One of the enjoyments I have with writing here is getting emails asking specific questions. Sometimes gold goblins want specific advice on how they can raise their gold amounts. Others ask questions and get a more general knowledge on my views on the Warcraft economy.
This week was another one of those questions I get multiple times a week. Sometimes it uses more colorful language to describe their frustration. In a nutshell they asked me why people seem to undercut like lemmings off a cliff.
Undercutting is something that any active gold goblin has had to deal with. Post up a shiny new belt of awesomeness, only to have another one posted right behind it 5 minutes later. The price of the newly listed belt being only 1 silver under what you posted. Coming back in 30 minutes and there ends up being 5 belts of awesomeness posted, with the price driven to half of your original posting.
So why does this happen? Undercutting is a part of the game of playing the Auction House. And there are many entries both here and other journals that talk about how to combat it. The frustration hits when undercutting is taken to an extreme that the price no longer even comes close to the value of the original item.
Extreme undercutting happens for 4 reasons.
1. Dumping of stock/quick profits
A player ends up inheriting a guild bank, or purchases a large amount of items and instead of pricing them out for a maximum profit, they want a quick amount of gold. So they list them to sell, and others follow the pattern til the price is driven into the ground.
2. Attempting to collapse a market
Any inscriptionist that has had an decent market share at one point will grind their teeth with the expectation of someone posting glyphs at just above cost. Instead of listing a glyph at a higher price, they want to keep the market low to drive others out of the playfield. Technially they never take a "loss" on the item. But many gold goblins back out and find other markets instead of wanting to fight an extended losing battle.
3. Addon Mismanagement
Addons are a powerful tool to a gold goblin. But just like a hammer it's not that difficult to smash your thumb if your not paying attention. An semi automated posting tool (TSM is a good example) can be set to a very low posting standard. If your not seeing what your posting then you could easily be putting up cut gems at bargain basement prices. Many players will follow the pattern and undercut farther and farther down the chain. Unless there is a reset in the market, the gems will sell lower and lower cutting into possible profits.
4. Players are just stupid.
Yes, we've all run into it. I can forgive ignorance in a players life. I've been there before not knowing what an item was worth. Without the knowledge I have now, I posted up items at guessing prices and threw the market out of whack for a short while. I learned my lesson, went to get knowledge and didn't repeat the same mistake again. Stupid players are ones that will repeat the same marketing mistake over and over, expecting a different result. These can drive a gold goblin insane.
Know your enemy is the best mantra when facing a situation like this. Knowing them and conquering these reasons will help limit your frustration and let you still enjoy the auction house.
Good luck and Good Hunting
Want to get in contact with me? . Email me at Dragonbearjoe @ gmail. dOT com or find me on twitter at "@Dragonbearjoe" or leave a comment here. You can find me hanging out on the Shandris Server, chat me up and I will buy you a glass of juice.
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