Hellow everybody. Hopefully you are all aware about some people getting newcomers out of the competition by selling cheap when another person turns up to monopolize/oligopolize the market.
Now there are 2 options to follow that up:
a) continue selling with a low profit margain in order to consistantly prevent new competitors from butting in.
b) Ramping up the prize to insanity since buyers have no other choice as your competitors are bullied out
And what surprises me that everybody seems to go for option b) as all Items where Supply and demand is low are overprized, which you can observe on low population Servers more so than on others while I myself went for option a). Was my choice really that bad?
From a gold making perspective you should always charge what you can get that makes you the most gold. If that's asking extortionate prices then so be it. From my experience though, extortion only works for short periods.
I find that selling stuff faster and more of it is a better way to get the most gold then it is to drive prices up and only sell a little. Glyphs are an excellent example of this. So depending on how "low" your low profit margins are I think I'd lean more towards being an A type trader as well. Mostly cause I find that competition will usually return anyway, sometimes a new person, sometimes an old one that apparently needs gold again after being gone for a while. The larger the contrast between actual cost (even if only opportunity cost) and profit margin the sooner you'll see competition arrive and try and get a piece of the pie.
If I post items on the AH at high cost and I consistantly get buyers, it isn't my fault prices are high. It's the consumer's fault. There the ones willing to buy at that price after all, rather than farming whatever it is they're buying.
Changed the topic title now because of the request. Note that I made this after seeing someone saying something like "bulyying away competitors" so I believed this was what it's called.
Also I start thinking that option b) might be better after all. For Example, Epic shoulder Enchants cost me 24g to create and I post them for 34g on AH whilst some others tend to post it for 500g or so, and I am pretty confident that while I do sell more, there is some downtime occasionally where only that person's 500g Enchants are up and the one Enchat that he sells makes him richer than the 20 I sell during that time.
Buy everything and post it more expensive. As long as you don't mind to spend some gold for some days... you'll get it back later on.
I used to do that with glyphs. My sister had done a bunch of them and I wanted to sell them when she left wow. I wouldn't find a spot because there were some players playing the ah.. so I started buying all to clear the ah and post my own.
It toke me 2 months to sell a whole damn bank of glyphs but it was totally worth it, not only for the gold but also for the fun. It starts as a frustrating thing... but later on you kind of feel like it working.
Many posters give up as soon as you log in (they obviously friend you as you add them to keep them under control) It takes some time to reach that point, but once you are there the whole AH is for you. (and that's not necessary against the EULA as long as you just screw the ah players and not all the "customers").
I like staying my way but when I buyout Everything like Inks for 27g and make Shoulder Enchants to sell with a Little Profit for 35g then I get a lot of curious and hateful whispers or Mails as of why I don't sell these for hundreds of Gold like all the other Shoulder Enchants Sellers.
You do whats most effective and suits you. It is much easier to destroy a profitable market than create one.
Most AH people will wnat to make as much money as possible, so you sell what people are willing to buy for. If you gouge too much buyers resent you and find another way. Sometimes selling things for a medium profit is better than gouging. If the profits are too low, then you have to ask yourself if its worth the effort.
If I was the only person in a market I would sell at a price that offered a decent profit, but didnt alienate my buyers. Sellers are so diversified these days that on most servers its not long before someone arrives to undercut you, especially if they are botting. Make the most of your monopily, but dont gouge would be my advice.
Think i'm being sent a lot of angry mails and whispers from other Sellers because Ibroke the "sell what People are willing to buy for" Rule. Like Shoulder Enchants Prizes ranged from 250 to 500Gold and I couldn't bear to watch that since they cost only ~~24Gold to create.