changes the logical assumption would be that prices would go up on glyphs to compensate for the tenfold decrease in demand." It's the direct opposite, the logical assumption when demand disappears is that prices will fall massively. Since the glyph changes lowered demand, prices tanked. Which is exactly what happened. No demand = low price, unless there's a complete lack of supply to compensate. Which there isn't, on most servers (but on mine, there is).
(However, if your point was that changes Blizzard makes trumps/dictates supply and demand, you're completely correct)
I also think you've misinterpreted the raiding statistics. Yes, casual raiders have less gold than hardcore raiders. I don't think that's because casual raiders are half-assed idiots like you make it seem. It's because hardcore raiders spend WAY more time in game, have WAY better gear and wipe WAY less. I used to casual raid, and the amount of money you spent on flasks, food and repairs were insane, and you had no time left to actually make money since you spend your time in game trying to take down bosses, and failing. Not because of individual lack of skill or effort, but because the guild is casual and doesn't spend enough time and doesn't have enough coordination to get past them.
Supply and demand does exist (this is to say, there is obviously supply for items and demand for purchasing them) but the term as a whole doesn't really apply to anything in-game.
You say there is no supply of glyphs on your server, but there's still demand. There's a reason why someone hasn't jumped in and made millions taking over a dream market like that; such a market doesn't actually exist. You may think there's no supply because the AH is empty but most players get their glyphs from friends or guildies these days so that's not a very good measure. Most people will see those 300g prices and just ask a friend to make it for them. I can't really say too much without knowing what server you're on but as far as pricing goes...
I say the logical assumption when demand for an item is cut so much is for prices to rise because said item still has the same production cost; there's just more of them. As a seller if you're making 100k a week on glyphs before the change and then only 5k per week after by keeping your prices the same... the last thing in the world you are going to do is further lower your prices. The reason why this doesn't automagically happen due to overwhelming supply is because most people will just leave the market instead of fight over such trivial profit margins. You may have a dozen people sharing the market beforehand but only 1-2 afterwards. Did the supply increase? Yes, it did... sorta. If everyone who was making glyphs continued to make glyphs there would be so much supply that prices would hit vendor value within a week. This doesn't happen though because nearly all of the smart sellers just switch their herb supply to something else like flasks or potions, or drop it altogether and spend that time on something else (time is money, so why spend it on something that gives lower profit than something else?). So actually the supply ends up going down as well, which is why prices generally stay the same (those 300g glyphs are ONLY there due to lack of interest in the market and don't really have anything at all to due with supply or demand changes) while profit margins end up decreasing tenfold.
More importantly you can't say an item is selling for 300g just because it's listed for 300g. That player might sell one a week for 300g but if someone came in and listed that glyph for 100g instead they'd sell five a week and end up making more. Despite most players being uninformed they also tend to be cheap which works for them in the long run. They see that 300g glyph and might not understand how overpriced it is but rather they simply don't want to spend any gold so they turn to friends/guildies/trade chat instead. Wanna see this firsthand? Try selling BoE raid drops. You can sell 2-3 a day for 50k+ on the AH to players that know the value of the items but if you post it in Trade Chat the highest offer you'll get is probably 5-6k simply because people want to be cheap.
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On January 08 2014 23:02 Teoita wrote:
Lol you mean if i put, say, enchanting vellums on the AH, people would ACTUALLY buy them? I just assumed most people would be smart enough not to do it xD
I make a few hundred a week selling vellums :x
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On January 08 2014 22:53 Pandemona wrote:
The source link is to a 403 permission denied Q_Q learn to source, reason i said it i thought it was Source to the survey you were on about.
Link works fine for me. You probably just suck at clicking or have some third world internet provider that blocks PDF files.
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Pandemona
Charlie Sheens House51449 Posts
No i have no third world internet provider nor do i have any blocks on PDFs....I also bet i have better speed than you Yankee Doodles have ^_^
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EPT
