Wednesday, May 23, 2012

D3 Auction House Blues

Diablo 3 has been unleashed and it is wreaking havoc on our sales because so many that play WoW have gone to the dark side to play Diablo 3.  Mists of Pandaria is on the horizon, most progression raiding has come to a halt and now the release of Diablo 3.  It is the perfect storm!  Sales have slowed, prices have fallen and for those that are willing to invest in the market, there will be plenty of opportunities to buy, buy, buy!

This particular combination of events has combined to give us a unique look into supply and demand at work.  Most people know that when supply is high and demand is low then prices fall, when supply is low and demand is high then prices rise.  A lot of people don’t know what happens when supply and demand meet in the middle, this is called equilibrium.  Basically this means that we have hit an unusual point in time in the AH, where we see the equilibrium of prices for the goods we sell because the demand and the supply are balanced.
This also means that we are about to shift, meaning that the market is about to move in a direction from here based on the laws of supply and demand.  The question is whether it goes up or down.  I believe that prices are about to down because I see demand slowing for a while and supply rising. 
This is considered a tipping point.  Why do I think this?  Diablo 3 will keep people busy for the next few weeks, and then slowly they will come back to WoW and put more time into WoW, we have seen this before so the pattern has already been established.  But raiding will still be slow, so what do people do when raiding is slow?  They start ALTS!  That’s right, more toons!  Most people think this means demand will go up on items, and it is true we will see some spikes here and there, but many of these toons will will have farming professions of mining, herbalism or skinning.  That’s means we will see supply increase for all levels, demand will not catch up and prices will drop.
Oh, and one more thing, summer is here which means kids are out for the summer and they will be logging in more than ever to play which will also increase supply.
I see the following weeks as an opportunity to stock up when prices are at low points, in many cases these low points have not been seen since last expansion.  Relist when the opportunity presents itself but do not go overboard because you will find that there will plenty of others listing under your price.  Do not let this discourage you, be smart, buy smart and stock up!

Tuesday, May 22, 2012

Flipping Gold

Most of the ways I make gold in WoW is through the simple concept of buying and selling the product through "flipping" it. This method is widely used, but very few understand the intracacies of what, when, where and how to do it to maximize profits. So here are some simple rules to follow or guide you in the process of flipping.

First of all, know your market. I used to be against the idea of buying and flipping armor for example, but when Blizzard added the ability to Transmorgify armor it changed the game. I only do small amounts of armor, but knowing which pieces are in demand and having patience to relist them a few times can pay off big time. I have purchased items for under 25 gold and simply relisted them for 500-1000 gold and they have sold. I could write up an entire method on just flipping armor and weapons because the market has changed so much.

Second, be willing to relist items many times. A good example is Copper Bars. I love to buy out Copper Ore and Copper Bars then relist them at higher rates. I have two strategies here, price them high enough that I make lots of gold but not so high that no one buys them; and price the Copper Ore higher than the Copper Bars so that people feel like they are getting a deal to just buy the Bars. Copper Bars will usually sell for about 1g per bar or less until I buy them and relist them for 2.5g per bar. This equates to about a 150% profit or more, but it does take patience because they are not a high demand item.

Third, be willing to buy more even after you have bought and flipped. Be careful, this is where most people go wrong. They come in and buy out the Copper Bars, relist them for a higher rate and then see that someone has come to the market and undercut them or filled the low end pricing of 1g each or less. So what do you do? Buy it. If you don't have the stomach for this then don't try flipping. There have been times I have bought Copper Bars for 4 or 5 days straight without selling a single stack. Most people give up and then relist lower and make very little or no profit. This cannot be done unless you are willing to buy, buy, buy. Eventually the market will stall, your copper will be bought and you will make tons of profits.

Fourth, be willing to cancel auctions and relist again. Ok, so now you bought the Copper Bars and relisted them for 2.5g each and some guy undercuts you buy a copper, what do you do? Well it depends on how many they listed. If they listed a stack or two then I would leave them alone and let them be happy. Chances are you will never see them again and they just listed based on what the current market showed. However, if they listed several stacks then you may want to go ahead and cancel your auctions and relist them by undercutting the competition. I usually do not bother undercutting unless I see it is a regular competitor of mine or someone posted a ton of stacks under mine.

Fifth, be willing to wait. Sales happen in spurs, do not relist items thinking they will all sell overnight because if you do you will be disappointed.

Sixth, you do not need to undercut all the time. If the item you are selling is in high demand then undercutting is only temporary, if enough of them sell then the buyers will eventually reach you so don't worry about it. This really wraps back up to knowing your market, if you know what the demand looks like then you will know what to expect, what to price them at and how long it will take.

I will elaborate further on this topic, but this will give you a start at how to flip items in the AH. Good luck and happy auctioneering!

Tuesday, May 15, 2012

Choke Points = More Gold!

One of the methods I like to employ is by knowing where potential choke points are in the crafting process.  There are several if you look for them and are patient enough to let them work out for your profits.  One that comes to mind is Eternal Fire, something I discussed in an earlier post.  Eternal Fire is used in 40 recipes, most of which are not really used unless someone is leveling their crafting skills on an alt.  So how is it a choke point?  One recipe: Smelt Titansteel

Titansteel is not in huge demand but is in demand.  It is used in many recipes, but one in particular helps keep this material in demand, the Mekingeer’s Chopper.  People are still buying that mount and having it crafted.  The only way to build this mount is to smelt Titansteel Bars and to do that you need Eternal Fire which means it is a choke point!

How to capitalize on this?  Buy Eternal Fires and mark them up.  Buy Crystallized Fire and create Eternal Fire with them.  Craft the Titansteel Bars and mark them up.  Make it tough on your competition to craft Titansteel Bars because you own and control the Eternal Fire market.  If they want to craft them then they need to have Eternal Fire in their bank, or farm them. 

How much profit?  This one opportunity gives us the following:

Eternal Fire – I buy them for pretty much any price under 50 gold and then relist for 75 gold minimum.

Titansteel Bar – Takes 3 Titanium Bars, 1 Eternal Fire, 1 Eternal Earth and 1 Eternal Shadow.  The average cost of these mats are 25g for the Eternals and 35 gold each for the Titanium Bars so that is an overall cost of roughly 180 gold.  I sell these for 400 gold each.

Titanium Bar – I buy any bars listed for under 35g a bar, most of the time they are around 20-25g each.  I then relist them for 50g each.  These are smelted from Titanium Ore, another great choke point! 

Titanium Ore - I buy the ore at under 20g each and most of the time I buy them for 10-15 gold per each ore.  It takes 2 ore to make 1 bar.  I relist the ore for 25g for each ore.  This helps push the price of the Titanium Bars which I then relist for 50g each.

So let’s review.  I found 2 decent choke points that both lead to an end product, the Titansteel Bars.  I try to control the different levels of the production line so that the costs to create the bars justify the cost for the end product, in other words, they can’t make it cheaper by buying the lower mats and smelting them so they just buy the bars from me.  But if they do buy the materials then I make huge profits there too.

At each level I am making a minimum 50% profit, and in most cases over 100% profit.  There are tons of other choke points in the market, can you find them?

Monday, May 14, 2012

Black Market Auction House!

So, like several others this weekend, I browse MMO Champion to find out they discovered a new feature in MoP Beta, the Black Market AH!  Are you kidding me?  This is awesome!  So the basics of how it works is easy (as far as we know now), Blizzard has created a way to buy limited items in the AH from NPC toons.  Need that mount that never dropped?  Want a pet that won’t drop?  Can’t finish the achievements you need to get that mount?  Limited time to raid so can’t get the best gear?  Fear not!  Just go to the AH and buy them!  Yeah baby!
I see this as a huge win for people like me who just want that one item and are willing to pay the price.  I have seen several bloggers talking about whether they can flip the item into the regular AH and make gold, maybe we can but I have a feeling that Blizzard will make these all BoP items, even if they were BoE normally.  But who knows?
What really fascinates me about this move is the number of blogger’s who are talking about this being a “gold sink” to remove massive amounts of gold from the economy.  The theory is that this will force prices down in the AH and bring back some normalcy to the WoW economy.  By removing tons of wealth from the game, there will be less to spread around.
That’s their theory, what’s mine?  I seem to be of the very few who feel that this will really have no impact in the economy.  My reason is simple; removing some gold from the game is not the same as removing the source of the gold.  The sources are; Players, Bots, Gold Sellers.  Players are stable at around 10 million accounts so there probably will be no change there, so that leaves Bots and Gold Sellers.
The Bots have not only made it through each expansion, they have grown in numbers.  Blizzard cracks down on them but each time they make progress the clever software developers find ways around it and they come roaring back.  The only nice thing about Bots are that you can watch them in the AH as they over supply the market in items like ore until the market is bottomed out and over supplied, then move on to another item like herbs and repeat the pattern.  This creates great buying opportunities for people like us if you are willing to invest the gold.
The Gold Sellers keep doing what they do; selling gold.  They run some of the Bots, they also hack accounts, and they buy gold from legit farmers.  They use whatever means they can to obtain gold cheaply and then sell for profits.  As long as there are buyers there will be gold sellers.  They will only come out of the cracks as MoP hits the market.
So, while everyone else keeps saying that this Black Market AH will take gold out of the economy and be a price reliever to the Auction House prices, I say that nothing will change and prices will continue to inflate at rapid paces because unless Blizzard removes the Bots and Gold Sellers, nothing really changes.  The gold will still flow into the game and with a new expansion, the demand for this gold will only increase.  In fact, the demand may be even higher than in past expansions because of the inflation along with the new Black Market AH demands.
Whether I am right or wrong, time will tell.  But regardless of the outcome, the Black Market AH is a freaking awesome addition!!!

Wednesday, May 9, 2012

Easy Gold

One of the methods I have used to make some gold is very easy, all you need is access to Dalaran and a few gold and patience. The externals from the WoTLK expansion sell very well and can sell for high amounts because of their limited supply. Why are they limited? People do not want to farm, people do not store them in their banks for a rainy day when they need them on alt and bots do not farm them because the potential sales are too low for them to bother. Method 1 Buy them cheap and resell them. The eternal fire, air, shadow and earth are in more demand than others because of their recipes uses for people to level professions. I buy these when they are listed in the AH under 15 gold, sometimes I will go as high as 25 and even higher for fire. I relist them for 35 to 40 gold for earth and shadow. Air goes for 50 gold and fire goes as high as 75 gold. Fire has more potential not just because of how many recipes they are used in, but they are a necessity for those wanting to craft the mekingeer chopper. The chopper requires titansteel bars and to craft those they need eternal fire. Because of this supply chain, I often find that titansteel bars are only available if there are eternal fire available and that is not always the case. So people are willing to pay for them. As you may know, I hate farming unless it is Auction House farming! Method 2 Buy Frozen Orbs. This is where Dalaran comes into the picture. Most people have forgotten about the trader by the AH in Dalaran who will trade Frozen Orbs for several different items, one of which is eternal fire. I find Frozen Orbs on the AH for 5 gold to 35 gold all the them up and trade them for eternal fire and list them on the AH for 75 gold. Easy profits! These 2 methods alone will net me about 1k a week in profits for about 10 minutes work or less.

Monday, May 7, 2012

PVP Gold!

I don’t see many folks talking about this, so let me be among the first to give you a great tip on some easy gold: PVP.  Yep, PVP.  This is the dead time between expansions and so many people who continue to play WoW are looking for something to do and will start playing PVP.  This means there is a great opportunity to make and sell PVP gear, gems and enchants.
Over the last 2 weeks I have seen a huge increase in PVP gear sales of all varieties.  There are great profits to be made in these items, of course some of that depends on the competition on your server.  I am currently seeing a 65% profit margin in my sales and the only farming I do is in the Auction House for materials!
Side markets due to PVP include materials like leather and cloth.  I do not include the metals because it seems there are always “bots” running the mineral market down and flooding it with tons of ore.  Savage leather and Embersilk cloth have been dwindling in supply as fewer people have been playing (thank you Beta) and the increase in demand due to PVP gear, leveling alts etc.  This has resulted in the prices of leather and cloth going up over 50% on average.
How do you benefit? Buy low sell high.  Try buying your Embersilk cloth when you see it hitting low end prices and buy it up then craft it into bolts and list the bolts.  As an example, I am buying all Embersilk cloth that is at 4g each or lower and converting them into bolts.  It takes 5 pieces of cloth to make a bolt.  The bolt cost me a total of 20g maximum (most lower) and I am listing them for 40g each on the AH and they are blowing out the door.
How about your server? Are you seeing some of the same trends?

Ready to Stockpile for Mists of Pandaria?

We have hit the infamous “brick wall” in game, the time between expansions that seems like everything comes to a crawl.  I see it as the time to start investing in the future, in this case the future is MoP.  This lull in between expansions will do some crazy things to the Auction House; prices will probably have erratic ups and downs tied to the summer (kids are home) and the increase in alt leveling and people preparing for MoP while some are still finishing their Cataclysm raiding and achievements.  I see this time as opportunity.
First let’s look at what we want to stockpile.  We can learn lessons from the past expansions and our gold making lists to gain insight as to what may be of value in MoP.  My shopping list includes the following: (Some of these are from WoTLK expansion and should not be overlooked)
Ores – Pyrite, Elementium, Obsidium, Titanium
Volatiles – Air, Fire, Water, Life, Earth,
Herbs – Whiptail, Heartblossom, Azshara’s Veil, Cinderbloom, Twilight Jasmine, Stormvine
Gems – Uncut Uncommon gems and Uncut Rare Gems
Leather – Savage and Heavy Savage Leather
Enchanting Mats – Hypnotic Dust, Maelstrom Crystals, Greater Celestial Essence, Infinite Dust
Inks – All lower level inks for glyphs
Cloth – Embersilk and Frostweave cloth!
The items in bold are my priority for stockpiling while the others will get some of my attention.  Be wise on your stockpiling by watching the market over the next several weeks and try to buy when prices are hitting new low points.  Be careful because there will be some new low points coming in the next few weeks due to an influx of kids home from summer,  people bored and a lot of people unloading their banks before MoP. 
How much to invest?  This is all about your comfort level and the amount of gold you have on hand.  I plan to invest about 10% of my current in game gold which translates to about 150-200k investment, but I expect that this will give me back over 1 million gold within 3 months of MoP release.

Gold Secrets 101

The biggest question I always seem to garner from my guildies and others on my realm is, where do I start and how do I do what you do?  Seems like an easy enough question but the answer is not that easy.  It really depends on what professions you have, your game knowledge, the amount of gold you want to invest, your patience level, the amount of time you are willing to put into learning, the markets on your server, and several other factors.  I know that you are reading this because you want an answer so I will do my best to give one or two for you.
First off, let's be clear here, my methods are not going to net you 10k or 20k in a day, unless you are willing to invest at least 20k or more to start with...for most people this is just insanity and welcomes a whole bunch of pain and frustration.  Sure, I can make that in a day, but this is with tons of experience, knowledge and a huge bankroll.  If you truly want to learn how to master the Auction House then my first piece of advice is to start slow.
Now that you have agreed to start slow and really learn how to master the trade of auctioneering, let’s look at our options of how to make gold.  I will list just a few of the ways that someone can enter the market safely and make gold coins.
Enchanting Scrolls - Enchanting Mats - Disenchanting greens/blues for Mats - Disenchanting crafted items - Glyphs - Inks - Crafted Relics - Uncut Gems - Cut Gems - Prospecting - Dreamcloth crafted items - Crafted PVP Gear - Armor Enhancements - Flasks - Potions - Elixirs - Transmutes - Smelting - Market Speculation - Market Timing - Resetting the Auction Price - Recipes from Vendors - Trading in Commodities - Pets from Vendors - Old World Materials - Dumb Luck
Has that got you thinking?  I will hit on these and other items as I post each day so that you get better insights.  One of questions I am also asked quite often is "Do you farm?" the answer to that is yes, I farm the Auction House every day!  I hate traditional farming, spending hours collecting herbs, leather, cloth or minerals is just not my idea of fun.  There are those who like this method, it is simple and they make gold at it.  We need those players, they are my best friends!  Why?  Because they typically do not care about market timing, market pricing or anything else other than making a quick turnaround in gold.  So they will undercut and drop their stacks in for me to buy them and resell them.
Think about what I just said.  They spend hours farming materials, sell it in the AH to me for a good price (cheap is good) and then I repost them in the Auction House for a higher price when the timing is right and make even more gold off the materials.  Why is my way better?  Because for every hour they spent farming to make their gold, I spent 5 minutes making the same amount of gold from their hard work.  :-)
"Where do I start?"  My best recommendation is to start small and start in area that you have a lot of knowledge in already, this will make it easier to learn the concepts of market timing and how to manipulate the markets to your advantage.  There are hundreds of ways to make gold in the Auction House, so rather than trying to learn a dozen or more ways and taking on too much risk, just take on one way at a time and master it.