People undercutting like idiots

[ComputerNerd]

If someone undercuts by 1c they are an idiot.
If someone undercuts by 1000g they are an idiot.
Some people can't stand competition.

[ryan1mcq]

Oh look another person who doesn't understand, the mats you gathered are not "free except for time"

Please understand, all they cost me is time, so to me they are/were free. Not that i'm an AH player or anything like that, i sell as i make, i dont make a living off it and only sell once every few days so i'm not bothered about AH baron's or anyone else's valuation of materials, if folk don't like it they can buy it and sell it at what they want. I'm in it for the gold and to not charge folk the earth or what others dictate should be the price for stuff they want, whatever i make is all profit..... winner winner chicken dinner.

[Deleted]

Alright, this thread has gone on long enough with people abusing easily understandable economic principles so lets get some science up in here.

The first thing you need to understand that there is such a thing as a demand curve.

This curve (or straight line) is the quantities at which certain products are bought (Q) compared to the price (P). Logically speaking, this relationship is inverse, this means that the higher the price, the lower the amount sold.

People who undercut are logically thinking: if I drop my price significantly then I have a significantly bigger chance of selling my item, this is true.

However what a lot of people dont seem to understand is the most important thing is the elasticity of the demand curve:



Elasticity means the percentage the quantity demanded increases when the price drops by 1%

As you can see, the right curve is very steep, meaning that a decrease in price by 1% leads to an increase in consumption by less than 1%, making it a suboptimal strategy to undercut, since the total profit (which can be calculated by (Price-Cost)*volume sold) will be lower than if you didn't undercut.

However the left curve is completely different, here a decrease in price leads to a massive increase in volume bought.

So the question si now: what kind of demand curve do goods in wow have?

The answer to that is fairly simple, steep demand curves are usually present in situations where people dont care much about the price or are generally uninformed about the price of items.

Because for a lot of people it is ''just internet gold'', they generally wont care too much about the price they are paying, as long as it is aproximately right, since most people only buy items 1-2 times a day and generally have no idea what the things are worth. This obviously is very dependant on the player, someone like me, who plays the AH to make decent profits (made 4 mil so far in legion) do care about the prices, however the average joe really doesn't. Because there are far more people playing that dont care too much about the prices and just want that flask/pot/ring/foodbuff to be able to do bigger numbers, they will generally buy them at whatever prices they are listed.

Because of that, people who intentionally undercut are leaving money on the table and are wasting other peoples time. Even if your motivation is to reduce the chance of being undercut, it is still stupid to do so, because most ah players will keep undercutting you no matter how low you go, as long as they are making a profit, since the most optimal market strategy is to assume that the market is unlimited, especially for low-cost items like food flasks and pots, since relisting items is essentially free.

Having said that, in some markets (rare pets/armor or anything expensive) undercutting bigtime often can be worth it because it is a much flatter demand curve and people will usually only buy those kinds of things when the price is right.

I hope I explained everything clearly, if I was unclear in anything or you think my assumptions don't check out, feel free to say so (I have a masters degree in health economics).

[Omega10]

Alright, this thread has gone on long enough with people abusing easily understandable economic principles so lets get some science up in here.

The first thing you need to understand that there is such a thing as a demand curve.

This curve (or straight line) is the quantities at which certain products are bought (Q) compared to the price (P). Logically speaking, this relationship is inverse, this means that the higher the price, the lower the amount sold.

People who undercut are logically thinking: if I drop my price significantly then I have a significantly bigger chance of selling my item, this is true.

However what a lot of people dont seem to understand is the most important thing is the elasticity of the demand curve:



Elasticity means the percentage the quantity demanded increases when the price drops by 1%

As you can see, the right curve is very steep, meaning that a decrease in price by 1% leads to an increase in consumption by less than 1%, making it a suboptimal strategy to undercut, since the total profit (which can be calculated by (Price-Cost)*volume sold) will be lower than if you didn't undercut.

However the left curve is completely different, here a decrease in price leads to a massive increase in volume bought.

So the question si now: what kind of demand curve do goods in wow have?

The answer to that is fairly simple, steep demand curves are usually present in situations where people dont care much about the price or are generally uninformed about the price of items.

Because for a lot of people it is ''just internet gold'', they generally wont care too much about the price they are paying, as long as it is aproximately right, since most people only buy items 1-2 times a day and generally have no idea what the things are worth. This obviously is very dependant on the player, someone like me, who plays the AH to make decent profits (made 4 mil so far in legion) do care about the prices, however the average joe really doesn't. Because there are far more people playing that dont care too much about the prices and just want that flask/pot/ring/foodbuff to be able to do bigger numbers, they will generally buy them at whatever prices they are listed.

Because of that, people who intentionally undercut are leaving money on the table and are wasting other peoples time. Even if your motivation is to reduce the chance of being undercut, it is still stupid to do so, because most ah players will keep undercutting you no matter how low you go, as long as they are making a profit, since the most optimal market strategy is to assume that the market is unlimited, especially for low-cost items like food flasks and pots, since relisting items is essentially free.

Having said that, in some markets (rare pets/armor or anything expensive) undercutting bigtime often can be worth it because it is a much flatter demand curve and people will usually only buy those kinds of things when the price is right.

I hope I explained everything clearly, if I was unclear in anything or you think my assumptions don't check out, feel free to say so (I have a masters degree in health economics).

I get it. You think I am stupid. And I will continue to undercut, even though it wastes your time (as you said here: "Because of that, people who intentionally undercut are leaving money on the table and are wasting other peoples time."). I do not apologize for wasting your time and ruining your WOW experience. I will continue undercutting, and I know you will continue calling me stupid.

Thank you for your well written explanation of why you think I am stupid.

[FertsBlert]

I get it. You think I am stupid. And I will continue to undercut, even though it wastes your time (as you said here: "Because of that, people who intentionally undercut are leaving money on the table and are wasting other peoples time."). I do not apologize for wasting your time and ruining your WOW experience. I will continue undercutting, and I know you will continue calling me stupid.

Thank you for your well written explanation of why you think I am stupid.

Nah he doesn't think you are stupid he has empirical proof that you are, if you are happy to continue being stupid munch those crayons and OWN that waxy grin.

[Guruftw]

The majority of players are idiots so that logic fits nicely actually. Catering Wow to braindead kids and this is what you get

[Shadowspire]

free market, unless u are some wierd trade genius, you will not own the market and the price items will go down. and no matter what you want to think, that is a good thing for consumers. you are bitching becauseinstead of getting 5k you'll be getting 3k or something like that, but that is still a lot of gold at the end of the day.

[endersblade]

I remember near the start of WoD, I had amassed a truckload of leather. I was crafting tons of the craftable PvP gear. I noticed that people were selling them for stupid prices - chests were up to like 8k a pop. I thought that was overpriced as fuck, so I posted them all for 1k each.

No less than 2 days later, my mailbox had over 100 hate letters from people trying to price gouge the stuff I was selling. I'd log in and people would whisper me all sorts of hateful shit. I can't even imagine how many people I got suspended for harassment. I ended up selling almost 100k in PvP pieces, and then I ran out of mats and just never did anymore. But the damage was done, people were trying to undercut me, so the prices dropped down quite a bit.

[mikoslav]

Herbs that you gather to sell are free only if the herb gathering is something you love the most in this game.
If there is something in this game that you like to spend time on - more than spending time on gathering, your herbs cost the sum equal to how much gold you would make if instead of gathering you would go, for example, do old instances(if you like doing it), hc dungs, or raids, or imple killing quests.
So a "big %" undercutter should honestly decide if he likes gathering herbs the most in this game,
If yes - indeed the herbs have no cost, only pleasure to gather.

If no - how much gold per hour you earn during that favourite activity in game, and this is how much it costs you to get those herbs. They are not free.

So only if you undercut and make less than your cost, you are indeed not very smart.

[Omega10]

Nah he doesn't think you are stupid he has empirical proof that you are, if you are happy to continue being stupid munch those crayons and OWN that waxy grin.

I am having fun play WOW. Nothing stupid about that

[Hyve]

People who price the Herbs to make Flasks higher than the Flasks themselves are idiots. Even excluding Proc Rates, people are just taking up Herbalism instead and then the Herb market will crash and ya'll going to be sitting around going; "What the fuck! Some idiot undercut my overpriced herbs!"

[Omega10]

If no - how much gold per hour you earn during that favourite activity in game, and this is how much it costs you to get those herbs. They are not free.

I LIKE herbing and mining. So I get the herbs and mines, sell them, and get lotsa gold. OK admittedly I could get MORE gold if I spent time doing something I do NOT like, which is spending more time in the AH, but for me I'd rather sell for less gold, less time in the AH, more time out in the fields. This is my win-win situation.

[Gsara]

Dont worry, Tuesday will be worse than ever for undercutting.

[Panta]

Iif instant gratification was worth costing yourself 1k gold rather than waiting 24hours I can see why you only had 2k.....

Of course it worth. Didn't you read the part where I said that I log a couple of hours every other weekend. I need "instant" gratification in every aspect of the game blocking "progress" (on the main history, of course).

BTW, I have 2k on my alt(s) cause basically I (and a lot of people who undercuts) DON'T CARE ABOUT GOLD.

There is almost no need on the game for having gold, once you have gone through all the "required" gold sinks (name them riding training and L3 Garrison, which ends up being somewhere around 15k gold).
There is a lot of things you can buy with gold, but I'm not interested on any of those.
I like pet battle (I have even spend a whole month doing nothing but pet battles... a whole month that actually were two weekends 3 hours per day), but I like to hunt my own pets. I don't buy them.
I don't raid, so I don't need "gear" (I end eventually with the best gear that my professions can give without group requering materials).
Sometimes I can log in and spend the whole day just fishing (In WoD, that was my main income, actually... food was selling pretty good). I tend to max fishing in the first couple of weeks in every expansion.

Again, everyone plays the game in different way, and gives importance to different things. I gave importance to the moments of relax that game gives me (I play, of course, on a PvE realm... when I need PvP I just go to sewers and drop AoEs, jajajaj, so funny to die to uncontrolled chaos!), without need to wait to do what I want... Yes, that worth thousands of time more than those 1-2k undercuts.

Anyway, I'm done here (Im gonna farm some ore for my BS today ). Have a beautiful weekend!

I LIKE herbing and mining. So I get the herbs and mines, sell them, and get lotsa gold. OK admittedly I could get MORE gold if I spent time doing something I do NOT like, which is spending more time in the AH, but for me I'd rather sell for less gold, less time in the AH, more time out in the fields. This is my win-win situation.

Did I told you that I love you?

[Djuntas]

There are 2 kinds of people in WoW on the AH

1. Thoes in it for the long run (Like I have sertain items I have sold for 1 year+...its my bread and butter)

2. Thoes not in it for the long run (Like when I invest into a new craft, 1-2 weeks go by, no sale...I dump it, dont have time)

I have recived 1-2 complaints for that before. I recently went out of the MOP pvp crafted market...1 guy was not happy, I get that, but I was posting like 50-100 items pr. day and 1-2 would sell...not worth it, so I dump it after having been into the market 3-4 times in WOD, but gave up the last time.

[sarym13]

Honestly I feel lowering it by 1g is insulting. I will and personally do buy my AH items about 1-200 gold more (Unless its flasks/pots/food) than current cheapest price unless the cheapest price is a generous cut already.

Screw you and your desire to make a profit.

[xcess]

Like the guy with masters degree said, its easy to know what price to put if its a popular item you know will sell. So undercutting like flasks by a lot would be stupid. Its much harder for the more rare expensive items.
How many times have you saw a pet or mount or gear which you want but the price was too high for you and you will only buy it when its at the price youre willing to pay. So for example I remember some guy selling some rare pets cheaper so I decided to buy it

[Deleted]

Honestly I feel lowering it by 1g is insulting. I will and personally do buy my AH items about 1-200 gold more (Unless its flasks/pots/food) than current cheapest price unless the cheapest price is a generous cut already.

Screw you and your desire to make a profit.

That's also my wares with another alt! Muahahahaha

[Fabinas]

If you are a gatherer/crafter then the majority of your raw mats are free, all they cost is time so whatever you sell stuff at is all profit, i undercut cause i want my stuff to sell and sell fast which it does, also potential buyers and regular players want stuff at decent prices, some of the prices you see and hear about prices are totally nonsensical.

The only currency that is not interchangeable, very limited and therefore, priceless is... TIME. Think about that before you claim again that gathered mats are free...

[dyzz]

Many items are overpriced and people won't buy them. They put it 1000g less and they fool moronic sniper addons. Still getting a hefty profit.

This works so well on BOE's its silly. Item wouldnt sell for 4 days at 25k, when market price was 25-26k. I put it at 20k, and it sold instantly. A week later, I looked and prices were down around that 20k. So I basically got market value for it.