[AH] How do you deal with undercutting?

Post by Arkaen

So recently I was leveling blacksmithing, and through farming the materials myself. That's all well and good, since farming isn't that bad in my opinion. So, I farm about 400 thorium ore to get to 300, so I can use fel iron recipes; that's okay too, again, farming is easy.

From the thorium, I get a bunch of lowbie gems . Here's where the problem comes in.

I post them and people on the market undercut me by anywhere from 5g to 50g. Large Opals were going for 40g and someone posted 15 for 3g each . But, I have fairly limited funding, so I can't keep on doing this . Should I keep pumping money into this to fix the problem, or are non-level cap markets just retarded, generally?

Post by lonewarrior

I have always posted the same response to people complaining about undercutting.
When you go to the AH to buy something and click on the most expensive stack/items listed instead of the cheapest then I will take your argument serious.
Everyone who complains about undercutting never seem to follow up their argument that they are going to pay the higher price on mats they need"
I've yet to read a thread that said "I'm going to pay the highest price from now on to teach those undercutters a lesson"
Otherwise...do what I do and wait them out. You have a choice...you get paid the going price or wait for the right moment and get your price. Be patient :)

Post by 836277

This post was from a user who has deleted their account.

Post by AdituSunlock

...wow... Are you really calling someone who is trying to sell something on the AH a goldseller there iala? :X I'm not even going to try and refute the rest of it...

How to deal with undercuts:
- Undercut them in turn
- Wait for a better moment to post your items
- Do nothing and hope the demand is high enough so your items get bought anyway.

You probably undercut them already the first time you put it on the AH, either they are returning the favor or someone else came along who also had those items for sale.

There's a big difference between the weekend and midweek. As for gems, flasks and food Wednesday is usually a good day.

Lower level mats however, just hope not too many ppl are farming those :) If it's someone who just levelled past there his auctions should be gone in a few days, just try again then :)

Post by deathbyte

Normally I watch the AH for a few days to see at what price most are selling then set mine for about that price. If it sells, I got my money. If it doesn't, I just repost and wait it out

Large Opals were going for 40g and someone posted 15 for 3g each .

I would say that 40g is way too much, they go for about 5-7g on my server if you are lucky

Post by Kinbuzz

Always set your item to the right price the first time. If theres already an item of that name but at a much lower price, wait for it to sell. Then post your own. :D

Post by 836277

This post was from a user who has deleted their account.

Post by AdituSunlock

And this relates to the topic, how?

Perhaps it is because of my assumption that the TS was already posting below the current prices, but I really fail to see how you can QQ about ppl being cheaper if you're the one that started out way above market prices ...

Post by TheReal

AH is PvP. Learn to win.

Post by 533681

This post was from a user who has deleted their account.

Post by ElhonnaDS

I...undercut the lowest person the next time I post and the cycle continues. What do you expect people to do- post higher than you and "wait their turn" to sell? Sometimes, just because an item is listed at a certain price, doesn't mean it will sell at that price. Whent he AH is empty of the gems you're talking about, people will post them at 40g, hoping they get someone desperate enough to pay it. Occasionally they do, but more often, they just sit there. Then someone comes along and posts for 39.50. Next person for 39 and so on. Eventually someone gets tired of trying for 2 weeks to make an extra 20 gold on a low level item, and just posts it lower to get rid of it. Other people follow suit, and the people who refused to buy at 40 will clear out the AH at 10g. Then, when there are none left, the cycle resets. It's supply and demand.

If the items are staying on the AH long enough to have a significant amount of undercutting by large amounts, the price you set was too high compared to the number available and what people are willing to pay. If the item is set at the correct price, and someone greatly undercuts you, an AH shark will buy up everything they posted in a second, because the know that the value is much higher based on supply and demand. If someone posts a lot of things too low (in your opinion) and they sit there for any length of time, they're probably at market value and you're too high.

Things that are poster way below value never sit on the AH for long. Things that are listed far below the current selling price could easily be put up by people with a better grasp on the market, people who have been trying to sell the same item for days or weeks, and have been gradually dropping the price, etc. 40g for a Level 40-50 gem sounds like price gouging, and it only works when there aren't many on the market.

Post by Problimatic

Well in your situation they are low level mats which the prices do indeed vary and many will post extremely low due to the low demand just to even get them to sell at all. Personally with most of the things I do I do a 1c undercut on the cheapest price in order to not ruin the market on the item and still sell my item. (With items that always have demand, it doesn't matter if its a 1c undercut or a huge 20% undercut, the cheapest is going to be purchased. This is for things like flasks, gems, enchanting mats, etc, where there is always a demand for them. For things like vanity items, and things with lower demand the undercuts may vary quite a bit.

As to:
tough luck, kid. That's supply and demand for you. You're overcharging, someone else sells the same thing for less, he gets the customers.
I'll ALWAYS undercut others, sometimes severely, if their prices are higher than the cost to me of making the item or what I can get from selling it to an npc, whichever is higher.

That way I'll make a profit, and sell quickly. It might not be a massive profit, but it's a quick bit of cash.
Not everyone is a jerk who only cares about fleecing others by forcing them to pay excessive prices for things, you know. I've seen that kind of behaviour way too much in other mmos (and to a degree in WoW), and most often people who try to force prices through the roof in the player market are working for goldsellers, trying to drive up prices to the point where the average player can't afford anything unless they buy gold...

You obviously know very little about the economy. Most goldsellers are the people who CRASH the prices. They use bots to farm up ridiculous amounts of mats and sell them for ridiculously cheap prices to sell them extremely quickly, and get the gold to something that will sell the gold. The people who make their own gold off the auction house are not the ones who are selling gold, and they don't want idiots to ruin their market on an item through posting for stupidly low rates. To a point these people can buy out the undercuts and resell for more profit, however most people have a limit on how much they can buy of the undercuts. (Since most of the market crashed people are goldsellers with a near infinite supply of materials from gathering bots, the market price will eventually end up falling.)

Post by lonewarrior

AH is PvP. Learn to win.

Well put. Wish I would have thought of it :)

I've been a AH player from the start. I can simply tell you I have never allowed myself to not get the price I wanted.
If you want to stack and run then your going to get to going rate.

Some quick pointers.
If your stacking items(i.e. herbs) Don't farm a 300 of them and then post them all at the same time. Your just begging to be undercut. When the market is volatile, don't post for anything other then 12 hours..so if you have to pull and re-post it won't hurt your pocket as much.
Get rid of the notion of catering to cheap players...there is a load of gold out there and players leveling alts/profession who aren't counting their pennies. They will pay.
If the market seem fair and the lowest price is a only on one or two stacks...don't undercut, place it just above them. Players leveling raid professions are buying by the stacks. They need much more then one. For example a tailoring needing frostweave to level is going to buy all the stacks he can find. Whether your is the first stack bought or the tenth, he is going to buy it...so why get the lowest price for your effort.

Finally..when the iron is hot..strike. There are time when there is a void in the market..that's when you go and fill it.
I can't tell you the numerous time I got 10 times the normal amount.
A stack of purple lotus for 800 gold. Stacks of wool cloth for 75 gold. Khrorium for 100 gold a bar...etc
Eventually the rest of the players take notice and the market normalizes, but by that time you've made your gold :)

Post by 810280

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Post by 810280

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Post by Trishi

Being an economics student, I have actually been given an assignment, going over a couple of months, where I have to earn 100k gold. My teacher being a WoW player too, he found it amusing when I was talking to another WoW player from my class about how I sucked at getting gold, and gave me this specific task. And I have to admit, it's far more interesting than I would have thought.

Think of it like Ebay. It's a shop, where you put up your wares for sale. These wares go for whatever price the populace is willing to pay, unless the rare occurences where said product is an essential ware that people need (But this doesn't apply to WoW - There's nothing you absolutely can't live without)

If you want to sell your stack of Embersilk Cloth for 50 gold, and someone else wants to sell it for 25, there are a couple of things to keep in mind here. If we go by the assumption that people are generally willing to pay 50 gold for a single stack of embersilk (They do on my realm), the person selling his stack for 25 is, essentially, losing potential profit. This not only applies to the 25 gold he would otherwise have earned, but the time spend gathering said gold. Say it takes 10 minutes to gather the stack. That would mean, on an hour basis, you would have lost 150 gold to the guy selling it at 50. Of course, time again is essential - if you sell it for 50, you will be in the back of the line, waiting for yours to be sold.

As Lonewarrior pointed out, people doesn't need 1 stack. They need several. With this knowledge, and the fact that we know people will pay 50 gold for a stack, we can put it up for 50 gold, and wait it out. Eventually, maybe not today, maybe not even tommorrow, but sooner or later, someone will buy it. If you have 30 stacks rolling, that will have earned you 750 gold more, than if you had done like the other guy, and sold it for 25 gold.

Find a rarely sold material that people need (Wool cloth is always in demand, but people never sell it), and put it up for 100 gold. I started doing this 1 week ago, and sold a total of 24 stacks quite easily. At some point, someone will try to severely undercut. Someone started posting stacks for 20 gold. This is where you need to consider if you find it worthwhile, and if you have the ressources nessesary, to compete with him. You can either let people buy from him first, or let them take yours later, or you can outright buy up his supply, and put them up with your own price.

The second option devalues your effort. You effectively "lose" 20 % of the profits by buying his supply. It may seem like the better choice, but it's not.

The first customer will open the AH, and see the stacks. This person had previously decided that 100 gold was fine, but then sees these stacks for only 20 gold. He immediately buys them, seeing as their price is far below what he had thought they would be. But then your stacks for 100 gold comes up. He wont buy then now, but rather waits till new stacks for the same price pops up. You "lost" to your competitor, but only this time around. The next thing that happens, is that a new customer comes in, and sees your stacks as the cheapest. If this one had the same willingness to pay 100 gold for 1 stack, he will buy them, unaware of the fact that someone else had just bought a whole bunch of them for 1/5 of the price he just did, and even if he did know, there is also the chance that he would just assume the person putting it up for 20 gold is an idiot, and will buy yours anyway. You get full profit, and the person selling it for 20 gold got ripped off. You win, regardless, it simply took a little longer for the money to roll in.

Obligatory TL;DR
This is all about patience. This isn't the Stock Market. You can't "lose" your wares. The only way to really fail at the AH, is by severely undercutting. You earn a quick low profit, but lose out on a lot of potential profit. For someone who cares little for the AH, this means little to nothing - it's the best choice if you just wanted to get rid of the items, and earn a few gold more, than had you sold it to the vendor. For someone who wants to use the AH to earn money, you need patience, and lots of it. If you don't have patience, I suggest you go do dailies instead.

Post by Nipah

Find a rarely sold material that people need (Wool cloth is always in demand, but people never sell it), and put it up for 100 gold. I started doing this 1 week ago, and sold a total of 24 stacks quite easily. At some point, someone will try to severely undercut. Someone started posting stacks for 20 gold. This is where you need to consider if you find it worthwhile, and if you have the ressources nessesary, to compete with him. You can either let people buy from him first, or let them take yours later, or you can outright buy up his supply, and put them up with your own price.

The second option devalues your effort. You effectively "lose" 20 % of the profits by buying his supply. It may seem like the better choice, but it's not.

The first customer will open the AH, and see the stacks. This person had previously decided that 100 gold was fine, but then sees these stacks for only 20 gold. He immediately buys them, seeing as their price is far below what he had thought they would be. But then your stacks for 100 gold comes up. He wont buy then now, but rather waits till new stacks for the same price pops up. You "lost" to your competitor, but only this time around. The next thing that happens, is that a new customer comes in, and sees your stacks as the cheapest. If this one had the same willingness to pay 100 gold for 1 stack, he will buy them, unaware of the fact that someone else had just bought a whole bunch of them for 1/5 of the price he just did, and even if he did know, there is also the chance that he would just assume the person putting it up for 20 gold is an idiot, and will buy yours anyway. You get full profit, and the person selling it for 20 gold got ripped off. You win, regardless, it simply took a little longer for the money to roll in.

I don't know... I think buying up the cheaper ones and reselling has always netted me a tidy sum... Taking into account that I didn't have to do anything, and I'm only losing 20% (in the example given), I'd gladly take 80% of my estimated profit for simply clicking the buyout button & reposting.

The only downside comes from when that person decides to flood the market with cheap wool, thus making the ones you purchased from them only salable at a loss (thanks to the AH cut).

Also, regardless of how stupid I may think someone is, if they're posting something on the AH for a crazy low amount, I will buy it up in a heartbeat.

Post by hymer

Well put, Trishi.
May I add that it only applies if you don't value money here-and-now (say, you need to make some quick cash, because you can't afford something you want; not all players work at an overall goal like amassing 100k), and if you have limited production to sell from.
If your main problem in earning money isn't production, but selling, then the sitaution also changes. You want all available customers to buy your wares, and getting rid of the competition by having them give up may well be worth it.

Post by Trishi

Also, regardless of how stupid I may think someone is, if they're posting something on the AH for a crazy low amount, I will buy it up in a heartbeat.

Of course you buy it. But let's go by my example, and say you see 5 stacks of 20 gold wool cloth, and 40 stacks of 100 gold wool cloth. If you bought the 5, would you assume someone else would repost it at that price, or would you assume the price would most likely stay near the 100 gold buyout? General consumer psycology dictates that people will either assume it was a crazy sellout, and not expect to see such a good offer again, or think some mistake was made, and they only got lucky through sheer stupidity on the sellers part. It's only the few exceptions that assume the price will drop to that level again, and just wait it out.

Of course, the main difference between WoW and reallife is, that in Reallife, you really don't have a choice for most products. Food, phones, televisions... You buy the ware, or you go buy the same ware somewhere else. In WoW, if the price is too steep, you can choose to farm it yourself. This is what generally happens with a lot of low level jewelcrafting gems. People just choose to buy the minerals instead, and prospect. When 1 stack of elementium costs 30 gold, and 1 jasper costs 30 gold, people will generally ignore the gem altogether, regardless of how much you may try to control that specific market. It may be convinient to some, and actually get sold to that price, because some people outright refuse to become victim to poor RNG. But they will be rare, and generally only the very rich players that will do this sort of thing. This is pretty much the only time where you should reconsider the price you try to sell at. If no one buys, it isn't nessesarily because of people severely undercutting - it could very well be because the price is simply too much for people to accept, so they choose alternate ways to get the materials instead.

Post by Interest

I was wondering what thread he was talking about.

Arkaen: Just let me play the AH for you. It's easier that way.

[AH] How do you deal with undercutting?

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